the insanely high price of the past 40 years of trickle-down, anti-wage economic thinking: Some $50 trillion that used to go to the paychecks of working Americans has been diverted to the wealthiest 0.1%. Had wages continued to grow at the pace that we saw back when the Times supported higher wages in the 50s and 60s, the median American worker would be making around $45,000 more per year.
A minimum wage, they believed, would introduce "distortions" into the market's power. By raising wages beyond what the market dictated, the government was killing jobs. The theory, Appelbaum says, "looked really great on a blackboard" in economics classes around the country. When New Jersey raised its minimum wage from $4.25 to $5.05 an hour in 1992, economists David Card and Alan B. Krueger compared restaurant wages and employment on both sides of the state line between New Jersey and Pennsylvania, which did not raise the wage. Appelbaum says that Card and Krueger's report found that "in the real world, raising the minimum wage had not in fact caused all of these disastrous consequences.
Eventually, the conventional wisdom turned away from the idea of the harmful minimum wage. "The idea that any increase in the minimum wage, or even a fairly significant increase in the minimum wage, is going to put people out of work has just turned out not to be true in practice," Appelbaum said.