Saturday, April 26, 2014

Increasing the minimum wage

Will increasing the minimum wage produce disastrous job losses? NO! Experts have debunk that claim time and time again. Nonetheless, opponents made the same prediction each time the minimum wage was increased. The fact that these predictions have never come true doesn’t keep them from rolling off the tongues of low-wage advocates.

In February, the non-partisan Congressional Budget Office (CBO) reported on the impact of proposed increases in the minimum wage to $9 per hour. Increasing the wage to $9 per hour, according to the CBO, would result in job losses of less than one-tenth-of-one-percent.

The CBO continued, “Federal spending and taxes would also be indirectly affected by the increases in real income for some people and the reduction in real income for others. As a group, workers with increased earnings would pay more in taxes and receive less in federal benefits of certain types than they would have otherwise.”

When Americans pay their taxes, the bill includes billions for maintaining a publicly funded safety net for low-wage-workers. Most people receiving so-called “welfare” benefits are working full-time but are paid so little they qualify for food stamps and Medicaid. For example, Forbes says, “Walmart’s low-wage workers cost U.S. taxpayers an estimated $6.2 billion in public assistance including food stamps, Medicaid and subsidized housing.”

Walmart isn’t alone.

Prices may rise minimally to cover minimum wage increases. That impact will be offset by the reduction in costs of federal programs. The CBO predicts the overall effects would include a small decrease in the budget deficit for several years. They acknowledge there may be a small increase after that unless economic growth overcomes that trend.

The Economic Policy Institute believes minimum wage hikes would do that.Raising the minimum wage,” their 2013 study found, “would help reverse the ongoing erosion of wages that has contributed significantly to growing income inequality. Additionally, it would provide a modest stimulus to the entire economy, as increased wages would lead to increased consumer spending, which would contribute to GDP growth and modest employment gains.”

What’s even more interesting is that the CBO’s 2014 findings mirror the conclusions reached by EPI experts who studied past increases. In 2000, EPI studied the impact of increasing a minimum wage from what was then a paltry $5.15 per hour. Their findings were that, “No evidence exists that teenagers or less-than-high-school-educated adults lost work as a result of the 1996-97 minimum wage increases.”
EPI economists looked back over decades at previous minimum wage hikes and concluded, “Historically, analyses of the minimum wage’s impact on young workers have never shown the predicted large job-loss effects. The small negative employment effects found in past analyses diminish over time and are no longer statistically significant.”

It doesn’t make you a “socialist” to believe that middle and low-income people with more money to spend is good for the economy. Nor are you a “socialist” if you believe well-paid employees are critical to the success of a business.

Fair wage opponents will cite other studies to refute these. Between the Heritage Foundation, Americans for Prosperity, and the US Chamber of Commerce, there will be a number of contrary claims. But they have made the same arguments every time the minimum wage was increased since it was set at 25 cents an hour in 1938.

Sadly, their arguments, or more accurately the arguments made by their lobbyists (who are paid countless multiples of the minimum wage) are responsible for the fact that today the minimum wage paid to US workers is lower than that earned by workers in every economically developed nation in the world with the exception of Japan.

Meanwhile, Wyoming is one of only five states where the state minimum wage falls below the federal minimum.

There are good economic reasons to raise the minimum wage now. There is also a good moral reason. Franklin Roosevelt said it best. “No business which depends for existence on paying less than living wages to its workers has any right to continue in this country.”

Saturday, April 19, 2014

2 answers to high food costs

If you eat food, the news isn’t good. Beef prices are at an all time high. Last month’s increase in food prices was led by a 30% leap in the costs of hogs and 12.4% increase in poultry.

During Lent, my wife and I attempted to eat on a food stamp budget. The Department of Family Services, who administers the program, tells me that for the two of us, benefits would be $347 per month following recent federal budget cuts.

I use the word “attempted” because we didn’t quite make it. We ended the month spending just under $400 on food. There are a couple of reasons we didn’t succeed. One is that we didn’t really have to! Unlike millions who rely on food stamps to feed their families, we don’t. That difference led to the second reason.

When we take care of our grandchildren, and that occurs as often as their parents permit, we buy the extras they want. Doing so, we quickly realized how much of a dent those purchases put in our budget. More important, we realized how difficult it is for those who actually rely on food stamps to say “no” to children and grandchildren.

We became more price-aware than ever and painfully aware of what the economists are reporting. All of us are experiencing those huge increases in the cost of food. Before this exercise, I used to ask rhetorically, “How do poor people make it?”

Today I have a limited glimpse into what that actually means. The answer is, “with great difficulty.” I have even greater respect for the local food banks at Needs, Inc. and St. Joseph’s and for the churches and others donating food to them. (NOTE: Day of Giving is Friday May 9, the community’s chance to donate food and more.)

It would help if certain members of Congress, including the three from Wyoming, would declare a ceasefire in their war on the poor.

