Raising the Minimum Wage for Working Men and Women in California and the Rest of America

How to Help the Working Poor

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Congress is currently addressing two major proposals to help the working poor: an increase in the federal minimum wage to $10.10 an hour from $7.25 an hour, where it has been set since July 24, 2009, and an increase in the earned income tax credit, proposed by the White House, that sends cash payments to those with low earnings. Supporters of a higher minimum wage point out that it has fallen 32 percent in inflation-adjusted terms since 1968.

One problem with proceeding simultaneously with two very different programs designed to aid the same population is calculating their interactions. It may be possible to minimize budgetary costs one way, maximize worker well-being another way. There may also be unintended, even perverse, implications for those whom both programs are designed to help unless one is fully aware of how they interact.
• Category: National • Tags: Bruce Bartlett