Why Raising the Minimum Wage Will Help Economic Growth

Minimum wage rally

On February 6, 2014, Mike Wilder,Community Coalition Organizer for Wisconsin Jobs Now, held a webinar entitled "Why Raising the Minimum Wage Will Help Economic Growth." You can view the slides from his presentation here: 

You can access the entire presentation -- both the slides and the audio, including the question and answer period.

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A Tale of Two States: Progressive Policies Win

24BORDERS-articleLarge.jpgStarting with the similarities in their histories, Lawrence Jacobs, professor of political science at the Humphrey School of Public Affairs at the University of Minnesota, writing in the New York Times, analyzes two extremes and demonstrates how the Progressives in Minnesota have brought growth and security while Wisconsin's Republican majority has failed to make any improvements in the business climate and job growth.

The piece points out that these neighboring states both elected new governors in 2010 and also gave each governor's party a strong majority in his respective legislature. Since then their economic fates have diverged. Minnesota pursued a range of progressive policies, including a highly progressive tax increase to fund essential services and infrastructure, while Wisconsin followed the hard-right playbook by cutting taxes for the wealthiest and for businesses.

As professor Jacobs writes, the election of these opposing governors and legislators "began a natural experiment that compares the agendas of modern progressivism and the new right." Here's the gist of his analysis:

Which side of the experiment — the new right or modern progressivism — has been most effective in increasing jobs and improving business opportunities, not to mention living conditions?

Obviously, firm answers will require more time and more data, but the first round of evidence gives the edge to Minnesota’s model of increased services, higher costs (mostly for the affluent) and reduced payments to entrenched interests like the insurers who cover the Medicaid population.

Three years into Mr. Walker’s term, Wisconsin lags behind Minnesota in job creation and economic growth. As a candidate, Mr. Walker promised to produce 250,000 private-sector jobs in his first term, but a year before the next election that number is less than 90,000.

Jacobs' insights have been picked up in a number of national media outlets like MSNBC, Minnpost, DailyKos, and others.

As it happens, this tale is repeated with another set of comparisons: between California and Wisconsin. And the results are similar. Professor Chinn, Professor of Public Affairs and Economics at the University of Wisconsin, Madison, posted a piece on the Econbrowser blog in September in which he "compared economic outcomes in two states that implemented contrasting fiscal policies: California, which surged ahead while raising taxes and cutting spending, and Wisconsin, which lagged far behind as it slashed spending on education, and cut taxes. Latest estimates of current economic activity, and forecasted economic activity six months out, indicate continued lagging performance for Wisconsin."

No matter how you slice it, progressive economic policies promote growth; regressive ones don't.

 

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Southern Voting Patterns and the Legacy of Slavery

These two maps show the 1860 map President Lincoln used to show the reach of slavery and a 2008 map showing most of the US counties where voters trended more Republican when compared to the 2004 voting patterns in those same counties.

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Although the deepest red squares on the voting map do not line up exactly with the counties where there was the highest concentration of slaves at the time of the Civil War, the proximity of the counties that became increasingly red in 2008 to the areas where slave-holding was most concentrated is hard to miss. As many analysts of voting patterns in the history of the United States have pointed out, the convergence of these two phenomena during an election in which a Republican candidate opposed an African-American one is not accidental.

Racial attitudes are probably only one factor in the increasing polarization we see in politics today, but it is clearly a potent one.

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A Study in Contrasts

As neighboring states in the Midwest, Wisconsin and Minnesota have more in common than they do differences. Yet the two states took very different approaches to implementing the Affordable Care Act (ACA), or Obamacare, and have achieved very different results.

Paying More to Cover Fewer People

86million_preventive_small.jpgA key component of the ACA is the opportunity to receive additional funding from the federal government to strengthen our safety net program, BadgerCare, by filling the gaps in coverage. In fact, the federal government offered 100% of the funding needed to fill the coverage gap for the first three years and at least 90% in subsequent years. In February, our governor announced he would reject the ACA's recommended path to pursue his own Medicaid plan, which will cost the state more taxpayer money to cover fewer Wisconsinites.

The Republican-controlled Joint Finance Committee (JFC) had an opportunity to set Wisconsin back on the right track when it took up this portion of the state budget on June 4, 2013. Instead, they approved most of the governor's plan in a 12-4 vote. Senate Democrats introduced several amendments on the floor to the 2013-15 state budget pertaining to Medicaid funding including an amendment to accept the full Medicaid expansion funding. This amendment was rejected by the Republican majority.

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The Republican War on Women

Republicans Prioritize Taking Away Women’s Health Care Access Over Jobs

Republicans refuse to exempt rape victims and women who need an abortion to save their lives from SB 206.

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