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Christopher Caldwell, the conservative - but sane - senior editor of the Weekly Standard, comes up with another interesting column in this week-end's Financial Times, where he discusses the economic merits of a minimum wage, which he claims are unconvincing, but nevertheless ends up supporting an increase in such minimum wage for social and political reasons.

His arguments make a lot of sense, and show exactly what the Dems should fight for:


Christopher Caldwell: Social logic of a living wage

The economic case for a higher minimum wage looks strong at first glance. In the US, it was last raised in 1998. The minimum now pays only one-third of the average salary, at a time of rising energy and healthcare prices. As Mr Kennedy noted, a year of minimum-wage work leaves a single mother with two children thousands of dollars below the poverty line.

In fact, the economic arguments for a higher minimum wage are weaker than they look. But the political arguments are strong enough for leaders to cross them at their peril. Mr Kennedy's dramatic statistics do not capture the social reality of the minimum wage. Among those who get it, single-income families are a distinct minority. Half of minimum wage earners are under 25, according to US Bureau of Labour statistics, and one-quarter are teenagers. Many people have to take minimum-wage jobs; it is less clear that many have to stay in them. A person who spends six months loading the dumpster at a superstore, showing up on time, being polite, acquires a record for reliability that is a marketable credential. Removing that first rung on the career ladder could certainly spur unemployment.

This is a fair summary of the main arguments on that topic: the minimum wage is so low that it is not even enough to take peoplee out of poverty (which is undoubtedly true); but if it is only a first step into the labor market, making the step higher will keep some people out (harder to say if it is true, but the argument is certainly used).

Caldwell then goes on to shoot some of the anti-minimum wage arguments, by pointing out the contradictions in them:


Not that attacks on the minimum wage are particularly impressive on economic grounds. Claims that modest hikes would cost jobs - such as were made in the US during the Clinton rise, and in the UK when the minimum was introduced in 1999 - have been overblown. There is something self-contradictory about the twin rationales of the minimum wage's opponents. They see the minimum-wage workforce as minuscule for the purposes of measuring the gains (money for poor people) and vast for the purposes of measuring the costs (bankruptcies and job losses).

But he then goes for the big picture in a way which is pretty unusual for a conservative, in that he acknowledges that the current economy is becoming increasingly tough for the middle class, and is encouraging a growing divide between the "winners" of globalisation, and the losers


 There is a larger narrative about how people are compensated in today's economy. It is recounted in a fascinating way by Frank Levy and Richard J.?Murnane, the Massachusetts Institute of Technology economists, who have long studied the gap between the well and poorly paid. In The New Division of Labor, just out in paperback from Princeton University Press, they examine the role of computers in creating that gap. For Mr Levy and Mr Murnane, computers are best at carrying out "rules-based tasks". Computers enhance the value of those engaged in "expert thinking" (thinking outside the box) and "complex communication" (interpreting information). But they drive down the demand for people engaged in the rules-based work that used to support much of the lower middle class. The results are a "hollowing out" of income distribution and increasing inequality. Low-paying rules-based  jobs - various secretarial, computational and manufacturing posts - are candidates for either automation or outsourcing.

(...)

The authors find John F.?Kennedy's remark that "a rising tide lifts all boats" inapplicable in today's economy. The same processes that increase demand for skilled workers reduce demand for unskilled ones. One possibly dangerous consequence, they fear, is that the "haves" of the new economy may use the political clout that money buys to accelerate these processes. But that could set off a destructive reaction. "Our market economy," Mr Levy  and Mr Murnane write, "exists in a framework of institutions that requires the political consent of the governed. People doing well today have a strong interest in preserving this consent. If enough people come to see the US job market as stacked against them, the nation's institutions will be at great risk."

In short:

  • globalisation and technological progress are indeed hollowing out the middle classes, by empoverishing its bottom half, whose jobs can be automated or outsourced, and who are left with only menial, low paid jobs (and, I may add, in competition wiht the traditional holders of such jobs, i.e. recent immigrants;

  • this can be a politically self-sustaining, and self-reinforcing process, as the "winners" vote to defend the status quo and protect their advantage, and the losers get disinfranchised from the political world (or are distracted by cynical politicians focusing on "external enemies" like immigrants, gays or Arab terrorists);

  • this will however reinforce the feeling of exclusion from society, and may ultimately lead to a wider delegitimisation of today's politics and institutions.


There is evidence of just such a perception of a stacked job market. America now has a strong grass-roots political movement that is claiming a level of compensation that cannot be justified by the laws of supply and demand. Last November, a Florida referendum to raise the state's minimum wage to a dollar above the federal one got 71 per cent of the vote. The Association of Community Organisations for Reform Now was instrumental in the initiative. The group, which many dismissed a decade ago as a remnant of 1970s progressivism, is once again a force after campaigns in dozens of cities and states to pass "living wage" laws. One-third of states now have minimum wages above the federal level.

This is not an economic but a political victory. It does not mean that, say, wrapping hamburgers is worth a dollar an hour more than we thought it was. But it may mean that social peace is.

This means that a smart conservative like Caldwell recognises that the political pendulum has switched so far in favor of the moneyed and/or educated and/or globalised classes and to the detriment of the working class that there is a real risk that the reaction could be very violent.

Thus lies a very simple lesson for the Democrats and the left in general:

if even conservatives can recognise that the economy is becoming increasingly unequal and unfair, why aren't they making a bigger stink about it? Why leave this to grassroot organisations? This is a political winner that can be easily be grasped: THE ECONOMY IS INCREASINGLY UNFAIR.

The left needs to make more noise about this, so that the politicians can go and fight for incremental improvements - for social justice, to save the political compact, democracy, and to stave off the implicit threat of major social unrest.

Is this a dream? Can it be done? The minimum wage ("living wage") is certainly a good place to start.

Originally posted to Jerome a Paris on Sat Oct 22, 2005 at 06:14 AM PDT.

