Why the Poor Vote Like They're Billionaires

Steve Russell

The left coast and the right coast, California and New York, have gotten on board for raising the minimum wage to $15 an hour. That has been Bernie Sanders’ position. Hillary Clinton bids $12 an hour. The Economist reported last year that if the U.S. followed the same standards as most industrialized nations, the minimum wage would be $12 an hour.

The other party is generally opposed to any minimum wages set by government. The Pew Research Center reported last year that 71 percent of all people favored increasing the minimum wage but only 53 percent of Republicans. The GOP line is that a minimum wage “kills jobs.” You know, like Obamacare was supposed to do?

The meme that Obamacare would destroy jobs or cause massive shifts from full time to part time work was focus group tested to scare voters and fed though the right wing propaganda machine of talk radio and Fox News. A focus group can tell you how to scare people but it can’t cause the fearsome thing to happen.

The employment figures just released show the 73rd consecutive month of private sector job growth. This is the longest streak since records started being kept in 1939. President Reagan had a streak of 71 months. President Clinton would have had a streak of 85 months and taken the brass ring but for a monster blizzard that shut down the entire East Coast in January of 1996.

The Labor Department began tracking part time employment in 1968, when 13.5 percent of U.S. employees were part time. Part time employment went up over the years and peaked at 20.1 percent in 2010, which happens to be the year Obamacare was signed into law. The entire part time spike was after the Great Recession and before Obamacare. The number now is 18.4 percent and the trend is down.

The stuff about Obamacare and jobs was a political meme created for political purposes and the objective was political leverage rather than truth. For the tiny minority of voters who pay attention, that pack of lies has come out in the wash.

The position that the existence of a legally required minimum wage causes people to get laid off is a constant staple of the debate.

It hasn’t happened. The favored method for studying it is to match cities by all relevant measures and then watch what happens when one of the pair raises the minimum wage and the other does not. The answer is that not much happens except that a rise in the minimum wage tends to drive up wages generally in the lucky city with the raise.

The reality on the ground is that the jobs do not disappear, but I cannot follow the abstract logic that is supposed to support the claim. To think a minimum wage would cause people to be laid off assumes that employers are at this time carrying more employees than they need. Out of the goodness of their hearts, I presume?

My Republican friends have claimed that a rise in the minimum wage would cause a competitive disadvantage. Say what? Where I live, football coaches don’t get to blame the rain for a loss because, they say, it’s raining on both sides of the football field.

Some family businesses are too small for the Fair Labor Standards Act to kick in, and so Pop’s Hamburgers might have a competitive advantage against Mickey D because Pop does not have to pay minimum wage and Mickey D does.

I have yet to hear anybody claim that the minimum wage is a bad idea because it might help family businesses do better than chains.

One of my brighter Republican friends challenged me to show the minimum wage is rational. Why, he wanted to know, should it be X amount rather than Y amount? How is it that government knows what labor is worth better than employers do?

It ain’t rocket science. A full time minimum wage worker with one child should not qualify for public assistance. As to a full time worker with more than one child qualifying for public assistance, the government might be subsidizing having children and we could have a discussion about whether that’s a good idea.

Why should the government subsidize even one child? Because the right to procreate is protected by the Constitution? Because we don’t want to encourage abortion? Because the child would be punished for the conduct of the parents? We could argue about allocation of space in the economic cellar but not about its existence. The policy question is who has to live in the cellar?

Whether the cellar is one child or no children, if a full time minimum wage worker qualifies for public assistance, then we the taxpayers are subsidizing the business that is not paying a living wage.

That brings up one criticism of the minimum wage that is correct. The law is one size to fit all. A fair living wage is a different number in New York or San Francisco or Washington than it is anywhere in the Dakotas or Oklahoma. The Massachusetts Institute of Technology hosts a living wage calculator on the Web that shows wide disparities by geography in how much it takes to live.

Politicians working in good faith could smooth out the regional variations in the cost of living. When it comes to the minimum wage, politicians are seldom working in good faith. The Fair Labor Standards Act was part of the New Deal and rolling back the New Deal is the Holy Grail of today’s Republican Party.

