Since Ronald Reagan was president, the chief operating principle of U.S. fiscal policy has been trickle-down economics: Cut taxes for the rich and their increased wealth will trickle down to the middle class. And trickle it has. In the last 20 years, income for the top 5 percent has increased by 17 percent while income for the middle 20 percent has grown by only 5 percent.
Tax rates for high income earners and corporations are less than half of what they were during the Eisenhower years. The best way to make the tax system fair is to require wealthy Americans to pay their fair share. In the 1950s, the economy prospered when wealthy Americans did their part.
This kind of fundamental tax reform is a long time coming but there's something we can do right now to put more spending money into the hands of the working families. And that's to give America a raise. President Obama has proposed and House Republicans have resisted an increase of the minimum wage to $10 per hour from the current rate of $7.25 an hour.
If the minimum wage for the bottom end of the income scale goes up, there will be pressure to increase wages for the hard working families in the middle. People have more money to spend in stores, so both workers and businesses people benefit.
A pay raise is a no brainer for the public. National polls by conservative, liberal and non-ideological media outlets show that anywhere from 60 percent to 70 percent of Americans support raising the minimum wage. Congress is very unpopular because it has isolated itself from the public. The increase in the minimum wage and a tougher system of background checks for gun purchases are just two of the many popular measures that Congress has ignored or rejected.
ABC News and the Washington Post just released a national poll with new insight on the support that exists for a pay raise for the public. The poll goes farther than the typical yes or no question in so many surveys.
First the pollsters told Americans that the current national minimum wage was $7.25 and then asked them what they thought the minimum wage should be. The answer averaged out to $9.41 an hour which is a lot closer to President Obama's position than the Republicans' support for the status quo.
Americans not only support a hike in the wage rate, they strongly support the idea. In the ABC News/Washington Post poll, the researchers laid out both sides of the argument. The statement in the poll read "The minimum wage should be increased to help low income workers get by" or it "would lead businesses to cut jobs." Then the researchers asked the public how they felt and Americans supported the minimum wage increase to $10.00 by more than a two to one margin (66 percent to 31 percent)
Because a pay raise for America makes economic and political sense, Democrats will certainly feature a minimum wage increase during the midterm campaigns next year. There also will be minimum wage increase requests on the ballot in several states next year. But Republicans have an easy way to get the issue off next year's campaign agenda and that's to pass it this year.
It's the least Republicans can do to help struggling working families. But it's the also best thing Congress can do until we have a tax system where wealthy Americans have to pay their fair share.