Minimum wage, maximum stupidity

Occasionally, the Oklahoman will run a syndicated column that actually espouses a non-right-wing view. Such is the case a few days ago, when Leonard Pitts wrote about the now-infamous infographic put out by McDonald's explaining to its workers how they might be able to save money.

Pitts thoughtfully concludes his piece by saying

Look, there are many reasons people wind up in poverty. Sometimes they make bad life choices-- they drop out of school without salable skills, or they become teen parents. Often, it falls on them from the sky in the form of illness, injury, addiction or financial reversal. 

However they got into poverty they all need-- and deserve-- the same things: a way to work their way out and to be accorded a little dignity while they do so. The former comes with paying a living wage, the latter by treating people with respect and not presuming to teach them what they could teach you. McDonald's fails on both counts.

 There is hardly anything controversial or radical here. And yet Sarah Mulkey of Yukon-- clearly someone who has put no real thought into the issues and remains willfully ignorant of facts-- felt compelled to chime in on Mr Pitts' column. In her letter, she writes,

In “Living on pennies at the Golden Arches” (Commentary, July 28), Leonard Pitts writes about working at McDonald's. What's a “living wage” besides words? It's an illusion, because as people are paid more in some jobs, everything else goes up in cost.

Wait. What? It's hard to imagine a more nonsensical statement than this. A "living wage" isn't just words. It's a real concept: a wage that makes possible for a wage earner or an individual and his or her family to live at least according to minimum customary standards.

As the people at MIT make clear, a living wage isn't the same thing as a minimum wage. And they shouldn't necessarily be. However, "given that almost two-thirds of minimum wage workers are adults, and four in ten are the sole bread winner of their family," it may be worth considering some sort of raising of the minimum wage. (Indeed, according to MIT, to have a reasonable living wage, a single adult in Oklahoma City needs to bring in ca. $8.19 an hour-- almost a dollar more than the minimum wage of $7.25. And if you're the primary bread-winner for a family, that number goes up considerably.)

For Ms. Mulkey, this is all an "illusion" because once you start paying minimum wage earners more, the price of "everything" goes up in cost. Indeed, one imagines that Ms. Mulkey sees a living wage as the first step towards the US becoming the next Weimar Republic. (Note: it can't.)

So what's the evidence for this idiocy? Well...

Compare the minimum wage to the price of a good hamburger as far as you want to go, even before minimum wage. When the government got involved in mandating what companies have to provide employees working 40 hours per week, businesses had to push back and try to contain costs.

Uh. No. The reality is that this is not the case. Indeed, assuming that all costs associated with raising the minimum wage were passed on to the customer, we'd see almost no change in price-- under 1%.

Amazingly, Ms. Mulkey has more advice for those advocating for a living wage:

We still have choices. If McDonald's isn't for you, start your own business. The more control over your life, generally the happier you are. Also, a course or two in business accounting would help to understand the wages paid.

Holy shit. So-- if you are trying to get out of poverty by working hard and find that two jobs at $7.25 an hour isn't cutting it, then start your own business??? That's her advice? WHAT A GREAT IDEA!! I'm sure a bank will happily loan a minimum-wage guy at McDonald's some case to start a new business. And then-- don't forget those college courses. Last time I heard, college courses were free. Oh, wait.

Finally, Ms. Mulkey gets in a line every plutocrat must love:

How much the head of McDonald's earns has no place in the discussion. It only creates dissension when brought up.

HAHAHAHA! I've already noted that executive pay has far out-paced the pay of the rest of us since Saint Reagan came to office. So if we are talking about raising worker pay, then yes, the pay of the CEO should come into discussion. Right now, the McDonald's CEO Don Thompson makes almost $14 million a year. While cutting his salary-- even by a lot-- won't help the over 700,000 Americans who work at a McDonald's by much, it is important to note how quickly that salary has risen over time when compared to ordinary low-wage earners. The CEO whom Thompson replaced, Jim Skinner, made $8.8 million in his last year working for the company. Thompson, as noted above, began his tenure making $13.8 million. McDonald's is paying the new guy $5 million more than the old guy! (And note, most of this compensation comes in the form of stock options, meaning that the tax for most of these millions of dollars will be far less than if it were just base salary...)

Anyhow, as should be clear, this letter is fraught with problems and no serious newspaper would consider running it. But the Oklahoman wants to push its plutocratic agenda-- an agenda that includes reminding the plebeians not to question how the rich keep getting richer while the rest of us struggle to get ahead. Indeed, pay no attention to the plutocrat behind the curtain!