Prices rises might follow an increase, but not to where the inflation alarm would sound. In Australia the minimum hourly wage is 16.76 US dollars, at the current exchange rate. If the US were to adopt the same rate, would high-priced hamburgers bankrupt Americans? Hardly. The Economist's July 2012 Big Mac index listed average prices in USD of $4.33 in the US and $4.68 in Australia, a difference of only 8.1 percent. I'm an American living in Australia and have compared prices at fast-food chains operating in both countries. Prices in USD on comparable items mostly run 10 -- 15 percent higher in Australia, not counting sales taxes.
Compared with my hypothetical adoption of the Australian minimum, Harkin-Miller would raise wages by a fourth as much. The impact on prices would be slight.
US conservatives claim that a higher minimum wage kills jobs. A well-referenced refutation of their argument is here.
We cannot raise every Anerican's wages with a stroke of a pen, but delivering a decent wage to workers who feed money right back into the domestic economy is sound policy.
Let's start by getting behind Harkin-Miller.
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