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Raising Minimum Wage Essay

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1. How rich are the rich? Wealth statistics on the very rich are compiled every year by Forbes magazine. Answer the following questions:
A. Carefully define wealth, differentiating it from income. Which of these two are more 
unequally distributed in the US? Why?
Wealth is a stock concept. Usually it is an ownership of shares, savings in the bank accounts, properties, pension plans, bonds etc. Income is a flow of money coming from salaries, profits from business activities, and government benefits. Wealth generates income. For example, rental property is wealth, and a monthly rental payment received is income. Based on the Survey of Consumer Finances conducted by the Federal Reserve Board in 1983, the distribution of wealth is much more unequal than the distribution of income. One of the reasons …show more content…

Why was the minimum wage law first enacted?
The minimum wage law was first enacted during the Great Depression to keep workers out of poverty and to increase people’s purchasing power. This law was enacted as a 4-year experiment to stimulate the economy of the U.S.
g. What are the arguments for and against raising the minimum wage?
The arguments for raising the minimum wage are:
- It is too low; and the employers can afford to pay more
- Job losses as a result from the wage increases are minimal
- The value of the minimum wage falls drastically compared to the prices increase
- Increased wages keep more people from applying for government benefits
- “If minimum wage grew at same rate as worker productivity it would have reached $21.72 per hour” (cepr.net).
On the other side, the argument against raising the minimum wage is that it would hurt the low-paid workers. Small businesses will not be able to pay higher wage to their employees and will have to let some of them go. Finding jobs will become more difficult for the low-skilled workers. Higher minimum wages will increase the prices for goods. Thus, the real value of the increased minimum wage will be the same as

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