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What is the Minimum Wage?

How much money should people earn?

To make sure people have enough money to live, the government asks companies to pay workers at least the minimum wage. Companies can pay workers more than the minimum wage, but never less.

The minimum wage has been $7.25 for every hour worked. That is the federal government’s rule. States can make higher wages, but not lower ones. A lot of people and most of the Democrats in Congress want to raise the pay to $15 for every hour, but many others don’t want to, including most Republicans. The Democrats are in control of the House of Representatives, and they voted to have companies pay more. Republicans control the Senate though, so it most likely won’t pass.

Some people think that making companies pay more money for every hour worked will help the economy. They think that since people will have more money, they’ll buy more stuff. Then more people will need to work to make things. With more jobs and more pay, people would be happy.

But other people don’t think it’s a good idea. When companies must pay everyone more money, they raise their prices and they don’t let their workers get as many hours. So even though people make more money every hour, they take home less money because they work fewer hours. Then when they want to spend their money, they can’t buy as much with it as before.  It also makes companies not want to hire new people, and they might fire some people because they have to pay them too much.

A lot of Americans want $15 for every hour worked, but people who think the government should stay out of the economy argue that it will just leave young people without jobs. Is a higher minimum wage a good idea or a bad one? Time will tell.

Andrew Moran

Economics Correspondent at LibertyNation.com and LNGenZ.com. Andrew has written extensively on economics, business, and political subjects for the last decade. He also writes about economics at Economic Collapse News and commodities at EarnForex.com. He is the author of “The War on Cash.” You can learn more at AndrewMoran.net.

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