In his 2014 State of the Union address, President Barack Obama embraced the movement for a $10.10 minimum wage. Two weeks later he went even further, issuing an executive order that set $10.10 an hour as the minimum wage for all federal contractors, effective January 1, 2015. As President Obama put it in his address, this executive order requires “federal contractors to pay their federally-funded employees a fair wage of at least $10.10 an hour—because if you cook our troops’ meals or wash their dishes, you shouldn’t have to live in poverty.” This new federal contractor minimum will be indexed to inflation. The statutory minimum wage that applies to all other American employers is not indexed to inflation. As a result, its real value has declined steeply over the years.

Does the President’s $10.10 an hour represent a fair wage? Maybe. A living wage? Hardly. No one can really support a family on minimum wage employment, even if the minimum is raised to $10.10 an hour. At $10.10 an hour it would be difficult even to support yourself, never mind a family. And that’s assuming you could find full-time work, which you probably couldn’t. Very few minimum wage workers can find full-time employment, even full-time employment may not be available year-round, and all workers get sick sometimes, or have to care for sick children, or (God forbid) need a day off.

But in the end, the root problem is the low wage. The proposed $10.10 minimum isn’t based on any real analysis of what it costs to live in 21st-century America. It is carefully calibrated to meet the sensitive political criterion of raising families out of poverty—very carefully calibrated indeed. The 2014 federal poverty threshold for a family of three (the standard Census Bureau reference family) is $19,790 a year. The current Federal Reserve inflation target is 2% inflation per year. Since the federal poverty thresholds are indexed to inflation, the anticipated poverty threshold for 2015 is $20,186 a year for a family of three. At $10.10 an hour a person working 40 hours a week, 52 weeks a year—minus 10 unpaid federal holidays—would earn $20,200 a year, or exactly $14 more than the poverty threshold.