Proposed minimum wage, designed to align political goals.
Mw = Mi * (GDP + Fm - Fb) / (HY * (GDP + Fm))
Mi = US average Income (as of 2021, $61372)
GDP = Gross Domestic Product (as of 2021, $21.43T)
Fb = US Budget total expenditures (as of 2021, $4.79T)
Fm = US Military expenditures (as of 2021, $778B)
HY = Working hours / year, or 1980, assuming 15 holidays
Mw = Minimum wage, in USD / hr (given equation and current values, $22.94, or $6.82 in 1980 dollars)
const mw = (mi, gdp, fb, fm) => mi * (gdp + fm - fb) / (1980 * (gdp + fm));If possible, Mw should be recalculated monthly, with some level of historesis (for example, a rolling average of the last six months' calculation).
Now, the question is: why?
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Increases in economic success naturally increase the minimum wage, by virtue of the median income increasing. The median income is used, since shifts in the absolute value of values below a median do not affect the median, so long as they are less than it. So there's little feedback. A criticism to this is that if everyone's making $39k/yr, $51k/yr won't be as attractive, and incomes will ratchet up, causing inflation. I'm not actually convinced this is a problem; the mean income in the US is about $10k higher than the median, indicating that we have a fair amount of income inequality dragging the average up. Up-ratcheted middle-class incomes will only improve that situation. Or, more clearly, inflation takes the most value from those with the most money - and they're better able to afford it.
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Increases in budgetary expenditure necessarily reduce the minimum wage. The reason for this is that the benefits of government programs ideally go to those with lower wages who need it most. This is not always the case, but in the areas where it is not, repairs to the logic that governs those programs is in order.
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Changes in military expenditure are removed from consideration (total expenditures contains military expenditure; adding the term avoids encouraging greater military outlay).
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Given this equation, shifts in the GDP don't materially affect minimum wage long term - but when the GDP shifts more quickly than changes in the federal budget, we see interesting effects: If the GDP drops dramatically, Fb becomes a larger fraction of it, and the minimum wage shifts down, allowing companies to invest in their workforce. If the GDP grows dramatically, the minimum wage shifts up, granting the benefits of a growing economy to the workforce.
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Republicans are largely influenced by businesses to keep the minimum wage as far down as possible; they're also influenced by their constituency to keep government expenditure down as far as possible. Similarly, Democrats are influenced to raise the minimum wage and to expand social programs. By setting these values against one another, we create direct, politically clear incentives for both parties to rein themselves in, forcing them to do real math before political calculus.