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- iHaveNet.com: Economy
by Robert B. Reich
Raising the minimum wage from $7.25 to $9 should be a no-brainer.
Republicans say it will cause employers to shed jobs, but that's baloney. Employers won't outsource the jobs abroad or substitute machines for them because jobs at this low level of pay are all in the local personal-service sector (retail, restaurant, hotel and so on), where employers pass on small wage hikes to customers as pennies more on their bills.
States that have set their minimum wage closer to $9 than the current federal minimum don't have higher rates of unemployment than do states still at the federal minimum.
This doesn't mean we could raise the minimum to $15 or $20 without having a negative effect on jobs. It just means we can raise it modestly.
We raised the minimum wage in 1996, when I was secretary of labor. Republicans claimed it would kill jobs then, too. It didn't. In fact, job growth accelerated.
A mere $9 an hour translates into about $18,000 a year. That's still under the poverty line. Most workers at the minimum wage aren't school kids. They're breadwinners for their families, desperately trying to make ends meet.
When you add in the Earned Income Tax Credit and food stamps, it's barely possible for someone receiving a $9 minimum wage to rise above poverty. But even the poverty line of about $23,000 understates the true cost of living in most areas of the country.
Besides, the proposed increase would put more money into the hands of families that desperately need it, allowing them to buy a bit more and thereby keep others working.
A decent society should do no less.
Some conservatives say "decency" has nothing to do with it. Who has the right to decide what's decent? They say we should let the "market" decide what people are paid.
This is one of the oldest conservative canards in existence, based on the false claim that there's something called a "market" that exists separate from society. But there's no "market" in a state of nature, just survival of the fittest.
A society necessarily determines how the "market" is to be organized. Standards of morality and decency play a large role in those decisions.
We set minimum standards for worker safety and consumer protection. Those standards may raise the cost of labor or of the goods and services we buy. But that's a price we're willing to pay.
We decide young children shouldn't be in the labor force. Imagine how cheaply we could get our roofs shingled if 10-year-olds would do it for a couple of bucks an hour. (Maybe we'd have to throw in an ice cream cone.) But we don't allow this, either.
We do our best to prevent lots of things from being bought and sold -- slaves, dangerous narcotics, babies, votes, sex with children, machine guns and nuclear material. Why not just leave it up to the "market"? Because most of us don't want a market that includes these sorts of transactions.
We decide that citizens shouldn't have to buy certain things that should instead be available to everyone free of charge (paid in effect by all of us through our taxes) -- clean drinking water, K-12 schools, safe bridges, protection from violence, public parks. Why not leave all these up to the "market" and require everyone pay for them individually? That's not the kind of society we want to live in.
Opinions may differ about what decency requires, of course. But we hash this out in our democracy. Sometimes we decide certain proposed minimum standards are too costly or inefficient, or they can't be enforced, or they impose unwarranted constraints on our freedoms.
Different societies come up with different answers. Handguns are banned in most other advanced nations, for example. Workers have more protections than they do in the United States. Minimum wages are higher. Taxes on the wealthy are higher. Health care is more universally available.
Every society must necessarily decide for itself what decency requires. That's the very meaning of a "society."
Don't fall for the mindless assertion that "markets" know best. Markets are human creations, requiring human beings to decide how they are structured and maintained.
The toughest questions we're facing today -- whether, and how much, to raise the minimum wage; whether, and how, to restrict the availability of guns; whether, and how, to expand health care coverage -- inevitably require us to define what we mean by a decent society.
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The Minimum Wage and The Meaning of a Decent Society | Economy