Minimum Wage Rises, Sky Does Not Fall

By Barbara Ehrenreich, AlterNet. Posted January 23, 2007.

When I flew to Seattle last week, airport security gave me trouble over the four-pound ham I was carrying. Several TSA officials gathered to consider the question of whether ham is a "gel," to which I retorted: If ham is a gel, so am I. I suggested that they biopsy it for hidden box-cutters. I offered to divide it into 21 three-ounce chunks, each appropriately stowed in a Ziploc baggie. But no deal.

So I broke down and told them I was flying into what I had been warned would be a food-free zone: Washington, with the highest minimum wage in the country ($7.63 an hour), could hardly be expected to have affordable restaurants or a functioning economy of any kind. Notable conservative economists have almost unanimously predicted that an increased minimum wage would result in wild price increases and mass unemployment, and I had a suitcase full of clippings to prove it.

I would be entering a culinary wasteland, facing fast food meals of $20 and up, and if I tried to fall back on soup kitchens, thousands of unemployed restaurant workers would be lined up ahead of me.

So imagine my surprise when I arrived, ham-less, in Seattle to find it fully functional, if not positively bustling. Restaurants were packed, and I could still get a grilled salmon sandwich for $7.95 at a cafeteria-style place overlooking the sound. My hotel was amply staffed with congenial people and - perhaps only because of the un-Seattle-like cold, no beggars approached me on the streets. Nor can you say the dire effects of a higher minimum wage just haven't had time to set in: Washington raised its minimum wage above the federal level of $5.15 an hour about a decade ago.

In fact, according to a January 9th article New York Times, Washington's economy is booming, generating 90,000 new jobs in the last year. Even business groups have stopped griping about the state's minimum wage. The article quotes a pizza store owner in the western part of the state: ''We're paying the highest wage we've ever had to pay, and our business is still up more than 11 percent over last year.''

My next stops were in California, with a minimum wage of $7.50 an hour, slated to go up to $8 next year. Again, no imported ham was required. Sidewalk taquerias flourished, as well, or so I'm told, as those celebrity sushi spots where you can pay $100 for a bite of fresh chum.

Overall, 29 states have raised their minimum wages above $5.15 an hour, and -- lo! -- the sky has not fallen. Could we have some apologies, please, from the economists who predicted a retail apocalypse?

Not that a $7 or even $8 minimum wage is utopian. My book Nickel and Dimed is often wrongly described as an account of my attempts to live on the minimum wage. Far from it; I averaged $7 an hour, which, according to the federal government, is well above the poverty level for a family of one. But I couldn't get by on that, thanks to the high rents even in trailer parks and residential motels, and I never went near pricey housing markets like San Francisco or Seattle. In the Seattle area, a "living wage" (calculated to reflect local housing and other basic costs) is $11.89 an hour for a single person and $25.35 for a family of three - more than three times the current minimum wage.

There is no moral justification for a minimum wage lower than a living wage. And given the experience of the 29 states that have raised their minimum wages, there isn't even an amoral economic justification either.

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Barbara Ehrenreich is the author of 14 books, most recently "Dancing in the streets: A History of Collective Joy."

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