$10.10-An Hour Minimum Wage Campaign Is A REALLY Bad Idea

In General Interest by Jonathan Tasini7 Comments

The campaign for a $10.10 federal minimum wage, championed by the president, Democrats in Congress and a whole raft of “liberal/progressive” organizations, is a very bad idea.

To be clear, I’m not arguing it’s too ambitious. The opposite: what we need is a campaign, now, today, for a minimum wage of $20-an-hour. Anything less is a failure to confront poverty in America and a bankrupt economic system.

$10.10-an-hour will not allow people to make a fair living, or challenge the basic, “We-make-profits-thanks-to-poverty” system that underpins today’s real world economy.

Anything short of $20-a-hour is a capitulation to the most narrow politics, particularly on the part of so-called “liberals/progressives” who are, unintentionally, locking into place deep poverty in America and ratifying the basic principle of the so-called “free market”.

And $20-an-hour actually relates to real life after you look at a very complicated idea: simple math.

The Math:

In the past 45 years, productivity has more than doubled. Productivity is a measure of how much value workers add per some unit, usually hours of time worked. In shorthand, it typically means people are working harder than ever and making more stuff faster (a small bit of that is due to technology) and, thus, cheaper (whether this fast rise in productivity is good for the human soul or the planet is a very important topic for another time).

In the old days, (say, the really “ancient history” of the early1970s) productivity translated into wage gains. If the minimum wage today reflected the cumulative productivity increases, computed from four decades ago to 2014, the minimum wage should be $18.30 today and close to $19-an-hour by 2016 when the proposed $10.10-an-hour would kick in, if it became law.

That’s pretty simple math. Grossly, and somewhat imperfectly speaking, the demand for $10.10-an-hour is a demand that would place the minimum wage a shade under half of what it should be if corporations actually paid for workers’ value-producing labor—as opposed to robbing them of their value-producing labor.

Some more basic math: at $10.10 per hour, for a 40-hour-a-week, a full-time worker laboring 52 weeks a year would gross $21,008, with no pension, and no vacation (for the moment, put aside the reality that minimum wage workers often can’t get full-time work).

That would put a worker just above the official poverty line for a family of three, which in 2014, is set at $19,790 (the numbers are published in the Federal Register and are based on the Census Bureau’s official poverty thresholds.

In that world, you are a slave. To make $21,008, you get no time off. None. Zero.

Second, if you happen to live in a family of four or larger, tough luck—you still are in poverty, which, for a family of four, is defined as an income below $23,850.

Third, and really most important, the official poverty levels are too optimistic because they are set using calculations that do not reflect what it really costs to make it day-to-day, week-to-week. I, and many others, have raised for a very long time the issue of the serious shortcomings in using the CPI and Gross Domestic Product as a measure of economic well-being (in short, a lot of stuff can be made, the economy can “expand” and prices can go up…and the people can actually be far worse off…here is one post). The official poverty level is set using the consumer price index, which rose 1.5 percent for the time period used to come up with the 2014 figures.

Raise your hand and dance a few cool steps if you think that on an annual wage of $21,008—whether you are single or in a family of two, three or four—you could meet your rent, pay utilities, pay for food, gas, cable, and a whole host of other expenses—not to mention, god forbid, save a few dollars for your kid’s education. The official price index does not reflect the real struggle to make ends meet in the wage-robbery economy of today.

So, we should be talking about indexing the minimum wage to productivity—how hard people work—as opposed to indexing it to inflation or the CPI (which the Democrats proposal does) because those are very dodgy numbers to use to judge how people actually live. This is an argument advanced for some time by Joel Rogers, a professor of sociology at the University of Wisconsin and one of the country’s foremost thinkers about work and the economy (and, as an aside, the original conceiver of the New Party, the first iteration of what would become the Working Families Party).

I’m guessing that the notion of tying the minimum wage to productivity will have a few worrywarts wringing their hands. They might say that if the minimum wage is indexed to productivity, then, eventually the minimum wage will catch up with the median wage.

Well, it’s worth remembering why that would happen. Wages have been flat for so long that the median wage has barely budged, rising just 0.2 percent annually between 1979 and 2013—while productivity rose almost 65 percent in that period overall.

Why? Well, we know why: employers have been more interested in pocketing profits for themselves (read: huge CEO pay and benefit packages) than giving workers raises. Those profits come directly from the big productivity gains thanks to the sweat and blood of workers (which is why my blood boils when I hear the bi-partisan praise for the small business “job creators” who power the economic engine seemingly on their own).

Oh, imagine the horror when the minimum wage catches up with the median wage. And if that is what worries people, wouldn’t it make more sense to seize the political agenda, and advocate for a higher minimum wage AND a boost in the median wage—partly by making it easier, not harder, to unionize?

