free market – RI Future

“The worker deserves his [or her] wages.”
– Apostle Paul (1 Tim 5:18)

Let’s get real. Any adult working for $7.25 an hour is being exploited, and the $9.60 Rhode Island minimum beginning January 1, 2016 also falls far short of being just.

Ask any Haitian garment worker: Survival requires servitude—-even if paid a scandalous 64 cents an hour.

Slavery is forced labor which legally rescinds all freedoms. A poverty wage is wage slavery, legally allowing employers to pay wages which eliminate many freedoms: The freedom to obtain decent housing; the freedom to take a paid vacation or sick day; the freedom to spend time with children; the freedom to retire; and, for some families, even the freedom to eat every day of the month.

Of course, the minimum wage promotes at least one freedom: The freedom to work two or three jobs.

The Declaration of Independence speaks eloquently to the minimum wage, stating that the Creator endows us “with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness.”

How can a person experience Life when their work is punished with poverty? How can a person experience Liberty when unjust wages impose soul-crushing limitations? How can a person pursue Happiness with the drudgery of constant work? Are Life, Liberty and the pursuit of Happiness truly today’s “unalienable Rights”?

Living Wage Benefits Many

Two practical arguments win the day for a minimum wage which is a living wage. First, a raise stimulates the economy because minimum wage workers spend virtually all they receive. For example, with a raise to $10.10, the Economic Policy Institute estimates the boost in Gross Domestic Product would support the creation of 85,000 new jobs.

Second, a raise also decreases government spending to assist minimum-wage workers. Think corporate welfare. Government’s indirect subsidies to unethical businesses cease when a living wage is mandated.

The most pertinent argument for a living wage is moral. As the Apostle Paul wrote: “The worker deserves his [or her] wages.”

I recently heard a politician cynically argue we could raise the minimum wage to $50. This logical fallacy is absurd. Similarly, we could argue for a minimum wage of three dollars. Of course, the minimum wage should be the legally permissible minimum enabling a decent life.

Some opponents maintain the minimum wage is for training teenagers. To the contrary, the Department of Labor reports 88 percent are at least age 20. Moreover, even a single adult requires $11.86 an hour to escape poverty.

At least $12 an hour—and a benefits package which includes health insurance, vacation time, sick time and retirement pay—would provide a living wage. Indeed, the Institute for Policy Studies estimates that if the 1968 minimum wage was adjusted for income growth and inflation, workers would receive $21.16. The U.S. permits 34% of this wage.

Pols Opposing Minimum Wage

This prompts the question: Who is responsible for this repugnant impoverishment of workers? The answer is straightforward. While raises are frequently passed when Democrats are in charge, Republicans blocked all raises during the 16 years of the Ronald Reagan and George W. Bush administrations.

In what moral universe do these politicians live?

The jargon of plutocrats and pols tell the story: They cite ‘capitalism’ (meaning the choice of those with capital to fleece workers); they cite ‘the free market’ (meaning misers seek freedom from regulation so they can pay paltry wages); and they cite ‘supply and demand’ (meaning employees are priced the same as goods and services—-ignoring the requirements for Life).

Worshipping at the altar of unregulated capitalism justifies treating people as property. Isn’t this the very definition of slavery? What a crude and callous obscenity.

Want to make a difference? Encourage your RI Senator and Representative now to introduce a living wage bill this January. You can identify your state legislators at https://sos.ri.gov/vic. Oppose the moral outrage of today’s slave labor with a demand for wise and caring justice.

Rev. Harry Rix is a retired pastor and mental health counselor living in Providence, RI. He has 50 articles on spirituality and ethics, stunning photos, and 1200 inspiring quotations available at www.quoflections.org. ©2015 Harry Rix. All rights reserved.

First, let me apologize that I’m not addressing this in the comments of the original post. I simply am not able to participate in the discussion on the threads. However, I am pleased to see the amount of intelligent discussion that took place.

In particular, there was some back-and-forth about unregulated capitalism, what constitutes it, etc. There is one very important point I want to stress on this. It’s the crux of my argument.

I made the point that I’m not trained as an economist. That wasn’t necessarily deference, but an indication of my point of view. I am not terribly concerned to argue about econometric models that may–or may not–describe, or even resemble reality.

I am approaching this from an historical perspective. I am not concerned with what the models tell us may happen; I want to know what happened when certain conditions were in place.

Unregulated capitalism did exist. In real life. It was how the markets operated from the mid-1800s until regulations cleaned it up in the 1930s. This means we have what is called a ‘natural experiment’, in which conditions are not modeled, but put in place.

So we don’t have to ask what the various schools of economics tell us what will, or might happen should unregulated capitalism occur. We’ve been there. We’ve done that. We tried it. It didn’t work.

The result was a welter of vertically-integrated monopolies, or near monopolies. I quoted a source that had a contemporary description of the situation that existed. Whole sectors of the economy were controlled by single companies headed up by a single individual. This was described as a good thing because it ended ‘wasteful competition.’

In the process the economy was subjected to cycle of boom and bust, the busts getting progressively worse, until we were hit with the Great Depression. At which point, we started regulating the markets, the first step being to prohibit monopolies.

Again, this is not theory. It’s what happened the first time. There is absolutely no reason to believe it won’t happen again should we deregulate even more than we have. Corporations are getting larger. Intel and Microsoft have no effective competition. Banks are so large that the failure of one can bring down the entire economy.

Since we did that, the economy grew, and the recessions that occurred were generally much shallower and of significantly shorter duration than what occurred before the 1930s. This was called the great moderation.

Then we started de-regulating. We kept de-regulating. Banking in particular was de-regulated to a degree not seen since, well, the 1920s. After which, they went off on a spree based not on sound market principles, but speculative fervor. The result was a crash that was the worst since, well, the 1930s.

This is not a coincidence.

Unregulated markets? We tried it once. It didn’t work.

Tag: free market

The minimum wage is a moral outrage

Been there, done that reiterated