The least we can do

A state panel is recommending a hike in the minimum wage and an indexing scheme that would tie it to the cost of living index — a move designed to prevent the kind of neglect that allowed the minimum wage to fall so far behind inflation in the first place.

The state panel found the $7.15 per hour level is no longer adequate to maintain the same purchasing power as when it was implemented in October 2006.

“New Jersey’s minimum-wage workers are struggling to make ends meet,” said Labor Commissioner David J. Socolow, the chairman of the Minimum Wage Advisory Commission. “Without an immediate increase in the minimum wage and annual cost-of-living increases every year these workers fall even further behind.”

At $7.15 per hour, a minimum wage worker earns about $2,000 less than the federal poverty level of $17,160 per year; an $8.25 per hour wage would bring that worker even with the poverty level.

If it adopted automatic inflation increases to the minimum wage, New Jersey would be the 11th state to do so. Arizona, Colorado, Florida, Missouri, Montana, Nevada, Ohio, Oregon, Vermont and Washington already have such a policy.

“Minimum-wage workers in New Jersey need a raise and a real opportunity to lift themselves out of poverty through their hard work,” Socolow said.

Even with the proposed increase, as the story points out, a minimum-wage worker would remain in poverty, which means that any increase in the cost of living that is not offset by an equivalent increase in the minimum wage is a step back deeper into poverty. And this does not take into account that many people — me included — believe that the poverty level has been set at an artificially low level.

So, the least we can do is index the wage so that workers aren’t falling behind (or quite so far behind).

The business community disagrees, saying the wage is an expense most small businesses cannot afford.

“Small businesses that rely on entry-level minimum-wage employment simply cannot afford this increase in a single step,” said Philip Kirschner, president of the
New Jersey Business & Industry Association. “As these businesses struggle to try to cope with other rising costs such as energy and transportation, they simply can’t afford a 55 percent increase in wages over three years.”

The Record has an answer to this:

The state should not price businesses out of New Jersey. But it cannot allow documented workers to be reduced to poverty. And rather than continue the minimum-wage debate year after year, tying the cost of inflation into a new minimum-wage law would remove the politics from what should be an issue of justice.

Many of us do no see our salaries rise at the rate of inflation. But most of us are not living below the poverty level. People who toil full time at low-wage jobs are not looking for government handouts. They are just trying to earn a living. Raising the minimum wage is the right thing to do.

South Brunswick Post, The Cranbury Press
The Blog of South Brunswick

E-mail me by clicking here.

Email me at grassroots at comcast dot net.

The Christmas spirit

I wanted to pass along a couple of song lyrics that sum up the season for me, a Jewish pacifist:

“Someday at Christmas,” recorded by Stevie Wonder and Remy Zero

someday at christmas men won’t be boys
playing with bombs like kids play with toys
one warm december our hearts will see
a world where men are free
someday at christmas there’ll be no wars
when we have learned what christmas is for
when we have found what life’s really worth
there’ll be peace on earth
someday all our dreams will come to be
someday in a world where men are free
maybe not in time for you and me
but someday at christmastime
someday at christmas we’ll see a man
no hungry children, no empty hand
one happy morning people will share
our world where people care
someday at christmas there’ll be no tears
all men are equal and no men have fears
one shining moment my heart ran away
from our world today
someday all our dreams will come to be
someday in a world where men are free
maybe not in time for you and me
but someday at christmastime
someday at christmas man will not fail
take hope because your love will prevail
someday a new world that we can start
with hope in every heart
someday all our dreams will come to be
someday in a world where men are free
maybe not in time for you and me
but someday at christmastime
someday at christmastime

“The Rebel Jesus,” by Jackson Browne

All the streets are filled with laughter and light
And the music of the season
And the merchants windows are all bright
With the faces of the children
And the families hurrying to their homes
As the sky darkens and freezes
Theyll be gathering around the hearths and tales
Giving thanks for all gods graces
And the birth of the rebel jesus
Well they call him by the prince of peace
And they call him by the savior
And they pray to him upon the seas
And in every bold endeavor
As they fill his churches with their pride and gold
And their faith in him increases
But they’ve turned the nature that I worshipped in
From a temple to a robbers den
In the words of the rebel jesus
We guard our world with locks and guns
And we guard our fine possessions
And once a year when christmas comes
We give to our relations
And perhaps we give a little to the poor
If the generosity should seize us
But if any one of us should interfere
In the business of why they are poor
They get the same as the rebel jesus
But please forgive me if I seem
To take the tone of judgement
For I’ve no wish to come between
This day and your enjoyment
In this life of hardship and of earthly toil
We have need for anything that frees us
So I bid you pleasure
And I bid you cheer
From a heathen and a pagan
On the side of the rebel jesus.

South Brunswick Post, The Cranbury Press
The Blog of South Brunswick

E-mail me by clicking here.

Email me at grassroots at comcast dot net.

Debating health care

Paul Krugman has been correct about the recent rightward drift of the Obama campaign, especially on health care, as the Illinois senator attempts to separate himself from Hillary Clinton and John Edwards and potentially draw in some independents. And Krugman is right that health care is probably the most important domestic issue of this campaign.

But, as this post from Scarecrow on FireDogLake demonstrates, the Clinton and Edwards plans are only partial fixes, better than Obama’s incomplete plan and everything that has been offered by the GOP.

A key point is that “mandates” require penalties, and you need economic experts to design a “good” penalty system that will lead companies (or individuals) to make rational decisions that are consistent with the result you want to achieve, without adding significantly to the total cost.

Individuals also face these kinds of choices. If they confront a “mandate,” the rational thing to do is to consider the “penalty” for non-compliance versus the cost and benefits of complying. In Massachusetts, the Legislature was leery of imposing tough penalties on the uninsured, so the first year penalties are quite small — only a fraction of what it would cost to purchase insurance on your own. Result: many people are deciding, quite rationally, not to purchase insurance.

Finally, there’s the state subsidized pool. The rational thing for employers and individuals to do is to avoid providing/paying for insurance on their own, pay the small penalty, and move those who choose this route to rely on the subsidized insurance pool. Perfectly rational; perfectly predictable; and that’s what’s happening.
Because of the incentives, thousands of people are winding up in the state subsidized pool, and the Legislature is looking at $150 million or more in unanticipated costs. And that apparently has been the pattern in other states that have tried “mandate” approaches to universal coverage, but gave up because they weren’t willing to raise taxes to cover the rising costs of state subsidies. You need a broad tax base for that, and progressive taxation.

And that’s OK, as far as it goes. But penalties and taxes — especially when taken together — leave the insurance companies in place. Despite what Krugman says about there being a public option, mandate-based programs still rely on insurance companies to cover the bulk of Americans — while also creating a potential situation in which the poorest people are forced into the public portion of the program. That could raise the cost of a public program artificially, making a move to a full public system difficult down the road.

And make no mistake, if we are to ensure that all Americans have adequte insurance — and the issue isn’t just about the 47 million without coverage, but also about the millions who are underinsured — then we need to move to a single-payer system.

Unfortunately, only Dennis Kucinich among the presidential hopefuls is talking about this. And he isn’t being taken seriously by the news media, meaning that single-payer has been removed from the table.

South Brunswick Post, The Cranbury Press
The Blog of South Brunswick

E-mail me by clicking here.

Email me at grassroots at comcast dot net.