Minimum Wages and Poverty: Will a $9.50 Federal Minimum Wage Really Help the Working Poor‪?‬

1. Introduction Proposals to increase the minimum wage are politically popular because they are widely seen as an effective way to help the working poor (AP-AOL 2006). Former President Bill Clinton captured this majority view in his statement of support for an increase in the federal minimum wage when he said: "It's time to honor and reward people who work hard and play by the rules .... No one who works full time and has children should be poor anymore" (Clinton and Gore 1992). The goal of helping the working poor was also an important motivation behind the most recent legislation to increase the federal minimum wage from $5.15 to $7.25 per hour in 2007, and it remains a key rationale for Senate Bill 2514, the Standing with Minimum Wage Earners Act of 2007, which would increase the federal minimum wage yet again from $7.25 to $9.50 per hour. (1)