Unprincipled Politics

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Comment from Corvallist:
Have to disagree with you on this one. I’ve known too many adults working for minimum wage who wouldn’t really be able to take advantage of training opportunities for various reasons. And the minimum wage hike in Oregon did not increase prices as the doomsayers predicted, so no, that extra $40 means being able to buy gas, or pay the water bill, without as much difficulty. Teenagers make up a fraction of the minimum wage earners, so they shouldn’t figure into this.

There always has been and always will be a working underclass. There will always be a need for labor at that basic level; once that part is realized, the understanding that these people should be able to at least earn enough to pay rent and eat will help keep them from relying on other social services. We’re going to pay either way, and raising the federal minimum wage a couple of bucks is the least that can be done.

(But hey… good article in the GT today! It’ll be mentioned in the Corvallist later.)

Posted by Corvallist    Jul 29, 09:19 AM    #

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Comment from Michael Smith:
From a quick look on the internet I find that the Federal Reserve believes that a minimum wage hike is translated into increased unemployment, and a study Brazil suggests the effects are either unemployment or inflation. Within my understanding of supply and demand it seems unlikely that any economic component like minimum wage can be changed without something else moving within the system to create a new point of equilibrium not much different than the old equilibrium point.

(I have to go pick up a hard copy of the GT, but I was quite pleased with what I saw online.)

Posted by Michael Smith    Jul 29, 11:15 AM    #

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Comment from chris farrell:
Here’s a few facts:
Corporate profits have been going way up while wages have been remaining stagnant. If some of those profits were used to pay their employees a fair wage, that would be fair. Why is it fair that corporations make massive profits without sharing the money with their employees? Answer: it’s not fair. It’s the government’s responsiblity to look out for the needs of all the people, not just the rich.
Of course, I’m not going to convince you, so why am I even writing this?

Posted by chris farrell    Jul 29, 12:24 PM    #

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Comment from chris farrell:
Also, what makes you think they’re buying Whoppers and Slurpees? Maybe they’re buying rice and beans and flour. That sounds pretty disrespectful of the poor to me.

Posted by chris farrell    Jul 29, 01:16 PM    #

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Comment from Michael Smith:
Chris,

I am a Republican. What do you want? If you’re looking for “to each according to his needs, from each according to his abilities” try a Democrat, socialist, or communist. Corporations have no obligation to share profits with anyone other than their shareholders. A fair wage is whatever the labor market dictates.

I don’t doubt that corporate profits have been growing, but as a percentage of invested capital? We have a capitalist economy, and return on investment is what creates jobs and drives the economy. I agree that the government has a responsibility to all people and should ensure fairness, but equality of income is not “fair.” What is fair is the opportunity for people with skills, people who take smart risks, people who invent, people who compete effectively to be rewarded proportionately.

We have a system founded on life, liberty, and the pursuit of happiness. There are no entitlements to happiness and nothing in the Constitution about government subsidizing one class at the expense of another. For “fairness” in the form of equal outcomes try France where they promise “Liberté, Egalité, and Fraternité.”

Posted by Michael Smith    Jul 29, 01:23 PM    #

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Comment from Ken:
I’m not fond of minimum wage increases—if government is involved, I’d rather see efforts to improve job training and education so people can get better-paying jobs—but the thing that bugs me about this story is that the Republicans attached an unrelated bill to the wage hike. I hate riders with a passion—either get the issue passed on its own merits, or don’t bother.

By the way, who decides the definition of a “fair” wage? The feds? Unions? Local government? You’re likely to get 16 different definitions, and all will be deemed “unfair” to someone.

It is NOT government’s responsibility to take profits away from corporations and give them to their employees. That is Socialism.

Posted by Ken    Jul 29, 01:47 PM    #

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Comment from Max Sklar:
Michael -

I agree with you on the incorrigibility of the Republicans. I just don’t know how we’re going to get them to stand up for principal over politics. Same for the dems of course.

