Unequal Democracy: The Political Economy of the New Gilded Age

By Larry M. Bartels | Go to book overview

CHAPTER 8.
The Eroding Minimum Wage

Jim Borgman © 2008 Cincinnati Enquirer. Reprinted with permission of Universal
Press Syndicate. All rights reserved.

IN MAY 2007, overwhelming majorities in both chambers of Congress passed the Fair Minimum Wage Act of 2007, which increased the federal minimum wage from $5.15 per hour to $7.25 per hour in three annual 70-cent increments. The liberal Economic Policy Institute estimated that 5.3 million workers would be directly affected by the increase, with another 7.2 million indirectly benefiting from “spillover effects.” House Speaker Nancy Pelosi hailed the outcome as a victory for “the hardest-working Americans.” It was also a victory for Pelosi and the Democratic Party, since they had made a minimum wage increase one of the most salient planks in their 2006 midterm campaign platform. When the first phase of the increase took effect two months later, Democratic National Committee Chairman Howard Dean

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