By Dick Miller
WE.CONNECT.DOTS: At last! A political concept that can be embraced by Democrats and Tea Baggers alike.
Talking here about redefining the term “minimum wage” in a manner that could prevent our economy from sinking into another Great Recession, or worse.
“Minimum wage” from this day forth should mean that level of income that makes the worker ineligible for benefits such as food stamps, Medicaid, lower-interest mortgages and the like.
This is how the concept would work.
First, the establishment of a minimum wage should exclusively revert to the states to establish. This might require some initial action by Congress and the President, but hereafter each state would be required to set its own minimum wage to reflect the economics and political philosophy of that region. To keep everyone honest, Congress might continue to establish a floor such as it does now.
The new state-mandated minimum wage — for adults only — would reflect what a worker earns to be ineligible for subsidies and benefits. Corporate executives and shareholders can no longer take advantage of government benefits to low-income people to amass their wealth.
Most people believe these government programs suck up our taxes and only benefit individuals too lazy to get higher-pay jobs. These benefits from our taxes are intended to help establish a minimum standard of living for millions of people, ergo they are the only beneficiaries.
But what about the mega corporations? They make billions because these benefits enable them to pay their employees less. Think McDonalds and Walmart for example.
As much as some Republicans want to do away or at least reduce these benefits, Corporate America picks the pockets of taxpayers to keep their operating costs lower.
Most people don’t realize that benefits paid by taxpayers to these poor people are a license for Corps to pay sub-standard wages. Why else would McDonalds and Walmart “coach” their employees on how to apply for these benefits? Much cheaper than paying higher wages.
Can Corporate America pay higher wages?
The US minimum wage is $7.25 per hour while in Australia the rate is $15.96. Guess what? Mickey D has stores in Australia and the cost for hamburgers is not too much higher than here. Australia’s Fair Work Commission recently approved a new labor agreement between McDonald’s and its employees that will take wages to over $17 per hour by 2017.
Worldwide, academic estimates suggest that labor accounts for about 45 per cent of the cost of selling hamburgers at McDonalds. In the US this cost drops to less than a third of all expenses at the average franchise.
Why does the new minimum wage need to be a state’s right issue?
Affordable housing is an example of the variance. The National Low Income Housing Coalition, using 2013 data, reports on wages necessary to afford a two-bedroom unit without paying more than 30% of a household income. The full-time hourly wage needed in California is $25.78, but in Alabama it is only $13.34.
The new minimum wage need only apply to adults. Those under 18 would continue to be paid less because they are unlikely heads of household. Would McDonald’s stores not open weekdays until 3:30 p.m. to avoid hiring adults?
Like immigration, hindrance to a new minimum wage program rests with the Republican majority in the House of Representatives. Unofficially, leadership wants passage or rejections of every bill to be accomplished with votes from GOP members only.
Bottom Line: The winners in this proposal are easy to identify. Either our taxes can be reduced or the proceeds applied to reducing the national debt. Our less fortunate would shed the stigma of being on the public dole.
The question should not be, how much should the minimum wage be. The question should be, how do we go about bringing back to the U.S. the decent paying jobs that have been and still are being outsourced abroad.
We need a little common sense here. If we raise the minimum wage for low skill jobs to $15.00/hr, then the people in skilled positions currently making $15.00/hr are going to want their pay raised to $22.75/hr and so on up the job scale. This then would lead to more good jobs being off shored. Everyone’s cost of living would also increase.
You can also guarantee that fast food production would become highly automated thus eliminating probably 50% of fast food employees.
I saw a perfect example of this narrow thinking on a news show last week. It featured a Democratic congress woman, who with others were going to spend a week trying to live on minimum wage. Her take away was that if we increased the minimum wage than more restaurants would open to cater to this new found wealth. Brilliant, we increase the minimum wage so that we can create more low skill jobs.
No one in their right mind would suggest that living on minimum wage is an easy life. The answer to the problem is to create good paying jobs and provide training to people to fill those jobs. We have a problem right now with filling skilled positions that don’t need a four year degree because we waste our resources feeding the Higher Education Propaganda Machine. We have millions of young people in debt up to their eye balls with degrees in subjects that are virtually useless in the job market.