The Politics:

So, that’s the math. Predictably, when you get to the politics, you hear the most unimaginative, uninspiring and lazy, “this is the best we can do. Nothing better will pass.” This view also comes along with another politically exciting view: we, (presumably, this means “Democrats”), will have a real difference to show people in the 2014 elections, with a message: “we care about workers, the Republicans do not.”


Politics point Number One. According to the Economic Policy Institute: “Raising the federal minimum wage to $10.10 by 2016 would return the federal minimum wage to roughly the same inflation-adjusted value it had in the late 1960s.” [emphasis is mine].

Don’t you love it? The great minds of politics, the people who are the warriors for the working “family” (“family” being another annoying capitulation to “messaging”), the movement builders, are promoting a message that boils down to: “Hey, you, minimum-wage worker, have we got a bargain for you. We care so much about how hard it is for you to live on the minimum wage, elect us so we can bring your pay right up into the modern age…into the 1960s.”

And leave it stuck there for a very long time. The bill indexes the minimum wage to inflation, so that as prices rise in subsequent years, the $10.10 would be, as EPI writes, “automatically be adjusted to preserve its real value.”

But, its real value—the real value of how hard people have sweated and labored—has already been eviscerated. Indexing the $10.10 to inflation (not productivity) is keeping its real value linked to a 1960s standard.

Politics point Number Two: you can almost guarantee that, if someone actually notices, say in five years, that millions of people on the minimum wage are still mired in poverty and argues for a new hike, a bi-partisan echo will follows: “We did the minimum wage already, go away.”

So, in the unlikely event the $10.10 passes, it basically dooms millions of people to a life of poverty. Forever. Though it does offer a great opening for a new, inspiring slogan for the 21st Century: “The (Just Kidding) War On Poverty (Lite Version)”, with perhaps even an opening for a theme song to debut on American Idol.

Politics point Number Three (most obvious): $10.10 isn’t going to pass the Congress. So, it really is just a political exercise and one lacking in any political courage whatsoever.

So, why not be bold?

What Should Be Done:

Twenty. Dollars. An. Hour.

Simple. Easy to remember. And consistent with math that accurately values workers’ contributions to the economy.

Think of it. T-shirts, buttons, bumper stickers, and social media memes everywhere that state simply: $20.

That’s all. $20.

The back of the T-shirt might say, “I Am A Human Being”. Eventually, “$20” would carry with it passion, energy, a vision and a simple idea: everyone should have decent-paying work.

And we should not settle for anything less because to do so is inhuman.

In the 1970s, women, and many men, wore a button that simply said “59¢” to signify what a woman’s pay was compared to a man earning a dollar. Eventually, that button, without needing a single word of explanation, carried with it a whole narrative and political demand.

Liberals/progressives (on this issue, it’s hard to see a difference) will react to $20-an-hour either by saying it’s “crazy” or “too ambitious” or “unrealistic” because the polling doesn’t support such a big hike and, of course, it will never pass.

But, the job of leaders and organizations shouldn’t always be simply to cater to where “the public” is today. Or where organizational funders—either foundations or rich people—happen to be.

Instead, we need to look ahead, try to move the country in a different direction, and, sometimes, dramatically. It’s easy to take for granted, for example, the now growing public majority opinion supporting same-sex marriage and legalization of marijuana but those two issues, very recently, did not command majority support. The shift came because a core of committed people did not accept, and were not trapped by, what public opinion happened to be. And, in their actions, they moved the country.

For sure, it’s hard work. Moving the public dramatically involves a lot more than clicking a petition link, doing a “fly-in, fly-out speech” or, even more seductive, getting an invitation to the White House. You have to actually knock on doors and put in serious shoe leather to move the public.

People in SeaTac proved that, in the face of an onslaught of millions of dollars, it could be done—the community waged the successful ballot initiative to hike the minimum wage of $15-an-hour, a level no one would have imagined possible before the campaign began.

The timidity of a $10.10-an-hour rate is even more perplexing given the topic: inequality and wage robbery.  Occupy Wall Street, strikes against low-paying fast food chains, the unease about the Wal-Martization of the economy, the public’s awareness of corporate greed, the huge gap between rich and poor, and the continued anger that bankers complicit in the financial crisis escaped punishment—all converge to create a rich terrain to be bold, and to dramatically change the conversation.  The hiking of the city minimum wage in Seattle to $15-an-hour and the SeaTac ballot initiative show that you can move the conversation.

And those efforts also bluntly underscore how meek $10.10 is in comparison and, actually, is counter-productive and damaging to tackling deep poverty in the country

At the end of the day, win or lose, we should care about dramatically altering the economy of poverty, not having some phony messaging gambit to influence a particular election cycle.

Twenty. Dollars. An. Hour.