There’s another strategy as well. Couponing. During the month, I had the pleasure of meeting a woman who has trained perhaps a thousand Cheyenne families on the art…and it is indeed an art. Wendy Troutman is a jewel in “the Gem City,” i.e. Cheyenne.

Wendy got my attention when she told me plainly that when we toss the Wednesday grocery store ads in the trash, it’s like throwing away hundred dollar bills. After an hour with her, I agreed.

Looking at her three-ring binder, in which she catalogues coupons and listening to her describe a whole new approach to grocery shopping, I wondered aloud whether it’s worth it all. “Just how much would one expect to save if they did all this,” I asked her. The answer was attention getting.

Wendy assured me that if a person is only “moderately couponing,” he or she could expect to save no less than 50% on groceries. More intense strategies save her as much as 90%.

Teaching others how to achieve that kind of result is Wendy Troutman’s mission. She teaches classes at the library, WAFB, and community churches. She’s taught Climb Wyoming and Wyoming Family Home Ownership classes.

By the time we finished a cup of coffee, she had me convinced this is the one realistic alternative to eating less. Her major teaching is that couponing demands a new philosophy about grocery shopping. A couponer gradually becomes more price aware. They are sensitive to store and manufacturer polices such as which store doubles coupons, where to find coupons on-line and the best newspapers in which to search.

As I leafed through her binder full of coupons, Wendy said, “I’d give you my wallet before Id’ give you this binder.”

Face it. It is unlikely food prices are going to drop significantly enough to make much of a difference on anyone’s budget. Congress is not likely to do any more about this problem than any of the others that confront low-income families.

But Wendy Troutman has a real-life alternative. Look for her classes at the library.

Saturday, April 12, 2014

Cheney's Legacy? Torture

The Senate Intelligence Committee has voted 11-3 to allow the rest of us to read its report on the CIA's use of torture. This report will define Dick Cheney’s legacy. When issued, torture will become the focus for how the former Wyoming congressman is remembered.

Think about Lyndon Johnson who should have been remembered for the Civil Rights and Voting Rights Acts, Medicare and Medicaid, the war on poverty, his leadership following President Kennedy’s assassination, as well as a senate career where many historians consider him to have been the most effective majority leader in history. Instead, his career is characterized by this question. “Other than Viet Nam, how’d your political career work out?”

When the public is finally able to read the facts amassed by Senate investigators, Dick Cheney’s name will be added to a long list of torturers going back to the dingy dungeons of the Middle Ages. History books will include his photo alongside that of the 15th Century “Grand Inquisitor” Tom├ís de Torquemada.

While that legacy is well earned, it’s also sad. Cheney’s pre-9/11 resume was exceptional. He was President Gerald Ford’s chief-of-staff. He returned to Wyoming, ran for congress, serving a decade as Wyoming’s congressman. He was appointed Defense Secretary in March 1989, leading the armed forces to a victory in the first Gulf War.

Cheney then made a fortune as Halliburton’s CEO. That’s when the ethical cracks began to appear. Halliburton shareholders filed a securities fraud lawsuit. Though Cheney was at Halliburton during part of the period at issue, he was by then vice-president and not named as a defendant.

Later Nigeria filed corruption charges against Cheney. Those charges were dismissed when Halliburton agreed to pay a quarter of a billion dollar settlement.

Sandwiched between the two cases were Cheney’s years as vice-president. Nine months after he was sworn into office, terror attacks on the World Trade Center and the Pentagon shocked the world. In the immediate aftermath, the vice-president made it clear the US would go to the “dark side” to avenge the attacks.

He discarded any notion that Americans had to wait for proof that someone was an actual threat before torturing or killing them. Cheney established what was called “the one-percent” doctrine, i.e. substantial evidence was unnecessary. If there was even a one-percent chance someone could harm Americans, they went on the hit list.

Torture was an integral part of Cheney’s game plan. We are perhaps only weeks away from learning the truth. Those who have read the report say the truth is uglier than even longtime Cheney-haters could have imagined. The Washington Post says, “The 6,300-page report includes what officials described as damning new disclosures about a sprawling network of secret detention facilities, or ‘black sites,’ that was dismantled by President Obama in 2009.”

It chronicles lies told by the CIA and Cheney among others to cover the brutality and severity of the torture as well as how little useful intelligence was gathered by casting aside the moral authority of our great country.

So what happened to the Dick Cheney many Wyoming people voted for and respected? Surely he knew as he was making those decisions that the torture program he unleashed would not remain a secret forever.

What happened was the infamous “Presidential Daily Briefing” Cheney-Bush received more than a month in advance of the attacks. Entitled “Bin Laden determined to attack inside the United States,” the memo provided prescient details of what happened on 9/11.

As he was moved to “secure, undisclosed locations” following the attacks, Cheney’s thoughts assuredly turned to that memo. He realized he and the President had missed its significance. For the remainder of his days as VP, Cheney endeavored to atone for that failure.

