“It may be true — as some economists argue — that any big jumps in the minimum wage discourage employers from hiring more workers,” then-Sen. Obama wrote. Nevertheless, Obama still wanted to do it, so he laid out his best case: “When the minimum wage hasn’t been changed in nine years and has less purchasing power in real dollars than it did in 1955, so that someone working full-time today in a minimum-wage job doesn’t earn enough to rise out of poverty, such arguments carry less force,” Obama added.
Little of Obama’s 2006 case applies today. First, the minimum wage was last increased in 2007, and 2008, and 2009 — not quite the distance in time that Obama cited in The Audacity of Hope. Second, the minimum wage has had more or less purchasing power in real dollars at various times over the years. Obama’s argument (in the inequality speech) that it is below where it was when Truman was in the White House is true of only one of Truman’s eight years in office; the rest of that time, the real value of the minimum wage was below where it is today. And today’s minimum wage is actually higher in real terms than it was a various points in the 1980s, 1990s, and 2000s.
Third, a minimum-wage worker today does in fact “earn enough to rise out of poverty.” A full-time $7.25-an-hour minimum-wage job pays $15,080 a year, while the federal poverty level for an individual is $11,490.