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Comment Preferences

  •  Tip Jar - Oct. 22 (4.00)

    In the long run, we're all dead (Keynes)
    Read more on the European Tribune - bringing dKos to Europe

    by Jerome a Paris on Sat Oct 22, 2005 at 06:13:40 AM PDT

    •  On the European Tribune today (none)
      More debunking of biased statistics: DoDo's British Immigration Scare

      A reminder from whataboutbob: Pakistan Quake: 2 weels later - they need our help

      The increasingly exhaustive and indispensable roundup of international news by Fran in the European Breakfast thread.

      And more... and remember that on European Tribune, your diaries stay visible for a few days, and discussions can continue at a more leisurely pace!

      In the long run, we're all dead (Keynes)
      Read more on the European Tribune - bringing dKos to Europe

      by Jerome a Paris on Sat Oct 22, 2005 at 06:35:03 AM PDT

      [ Parent ]

      •  "Sane conservatives"- where are they ? (none)
        Jerome,  I have not seen many of this type of so-called conservatives.  If they exist here in the US, they have been remarkably quiet while the Radical Conservatives (rad-cons) have torn apart our country.  Certainly you don't count Bubbles Greenspan among this very rare, nearly extinct, breed of conservatives.

        Imagine if we had some real fiscal conservatives in the US goverment, they certainly would not spend 1.5 billion per week invading and occupying Iraq.  The so-called conservative movement in the US is better named the "Greedy, radical oppressors", because that is the effect of their policies.  More money for the rich and the ultra-rich like the Bushite scum, and less for everyone else.

        The former conservatives from the Repug party have been just as spineless as the surrender Dems and DINOs like Joe Lieberman.  They have barely slowed down the Bushite scum in their rush to ruin this country and the world.  All to satisfy their insatiable greed for money and power.

  •  This is going to be an angry comment (4.00)
    not angry at you, Jerome, just angry, and if I get any facts wrong, please correct me.

    Among those who get it, single-income families are a distinct minority. Half of minimum wage earners are under 25, according to US Bureau of Labour statistics,

    Okay, Caldwell, let's examine that asinine passage.

    (1) Half of minimum-wage earners are under 25.

    (2) It would seem to follow that half of minimum-wage earners are over 25.

    (Conclusion) Half is not a "distinct minority".

    I managed to see that in about two seconds.

    This is slightly off topic, but I'm sure you know better than I do that the American economy requires an unemployment rate of 4% in order to function.  Lower than that and "wage pressure" causes inflation, not because of the minimum wage but because the "minumum wage" will no longer suffice for prospective employers.  Alan Greenspan has, in the past, often worried that too many people have jobs.

    It would seem to follow that, since the economy requires a fairly substantial unemployment rate, that we owe a decent welfare system to the unemployed.  (Note, of course, that when I say "4% unemployment", I refer to the rather amusing way the US counts the "unemployed" . . . not the actual unemployment rate).  

    Next:

    But they [computers] drive down the demand for people engaged in the rules-based work that used to support much of the lower middle class.

    Ah, that old chestnut. Here is the laughable idea that we live in a "post-industrial world".  No, we do not.  Industry is alive and not-so-well and living at starvation-level wages in China and India and Haiti and . . . just throw a rock at map and you'll hit one.

    The problem is not that there is no longer a need for "rules-based-work" . . . the problem is that the need is easy to hide and strangle to death in countries that don't appear on TV too often.  

    Sorry, and again, correct me where I went wrong.

    "In the beginning the universe was created. This has been widely criticized and generally regarded as a bad move." -- Douglas Adams

    by LithiumCola on Sat Oct 22, 2005 at 06:40:46 AM PDT

    •  Well, he IS conservative (4.00)
      and he IS trying to make the point that minimum wages are not economically sound, even if they might make sens politically.

      • his arguments are fairly mild, to say the least (he does recognise that the cost of a minimum wage to the economy is pretty low)

      • his recognition of the wider social and political implications are, to me, very significant as, in line with yesterday's diary, he recognises that economy "efficiency" cannot trump everything.

      As to your other point about where our economy is going, both you and him are right. His insight that globalisation and technological progress are threatening the middle class is right, I think (even if politicla choices that could make this tolerable are, to the contrary, making things worse).

      In the long run, we're all dead (Keynes)
      Read more on the European Tribune - bringing dKos to Europe

      by Jerome a Paris on Sat Oct 22, 2005 at 06:49:48 AM PDT

      [ Parent ]

    •  minor quibble (4.00)
      Half is not a "distinct minority"

      There is no logical connection between age and "single income families". He said that single income families are a distinct minority, not wage earners under 25.

      •  Fair enough (none)
        I was assuming that almost everyone who is both over 25 and earning the minimum wage has a family.  Of course, that might not be true (but I'll bet you a tuna sandwich that it is).

        "In the beginning the universe was created. This has been widely criticized and generally regarded as a bad move." -- Douglas Adams

        by LithiumCola on Sat Oct 22, 2005 at 06:54:13 AM PDT

        [ Parent ]

        •  I'll see your tuna sandwich (none)
          and raise you a bag of chips.

          Just because they have a family, doesn't make them a "single-income" family.

          •  Thanks (none)
            caught me.  

            "In the beginning the universe was created. This has been widely criticized and generally regarded as a bad move." -- Douglas Adams

            by LithiumCola on Sat Oct 22, 2005 at 07:30:39 AM PDT

            [ Parent ]

          •  But just to correct my point . . . (none)

            Mr Kennedy's dramatic statistics do not capture the social reality of the minimum wage. Among those who get it, single-income families are a distinct minority. Half of minimum wage earners are under 25, according to US Bureau of Labour statistics, and one-quarter are teenagers.

            Actually, that was very slippery of Mr. Caldwell.  You were right that I screwed-up the logic . . . but look at that passage.  Why did he slip in "single-income"???  That's just a trick.  Is his idea that two-income minimum-wage earners can support a family in some sort of decent way?  Who was even talking about "single-income" in the first place?