LBJ still has his loyal supporters as Dick Cheney will have his. But just as LBJ’s obituary was filled with references to Viet Nam so will Dick Cheney’s obituary be filled with references to torture. Torture is morally reprehensible and history will judge the torturers accordingly.

Saturday, April 5, 2014

The Parable of the Vineyard Workers
The Parable of “Occupy the Vineyard” - The Sagebrush Gospel Version

Matthew 20:1-16
“For the kingdom of heaven is like a landowner who went out early in the morning to hire laborers for his vineyard. After agreeing with the laborers for the usual daily wage, he sent them into his vineyard. When he went out about nine o’clock, he saw others standing idle in the marketplace; and he said to them, ‘You also go into the vineyard, and I will pay you whatever is right.’ So they went. When he went out again about noon and about three o’clock, he did the same. And about five o’clock he went out and found others standing around; and he said to them, ‘Why are you standing here idle all day?’ They said to him, ‘Because no one has hired us.’ He said to them, ‘You also go into the vineyard.’ When evening came, the owner of the vineyard said to his manager, ‘Call the laborers and give them their pay, beginning with the last and then going to the first.’ When those hired about five o’clock came, each of them received the usual daily wage. Now when the first came, they thought they would receive more; but each of them also received the usual daily wage. And when they received it, they grumbled against the landowner, saying, ‘These last worked only one hour, and you have made them equal to us who have borne the burden of the day and the scorching heat.’ But he replied to one of them, ‘Friend, I am doing you no wrong; did you not agree with me for the usual daily wage? Take what belongs to you and go; I choose to give to this last the same as I give to you. Am I not allowed to do what I choose with what belongs to me? Or are you envious because I am generous?’ So the last will be first, and the first will be last.”

 The struggles of the middle class began with vineyard workers in the time of Jesus. In those days a landowner didn’t have a steady workforce. He went early each morning to hire laborers. If he said, “I need all of you” they’d have enough leverage to negotiate higher wages. So, he took fewer workers than needed from those waiting for work, pitting hopefuls against one another.
After agreeing with a few laborers on wages slightly higher than Pharaoh paid his Hebrew slaves, he sent them into his vineyard. He returned about nine o’clock and saw other unemployed workers standing idle. This time there was no negotiation. The boss simply ordered, “You also go into the vineyard. I’ll pay you whatever is right.” So they went, not knowing what wage he thought was right. They needed the work. This might be their last opportunity that day.
He went out again about noon and about three o’clock, each time hiring fewer workers than needed, causing the unemployed workers to quarrel among themselves about who would work harder for less.
About five o’clock, near the end of the workday, he found others standing around. Although he knew they weren’t working because of his scheme to keep wages down, he mocked them, “Why are you standing here idle all day?” as though their idleness was their fault. They said, “Because no one has hired us.’ He said, “Go into the vineyard.”
When evening came, the owner said, “Call the laborers and give them their pay, beginning with the last and then going to the first.” When those hired about five o’clock received the same wages offered those who’d been hired first, those first hired grumbled, “These last worked only one hour, and were paid the same as us who have borne the burden of the entire day and the scorching heat.”
The employer replied, “Friend, I am doing you no wrong; did you not agree with me for this wage? Take what belongs to you and get lost; this is my business and you are a worker. Am I not allowed to do what I choose with what belongs to me?”
Eventually, the workers formed unions and elected representatives to negotiate with landowners so they couldn’t pit one against the other. Soon they were paid fairer wages, benefits and safer working conditions.
This was unacceptable to the owners.
The owner of the vineyard turned to friendly politicians. Pharaoh’s heirs took campaign contributions from owners in exchange for passing laws they called “right-to-work.” These and other laws made it difficult for workers to band together. Owners were once again able to pit underemployed workers against one another.
Still the landowners were displeased with laws putting minimums on the wages they could pay workers and workplace regulations such as overtime pay, child labor limits, and worker safety among others.  He cried out, “I built this business (conveniently overlooking the significant contributions of his employees and his customers). Am I not allowed to do what I choose with what belongs to me?”
And so he globalized the marketplace. Instead of hiring workers among his own countrymen, he outsourced their jobs, pitting workers throughout the world against one another.
If workers in his country demanded minimum wages, he could find workers in other countries willing to work for whatever he wished to pay them. Workplace safety and child labor laws didn’t exist in other countries. Environmental responsibility was no longer an issue. The Pharaoh again assisted, negotiating international trade agreements assuring him he could sell products throughout the world.
Money that once went to worker salaries now went instead to shareholders. Technology reduced the need for workers. Competition for diminishing numbers of jobs motivated workers to produce more for smaller wages.
Alas, the owners found that the last…will be last, the first will be first, which is Biblical for “the rich will get richer and the poor…”well, you know!
That’s the Sagebrush Gospel version of the Parable of the Vineyard Workers in Matthew 20.