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The rationale for minimum wage/maximum hours, as I see it, is to prevent sweatshops, basically. We as a society made a decision that there are certain minimum working conditions that we insist on if someone is going to work for pay. There's a tradeoff for that, which is that if someone has no skills or skills that are worth less than minimum wage, s/he is unemployable - the employer is prohibited from hiring that person at the wage that s/he is actually worth, so s/he won't get hired. Thankfully we have not recently been in an economic situation where the legal minimum wage has much effect, because lately the legal minimum wage has been for the most part below market-based minimum (with some exceptions for extremely low-skilled jobs that are filled mainly by part-timers and students). I'm OK with minimum wage laws precisely because they usually set the minimum wage below almost all of the market - it prohibits sweatshop-like conditions while still not interfering with market mechanisms. And I'm OK with raising it so long as it's below that level.
The other rationales I have seen for raising it don't have any rationale that couldn't be applied to a number double or triple what the current minimum is. So why not double or triple it? The answer has to be that once you double or triple it, there are tradeoffs that will hurt the macro employment level - but then it you have to acknowledge that there are tradeoffs at EVERY level. They just happen to be more favorable overall with the minimum wage at low levels.
Timing-wise, I think GD and Shesus are correct that increases in the minimum tend to follow increases in cost of living. That's how our political system works - it isn't proactive, it's reactive.
In terms of pan's post - pan, there isn't enough money in CEO salaries as an aggregate group to make a noticeable difference in workers' lives. If a company has 50,000 employees and the CEO makes $20million, you could take his whole salary away and divide it up -- and each employee will get $400. (Most CEOs of public companies make a lot less than that.) But then you still need a CEO. Good ones don't grow on trees, and you'd still need to find and pay the new CEO. So what do you suggest - outlawing CEOs? Good ones create lots and lots of wealth and lots and lots of jobs. We can argue about how much they should be paid, but it would need to be a lot of money any way you slice it - if your'e responsible for billions of dollars in assets and tens of thousands of jobs, you should be paid a lot of money. I know I couldn't possibly do that job, and I bet you couldn't either. Even some of the people who DO that job aren't very good at it (which is why CEOs get fired). The really good ones are unbelievably talented people.
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