Seattle May Raise Its Minimum Wage To $15 An Hour, And Not All Liberals Are Happy About That

Will Rahn Senior Editor
Font Size:

Seattle may soon approve a $15-an-hour minimum wage, which at least one liberal writer says could cause myriad problems for that frequently overcast Washington city.

Democratic Mayor Ed Murray announced his plan to gradually increase the minimum wage to $15 last week, and while it still needs to get the approval of Seattle’s liberal city council, many expect it will pass. The left-wing ThinkProgress celebrated Murray’s plan with a glowing news report, but at the liberal-leaning Slate, business writer Jordan Weissmann is far less sanguine about what such an increase could do to the city.

“[W]hile the fight for $15 has made for great politics—in Seattle, both mayoral candidates only adopted the idea last year after it was popularized by a socialist city council candidate, Kshama Sawant, who ultimately won her race—it’s built on dubious economics,” Weissmann writes. “The truth is, nobody has any idea what would happen if the minimum wage jumped that high. But there are good reasons to worry that results would be ugly.”

Weissmann goes on to note that while economic research on the effect an increased minimum wage does to jobs has been “mixed,” Seattle’s proposed wage hike would be unprecedented, and could very well lead to businesses fleeing the city.

The inflation-adjusted minimum wage in the U.S., Weissmann says, topped-out at $10.66 an hour in 1968. But not only would $15 be the highest minimum wage in American history, it might be the highest ever recorded worldwide in terms of raw purchasing power.

Australia’s $15 dollar minimum wage, Weissmann explains, only comes out to roughly $10 in terms of purchasing power, which is the same for countries like France and Belgium. That means that if Seattle’s hike passes, its minimum wage will be roughly 50 percent larger than France’s.

“Any plan that makes hiring a worker more expensive than in France should be cause for concern,” Weissmann says.

To put this is more perspective, even Paul Krugman says that at some point increasing the minimum wage would cause “a lot of problems,” although he uses $20 as a hypothetical cutoff, not $15. And New York’s famously left-wing mayor, Bill de Blasio, wouldn’t even go so far as to call for a specific hike when he demanded a raise in the minimum wage earlier this year.

Right-leaning economists, such as Walter Williams, say that even small increases in the minimum wage can be devastating for low-skill workers, and tend to hit minorities hardest.

“[D]uring times of gross racial discrimination, black unemployment was lower than white unemployment and blacks were more active in the labor market,” Williams wrote at last year. “For example, in 1948, black teen unemployment was less than white teen unemployment, and black teens were more active in the labor market. Today, black teen unemployment is about 40 percent; for whites, it is about 20 percent. The minimum wage law weighs heavily in this devastating picture.”

For his part, Weissmann ends his piece on an oddly upbeat note, saying he hopes the plan passes despite his misgivings. “If [the hike] succeeds, it could mean a profound shift in how we think about worker pay,” he writes. “If not, Seattle will have taken out the idea for a test drive. Better that one city’s job market crash than a whole country’s.”

Follow Will on Twitter

Tags : seattle
Will Rahn