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Maximizing the Minimum Wage

Debates over whether to increase the minimum wage are raging in cities across the country – San Diego among them.

Randy Dotinga, Morning Report scribe and Voice of San Diego contributor, has been covering the issue locally [1]. He joined VOSD Radio hosts Scott Lewis and Caty Green on this week’s podcast [2] to talk about the ripple effects of minimum wage hikes, as well as the arguments for and against such a move [3].

Download the episode below, or subscribe on iTunes [4] for quick and easy delivery to your dedicated mobile device.

Download Audio [2]

Below are some of the takeaways from Dotinga’s interview.

We can learn from other cities that have already bumped up wages.

“From what I understand, from reading coverage of SeaTac’s situation, is that the minimum wage is in effect and hasn’t had that much of a real impact in terms of people losing jobs, of businesses freaking out and leaving … It is in effect, and businesses have not had huge layoffs. I think one of the things people don’t realize about minimum wage is that a lot of these businesses are not going to leave town. They’re not going to have a higher minimum wage and say, ‘Well, I’m going to go to El Cajon,’ because they’re service industries that serve San Diegans.”

But what’s a reasonable figure?

“Based on a report by the Center for Policy Initiatives, which is a left-leaning progressive organization … you need to make about $28,000 a year for a single person. And they say that’s basically the lowest that you can make as a single adult in San Diego and survive – have a one-bedroom apartment, pay (for) transportation and food and those kinds of things. But no entertainment, and no donations to Voice of San Diego. They aren’t included as part of this minimum lifestyle, so I do question this proposal.”

For some, this boils down to social justice versus social engineering.

“This is basically an issue of social justice versus social engineering, depending whether you are a liberal or a conservative. If you’re a liberal you see this as social justice, and it allows poor people to increase their income and have a kind of lifestyle that all Americans deserve. But if you’re a conservative, you see it as social engineering, as income redistribution, taking income from richer people and giving it to the poor. And I think economists see it in that same light, depending on what kind of economist you are. If you think it’s better to push income downward then you’re going to be in favor of it, and the opposite you’ll be against it.”