There are so many faults with a minimum wage, I don’t know where to begin. Even if someone is really for the government tranfer of income from the haves to the have-nots, the minimum wage is one of the worst ways of doing this. Price controls have been policy abominations since before the Roman Empire.

Posted by Max Sklar    Jul 29, 02:11 PM    #

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Comment from Corvallist:
Using the threat of a possible increased unemployment rate is a bit of a cop-out. It didn’t happen in Oregon, it didn’t happen in Washington, the two states with the highest minimum wage. In the Midwest, where you can still rent a 3-bedroom house for $500 a month, it doesn’t matter as much. But in places like California and New York, earning $5.15 an hour keeps families on welfare and food stamps, because they are still well below the poverty line. It would have to be raised to $8.20 to break that mark.

So really, it’s a choice of whether we think businesses should be compelled to pay fair wages or whether we believe the government should keep carrying people. To say “neither” also doesn’t provide any solution whatsoever.

Posted by Corvallist    Jul 29, 04:54 PM    #

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Comment from s'not:
Hey, Mike. You can have my hard copy to add to whatever hard copies you already have. I can give it to Mrs. Smith today! I don’t think the Federal Government should impose minimum wages, since Cost of Living in different states is so variable. You sound awfully mean. Look at the way Henry Ford treated his workers. And he was the best large employer around in his day. Whatever the Capatilists can get away with, when they have all the power and all the money, no WONDER I’m a democrat!

Posted by s'not    Jul 30, 05:17 AM    #

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Comment from Anonymous:
It is in the best interest of secular society to not exploit their working poor. Unhealthy unhappy workers, unable to feed themselves, house themselves or get medical care when ill or injured, create instability and the liklihood of uprisings.

If you feed religion into the societal picture, with it allegedly comes morals. Extreme wealth disparities, exploitation, unfair wages, lying, cheating, stealing from anyone—-all these things are biblically immoral.

I believe many people use religion to keep poverty stricken masses in line, who then accept their fates hoping for rewards in the afterlife that have eluded them on Earth. The powerful love this.

There must always be more workers than managers. The pyramid cannot exist upside down. The majority of jobs are worker jobs.

Posted by Anonymous    Aug 2, 06:38 AM    #

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Comment from MsAmber:
I believe there is room in the U.S. for some socialist “cells”. Places of economic mediocrity where a struggling family can maintain a minimum standard of living. For example: Single parent families. A small town like Corvallis could reasonably become a haven where rent is considerably lower than the national average, and a single parent with two children could live and work with a reasonable budget earned working at a printshop.
I’m remembering Denver Colorado in the ‘90s when the cost of living surged but wages did not. My rent for a two bedroom duplex went from $675/mo to $1250/mo because the economy boomed. Along with increased prices in gas/electric/water. I distinctly felt as though Colorado was trying to run off the middle/lower class citizens in order to make room for all the rich Californians who were fleeing the coast after the earthquake.
In 1999 they increased minimum wage in the downtown metro area to $8.00. (Too little too late).
Sorry, that’s my rant.
In Oklahoma,
MsAmber

Posted by MsAmber    Aug 3, 04:38 AM    #

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Comment from chris farrell:
I believe in incentives to innovate and all of that, not taxing the rich excessively. But we can’t let people starve on the street. Here’s an editorial from the new york times regarding wage issues and issues of rising inequality that you either don’t know about or won’t admit. This is an issue of human decency, not being Democrat or Republican.

It’s an editorial in letter form to the current Treasury secretary.




Since the current economic expansion began in late 2001, productivity has soared. So have corporate profits. But, as you noted, relatively modest increases in salaries and wages for the bottom 80 percent of the work force have been eaten up by rising prices. Meanwhile, even among the top 20 percent, only the very richest, about the top 1 percent, have seen significant gains. Actually, their incomes have exploded. The result, according to the latest economic data through 2004, is that the top 1 percent now hold a bigger share of total income than at any time since 1929, except 1999 and 2000, during the stock bubble. But in those two years, everyone’s income was rising. Lately, only the rich have been winners.

