The International Monetary Fund (IMF) published its yearly review of the U.S. economy on Monday. Among its findings, the organization openly supported raising the minimum wage above the federal minimum of $7.25 per hour—marking the first time the IMF has ever done so. Though it praised the expansion of American healthcare, the report noted that raising the wage would go towards narrowing the United States' vast income gap. The report stated: Given its current low level (compared both to U.S. history and international standards), the minimum wage should be increased. This would help raise incomes for millions of working poor and would have strong complementarities with the suggested improvements in the [Earned Income Tax Credit (EITC)], working in tandem to ensure a meaningful increase in after-tax earnings for the nation’s poorest households.To complement the increase in minimum wage, the IMF suggested that an expansion of the EITC "to apply to households without children, to older workers, and to low income youth" could also help some of the 50 million Americans living in poverty better their situation. Though President Obama has urged Congress to raise the federal minimum wage to $9, his efforts have thus far been thwarted by opposition in both chambers.
Joshua Rosenblat is a Summer 2014 In These Times intern.