During the State of the Union address Tuesday night, President Barack Obama claimed that raising the minimum wage would be an effective anti-poverty measure.
“Tonight, let’s declare that in the wealthiest nation on Earth, no one who works full-time should have to live in poverty, and raise the federal minimum wage to $9 an hour. This single step would raise the incomes of millions of working families,” he said.
“But today, a full-time worker making the minimum wage earns $14,500 a year. Even with the tax relief we’ve put in place, a family with two kids that earns the minimum wage still lives below the poverty line. That’s wrong,” the president said.
But some experts claim that this move would be more of a job-killer than a poverty-fighter.
A recent study by the fiscally conservative Employment Policies Institute found “no statistically significant evidence that a higher minimum wage helped reduce hardship” with things like housing, health, and financial and food insecurity.
“The reality is that fewer than 20 percent of people who earn the minimum wage are poor, and most poor people already earn more than the minimum wage,” Jason Riley notes in the Wall Street Journal.
Minimum wage laws also disproportionately impact minorities.
“Among white males in this group [age 16-24], the authors find that each 10 percent increase in a federal or state minimum wage decreased employment by 2.5 percent. … But among black males in this group, each 10 percent increase in the minimum wage decreased employment by 6.5 percent,” a separate study by EPI found.
“The disconnect between the empirical evidence and the claims of wage hike advocates continues to grow,” said Michael Saltsman, research director at the EPI.
Throughout the president’s tenure, poverty levels have soared.
A report released by the U.S. Census Bureau last year showed a six percent increase in the number of Americans living in poverty between 2009 to 2011 — an additional 3 million Americans. For the middle 20 percent of earners, the Census Bureau found the inflation-adjusted household income was the lowest it had been since 1995, The Daily Caller reported.
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