Bob Herbert: Working for a Pittance

Nowadays, caring about the low wages of the poor seems so…quaint. So dreamy and bleeding heart. We have things to do that are so much more important, so much more noble, like ending the estate tax.

Working for a Pittance
Published: July 3, 2006

“We can no longer stand by and regularly give ourselves a pay increase while denying a minimum wage increase to the hardworking men and women across this nation.”
— Hillary Rodham Clinton, to her fellow senators.

The federal minimum wage, currently $5.15 an hour, was last raised in 1997. Since then, its purchasing power has deteriorated by 20 percent. Analysts at the Economic Policy Institute and the Center on Budget and Policy Priorities jointly crunched the numbers and determined that, after adjusting for inflation, the value of the minimum wage is at its lowest level since 1955.

For those who don’t remember, Eisenhower was president in 1955, the Dodgers were still in Brooklyn, and Barack Obama hadn’t even been born.

If you’re making the minimum wage, you’re hurting. If Congress and the president don’t raise the minimum wage by Dec. 2, it will have remained unchanged for the longest stretch since it was established in 1938. (The longest period previously was from January 1981 to April 1990 — a span that saw the entire Reagan administration come and go.)

Senate Republicans recently blocked a Democratic bill, sponsored by Senator Edward Kennedy, that would have raised the minimum wage to $7.25 an hour over the next two years. Jared Bernstein, a senior economist at the Economic Policy Institute, noted that while Republicans in Congress are standing like a stone wall against this modest increase in the poverty-level wage, “they are working as hard as they can to repeal the estate tax.”

“That,” he said, “is just vicious class warfare.”

The most important pay increases for most members of Congress are their own, and they are diligent in that regard. Senator Clinton, in a floor speech supporting the minimum-wage hike, said, “During the past nine years, we’ve raised our own pay by $31,600.”

Mrs. Clinton has introduced a bill that, in addition to raising the minimum wage to $7.25, would link Congressional pay raises to hikes in the minimum wage. Under the bill, the minimum wage would be increased automatically by the same percentage as any increase in Congressional pay.

Polls have shown that Americans overwhelmingly favor an increase in the minimum wage. But the low-income workers who would benefit from such an increase are not part of the natural G.O.P. constituency. Thus, the stonewall.

A separate study by the Economic Policy Institute found that in 2005, with the pay of top corporate executives up sharply, and with the minimum wage falling further and further behind inflation, “an average chief executive officer was paid 821 times as much as a minimum wage earner.”

That C.E.O., according to the study, “earns more before lunchtime on the very first day of work in the year than a minimum wage worker earns all year.”

The reality, said Senator Clinton, “is that a full time job that pays the minimum wage just doesn’t provide enough money to support a family today. We have to acknowledge that fact and do something about it. As a country, we cannot accept that a single mother with two children who works 40 hours a week, 52 weeks a year earns $10,700 a year — let me say this again: $10,700 a year. That is almost $6,000 below the federal poverty line for a family of three.”

During the 1950’s and 60’s, the minimum wage was roughly 50 percent of the average wage of nonsupervisory workers. It has now fallen to 31 percent — less than a third — of that average.

As the Economic Policy Institute and the Center on Budget pointed out in their study: “Each year that Congress fails to raise the wage floor, its purchasing power erodes. The fact that the minimum wage has remained the same for nearly nine years means that its real value has declined considerably over that period. As inflation has accelerated recently due to higher energy costs, the real value of the minimum wage has fallen faster.”

There is no justification — none — for condemning the nation’s lowest-paid workers to this continuing slide into ever deeper economic distress. “No one who works for a living should have to live in poverty,” said Senator Kennedy.

It’s very telling that in the most prosperous nation in the world, that kind of comment actually sounds radical. We have a very long way to go.

The Discussion: 5 Comments

Barbara Ehrenreich now has her own blog devoted to similar issues related to the dismantling of America’s working and middle classes:

July 3, 2006 @ 7:41 pm | Comment

As much as I am a libertarian, I support raising the minimum wage only because it would encourage employers to adopt more capital-intensive production methods, which cost them in the short run, but benefit themselves (in greater production efficiency) and the entire economy (by increasing long-run aggregate supply) over the long term.

July 4, 2006 @ 12:40 pm | Comment

The thing is…not everyone can be successful. A friend of mine wrote a great post about this over at Not everyone is going to be a winner. Not everyone is super-talented. But doesn’t everyone in this country who tries and works hard deserve some decent standard of living? Otherwise, what are we saying about the society we want to create?

July 4, 2006 @ 5:11 pm | Comment

Lisa, it’s more complicated than that, and it’s worse than that. You say “not everyone is super-talented.” But that’s not the main problem.
Some super-talented people end up in the streets, and some total morons end up in the White House.

July 4, 2006 @ 6:30 pm | Comment

Well, yeah. Not everyone is super-talented, lucky or connected.

The point being, that everyone who is willing to work hard in the US should have some decent standard of living.

July 4, 2006 @ 11:44 pm | Comment

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