For Investors Only -- Minnesota With History Of Low Minimum Wages; Last Time It Raised A $4.90/Hour Wage Was Almost A Decade Ago

Updates

March 19, 2014: a letter from someone who lives in Minnesota -- reported by The Dickinson Press --

For the past few months I’ve been examining the upper Midwest state personal taxation policies and their possible effect on population movement.

My original article “The great Minnesota exodus tax acts of 2013” available at gopherstatepolitics.blogspot.com indicates that North Dakota has no estate tax and that their individual income tax using an identical data example for all states was 73 percent lower than the Minnesota tax.

The next logical step was to check the out-migration population movement from Minnesota to its neighboring states. This had already been mostly done by the Center of the American Experiment in an April 2013 publication Minnesotans on the Move to Lower Tax States (AmericanExperiment.org) covering 20 states. I only had to go to the TaxFoundation.org website to find the IRS AGI (adjusted gross income) tax data on their migration calculator for Minnesota-Wisconsin for the same 2005-10 period to match the Center’s study.

Carefully reviewing the data, I was stunned by what appeared. Minnesotans moving to North Dakota had the lowest average taxable income of the 21 states migrating populations. We Minnesotans pride ourselves that we’re above average. Yet, here we are at the bottom. What a shame.

March 18, 2014: a reader confirms that Minnesota's minimum wage is one of the lowest in the United States. The state government is working to fix that but they still have not succeeded. In addition, when they finally do agree to increase the minimum wage, it appears that the minimum wage will be phased in. The Washington Post is reporting:

The House on Monday (earlier in March) rejected a Senate proposal that would have raised the minimum wage for employees at big businesses, saying they didn’t want to take a piecemeal approach. But the two chambers still need to resolve disputes over whether the minimum wage should be tied to inflation and the number of years the new rate would take to phase in.

The writer also notes:

Despite its progressive reputation, Minnesota has long had one of the lower minimum wages in the nation. In 1968, the lowest-paid workers earned just 70 cents an hour, a lower rate than any state other than Kentucky, according to the U.S. Department of Labor. The last time the legislature raised the minimum wage, in 2005, the lowest-paid workers went from earning $4.90 an hour to the current $5.25 rate.

Original Post

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It is amazing how fast folks find jobs when long-term unemployment benefits end. The AP is reporting:

Unemployment rates fell in 43 U.S. states in January as more Americans began looking for work and most quickly found jobs.

The Labor Department said Monday that the unemployment rate rose in just one state — Iowa — where the rate increased to 4.3 percent from 4.2 percent. Still, that's far below the national rate of 6.6 percent that month. Rates were unchanged in six states.

The data demonstrates that the steady decline in the unemployment rate nationwide has been broad-based, occurring throughout much of the country. The overall U.S. unemployment rate has fallen 1 percentage point in the past 12 months.

The story does not mention the end of long-term unemployment benefits. Unless I'm missing something the only thing that has changed in the last three months is the end of long-term unemployment benefits. Certainly, the economy has not changed all that much, and the weather was as bad as ever, certainly not conducive to finding work, unless it became a necessity.

What is more valuable: $15/hr in unemployment benefits or $10/hr working? For some, the answer is counterintuitive. I remember my first summer job; it was working for the county health department collecting mosquitoes. This would have been about 1967 or 1968.

The minimum wage had its highest purchasing value ever in 1968, when it was $1.60 per hour ($10.64 in 2012 dollars). -- Wiki  

The minimum wage may have had its highest purchasing value ever back then, but I was paid well below minimum wage, I assume. I honestly don't remember. But I know it could not have been much.

A bit of trivia: quick, which state ha a higher minimum wage? North Dakota or Minnesota? Redneck, conservative Texas or Al Franken's Minnesota? That backward conservative state of Kansas or that liberal progressive state of Minnesota? In all cases, Minnesota pays less. The minimum wage in Minnesota is a paltry $5.25 for small employers; $6.15 for large employers. North Dakota: $7.25; Kansas: $7.25; Texas: $7.25. Minnesota's minimum wage (small employers) is $2.00/hr less than its neighboring states. I can't recall any speech by Al Franken supporting President Obama's call for an increased minimum wage.

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A most interesting book to read is Sylvia Nasar's Grand Pursuit: The Story of Economic Genius, c. 2011. It puts the above comments into context. As I read it, I take notes here.

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Right, left, center, tea party, or Al Frankenite, without a doubt, no US president or German chancellor could have affected the outcome of the Crimean event once Putin made his decision.  I think the only argument is whether Putin would have made the same decision if the initial events had occurred under Ronald Reagan's watch. Ronald Reagan was absolutely predictably unpredictable; the Russians would have taken that into account. I do think Putin knew that Obama was absolutely predictably predictable which allowed him (Putin) to take advantage of a situation. Last night, while riding home on my bicycle, the phrase "emperor with no clothes" flashed in front of me. It was the first time in a very long time I recalled that idiom. Strictly speaking the idiom does not fit, but in contemporary parlance, it probably comes as close as any idiom to describe the president's situation.

Things are so ugly in the Ukraine right now, Kerry did not return. Instead, the president sent Joe Biden to eastern Europe to reassure folks that the US stands behind them 1000%, sort of like how we stood behind the Ukraine army when we removed all their weapons. Joe Biden has less credibility than almost anyone I can think of.