Friday, March 7, 2014
By Michael J. Cowell
Illustrating the plight of those trying to live on minimum wages ("Working for peanuts," June 16), Susan Feiner draws comparisons to the 1950s and 1960s.
Initially, her math is accurate enough as far as it goes; it would require $10.70 an hour in 2013 to match the purchasing power of the $1.60 minimum wage in 1968.
But then to conclude that improvements in labor productivity would somehow justify $21.72 an hour is carrying hyperbole to the point of economic frivolousness. That works out to an annual minimum wage of $43,440, close to the current U.S. median and way above the earnings of many Mainers.
Labeling herself "just another chick with an economics Ph.D. What do I know?" she trivializes the issue.
What she should know, and presumably does but fails to acknowledge, is that the global economy has undergone a major restructuring.
As in prior commentaries, to make her arguments on wages and taxes she harks back to the way things were half-a-century ago. In the 1960s, the U.S. still commanded the industrial world.
We have since surrendered our economic prowess to the likes of China, Brazil and India, now producing high-value-added goods and services at costs we cannot match. Back then, semiskilled and even unskilled workers were still in demand in the U.S., able to make a "decent" living wage.
They no longer are; their productivity has stagnated; "their" jobs will never return. Simply enacting a higher minimum wage may be a temporary palliative for those at the bottom of the income scale. But without the training to equip workers to cope with the harsh economic realities of the 21st century it is just so much rearrangement of the deck chairs on the Titanic.
Michael J. Cowell is a resident of Yarmouth.