jeudi 6 novembre 2014

Post Election Minimum Wage Rant

I want to congratulate all the states and cities that voted to increase their minimum wage, from blue San Francisco to red Arkansas. Americans overwhelmingly support a living wage and were not deterred by scare tactics or rampant inflation and high unemployment. The purpose of the minimum wage was indeed to provide a basic standard of living for those at the bottom of the income scale. It was wholly and utterly progressive. People who work full-time shouldn't starve.

The only reason we don't see the full effects of poverty wages is because so many people who work minimum wage jobs qualify for assistance; something that many who don't want to raise wages also want to scale back. Looking at inflation data, an indicator of where prices are going, the last increase in 2009, rates were within historical averages, if not slightly lower. Which indicates there is no real effect on prices. Unemployment peaked in 2010, .3 points higher than 2009, but considering the state of the economy, probably had little to do with the increase, and the unemployment rate has been falling since. So it doesn't affect prices and it doesn't affect employment, it spurs economic activity and it gives people dignity.

A low minimum wage also has the nefarious effect of affecting everyone up the wage scale who works for their pay, around 5% make the bare minimum or below, but it sets a benchmark for all other wages to be compared to. Someone with a four-year degree makes the equivalent of what a minimum wage worker made in the 60s. If wages had kept pace with productivity and inflation the minimum wage would be nearly $20, so what would a college grad be making? We haven't been too good about raising the minimum wage, yet prices still increase, productivity still increases. So I would like someone to show me the link between a raise in the minimum wage and all these negative effects, because the data doesn't reveal that.

When I was in Paris a Chipotle opened up and I was surprised that a burrito cost $13. But then I thought, these workers are well-paid, probably living in decent apartments in the suburbs, they have stable full-time schedules, they have health insurance, and paid vacation, and the line was still going out the door. In the US we accept crap and think its ok that the people who serve it to us should live like crap. When you travel in Western Europe you realize how poor the average American is, despite how insanely rich our country is, our housing in sub-par, we are sicker, we don't take vacations. Look at CEO pay and productivity, which grow exponentially and compare it to real wages, which continually fall. That's not ok to me, at all.

If income inequality is the issue of our time, and its getting worse, then what other solution is there than raising taxes and raising the minimum wage, which was designed to provide the least skilled workers a dignified minimum standard of living; a living wage. We may still worship at the alter of upward mobility, bootstraps and ambition, but the US is increasingly the least socially mobile country, has the most entrenched wealth, and the highest income inequality.

People are suffering and need relief and they could care less about proving their mettle at the fry station when they know they are going to leave their full-time job with their food-stamps and head to Walmart. If service jobs are the new mining and factory jobs then for the sake of workers and for the economic health of the US they need to be living wage jobs.

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