            "In the beginning the universe was created. This has been widely criticized and generally regarded as a bad move." -- Douglas Adams

            by LithiumCola on Sat Oct 22, 2005 at 07:36:51 AM PDT

            [ Parent ]

            •  Ahhhhh. (none)
              Look, I don't hold a brief for Chris Caldwell (and disagree with Jerome's assertion that he is sane), but you're trying to make a mountain out of a perfectly innocuous little paragraph.

              Caldwell made two statements:

              1. A distinct minority of minimum wage earners are single income heads of households.

              2. Half of minimum wage earners are under 25.

              There's no conflict in the "half" vs. "distinct minority" because one is about age, the other is about family status.

              And there's no issue about two-minimum-wage income households because the implication is that the other wage earner is not a minimum wage earner.

              In fact, since one quarter of minimum wage earners are teenagers they are for the most part, presumabely, still supported by their parents and are earning spending money.

              I don't know if Caldwell's statistics are correct (it wouldn't be a first for him to, like, lie) and he conspicuously does not cite the statistics behind his "distinct minority" description, but none of the logically fallacies you pointed out occur in the material quoted by Jerome.

              George W. Bush -- It's mourning in America.

              by LarryInNYC on Sat Oct 22, 2005 at 08:03:38 AM PDT

              [ Parent ]

              •  lol (none)
                okay.  And thanks for pointing that out.

                If you look at my original post, I was pissed-off by some of Caldwell's points.  And I got carried away.  I appreciate that you (and other people) spotted my mistakes.  

                <shakes head>  I should learn to think more before posting.

                "In the beginning the universe was created. This has been widely criticized and generally regarded as a bad move." -- Douglas Adams

                by LithiumCola on Sat Oct 22, 2005 at 08:55:20 AM PDT

                [ Parent ]

            •  Here are the stats: (4.00)
              "Of those paid by the hour, 520,000 were reported as earning exactly $5.15, the prevailing Federal minimum wage, and another 1.5 million were reported earning wages below the minimum.2

              Together, these 2.0 million workers with wages at or below the minimum made up 2.7 percent of all hourly-paid workers.

              Tables 1 - 10 present data on a wide array of demographic and socioeconomic characteristics for hourly-paid workers earning at or below the Federal minimum wage. The following are some highlights from the 2004 data.

              Minimum wage workers tend to be young. About half of all hourly-paid workers earning $5.15 or less were under age 25, and about one-fourth were age 16-19. Among teenagers, about 9 percent earned $5.15 or less. About 2 percent of workers age 25 and over earned the minimum wage or less. Among those age 65 and over, the proportion was 4 percent. (See table 1 and table 7.)

              About 4 percent of women paid hourly rates reported wages at or below the prevailing Federal minimum, compared with about 2 percent of men. (See table 1.)

              Nearly 3 percent of white hourly-paid workers earned $5.15 or less, compared with about 2 percent for both blacks and Hispanics or Latinos. The figure for Asians was about 1 percent. Among whites and Hispanics or Latinos, women were about twice as likely as men to earn the Federal minimum wage or less. (See table 1.)

              Never-married workers, who tend to be young, were more likely to earn the minimum wage or less than persons who are married. (See table 8.)

              Among hourly-paid workers age 16 and over, about 2 percent of those who had a high school diploma but had not gone on to college earned the minimum or less, compared with about 1 percent for those who had obtained a college degree. (See table 6.)

              Part-time workers (persons who usually work less than 35 hours per week) were much more likely than their full-time counterparts to be paid $5.15 or less (about 7 percent versus 1 percent). (See table 1 and table 9.)

              By occupational group, the proportion of hourly-paid workers whose earnings were reported at or below $5.15 ranged from less than 1 percent for persons employed in management, professional, and related occupations, to about 9 percent for those in service occupations. About three in four workers earning $5.15 or less in 2004 were employed in service occupations, mostly in food service jobs. (See table 4.)

              Among industry groups, the proportion of workers with reported hourly wages at or below $5.15 was highest in leisure and hospitality (about 15 percent). About three-fifths of all workers paid at or below the Federal minimum wage were employed in this industry, primarily in food services and drinking places. For many of these workers, tips supplement the hourly wages received. (See table 5.)

              Among the four broad geographic regions, the West had the lowest proportion of hourly-paid workers with earnings at or below $5.15, at under 2 percent. This compared with about 3 percent for the other regions. In 2004, 24 states and the District of Columbia had a proportion of hourly-paid workers earning at or below the Federal minimum wage that exceeded the national average (2.7 percent); 22 states had a lower proportion. It should be noted that some states have minimum wage laws establishing minimum wage standards that exceed the Federal level of $5.15 per hour. (See table 2 and table 3.)

              The proportion of hourly-paid workers earning the prevailing Federal minimum wage or less has trended downward since 1979, when data first began to be collected on a regular basis. (See table 10.)"

              Bureau Of Labor Statistics

              ...with night falling, and down to his last flair, can Armando keep the coyotes at bay?...

              by PhillyGal on Sat Oct 22, 2005 at 08:06:56 AM PDT

              [ Parent ]

              •  Labor Satistics gets it wrong! (none)
                I used to manage a hotel, so I speak from some experience...we paid our maid staff and wait staff in the bar above minimum wage because we ran (while I worked there) a classy operation that gave a damn about ou employees...but it was with constant struggle against the owners and the franchisers.  

                "Why do you pay maids $6.50 an hour?  They pay 'em per room down the street and it come to about $4.00 an hour, your losing us $2.50 an hour over 45 hours a week times 12 employees ... thats $1300 dollars a week in profit down the drain!"