In the 2012 elections, Newt Gingrich promised gasoline would be $2.50 a gallon under President Gingrich. Willard Romney declined to offer a particular price, but claimed that President Obama was responsible for high gas prices because:

1. Obama would not allow drilling in the Arctic National Wildlife Refuge.

2. Obama was taking too long to approve the Keystone XL pipeline.

3. Obama declared a moratorium on new deep-water offshore drilling permits in the Gulf of Mexico pending a report on the Macondo oil spill.

Gas where I live is under $2 a gallon in spite of the fact there is still no drilling in the Alaskan wildlife refuge and Keystone XL is still not approved.

What about the moratorium that Gov. Romney thought was destroying the industry? It banned drilling for six months in waters over 500 feet deep. It did not touch 4,515 shallower wells or 591 deep-water wells that were producing. The Louisiana oil and gas trade group claimed that the moratorium idled 33 wells. The Department of the Interior put it at 21. Whichever, the drop in production was one half of one percent.

Romney did make a specific promise on unemployment. When it was over 8 percent, he promised that a President Romney would have the rate to six percent in four years. President Obama got it to five percent in three years.

There was a time when the inconvenient numbers I’ve pointed out in this column would not cause indignant squalls of “Class warfare!” The Republican Party proudly represented the moneyed interests and was not afraid to say so. The Democratic Party represented the working class, something they told anybody who would listen every chance they got.

Since few voters are wealthy, how was it that the two parties could be competitive?

The Republican view of the public interest was demonstrated when General Motors CEO Charles Wilson, known among working people as “Engine Charlie,” was nominated for Secretary of Defense under President Eisenhower. Congress demanded to know if he could make an official decision adverse to the interests of General Motors?

Wilson replied that he could, but he could not conceive of such a situation because “I thought what was good for our country was good for General Motors, and vice versa.”

What about the vast majority of people who are by definition not part of what we now call the one percent? The question, I think, is not who you are but with whom you identify when you consider public policy.

People who do not understand what a “marginal tax rate” is see 90 percent and think it means the government would take nine of every ten dollars anybody earned. It didn’t when the top rate went even higher during the prosperity of the fifties and it would not now. The top marginal rate only applies to the part of income in the top bracket.

People who understand the only way they would ever reach the top bracket is win the Lotto still want to build policy around that dream. The dream of a life-changing win has crossed the mind of everyone who ever bought a Lotto ticket. Those who call lotteries “taxes on people who can’t do arithmetic” are correct, but they attach no value to the fantasies that go with the dream of winning the Big One. Recognizing the common humanity in that dream is not an argument for building tax policy around it.

John Steinbeck was a Nobel Prize winner for literature and the body of his work is all about the challenges facing working people. You feel what they feel in The Grapes of Wrath, Of Mice and Men, and Cannery Row.

A quotation attributed to Steinbeck explains how policies to benefit the one percent survive free elections in addition to the fact that the swell people always vote and the people born to serve the swells have more urgent priorities. I cannot find these words anywhere in Steinbeck’s oeuvre, but if he didn’t write them, he should have:

Socialism never took root in America because the poor see themselves not as an exploited proletariat, but as temporarily embarrassed millionaires.

Working people don’t support policy for themselves, but rather for who they will become in their dreams. When you think about that, it’s better to have dreams than not.

Those dreams of joining the one percent are the entertainment value of a Lotto ticket and why sales of the tickets spike on high jackpots---just when the odds of winning are longest. Those dreams are also just as important as the hostility of the Democratic Party establishment in explaining what is about to happen to Bernie Sanders
Steve Russell, Cherokee Nation of Oklahoma, is a Texas trial court judge by assignment and associate professor emeritus of criminal justice at Indiana University-Bloomington. He lives in Georgetown, Texas.

