The bosses are crying in to their coffee cups as the federal minimum wage is set to rise this month. The raise is the third phase of a three-part increase legislated in 2007. Prior to that, the minimum wage was stuck on $5.15 an hour for 10 years. This was during a period of massive profits and, as one bourgeois commentator stated in the Financial Times, the capitalist class, or its financial sector had a “sumptuous feast” in particular.
The US prior to 2007, the US minimum wage was at starvation levels. That is why people work two or three jobs with one of them for health benefits only. The present minimum wage is not much better and is not enough to survive on. People eke out an existence on it. Walter Jasper, a 48 year old from Nashville earns $6.55 an hour at a car wash he has worked at for 14 years on and off. His wife earns $7 an hour at a discount store and they are looking forward to a slight increase as they will be late with their rent this month and the extra few buck will help. *
A job like this will have no pension most likely and Mr. Jasper and his wife will have to rely on social security in their old age. Social security, which survived a privatization attempt during the Bush administration that would have had tragic consequences in this downturn, pays out according to the level of wages earned. It might just keep some people from starving.
The employers, as they always do, claim that jobs will disappear, as they will not be able to pay the higher wages as they can’t raise prices and pass on the increase in this economy. This is nonsense of course as it is the market, supply and demand that determines prices. If they can raise prices they will; if they can’t they eat it in profits. If the demand is such that the quality of service will decline if they reduce staff as customers shift allegiance then they can’t reduce staff either or they'll lose business to competitors. This is never mentioned, that an increase in wages leads to a decline in the employer’s disposable income as it is not something that would deter workers like saying that there would be no real increase in buying power as prices would rise.
It was mentioned on this blog this week the brutality of the US system compared to Europe. http://weknowwhatsup.blogspot.com/2009/07/unemployment-and-racism.html
The US is filled with millions of people like Mr. Jasper and his wife, grown men and women who have worked all of their lives and yet barely get by day to day, forced to work in to their 70’s and even 80’s to exist. Many of them are veterans who put their lives on the line; some have suffered physically and psychologically for what they were told was the greatest existence on earth. US big business attacks the European “welfare state” but, as one European worker put it to me, the difference between Europe and the US is that in Europe if you fall on hard times or have some bad luck, there is this social safety net that prevents you from falling to the bottom, that will provide some basics. In the US, not only do you fall to the bottom, you get stomped on when you get there.
The supporters of Facts For Working People campaign for a $15 an hour minimum wage. The Union leaders should lead a campaign for such a demand and build a movement around such demands as this and free health care, education and a decent retirement, but they won't unless they are forced to. We must demand and fight for what we need, not what Ted Kennedy and other millionaires (he was instrumental in passing the minimum wage legislation) tell us is acceptable. We have to raise our expectation of the system and when they are not met we have to change it.
*Wall Street Journal 7-6-09
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