                This is an aproximate quote of the last conservatoin I had with the part owner on site before I was no longer employable in the hospitality industry.  The pay system he was adcocating is not even legal in Mississippi (and thats saying something, our labor laws are a joke).  It is, however, the system the majority of hotels actually use.  The kind of employee who ends up in housekeeping is not the sort of person who is going to be able to argue against a "piece work" paycheck, who either has the education to realize it is illegal, or the option of finding other work.  These are middle age, mostly black, single parents with (felony) convictions in their records (for drug possession mostly) and no options.  They need to feed their kids and don't want to engage in the illegal "work" that is so readily available in their communities.  They mostly don't have the education to realize they are being offered illegal pay...but they know they are being taken advantage of.  As a result, they do as little work as possible, and steal loose change from the rooms.  This pay schedule is why every hotel room you have ever stayed in is not really clean (don't look under beds or in drawers, you don't want to know ... and _don't ask when the last time that comforter was cleaned was), and you have to take your valuables with you when leave.

                I have sworn upon the alter of God eternal hostility against every form of tyranny over the mind of man

                by TheGryphon on Sat Oct 22, 2005 at 09:09:52 AM PDT

                [ Parent ]

    •  rules-based work (4.00)
      Clerk work has been replaced by computers. After college, while focusing on intellectual pursuits that didn't at the time involve career, I held a variety of clerical jobs which I was much-appreciated at because I could comprehend and apply rules. Then, as the 80s progressed and PCs became widespread, I became the guy to go to if you wanted to use your computer better to ease your rule-based job. From there, I became the guy management would go to for the programming that would avoid their having to hire more staff. And so on.

      I've done quite well replacing clerical positions with computers. Meanwhile, most mid-level executives have been required to learn to prepare their own documents and spreadsheets and do without the clerks with the typewriters and calculators who used to do that work — again, I've both done those jobs and arranged from them to be obsoleted.

      From the standpoint of the clerk who already has the job, using a computer to ease the load is a no-brainer. There was no equivalent of the Luddites in the textile industry fighting techology to preserve clerk-typist and calculator-operator jobs.

      Anyway, there were a whole lot of office jobs that someone who'd paid attention during high school, was willing to work indoors, and could manage simple politeness, could get easily enough a quarter-century back. While those jobs have expanded in some industries — the legions denying insurance claims for a living — overall there are far fewer of them relative to the output of the firms that traditionally hired them.

      •  Absolutely Yes And (none)
        that's how I worked my way into programming at a large university.

        That path--and the destination professional career--are now both gone.

        We are called to speak for the weak, for the voiceless, for victims of our nation and for those it calls enemy....--ML King, "Beyond Vietnam"

        by Gooserock on Sat Oct 22, 2005 at 09:35:22 AM PDT

        [ Parent ]

        •  Absolutely (none)
          it's how I wound up in graphic design/publishing and web design/development. Add in a few computer classes, and you can add database design to that.

          To be totally fair, it's still possible -- just a lot harder, and you'll have to go to college as well.

          But being pleasant and helpful will ALWAYS be a huge asset in getting and KEEPING a job, and in getting ahead.

          It just doesn't pay as well as it used to.

    •  Well, Just for the Record, (none)
      My first programming job was to automate white collar student employee jobs at a university. Those jobs left for good.

      Now that outsourcing has purged me from high tech, I manufacture things for sale and export.

      When my business gets up to speed, I am not going to hire an American employee, nor am I going to outsource to the 3rd world.

      I'm going to add computer control.

      I can't possibly be the only person in this economy with such experience.

      We are called to speak for the weak, for the voiceless, for victims of our nation and for those it calls enemy....--ML King, "Beyond Vietnam"

      by Gooserock on Sat Oct 22, 2005 at 09:34:21 AM PDT

      [ Parent ]

  •  Having read Caldwell all last year (4.00)
    Having read Caldwell and Amity Schlaes all last year in the Financial Times, my conclusion is that neither one are sane.

    Caldwell's argument above presses the conservative economic argument but then explains the political reasons that those who press this argument might be in trouble.

    There is however a risk-based economic argument to be made for not concentrating too much income in the hands of too few people.  It is a parallel argument to the generally accepted on regarding securities diversification.  Diversifying income also increases the diversification of savings.  To the extent that this savings is in time deposits, this stabilizes demand in the economy and reduces other risks, such as massive bankruptcies and defaulted loans.  There are also decreases in some social risks, such as crime, divorce, and healthcare costs.  The healthcare cost argument being the early prevention argument familiar in talking about universal healthcare.

    Caldwell is just dusting off the old conservative argument against the minimum wage and saying, "Sigh, the politics are against us."  That is not sane.  That is not reasoned.  That is a refusal to face the reality that his theory is inadequate.  His vaunted "economic principles" fall short.

    The revolution starts now--in your own back yard, in your own home town

    by TarheelDem on Sat Oct 22, 2005 at 06:42:40 AM PDT

    •  See my comment above (none)
      He is a conservative, and most of the time, not a totally crazy one. Shlaes is far,far away in wingnut territory. Remember her column arguing that Bush had done his job the very week-end when thousands were still stranded at the Superdome. That was grand wingnuttiness.

      In the long run, we're all dead (Keynes)
      Read more on the European Tribune - bringing dKos to Europe

      by Jerome a Paris on Sat Oct 22, 2005 at 06:52:22 AM PDT

      [ Parent ]

      •  Sure makes Buckley look good, doesn't it (none)
        To say that Christopher Caldwell is most of the time not a totally crazy conservative certainly makes William Buckley the very elder look good, doesn't it?

        The revolution starts now--in your own back yard, in your own home town

        by TarheelDem on Sat Oct 22, 2005 at 06:55:35 AM PDT

        [ Parent ]

  •  Caldwell is a pig - Wellstone funeral (4.00)

    "Maoist reeducation camp"

    "With the help of the mob.."

    " We won't pretend to like this politics: With its obsessive focus on sexuality and race issues, its embrace of the anti-Western side in all conflicts, its combination of class privilege and class envy, its political correctness and its authoritarian speech codes, the leftism espoused almost unanimously on university faculties"

    "Wellstone's constituency was academic leftists."

    http://www.weeklystandard.com/Content/Public/Articles/000/000/001/845znhdk.asp?pg=1

    when confronted by Al Franken (pg 187-188), he admitted that he had not scene the funeral.