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turbojesus's picture
President Clinton's private sector job growth: deregulate the banks and cause all our current problems. Yeah I mean it was so against public interest at the time for eisenhower to support general motors. Considering Chrysler and GM made tanks. I'm sure nobody would be concerned about the rise of fascist governments in europe or imperialism that the russians would have exerted on western europe. Raise the minimum wage and everybody increases their prices. Now we have more inflation while we print more money to pay for government services and inflate some more. Now the interest rates are negative. Everybody can have their house made out of gold and a rocket car; all made in china of course. The world is now a better place. 'Merica land o' da free.
alexjacobs's picture
Gee those are alotta numbers Steve & I bet most folks wont "do the math" even if it affects their daily workaday lives...but I do bet they can tell you how many games in a row their fav'rite sports team or the trendy team is winning or losing, or the top draft picks, or the market shares of their fav'rite TV shows or why shows they hate are still on TV, or how many this' & thats' about their fav'rite or most hated Pop Culture Celebrities are, how many sales of whatever product are endorsed or promoted or sold by whoever Pop Icon...Distraction Much?
alexjacobs's picture
Gee those are alotta numbers Steve & I bet most folks wont "do the math" even if it affects their daily workaday lives...but I do bet they can tell you how many games in a row their fav'rite sports team or the trendy team is winning or losing, or the top draft picks, or the market shares of their fav'rite TV shows or why shows they hate are still on TV, or how many this' & thats' about their fav'rite or most hated Pop Culture Celebrities are, how many sales of whatever product are endorsed or promoted or sold by whoever Pop Icon...Distraction Much?
swrussel's picture
Turbo, I get whiplash reading your comment. I'm not clear how it makes sense to complain about inflation and deflation in the same remarks? I think if you would look at the numbers, you would be persuaded that the minimum wage does not cause inflation. If it did, the tendency would be well within what can be controlled by monetary policy because minimum wage workers are a very small part of the economy. It does set off an upwards domino effect but that used to run smack into union contracts in all the major industries, so that wages could not go up all at once but rather as contracts came up. You are right about Clinton signing the primary legal cause of the Great Recession, Gramm-Leach-Bliley. It is relevant that Gramm was at the time it blew up John McCain's principal economic advisor? As to mean old China, have you noted that they are doing their best to pivot from a manufacturing economy to a service economy like the one we have? This would be because their wages have risen enough that manufacturing jobs are decamping to Indochina and even, yes, Mexico. That's ironic enough, but the kingpin irony is that if a service economy is going to be more than flipping each other's burgers (as ours is) then it is based on intellectual property. All those solar panels made in China were made under US patents. So, I take it you know who the biggest thief of intellectual property has been? And now they are going to have to about face. Our problem is the amount of education it takes to win the globalization game with intellectual property. Our universities at the Carnagie R1 level are world class. K-12 not so much.
swrussel's picture
A dear friend of mind made a criticism he kindly addressed to me rather than posting it here but my slipshod language has been eating me ever since he pointed it out. He is a Choctaw and a professor of a discipline with more exacting truth standards than mine. That's an explanation, not an excuse. Contrary to the impression I leave on the reader, the odds of a particular Lotto combination are the same without regard to the size of the jackpot. What changes is your chances of winning the Big One by yourself. Each ticket sold has the same odds of winning. My sloppy remark enhances one of the great gambling myths. What are the odds of a coin toss coming up heads after having come up tails a hundred times? The same as they were before the previous 100 tosses, assuming nothing is introducing another force. That slot machine over there is hot because it just paid off. Or it's hot because it hasn't. Gambling generally is a tax on people who can't do arithmetic unless you introduce some skill, as poker does and as the stock market does. If that's a problem, I didn't make it better with my inexact remark about huge jackpots. Mea maxima culpa.
Michael Madrid's picture
The myth that raising the minimum wage will raise prices on everything is perpetuated by those who want to hold onto their profit margins. I've been working in the same job (in the public schools - we're pretty poor in southern New Mexico) for nearly seven years WITHOUT a raise. In the meantime the upper echelons in our District enjoy numerous "perks" at my (and many other low-wage workers) expense. The one thing Repuglicans are sincerely good at is getting ignorant people to vote against their best interests, but I think this is only true of White republicans because they seem to believe that they'll someday become millionaires. Natives don't seem to believe that BS.
Michael Madrid