❝ In 2014, Seattle passed an ordinance to eventually raise the minimum wage in the city to $15 an hour, giving the Pacific Northwest city the highest pay floor in the U.S.
❝ The ink wasn’t even dry on the wage legislation when the dire warnings of economic collapse began. Unemployment would skyrocket, economic growth in the state would be hurt, restaurants and small businesses would close en masse. The deserved punishment would be swift and harsh.
But a funny thing happened on Seattle’s way to economic collapse: the city thrived. Restaurants didn’t close — they actually prospered — and new restaurant openings rose. Unemployment fell, most recently to less than 4 percent, more than a full percentage point lower than the national rate. By all accounts the city on the Puget Sound is booming.
❝ How did the doomsayers get it so wrong? As in so many other cases of politically motivated economic analysis, this was what the opponents hoped would happen because it fit with way they think world should work. But given what we know about Seattle…higher minimum wages can improve workers‘ living standards and stimulate the local economy.
Blame a fundamental misunderstanding of minimum-wage economics and, of course, good old-fashioned political bias. There have been repeated attempts to misread the data and conclude it has hurt employment, but so far none of this research has withstood scrutiny.
Trump doesn’t own the Big Lie. Republicans – whose party loyalty supersedes economic reality – cling to the tactic as tightly as, say, any scholarly limpet who still prattles about trickle-down benefits to the working class.
Thanks, Barry Ritholtz