    Hey, it's the rightwing, - "they no need no stinkn' facts."

  •  I'm no economist, (none)
    but I've spoken a lot to conservatives who are also not economists. Their argument against minimum wage is that it only causes an inflationary increase in prices for consumer goods. They say increasing minimum wage will do no good because prices will rise. Minimum wage earners will end up with the same purchasing power they had before.

    This has always struck me as bullshit, but not being an economist I've never been able to counter it. If this argument is bullshit, could someone please explain to me why? I'd love to have actual facts to throw around next time I'm debating a conservative on this.

    When you have insomnia, you're never really asleep... and you're never really awake.

    by rjo on Sat Oct 22, 2005 at 07:11:00 AM PDT

    •  I'm also not an economist (none)
      but I think the reason would be that their imagining that the increase in inflation would be commensurate with the increase in the minimum wage.  So that for example for every $5000 increase in the wage per year, neccessary purchases will increase in price by about that much.

      I'll try and say this nicely.

      That's bullshit.

      There right to say that increasing the cost of labor for business will cause some increase in prices but because the benifit is concentrated on some and the cost is spread out among the many the cost to any individual is negligible for most increases in the minimum wage.

      Our virtues are usually only our vices in disguise. La Rochefoucauld

      by Parmenides on Sat Oct 22, 2005 at 07:27:32 AM PDT

      [ Parent ]

    •  The countervailing force... (none)

        ...is competition.

        A business can't raise prices if his competitors don't, unless he wants to go out of business.

        That said, I wouldn't mind seeing a tax credit extended to small businesses to make up for higher labor costs. Since higher-paid people use fewer social services, such a tax credit would pay for itself.

       Another angle -- high wages and high prices indicate a high standard of living. Low wages and low prices indicate a low standard of living. The cost of living is a lot lower in Bangladesh than it is in Switzerland. Which country would YOU rather live in if forced to choose?

      Republicans oppose abortion -- it happens eighteen years too early.

      by Buzzer on Sat Oct 22, 2005 at 08:32:57 AM PDT

      [ Parent ]

    •  I am an economist (none)
      and the conservative argument against the minimum wage has more to do with opportunity for the lower classes then inflation.

      Bare with me here.

      The conservative argument against the minimum wage is that it prices the most unskilled, the most unfortunate and the youngest members of society out of the work force.  It in fact accelerates the shift Jerome was talking about away from unskilled workers to skilled workers.

      The argument rests on basic price theory. Any time government sets the price of something above the market price, you end up with a surplus (more unemployed unskilled workers in this case) because the higher price encourages supply and discourages demand.

      And there is empirical data to support this. The jobless rate rises sharply as educational achievement falls (8.2 for high school dropouts vs 2.4 for college grads). The job rate for teens is substantially higher then the rest of the population (15.8 vs 5.1)

      So, the conservative argument is that the minimum wage actually hurts the very people it is designed to try to help by making it harder to get into the work force and gain the job skills needed to move up.

      •  Bull (none)
        There are good people at every level. A good manager will find and keep them.

        The reason HS kids have higher unemployment is because they're in school -- a business has to work around their schedule, and things like sports events, parties, etc. They also tend to have horrid work habits -- they don't call in when they're unable to work, they don't take work seriously, they goof off. Not all of them, to be sure, but a good many do. Ask my husband - he manages a chain restaurant, and he HATES HS kids because they're so unreliable - even in the summer when they DON'T have school.

        However, he LOVES immigrants. As long as they can speak enough English to understand the customers/managers, he'll take them. He's had Haitians, Guatamalans, Russians, etc. They work hard, they show up, they're polite.

  •  very low wages are effectively a subsidy (4.00)
    to inefficient and exploitative businesses.

    the working poor tend to have health, diet and other issues the consequences of which tend to be picked up by state and state-subsidized institutions (such as charities). so employers who pay less than a living wage are effectively outsourcing their social costs to the state.

    In the future, everyone will have a blog, and none of them will be read. My unread blog will be Symmachus

    by gracchus on Sat Oct 22, 2005 at 07:14:23 AM PDT

    •  Yes I Was One for 25 Years (none)
      because the Best Health Care System in the World® misdiagnosed two chronic conditions, one of which could have been immediately cured and the other avoided with trivial attention to the correct steps.

      Because I couldn't maintain the energy level to compete in the private sector, I worked for the state, eventually moving into high tech, but at about half what I could have earned in industry, or less depending on what kind of energy and focus I might have been able to muster.

      Every office I supported at the state institution for years seemed to have one or two staff who were chronically sick or had family who were chronically sick.

      We are called to speak for the weak, for the voiceless, for victims of our nation and for those it calls enemy....--ML King, "Beyond Vietnam"

      by Gooserock on Sat Oct 22, 2005 at 09:44:29 AM PDT

      [ Parent ]

  •  Another gripe (4.00)
    One problem I have with one of the conservative arguments is even if half or some large percentage of minimum wage earners are under 25, what difference does that make?

    Are we to assume that all those under 25 still live at home? No 18 year old can survive on minimum wage. Or they can survive but that existance is so meager and menial as to wonder whether it is living and not literally surviving.

    And I bring up another fallacy. Conservatives argue that people making minimum wage should work to better themselves. Well, how? If you're making so little that you're barely surviving, where does the money come from to better oneself?

    Particularly since college tuition is ballooning and financial aid is shrinking?

    These arguments don't work anymore, I think, for anyone who takes the time to rationally analyze the situation.

    I've been waiting for someone to bring this up. History is filled with rich people who didn't realize how angry people can get. If the rich don't take care of the poor, the poor WILL come and take it away from them once they get pissed enough.

