I think a good way to find out whether someone thinks more
as a liberal or as a conservative it to ask him or her how they feel about
minimum wage laws.
In general, a liberal will side with the worker saying that
minimum wage laws are necessary to prevent lower skilled people from having to
work for starvation wages.
On the other hand, conservatives will generally side with the employer
by saying that the free market should decide wages and that the government
should stay out of deciding how much people are paid for their work. In
addition, there is the argument that is repeatedly made that if the minimum
wage were to be increased, companies would hire fewer workers which would raise
unemployment.
Readers of my blog
know that I am decidedly liberal. I
think much of the reason for this comes from being raised in a household where
my dad made a modest living supporting us by laboring on his hands and knees
all day long as a unionized cement mason.
So it shouldn’t be surprising that I root for the interests of the
working stiff over the interests of big business.
Several weeks ago, liberal commentator (and former LBJ Press
Secretary) Bill Moyers was on Charlie Rose promoting his upcoming
PBS Frontline documentary about how a pair of middle class families (one black and
one white) he followed fared over a 20 year span. Needless to say, I watched it and as a
bleeding heart liberal, was deeply touched by what became their endless struggles on the
edge of poverty that took an enormous toll on their lives. It’s easy for some to say that people like
these are where they are because they are lazy.
But these were hard working full-time workers in economically struggling
Milwaukee who through an endless series of layoffs were bounced from one low
paying job to another. In essence, they were trapped into an impoverished
lifestyle with no way out despite their best efforts. For those who haven’t seen this 90 minute Frontline documentary and are
interested, it is available online in its entirety through this link. I defy even the most hard-edged conservative
to watch this without feeling some sadness and compassion for these people.
When Moyers was asked by Charlie Rose
what needs to be done, his response was that we need to raise the minimum
wage. But the battle to raise the
minimum wage by perhaps a dollar or two per hour doesn’t really address the
problems of full-time workers who at best are on the edge of poverty and at
worst are homeless. The only way to
address this is to fight for a living wage for these people – more on that
later.
Before returning to the living wage discussion, I want to
address a couple of points made by those on the conservative side of the
argument over minimum wage laws.
First, it is reasonable to say that workers and employers
should be able to negotiate a suitable wage that satisfies both sides without
the government intruding. But in an
economic environment where too many workers are chasing too few job openings
along with the systematic destruction of unions over the last several decades,
the worker is in a fight where he just doesn’t have a fair chance. And with a steady trend of overall corporate
profits improving while (or more accurately because) workers’ wages are
flat or falling over the same period, the workers are clearly getting the worst
of the deal.
Secondly, there is the argument that if the minimum wage were
to be raised, workers would be laid off and thus making unemployment worse. But as the many workers who are now doing the
work that two or more other workers used to do can tell you – employers in
general are already hiring the least number of employees they can get
away with. And with the millions of
dollars in lobbying money that business groups spend to fight any minimum wage
increases, do you think they are really concerned with the possible
consequences to workers instead of just trying to maximize their bottom lines
by keeping wages as low as possible? I
didn’t think so!
The concept of a so-called living wage means that somebody
who works at least a 40 hour week should be able to afford modest housing and have
enough money left over to avoid living at or near poverty.
As unfamiliar as this may be to some, the US already has de
facto living wage laws in the form of government safety net programs such
as Food Stamps, the Earned Income Tax Credit
and Medicaid among others to try and keep the lowest wage
full-time workers out of poverty. But
critics have (rightly, in my view) charged that government programs such as
these are little more than corporate welfare that subsidizes their miserly
stinginess towards workers at the bottom of the economic food chain. At least there are publicly funded projects
that require the bidding contractors to pay a living wage as a part of doing
business in this sector – and that’s a good start!
While many have advocated the concept of a living wage, an
organization called Universal Living Wage through its website universallivingwage.org
fleshes out the concept in detail along with addressing some of the facts and
myths about how a living wage program would work. As part of my research on the subject for
this posting, I had the pleasure of briefly corresponding with the
organization’s National Chairman, Richard Troxell who at one time was himself a
homeless Vietnam Veteran and now fights for living wage laws and against
homelessness.
I hope the reader
will visit this interesting site to learn more.
But two important points should be mentioned here. One is that Mr. Troxell does not believe in a
one size fits all wage. He believes in
tying the living wage to the local costs of basic housing so that its cost is
limited to 30% of a worker’s gross income to allow enough money for other
necessities (along with perhaps a few small pleasures) of life. And while the
living wage is based on a 40 hour work week, those who work less than a 40 hour
week also need to be paid the same hourly rate as those who work full time to
keep employers from gaming the system by making more and more people into part-time
workers – something many employers already do to avoid paying benefits.
I don’t harbor any false illusions here. As much as I believe in the need for a living
wage, there has always been tremendous resistance being waged by the corporate
world. Most notable is the battle between
Wal-Mart who wants to start up at least 3 stores in Washington D.C. and the
local government who wants to require Wal-Mart (and other similar sized
businesses) to pay a living wage to its employees there. Wal-Mart says they will not build the stores
if forced to pay a wage rate not of their choosing and that jobs would be lost
– a claim that some find to be debatable. More importantly, when a giant employer like Wal-Mart is
allowed to relentlessly drive down wages and benefits, its competitors will
likely feel that they have no choice but to follow suit.
But the award for corporate chutzpah goes to McDonald’s
who in a campaign aimed towards its workers, tries to convince them that it is
possible to work a minimum wage McJob and still live comfortably – if only they would budget their money
properly! They
support this by a sample budget that apparently assumes a worker has a second
job along with Food Stamps to pay for food and almost no expense for health
insurance. Unbelievable!
You would think that the anti-government Tea Party types in
Congress would want to eliminate much of the need for these government programs
by making corporations pay their full share of a living wage. But perversely, many of those same people are
instead fighting to cut Food Stamps.
But perhaps there is a little light at the end of the
tunnel. Long ago, there was the
well-known story of Henry Ford who gave his assembly line workers a large
raise, supposedly so they could afford to buy the cars they helped to make. While this may have some truth to it, there is another account
that says that the real motivation
behind Ford’s apparent generosity grew from the frustration he was having with
his high employee turnover rate and resulting cost of constantly retraining
replacement workers. Once he decided to
pay a living wage to his workers, he was rewarded with loyalty to the company
by the workers along with a far lower turnover rate. Henry still got filthy rich, but his workers
also enjoyed a better standard of living.
It doesn’t have to be one or the other!
A modern day example is Costco, a warehouse club competitor
to Sam’s Club. While Sam’s Club adopts
the Wal-Mart philosophy that has been derided as “Always Low Wages”, Costco
despite competing in a business that requires deep discounting does just fine while paying its employees a living wage.
So instead of having to pass a law that forces companies
to pay a living wage, perhaps a simple attitude adjustment by the business
community would work just as well.
One that instead of “work for us – we’ll pay you the very least we
can get away with but you have no choice” to “work for us – we will
reward your loyalty and hard work by paying you a living wage”.
And best of all,
workers who are paid a living wage will then have more money to spend which will
help to grow our economy instead of forcing companies like McDonald’s to apologize for their weak earnings because of a chronically weak
economy. Paying a living wage is a
win-win for everybody!
