Minimum wage- stereotypical jobs we think are for the uneducated as well as teens. When you think about it, many states have set their own standards, the federal minimum wage is a laughable $7.25 an hour and has been since 2009. Remember, the rich are always getting richer, the poor are getting poorer and us middle class folk? We stay the same.
A TikToker (video below) says the minimum wage should be $52 an hour, and he's done the math to prove it.
The federal minimum wage was instituted in 1938 by President Franklin Delano Roosevelt for reasons that are still all too resonant now. Just like today, when members of SAG-AFTRA and WGA, Teamsters working for UPS, and the United Auto Workers are striking over the ever-increasing erosion of their earnings by mega-corporations, Roosevelt's Fair Labor Standards Act established the federal minimum wage largely due to Depression-era union movements protesting the corporate greed that helped cause the Depression in the first place.
Roosevelt's legislation established a minimum wage that provided a livable income of $.25 per hour, or about $480 per year, to U.S. workers. And it was livable in the literal sense since even big-ticket items like a Harvard education only cost $420 a year (he said, bursting into tears and screaming into a pillow until his vocal cords snapped like twigs).
Times have, of course, changed. A lot. As Rafiki from The Lion King once said, "Oh yes, the past can hurt. But from the way I see it, you can either run from it or learn from it".
The TikToker explained that Roosevelt's minimum wage meant any worker could theoretically afford to buy a house. Elyon113 broke down the actual math in his TikTok, using numbers from 1932, the year Roosevelt first proposed a federal minimum wage. (It was passed by Congress in 1933 but struck down as unconstitutional by the Supreme Court in 1935.)
@elyon113 Replying to @Mich@34567 @Mich@34567 ♬ original sound - Elyon113
Elyon113 used a 1932 house price of $3900, which would have been about $1000 lower than the national average at the time — so think humble, no-frills "starter home," right? Converted to the present day, a $3900 home would cost about $87,000 in 2023. You'd be hard-pressed to even find a livable house for that price in most of the United States nowadays.
Elyon113 next calculated what your mortgage would cost today for a house that costs around $85,000 — a $358 monthly house payment. Which as Elyon113 showed using another mortgage calculator, would require a pre-tax yearly income of $13,429 — nearly $500 less than the yearly pay the current minimum wage would get you.
Not only is an $85,000 house unrealistic, the average cost of a house right now is nearly five times that — $416,000 as of July 2023 — a staggering 26% increase from 2020 and rising all the time.
This is in part because of inflation and supply and demand issues, of course. But it's also because as homeownership increased in the years and decades after Roosevelt's New Deal, mortgage companies and Wall Street firms began using mortgage debts to create sophisticated financial instruments like mortgage-backed securities to sell to investors.
These instruments are part of what caused the 2000s housing bubble and the 2008 global economic collapse, as Margot Robbie famously explained in "The Big Short."
@hedgefundmanagerbae explains mbs, clip from the big short♬ original sound - hedgefundmanager
You can probably see where this is all going. Elyon113 ran the numbers on a $400,000 home, which again, is below the national average, just like $3900 was in 1932. But even a regular middle-class American, let alone a minimum-wage worker can't even come close to affording that. As Elyon113 revealed, to afford a $400,000 house you need to make about $102,000 a year, which comes out to $52 an hour.
So if home ownership is still considered the gold standard not only for "The American Dream" but the health of our economy, then the minimum wage should be $52 an hour.
Instead, it's languished at $7.25 for 14 years, a wage that doesn't even pay for a squalid apartment, let alone a livable one, in a country where even many people making orders of magnitude more than that can't afford rent and are forced to sleep in their cars.
And, as is so often the case, America is unique in this respect. Aside from how shockingly low ours is, in most wealthy countries, the minimum wage is set and managed by economists. Ours is set and managed by politicians. And you can see how well that's gone.
He feels that minimum wage should be $52 an hour because housing is a human right.
Suffice to say, things should not be this hard and economically usurious in the richest country on Earth. Sure, a $52 minimum wage is at best a pipe dream, and most business leaders would tell you it would tank the economy. Heck, they say that about a $15 minimum wage, let alone a $52 one.
But here it's best to remember Roosevelt's words about the minimum wage back in 1938 during one of his famous fireside chats: "Do not let any calamity-howling executive with an income of $1,000 a day, who has been turning his employees over to the Government relief rolls in order to preserve his company's undistributed reserves, tell you — using his stockholders' money to pay the postage for his personal opinions — that a wage of $11 a week is going to have a disastrous effect on all American industry."
Good advice then and especially now, when many CEOs make more in a day than most of us will make in our entire lives. Demand better. It doesn't have to be like this.