  •  the other fact these idiots always omit (4.00)
    is this -

    if minimum wage is 5.15, and "living wage" (a wage high enough to support oneself) is $10/hour, how do folks making minimum wage survive?

    food stamps, AFDC, WIC, other kinds of "welfare" (there's no federal problem actually called "welfare," it's just a holdover from the Reagan Racist Codeword "welfare queen").

    so what these so-called economists are saying is that, since raising the minimum wage to a livable wage level would cost jobs, it's better for "the economy" to spend tax money on assistance programs.

    but of course they're not saying that, since the other mantra they use is that cutting taxes helps the economy, and the first place they always look to cut is assistance programs.  

    the natural result of their "economics" is that we should let poor people starve.

    "I'm not a member of an organized political party - I'm a Democrat." Will Rogers

    by mississippi scott on Sat Oct 22, 2005 at 07:26:26 AM PDT

    •  Their God... (none)
         ...is "efficiency".

         To rightwingers, "labor" is just another line on the balance sheet, at the same level as "equipment", "maintenance", "utilities" and the like.

         The idea that "labor" is real people with real lives doesn't register with them. If people are paid more than their economic models suggest they should be paid, it's "inefficient", and therefore not acceptable.

        This kind of thinking has always been around. Slavery was extremely efficient -- and the main argument for retaining slavery in America was economic, not racial.

        It is in the issue of wages and salaries, I believe, that the moral bankruptcy of the right wing comes through most clearly. Sub-living wages contribute to misery, health problems, family instability, and early death in many cases -- and the people pimping for the continuation of these conditions are the same ones who laud the "culture of life".

        And as another poster mentioned above, the people who want to hold the line on the minimum wage and keep unemployment at a certain level for the sake of "efficiency" are the same people who want to shred the social safety nets that protect the people mired in unemployment by design. In other words, while they're telling people to pull themselves up by their bootstraps, they're deliberately limiting the supply of jobs that would enable people to do just that, and then condemning those who don't take these nonexistent jobs as welfare leeches who don't deserve benefits. (This kind of stark-raving hypocrisy is the only reason I need to be a Democrat.)

       Efficiency uber alles. No competing virtues. What this writer is doing is reassuring his right-wing fellow travelers that yes, low minimum wages are economically still the "efficient" thing to do, but maybe, just maybe, we might want to consider that certain other things count, too.

       Better than nothing, I suppose...

         

      Republicans oppose abortion -- it happens eighteen years too early.

      by Buzzer on Sat Oct 22, 2005 at 08:26:15 AM PDT

      [ Parent ]

      •  Definitely family instability (none)
        and kids with all kinds of problems, that require all kinds of fed/state care/assistance, including institution or imprisonment.

        How can they say they want 'family values' when they don't value families? When they don't care that kids aren't getting the nourishment they need (physical, social/cultural and spiritual)? When it takes every waking hour that the parent(s) have to just keep a roof over their heads and food in their stomachs, forget about 'quality' time with their kids?

        If they even cared one iota about families, they'd make sure that working a full time job (ANY full time job) paid a LIVING wage, that parents had time to spend with their children, that help was available when it was needed.

        The truth is, they DON'T care about families. They care about THEIR family -- everybody else doesn't matter.

        Until, that is, they commit a crime, take drugs to escape their miserable existance, or get pregnant.

  •  Economic effects of minimum wage? (4.00)
    I always imagined that one of the most important benefits of increases in the minimum wage was the fact that this money would be going to those who would spend it immediately, multiplying every dollar's impact. The Henry Ford line about paying workers enough to buy his cars so they would seems relevant.
  •  How many here have worked at minimum wage? (4.00)
    It's been, oh, 10 or 12 years since I worked for minimum wage, and I was in high school at the time (no doing the math, please!).    I worked at the local library re-shelving books and back issues of magazines, and yes, it was a valuable work experience.  So I can definitely see the argument that a significant fraction of the people working for the minimum wage are not supporting themselves - they are teenagers working to pick up some spending cash, as I was.  A trip to your local McDonald's is an illustration of this point.

    But that doesn't mean, by any stretch of the imagination, that everyone up to age 25 is just working for a little spending cash!  In fact, I'd argue that anybody who is working full time, be they 16 or 26, are working to support themselves.  I'm sure there are exceptions - hello, summer jobs - but if we're speaking in generalities, that one should hold.  And working full time at minimum wage is barely enough to survive on, much less support a family.  40 hours a week times 50 weeks a year (to make the math easier) times $5.15 an hour gives us a little over $10k annually - that's pretty tough to live on, even in rural areas where things are cheaper.  Forget about buying a car, saving to buy a house, paying college tuition, health insurance - that's barely enough for food and a cardboard box with a view.  

    I also doubt that measure takes into account all the many food service employees who work for tips and thus are paid a lower base rate - I've had plenty of friends who earned the minimum $2.13 an hour when their restaurant was empty because it was a rainy night.  I don't have statistics at my fingertips, but I think it's pretty safe to say that there are quite a lot of people who are working to support themselves at minimum wage.

    So I agree with Jerome - why isn't this a huge issue?  Why can't we say outright, and make it a part of national policy, that anyone who works full time should be able to rise above the poverty line?  Even if the economics don't give it a ringing endorsement, why shouldn't we make this part of an old-fashioned social contract:  If you work 40 hours a week, you will be able to support a family.

    I think this is an issue that the Dems should latch on to like a pitbull with rabies.  If you work 40 hours a week, you should be able to support a family.  And that means more than having a little money to spend on cable TV - that means having health insurance so that a slip on the ice or a case of the flu that turns into pneumonia doesn't mean sliding into bankruptcy.  That means having financial aid so that even the lowest-earning among us can send their children to college to join the ranks of the middle class.  And it means having enough income to save up a little for a mortgage to own your home.

    A new social contract like this will inevitably be tarred with cries of 'liberal' and maybe even 'socialist' from the rightwing.  But can't we learn at last that it is the right thing to do, and not worry about being called names?

    O, it is excellent to have a giant's strength:  but it is tyrannous to use it like a giant.  --Measure for Measure, II.2

  •  The poor are just middlemen (4.00)
    I would benture every cent of a wage increase goes back into the economy. Minumum wage earners do not have the ability to save, but they do have the ability to spend. Spending is what our economy is built on. Capitalism 101.

