A dozen years of Republican Congressional rule and all we have is a deteriorating middle class — but I guess that wasn’t too much of a price to pay for the return of “values” to the public sphere.
The key to understanding the damage wrought by the GOP’s not-so-benign neglect is the federal minimum wage. As Derrick Z. Jackson writes today in a column in The Boston Globe, the “minimum wage has become one of the most appalling symbols of the exploding gap between rich and working poor in this nation.”
Workers earning the federal minimum of $5.15 an hour gross just $026 a week and $10,712 a year — not enough to cover housing around these parts, let alone food, clothing, transportation, child care, health care, or anything else. Here is what I wrote about the issue in 2005, after the show “30 Days” aired a segment on living on the minimum wage. (The show’s creator, Morgan Spurlock, and his fiance, Alexandra Jamieson, spent a month working minimum wage jobs and trying to survive in Columbus, Ohio.)
Several scenes stand out: There was the embarrassment of having to put groceries back because the food budget just won’t allow for the purchase of an extra bottle of water. And there was the difficulty in finding an apartment while clearing a little more than $350 a week between them. The best they could do was an apartment in one of the more dangerous neighborhoods in Columbus — a situation in which far too many at the bottom of the income ladder find themselves.
New Jersey attempted to rectify this problem with a phased-in hike to $7.15 that will fully kick in in 2007. And the new Democratic majority is promising a federal hike — phased in over two years — to $7.25.
It is a start — the least we could do, really — but not nearly enough to address growing inequalities we have come to view as all too normal.
Consider: A wage hike to $7.25 will boost weekly income to just $290, or about $1,200 a month — not much when you consider that housing in Middlesex County (according to a 2005 report) costs between $1,100 and $1,500 month.
The argument against raising the minimum — that it would destroy small businesses — has always had a hollow ring, as a new study shows. From Derrick Jackson’s column:
A new briefing paper released this week by the Economic Policy Institute, a liberal think tank, studied the 17 states and the District of Columbia that had raised the minimum wage between 1997 and 2005. It found that the states that increased the minimum wage actually experienced — for the most part — higher wages “without reducing employment or discouraging labor supply.” The median minimum wage of those states is $1.40 over the federal wage.
“Overall,” the report said, “it is safe to conclude that statistically reliable evidence for any employment losses in the data is nonexistent.” This included restaurants and bars, where owners and lobbyists have long cried they would be devastated if they were forced to pay higher wages. The report quoted a study of New Jersey’s fast-food industry that concluded, “The increase in New Jersey’s minimum wage probably had no effect on total employment . . . and possibly had a small positive effect.”
A study earlier this year by the Fiscal Policy Institute of New York found better economic performance in the 10 states with higher minimum wages than the others.
So the Democrats deserve some credit for promising a wage hike, but the reality is that it is — as Jackson says — a day late and more than a dollar short:
The current value of the minimum wage is the lowest since the $4.74 of 1955, when adjusted for inflation. The proposed raise to $7.25 still does not equal the inflation-adjusted value of the minimum wage in 1968, $7.71. The minimum wage is currently only 31 percent of the average hourly wage for nonsupervisory workers. That equals the widest gap since 1949. For the 1950s and ’60s, the wage floated between 44 percent and 56 percent of the average hourly wage.
According to other liberal think tanks, such as the Institute for Policy Studies and United for a Fair Economy, the minimum wage would now be $23 if it had risen at the same pace as CEO pay since 1990.
Another thing to consider is this (also noted by Jackson): It would take a wage of $8 an hour just to get a worker to the federal poverty line for a single-parent family of three — and this does not take into account that many who study the issue believe that the poverty line is actually a lot higher than the figure set by the government.
Increasing the minimum to $7.25 is perhaps the least we could do. But it is more than has been done in years.
South Brunswick Post, The Cranbury Press
The Blog of South Brunswick
Hank Kalet 