Raising minimum wage right movePublished 10:46am Thursday, April 17, 2014
One of the hot issues in this year’s political races is whether the federal minimum wage should be increased. It might seem obvious that if lower-income people had more money to spend it would be good for almost everyone.
President Obama and the Democrats have proposed that it be raised from its current $7.25 an hour to $10.10. Certainly, it would benefit the 17 million workers who’d get the increase — the majority of them women, who generally make less than men to start with. Some states have higher minimums, but none above the proposed level.
Many small business owners support a higher minimum wage. A 2013 poll by Greenberg Research showed 67 percent believe a higher wage is not only fairer, but will increase sales as customers have more money to spend.
Smart business people have known this since at least 100 years ago when Henry Ford voluntarily raised wages at his Ford plant to get the best workers, keep them longer and pay them enough money to buy his Model T’s.
So why do some folks, and most Republican members of Congress, oppose increasing the minimum wage? Some honestly believe raising wages will cause unemployment. They found support for this view in estimates from the Congressional Budget Office. But the CBO, it turns out, looked mostly at academic literature, rather than reality on the ground.
The fact is that states with the highest wages tend to have lower unemployment. And we know that since the first national minimum wage was signed into law by President Franklin Roosevelt during the Great Depression, our economy has gone mostly up. More recently, since the value of the minimum wage — measured against the value of the dollar — peaked in 1968, the real wages of ordinary working people have gone down.
The strongest opposition to raising wages seems to come from libertarians who believe almost all government regulation is bad, and the super wealthy who seem never to be satisfied with their massive wealth and want even more, by holding everyone else down.
Both of these groups say that if employers are free to pay lower wages they’ll hire more people and that will help the economy. But a look at history will make clear that doesn’t work.
I used to ask my students, “What was the minimum wage in the South before 1860?” Of course, the answer is zero. Millions of people worked in the South for literally slave wages — zero. For those who were enslaved, there was full employment, whether you wanted it or not.
People were minimally fed and housed, and that’s about it. I’m not saying the oligarchs of today want to return to slavery, but they do favor abolishing minimum wages, which would force people to compete for jobs at ever lower pay. The end result would be something like slavery, where you’re forced to work for food and shelter, but you’re paid almost nothing, and the owner typically lives far away where he can’t see the suffering caused by his low wages.
Yes, you might have the freedom to move, but how far can you go without money? In today’s world, as a few high-living, greedy billionaires gobble up businesses coast to coast, it may be pointless to move. And they oppose unions, which could help by increasing pressure for better pay.
Exaggerated picture? Maybe. But it’s no exaggeration to note that for millions of working Americans, no matter how hard they work, they barely tread water. It’s not a matter of education, either, since the large majority of minimum wage earners now have high school degrees or more — and in spite of the propaganda aimed at downgrading and privatizing our schools, kids are better educated than ever.
Nor are the minimum wage earners “kids.” Their average age is 35 and they bring home about half of their family’s income.
No one knows for sure all the effects of any government or business policy in the long run, but we certainly know it’s not fair for people to work day in and day out and barely be able to keep a roof over their heads. America’s future can be brighter than that — if we vote.
Southern Ohio writer, Jack Burgess, is a retired teacher of American & Global Studies.