    Increasing the minimum wage is the same as a taxcut, the republicans like to crow about. The only problem, in their minds, is it is going to the wrong people. They can't see it is going to them, too. The poor are just middlemen.

    Clintonomics showed giving the lower end more money, gives everybody more money in the long run, and makes for a more peaceful society at the same time. (crime, abortion rates dropped, less social services are necessary)

    I am a true believer in the "Christian" teaching of helping the poor because I truly believe it is in my own best interest. The less poor there are, the more people have a vested interest in the world I (they)live in. We are in it "together". It is more likely, that world will continue.

    Mythology is what we call other people's religion-Joseph Campbell

    by Sherri in TX on Sat Oct 22, 2005 at 07:54:54 AM PDT

  •  I was thinking along these lines (none)
    yesterday, albeit not in such an informed and eloquent manner.

    The more people you get into the middle class, the more buy-in you have to the existing system.

    The only reason to keep large segments of the population excluded from reaching the middle class is greed, cruelty, and in many cases, prejudice.

  •  I've suspected for decades, and now I believe (4.00)
    that ALL our arguements for community investment should be made on the basis of selfish self interest and greed.

    there is some optimal amount of investment required for transportation, health care, education ...

    in order to have a market of hundreds of millions, which provides employment opportunity for millions and millions (how about all 6 billion on our globe?)

    we don't know what the optimal amount to invest is for each community investment, nor for all community investments, AND

    our side ain't gonna be able to make the case until more people on our side get rid of their I-am-holier-than-dirty-money condescending attitudes, AND

    learn to use math, spreadsheets, computer modelling,

    so we can make the arguements in a manner which everyone understands - what is in it for me?

    appealing to the noble side of humanity ?? ... what a waste of time

    rmm.

    Grassroots Organizing Should Be for The Community, By The Community - NOT for "Leaders" http://www.liemail.com/BambooGrassroots.html

    by rmdSeaBos on Sat Oct 22, 2005 at 08:13:20 AM PDT

    •  disagree (none)
      the notion that people should be able to get make a living when they work hard is pretty central to american notions of fair play.  I don't think I would call that altruism, exactly, but its part of the american self-justification.

      also, if self interest were the best way to sell social policy, why would the greedy conservatives take such great pains to conceal their true motivations?  YOu don't hear these folks saying -- don't raise the minimum wage because that will mean less for me.  They say, it will have costs for all of us.

      Talk doesn't cook rice.

      by sophiebrown on Sat Oct 22, 2005 at 08:57:26 AM PDT

      [ Parent ]

      •  a living wage for all is good self interest for (none)
        all.

        that is everyone buying clothes, and paint for the kid's room, and new tires or a new bus pass, and going out to eat 1 or twice a week or month at the burger joint or the yuppie joint, and using the park therefore supporting the park department, and using the library therefore supporting the library,

        and travelling to see friends and family somewhere else and using their parks and roads and hospital if I need it, so we gotta have parks and roads and hospitals where I live when my friends and family come visit me,

        and people doing all of the above ain't robbing and stealing and beating each other up.

        people are selfish, and selfishness, like guns or booze or opiates, can be used for good and for bad.

        I think we got a better shot at changing the reward system than changing human nature.  

        finally, the conservative messages are based on greed - you are getting screwed paying taxes, you ain't getting roads or education

        AND, they have to lie cuz they are screwing everyone.

        rmm.

        Grassroots Organizing Should Be for The Community, By The Community - NOT for "Leaders" http://www.liemail.com/BambooGrassroots.html

        by rmdSeaBos on Sat Oct 22, 2005 at 10:48:48 AM PDT

        [ Parent ]

  •  LOL (none)
    "Sane" and "Conservative" in the same sentence... Now I've seen it all.

    IMHO there are plenty of reasons to up the minimum wage without using so called conservative's opinions...

    Good diary, though...

    •  I tend to see (none)
      "sane conservatives" as an oxymoron like "military intelligence".

      The last time we mixed religion and politics people got burned at the stake.

      by irishwitch on Sat Oct 22, 2005 at 10:21:10 AM PDT

      [ Parent ]

      •  LOL, let's be fair (none)
        The military is only as intelligent as the executive branch allows them to be;)

        "Sane" and "conservative" are basically antonyms.

        •  Well, true. (none)
          The troops only do what theya re ordered (and in this war, the PEntagon was much smarter than Bush and he owuldn't lsiten--they KNEW all hell would be break about 6 months after we "conquered" Iraq). Glad  my husband retired from the Navy BEOFRE the invasion.

          The last time we mixed religion and politics people got burned at the stake.

          by irishwitch on Sat Oct 22, 2005 at 11:36:27 AM PDT

          [ Parent ]

          •  That's good (none)
            I'm glad for both of you...

            I'm always thrilled to see those occasional military reports that take little shots at Bush... Like the report that showed terrorist attacks tripled around the world during the year after his illegal war started...

            •  He beelived getting rid of Saddam (none)
              was a good idea (he saw his handiwork in Kurdistan up close) but that the invasion was wrong, and that evenn if you OCULD jsutify the war,t he lakc of planning would turn it into a disaster.

              Rummy's theoeries on how to fight a war, were an utter failure.  The pro warriors KNEW they were,a nd tried to tell him, but he refused to listen to the pros.

              I'm not gung-ho an all-volunteer force,a ctually--a draft withotu exceptions for college would spread the paina round,a nd a lto of peopel would wake up. Problem is, with the high-tech warfarewe have today, except for grutns, it's not cost-effective to trains oemoen who'll only ne in for 2 years.  The training costs a mint.

              The last time we mixed religion and politics people got burned at the stake.

              by irishwitch on Sat Oct 22, 2005 at 02:49:17 PM PDT

              [ Parent ]

              •  I happen to agree (none)
                But not in a draft situation. I think in a country as "advanced" as the US, we should have a short required service of some sort - military for some, humanitarian or social for others, and in turn everyone gets a free college education... I think if everyone was required to serve it would cause alot more hell when a president dreams up reasons to go to war...