You offered the two usual administration responses to these realities.

The first is that people move up and down the ladder, so the picture at any point may seem bleaker than it really is. You said that when we read about “American families earning the median income, let’s remember that many of them are on their way up the economic ladder.” O.K.

But let’s also remember that the real issue concerning mobility is whether there is enough movement to overcome the drag of wage stagnation and income inequality. The answer is clearly no. Moreover, for decades, typical families have gotten ahead only by both spouses working ever more hours. The inequality of the Bush years implies that these trends have only worsened. You were quite right to cheer the economic accomplishments of immigrants and others who work their way up. But let’s not use pleasing anecdotes to distract from disturbing evidence.

In your speech, you also adhered to the administration view that today’s income inequality is mostly related to education; the solution is thus more and better education, which, you noted, is one of President Bush’s priorities. A greater focus on education — ideally, on first-rate public schools — is essential for many reasons. But as a catchall diagnosis and cure for today’s inequality, it is a dangerous oversimplification.

You noted in your speech that college graduates have long outearned less-educated workers. But you didn’t mention that the returns appear to be diminishing. Mr. Bush’s “Economic Report of the President” for 2006 shows that average annual earnings of college graduates fell by 5 percent from 2000 to 2004. In that time, the gap between the average yearly pay of a college graduate and a high school graduate shrank, and Department of Labor data shows that many college graduates are doing jobs that used to require only a high school diploma.

This does not argue for less education. But it does indicate that more college for more Americans is no silver bullet for income inequality. In a recent Foreign Affairs magazine, Alan Blinder, the Princeton economist and former vice chairman of the Federal Reserve, challenged those who “blithely assume” that the labor market in a globalized economy will continue to be divided between the highly educated and the less educated. “In the future, how children are educated may prove to be more important than how much,” Mr. Blinder said. “But educational specialists have not even begun to think about this problem.”

Are they likely to start thinking about it if people of your stature oversimplify the challenge?

Public education, like the progressive income tax, Social Security, the minimum wage and other labor protections, are pillars of what the economist Frank Levy once called “the nation’s equalizing institutions.” Rising income inequality has gone hand in hand with deliberate government attempts — some successful, others not — to weaken many of those national institutions and to replace them with serial tax cuts and increasing privatization. Moreover, the Bush administration has failed to champion new institutions for the new challenges we face.

I agree with you that the answer to economic dislocation is “not new trade restraints.” But you will never develop a consensus for globalization if it comes wrapped in a package that includes wage stagnation and income inequality. For that reason — and for basic fairness — equalizing institutions should be strengthened, not weakened.

That requires government leaders willing to build the institutions — and to recognize that if the Bush years have shown us anything, it’s that broad prosperity does not flow automatically from economic growth.

Posted by chris farrell    Aug 4, 05:38 PM    #

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Comment from willCode4Beer:
There are some really good comments here, so I guess its time for me to through in something.
I’ve never been big into the idea of the federal government determining minimum wages. Being a big states rights type, I’ve always thought that this is better left to the individual states. This is a really big country with diverse economies and values. Trying to centralize everything guarantees that somebody is going to lose. There is a huge difference between the cost of living in Georgia and New York City.

As for increased unemployment, etc, I don’t buy it. We have not seen unemployment rise with previous hikes, and the states with the highest minimum wage tend to have the lowest unemployment. Now, if we implemented a system like Germany or France, sure, we would definitely get extreme unemployment. Fortuneately we are a little smarter on this side of the pond.

Lets also not forget, a low minimum ensures that we get a certain number of illegal immigrants for certain jobs. Notice most minimum wage laws contain exceptions (for lower wages) for farm workers.

If people really want higher minimum wages, they should start at home (as in their home state). Some reasons for this, its easier (and less expensive) to change a state law, your reps in the state legislature have fewer constituents than a senator and are more likely to listen to you, and you are less likely to get resentment from people who live far away and have different values than you.

just my $0.02

Posted by willCode4Beer    Aug 11, 04:50 AM    #