Wednesday, October 6, 2010

The GOP and the Minimum Wage

While watching Lawrence O'Donnell last night, I learned that Republican Chairman Steele has no idea how much the minimum wage is, or should I say isn't.  It's only $7.25/hour, but there are various minimum wage exceptions that can apply under specific circumstances to workers with disabilities, full-time students, youth under age 20 in their first 90 consecutive calendar days of employment, tipped employees and student-learners.  When asked by O'Donnell if he, the chairman of the Republican Party, agreed with a number of Republican candidates that the minimum wage should be abolished, Steele wouldn't answer.

Alaska's GOP Senatorial candidate, Joe Miller, believes that the federal minimum wage law should be abolished, claiming that minimum wage laws should be under the purview of the States.  Others, however, believe that minimum wage laws are basically economic ceilings that make it costlier for many businesses to operate than it should, and should therefore be abolished entirely.  But, if you would ... take notice of the locus of their concern ... it isn't for the citizens of this country of ours ... but, instead for the businesses and the corporations.

Let's take a look at what a single person making minimum wage in a full-time job (2080 hrs/yr) might expect to earn: $7.25/hr x 2080 hrs/yr = $15,080 gross wages. To get to their net wages, we'd need to deduct income taxes [$1,844 (from 2009 IRS tax table)] and FICA taxes (7.65%, or $1,153). So, after deducting Federal and FICA taxes, take home wages are $12,083.  In most states, there are also State taxes to consider, and there may also be city/local taxes as well. If we take Ohio as an example, $208.52 in Ohio State taxes would apply and if this person lived in a taxing local city where a 2% tax applied ($301.60), that would bring the take home wages to $11,572.88 per year.

At $11,572.88, this person would be just barely above the poverty level for the 48 contiguous states of $10,830.00 and we haven't begun to look at other expenses like: health care expenses, auto payments, auto licensing expense, auto insurance, rent, utilities, food, etc.

Ever wonder just how much GOP Chairman Steele makes annually?  It's a far cry from our example at $235,000/year.  I'll bet he doesn't have any trouble putting a car in his garage, or food on his table each night.

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