                Rumsfeld is an incompetent fool. None of his hairbrained ideas have ever worked. Not 30 years ago, and sure as hell not now...

                •  That's actually what I mean by a draft (none)
                  --some sort of compulsory service. Either community or otherwise, dependign on skills and abiltiies and physical health.

                  But it STILL wouldn't solve the problem of a high tech military. One reason msot enlsitments run 4-6 years is so they can work off the amount spent in trianing.

                  Unelss you are just talking grunts--ie. cannon fodder. In which case thsoe fulfilling mandatory service would end up having the highest death rate.

                  The last time we mixed religion and politics people got burned at the stake.

                  by irishwitch on Sat Oct 22, 2005 at 08:23:42 PM PDT

                  [ Parent ]

  •  It's as simple as this: (4.00)
    More workers earning better wages is the way to grow the economy. Less workers earning less money make less purchases, and thus the economy shrinks.

    The Greedy Oligarchal Plutocrats don't get it.When the majority of Americans are unemployed or struggling along at poverty wages, who's going to buy all those Chinese-made $100 Nike sneakers? The Chinese who make twenty cents an hour?

    Henry Ford knew that if you pay your employees enough to buy your product, you'll sell more of your product. Today's businessmen think that you can impoverish everyone, take all the money for yourself, and still somehow have a robust economy.

    Who put these idiots in charge? How can we depose them before it's too late?

    Al Qeada is a faith-based initiative.

    by drewfromct on Sat Oct 22, 2005 at 08:25:24 AM PDT

  •  Basic fairness issue (4.00)

    Jerome is dead on about the basic fairness issue and the democrats should be pushing it. If you get up and go to work, you should earn enough to feed and clothe your family, heat the house, and get to work. The minimum wage should be indexed to cover the basics.


    Conservatives, especially the current herd, are always on about the need to reward hard work when it comes to justifing what they want to do. Here is a chance to show that they want to reward hard work. Not earning enough, for 40+ hours per week, to pay your basic living expenses is not a reward. Not having any hope of ever getting ahead is not really that motivating.


    An empty limosine pulled up and George W. Bush got out.

    by beerm on Sat Oct 22, 2005 at 08:30:43 AM PDT

    •  Of course... (none)
      ...the conservatives are lying when they claim that they want to reward work.  After all, if that is your goal, why should income earned from sitting on your ass (investment income) be taxed at a lower rate than income earned from actual labor?

      Political Compass: -6.75, -3.08

      by TexasTom on Sat Oct 22, 2005 at 08:48:33 AM PDT

      [ Parent ]

  •  Supply vs Demand (none)
    The traditional economic argument against the minimum wage-as I'm sure you know-is that a price floor will create unemployment.  What about jobs that are just barely profitable for the employer at the current minimum wage?  Wouldn't they be wiped out if it were raised?  

    I'm inclined to wonder if the problem with sticky wages(especially at the lower end) isn't in part a problem of supply and demand?  With the high level of immigration, doesn't that flood the low end of the workforce?  

    I generally accept the idea of comparative advantage, which would say that it makes sense to let manufacturing jobs go overseas.  Without some harsh protectionism it's basically inevitable that this will happen.  We can let these jobs leave and there's still more than enough money in this country to smooth things out for the folks that lose their jobs.  I wonder if, instead of tampering with the labor market, it would be better to do things like institute single payer healthcare, build a real infrastructure, and fix residential zoning laws so that the housing supply isn't artificially restricted and thus so expensive?  The costs of health care, transportation, and housing seem to be the major problem.  Raising the min. wage to deal with this almost seems like we're subsidizing these runaway costs instead of dealing with them.  

    <shrug> This is a very simplistic view and it might be very flawed but I'd appreciate your thoughts if you can respond, Jerome.

    I'm so metal I have the unlisted Number of the Beast.

    by MjrMjr on Sat Oct 22, 2005 at 08:56:02 AM PDT

  •  Do Dem Leaders Have Practical Incentives (none)
    to campaign on economic fairness?

    I'm not asking in terms of philosophy, I'm asking in terms of hard realities : do our leaders feel that their fortunes will rise if they take on the cause of a more fair economy?

    Obviously the tradeoffs are the plus of some potential more votes, and the minus of a loss of corporate and media support.

    We are called to speak for the weak, for the voiceless, for victims of our nation and for those it calls enemy....--ML King, "Beyond Vietnam"

    by Gooserock on Sat Oct 22, 2005 at 10:00:54 AM PDT

  •  At the end of the day (none)
    there are better ways to help the underclass then to raise the minimum wage and price some of the more unskilled members of that underclass out of the job market.

    What these people are lacking is a livable INCOME. Why screw up small businesses and reduce entry workers chance of a job when all they need is more money.

    What we as a country need is an incomes policy that cuts out the middle man and just gives people a minimum 'livable' income once you reach a certain age, probably 21. To keep bureaucratic overhead down, you could have the IRS manage it and call it a reverse income tax.

    •  Nothing ever happens in a vacuum. (4.00)

      I operated a small business (restaurant) and found when I paid higher wages, which I did ($7.00, when the wage was $5.15) I had very little employee turnover, great employee loyalty, and little theft.

      The guy who thought he was paying less, was really paying more than me. He just wasn't seeing the connection.

      Mythology is what we call other people's religion-Joseph Campbell

      by Sherri in TX on Sat Oct 22, 2005 at 10:47:05 AM PDT

      [ Parent ]

  •  My economist friend (none)
    always says this:  

    There is no  economic justification for a federally mandated minimum wage. It simply does not make sense in the context of pure economic theory.

    But, he adds, there is no pure economic theory either. Economics are fundamentally and inextricably colored by moral and political judgments. Those judgments, in the end, trump everything.

    In my view, arguments against a minimum wage come wrapped in moral and political judgments that place a higher value on greed and selfishness than on the common good.

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