(LOS ANGELES TIMES)

By Andy Stern & Carl Camden

Nearly 8 million Americans go to work every day yet still live below the poverty line. That is in part because the federal minimum wage is too low.

Currently, an individual with a full-time job at the minimum wage and a family of three to support will fall below the federal poverty line. These workers, despite putting in regular hours, are struggling to provide basic necessities for themselves and their families. By allowing the minimum wage to remain at a nearly unlivable level, we have deemed certain jobs not worthy enough to meet even our country’s minimum standard of living.

How have we been able to keep wages so low without significant social discord? By using tax revenue and a complicated government bureaucracy to subsidize low-wage employers and supplement minimum-wage salaries. Rather than firms paying a worker’s true cost and customers paying an appropriate price for the services provided by those firms, the government provides workers with “income transfers” to help them meet basic needs. These include such programs as the earned income tax credit, food stamps and Medicaid.

These government supports mask a job’s true value and set an artificially low wage. They also represent the height of inefficiency. Raising the minimum wage means that the income required for basic needs is delivered in a one-step approach, via the paycheck directly from firm to worker, rather than requiring additional government expenditures.

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