Let’s Experiment With the Minimum Wage and EITC

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When you add up the minimum wage and the Earned Income Tax Credit, Brad DeLong thinks it should add up to a living wage:

Of course, minimum-wage advocates are fearful of the following: We say raise the minimum wage, they say increase the earned income tax credit instead. We say increase the earned income tax credit, they say it is more important to reduce the deficit. We say fund the earned income tax credit by raising taxes, they say lower taxes promote entrepreneurship. We say cut defense spending, they say ISIS and Iran. The shift of attention to the earned income tax credit is then seen as—which it often is—part of the game of political Three Card Monte to avoid doing anything while not admitting you are opposed to doing anything.

That is all very true.

So raise the minimum wage, and then bargain back to a lower minimum wage and a higher income tax credit if it turns out that there are significant disemployment affects.

Well, yes, that would be fine except that the same people who refuse to increase the EITC are the same ones who refuse to raise the minimum wage. We’re no more likely to get a $15 (or $12 or $13 or $14) minimum wage than we are to get a more generous EITC. Ditto for wage subsidies, which are popular in some conservative circles. The excuses may vary depending on the circumstances, but they will always add up to No.

Perhaps a better bet is to focus on the state level. Plenty of states have an EITC that piggybacks on the federal EITC, and that means there are plenty of laboratories of democracy where we could try different combinations of EITC and minimum wage to see what works best. Who knows? Maybe a few states could even be talked into trying out wage subsidies.

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SIX TRUTHS

Reclaiming power from those who abuse it often starts with telling the truth. And in "This Is How Authoritarians Get Defeated," MoJo's Monika Bauerlein unpacks six truths to remember during the homestretch of an election where democracy, truth, and decency are on the line.

Truth #1: The chaos is the point.

Truth #2: Team Reality is bigger than it seems.

Truth #3: Facebook owns this.

Truth #4: When we go to work, we're in the fight.

Truth #5: It's about minority rule.

Truth #6: The only thing that can save us is…us.

Please take a moment to see how all these truths add up, because what happens in the weeks and months ahead will reverberate for at least a generation and we better be prepared.

And if you think journalism like Mother Jones'—that calls it like it is, that will never acquiesce to power, that looks where others don't—can help guide us through this historic, high-stakes moment, and you're able to right now, please help us reach our $350,000 goal by October 31 with a donation today. It's all hands on deck for democracy.

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