The Tight Link Between the Minimum Wage and Wage Inequality

[ProSense]

The Tight Link Between the Minimum Wage and Wage Inequality

by Lawrence Mishel

A higher minimum wage is an important way to address wage inequality, as the erosion of the minimum wage is the main reason for the increase in inequality between low-and middle-wage workers (in particular the 50/10 wage gap, that between the median and the 10th percentile earner). This is particularly true among women, the group for whom the wage gap in the bottom half grew the most. As the figure below shows, two-thirds of the increase in the 50-10 wage gap can be attributed to the erosion of the real value of the minimum wage. [The 50/10 wage gap grew 25.2 (log) percentage points between 1979 and 2009 and that two-thirds of this increase (16.5 percentage points, or 65 percent of the total) can be attributed to the erosion of the minimum wage.] The paper this figure draws on usefully and appropriately captures the spillover impact of the minimum wage—the impact on those earning above the legislated rate. This finding makes sense, since it was in the 1980s that the minimum wage eroded the most, and that was the same time period when the 50/10 wage gap among women expanded greatly. The erosion of the minimum wage explains over a tenth (11.3 percent) of the smaller 5.3 (log) percentage point expansion of the 50/10 wage gap among men. For workers overall more than half (57 percent) of the increase in the 50/10 wage gap was accounted for by the erosion of the minimum wage.



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http://www.epi.org/blog/tight-link-minimum-wage-wage-inequality/

Senator Sanders: A Victory for Workers
http://www.democraticunderground.com/10024400795

[ProSense]

1. Oooh, Republicans are pissed:

A wage hike isn’t a ‘constitutional violation’

By Steve Benen

The White House probably didn’t expect congressional Republicans to celebrate President Obama’s new policy raising the minimum wage for employees of government contractors. But this isn’t one of the options available to GOP lawmakers.

Rep. Steve King (R-Iowa) in an interview Tuesday blasted President Obama’s move to require new federal contractors to pay their employees above $10.10 a “constitutional violation.”

“We have a minimum wage. Congress has set it. For the president to simply declare I’m going to change this law that Congress has passed is unconstitutional,” King said.

The Iowa congressman suggested that there would be a legal challenge to the move, and said that the nation never “had a president with that level of audacity and that level of contempt for his own oath of office.”

On the substance, the congressman seems confused. Obama isn’t declaring a change to federal law – the federal minimum wage won’t be, and can’t be, changed through executive order.

What Obama has done – and what Steve King should have looked into before talking to reporters – is use his regulatory authority to establish conditions for businesses that contract with the government. According to the administration, Congress already gave the president this authority when lawmakers wrote current law.

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http://www.msnbc.com/rachel-maddow-show/wage-hike-isnt-constitutional-violation

[ProSense]

2. Kick because

it sure is quiet in here.