As the CNN team was noting how well Senator Obama did today, Paul Begala suggested that Team Clinton needs to win over Edwards voters by adopting some of the Edwards populist themes in her speeches. How prophetic as just a few minutes later, CNN cuts away to an El Paso, Texas speech by Senator Clinton. It was an impressive little rally in which she made a lot of promises to the audience including a $9.50 minimum wage for full-time workers.
Something tells me that she’ll got a lot of criticism from the right who’ll say that a $9.50 an hour minimum wage will create a lot of unemployment. OK – time to check some facts and turn the clock back 40 years (1968) when the nominal wage was a mere $1.60 an hour. But it seems that the consumer price index in 2007 was 5.96 times the consumer price index in 1968 according to the Bureau of Labor Statistics (BLS). So in 2007$, the real minimum wage was $9.53 an hour. Besides, a President Clinton would not likely be signing any such bill until 2009 when the consumer price index will likely be 1.05 times what it was in 2007. This implies a real minimum wage equal to only $9.05 an hour in 2007$ or 95% of the real minimum wage back in 1968.
Before you wonder how high the unemployment rate jumped in 1968, be warn that BLS reports that it was only 3.5 percent or so back in 1968. I’m not saying that a higher real minimum wage won’t create some market dislocations, but let’s be mindful of the actual evidence as we read the hype from the right.