As President Barack Obama comes off of a tough year for his political agenda in 2013, the administration hopes to refocus the debate on how to lift Americans out of poverty and into the middle class. The president’s answer? 

Minimum wage. The minimum wage, although increased to $7.25 in 2009, still sits far below the $10.10 that Obama recently set for federal contractors through executive action. It also doesn’t provide as much financial support as it used to.

According to the U.S. Department of Commerce’s Bureau of Economic Analysis, the minimum wage reached an “adjusted for inflation” peak of $8.56 in 1968. This shows that the minimum wage had more buying power in 1968 than it does now, when accounting for different values of the American dollar from 1968 to the present.

Thus, the value of the minimum wage has steadily declined ever since reaching its peak in the late ’60s. Gap recently raised its minimum hourly pay to $9.00 and will increase that amount to $10.00 by 2015. Additionally, polls show that a majority supports raising the minimum wage nationally.

But despite this, many barriers could prevent Obama’s policy dream from becoming a reality. Many economists, including DePaul economics professor Qi Hong Dong, believe that raising the minimum wage brings more negatives than it does positives.

“In the teenage labor market, a 10 percent increase in the minimum wage depresses teenage employment between 1 and 3 percent,” she said. “Some teenagers who are still attending high school choose to drop out and take jobs due to the higher payment.”

For her, real economic reform would include education reform and expanded access to educational opportunities for young people. These sentiments are shared with many in the economic community. According to famed economist Greg Mankiw, 79 percent of economists are against raising the minimum wage. Economics professor Brian Phelan, on the other hand, brought up the benefits that could come with the increase.

“There is an extensive empirical literature in economics on this question, and the consensus is that the effect of minimum wages on employment is actually quite small,” he said. However, Phelan also warns about the potential negative effects of a higher minimum wage.

“The economic recovery has been hindered by a slow recovery in the labor market, where employment levels remain well below where they were before 2007,” he said. “Thus, the minimum wage is a potentially dangerous policy tool at this juncture given its potential disemployment effects. This is particularly true as firms think about whether they should expand or not.”

Strong supporters of raising in the minimum wage, on the other hand, see the labor market as structurally unfair to workers and see the increase as a way for low-income workers to move out of poverty. Democrats in particular believe it could prop up those who need help the most.

“It’s not just teenagers that are the line cooks anymore. It also includes single parents trying to support their families and the elderly,” Cameron Erickson, treasurer of DePaul Democrats, said. “Many of the folks that are working now actually fall below the poverty line and need government benefits like food stamps and temporary assistance for needy families to make ends meet. It’s the fiscally responsible thing to do to give workers a livable wage of at least $10.10 an hour.”

According to a recent report from the Congressional Budget Office (CBO), there are arguments for both sides. The CBO estimates that an increase of the minimum wage to $10.10 would cost up to 500,000 jobs in the private sector, the New York Times reported, but would also help 900,000 people out of poverty.