WASHINGTON–Sen. Bernie Sanders (I-Vt.) introduced a bill on May 4 to raise the federal minimum wage to $17 per hour. The proposal, which is more than double the current rate of $7.25, was unveiled to the cheers of various labor leaders outside Capitol Hill.
“It is time to pass a new livable wage,” Sanders said. He was joined by AFL-CIO President Liz Shuler, who said the increase would not burden large corporations, citing a leaked McDonald’s earnings call wherein the CEO says the company would do “just fine” under a $15 minimum wage.
Last December, McDonald’s opened its first largely automated restaurant, a concept that is still in its infancy as humans are still needed to cook and prepare the food.
When asked if the increase to the federal minimum wage would disproportionately increase costs for small businesses, as opposed to corporations, Sanders rejected the premise.
“[Small business] can handle it … we’re not increasing the cost of business,” he told The Epoch Times. “When these people are able to earn a living wage—you know what—maybe they’re going to be able to go out and buy a damn hamburger.”
Sanders argued that the Democrats’ previous goal of raising the minimum wage to $15 was no longer sufficient, as the dollar’s purchasing power has eroded over time. Accounting for the recent spike in inflation, a $17 wage is roughly equivalent to $14.50 pre-pandemic.
Critics of the increase say higher wages are a key contributor to rising inflation and that such policies will only worsen the problem for low-income wage-earners.
“What’s causing the dollar to lose its purchasing power?” said 2024 Libertarian presidential front-runner Dave Smith during an episode of his podcast last week. “[Sanders] just seems to have no thought, ‘Oh yeah, there actually might even be a connection between the policies you advocate for and the fact that inflation is destroying the purchasing power of the dollar.’”
Joseph Salerno, professor emeritus of economics at Pace University’s Lubin School of Business, agreed.
“With a $17 minimum wage some workers will have additional dollars in their pockets permitting them to spend more on hamburgers, but other workers will have to give up purchasing chicken nuggets because higher labor costs will cause them to be laid off and lose their paychecks,“ Salerno told The Epoch Times. ”In addition, with fewer people employed, fewer hamburgers and chicken nuggets will be produced and the reduced supply will drive up prices for all consumers, intensifying inflation.”
Although many states have raised their minimum wages in recent years, the federal rate of $7.25 still applies in the 20 states that do not mandate a higher one. Congress has not voted to increase the federal minimum wage since President George W. Bush signed a series of increases into law in 2007.
The bill introduced by Sanders is expected to face resistance from Republicans, who have long opposed raising the minimum wage, arguing that it would lead to job losses, exacerbate inflation, and hurt small businesses.
Also speaking at the event was Economic Policy Institute President Heidi Shierholz, who argued that an increase in the minimum wage would boost economic activity and only lead to minimal job losses.
Expanding on her premise, The Epoch Times asked Shierholz why then an even higher minimum wage would not be preferable.
“Nobody is suggesting a $100 an hour minimum wage,” she said. “We know that particularly low wage employers have the power to suppress wages … that’s inefficient.”
