Dear Future President,
As of now there are people in America who are making only $7.25 an hour at their jobs, even working 40 hours a week, every week, that person can only make $15,121.44 in a year. According to Gallup news the average American spends $151 on food each week(Gallup), that's about $7875 spent annually just on food. With only around $7250 of their salary remaining how are people expected to support themselves and their family? Raising the minimum wage would not only help people who are earning minimum wage support their families and keep themselves out of poverty, but it also benefit people who already earn more than minimum wage, because their salaries would go up too. How are you going to manage the relationship between inflation and minimum wage?
One of the current problems with raising the minimum wage is that stores will inflate their prices to compensate for the money that they are losing because of higher pay rates for their workers. If companies do this it defeats the purpose of raising the minimum wage. If the inflation rate and the minimum wage rates stay parallel, people won’t experience any benefit of a higher minimum wage. But if the minimum wage increases at a higher rate than inflation does, people will notice a change and would be able to stay further out of poverty as well as afford better food and clothing.
America’s minimum wage is 27 percent of the U.S. average pay, a lower ratio than that of any other member of the Organisation for Economic Co-operation and Development except Mexico. That doesn’t prove that the U.S. floor is too low—only that it can be higher without the sky falling. For example; in Denmark the minimum wage is the equivalent of about $20 an hour. Despite that, the World Bank has ranked Denmark as the easiest place in Europe to do business for three years running. (Bloomberg) Denmark shows us that we can have a higher minimum wage and a better quality of life without hurting the local or international businesses revenue. If the minimum wage in America was the same as in Denmark, people's salaries would increase by about 275% per year. If the minimum wage was increased to $20 per hour and the inflation rate did not increase or only slightly increased, millions of people who are working minimum wage jobs would find themselves escaping poverty and settling into a more normal and predictable way of living.
According to inflationdata.com from 1913 to 2016 the average inflation rate has been aproxametely 1.5% per year. That means that something that costs $1 today in 2016 will cost about $1.02 in 2017(McMahon). The average minimum wage increases by about 0.1% each year, which means that each dollar you could earn in 2016 would still equal about $1($1.001 to be exact). Shouldn't minimum wage rate be about the same as the inflation rate? With inflation rates being so much higher than minimum wage rates, how are people working minimum wage jobs expected to survive and thrive in their environment?
Managing the relationship between minimum wage and inflation rates would help America’s lower working class and lead to a more regular and predictable lives. It would also mean that less people would fall into homelessness and more people could afford to live a healthier lifestyle and support their families. You could balance the minimum wage and inflation rates by mandating that the federal reserve regulates inflation while also using your position to increase the minimum wage, across the nation, each year to meet the needs of the people. Applying these changes or something like these changes would help close the gap between the minimum wage and inflated prices as well as let people who are working minimum wage jobs afford the things they need to lead a healthy life. (A healthy life is what people need in their lives so they can be succesfull and healthy, things like; a well balanced diet considting of fruits, vegitables, carbs, protien, .ect, a place to sleep, claen water, and a safe community.) These changes obviously can’t happen overnight but with time you can make them a reality and help people all over America.
Gallup, Inc. "Americans Spend $151 a Week on Food; the High-Income, $180." Gallup.com. 02 Aug. 2012. Web. 18 Oct. 2016.
McMahon, Tim. "Tim McMahon." Average Annual Inflation Rate by Decade. 18 June 2015. Web. 25 Oct. 2016.
"What a Higher Minimum Wage Does for Workers and the Economy." Bloomberg.com. Bloomberg. Web. 20 Oct. 2016.