The Case Against Raising the Minimum Wage - Part II

In a previous essay, I gave some reasons why I thought it was not a good idea for the various States to enact bills raising the minimum wage. Such a wage hike seems to be a fait accompli in Illinois, where Governor Pritzker recently signed a bill that would raise the minimum wage from its current $8.25 an hour to $15.00 an hour, to be phased in over the next few years. (Chicago already has a higher minimum wage of $12 an hour for employees of larger companies operating within the City.)

Even though the push for a higher minimum wage seems to be an unstoppable force across much of the United States, I still think it’s worthwhile to stop and reflect a moment about some of the negative consequences of further increasing wages. The policy has an obvious appeal. Who wouldn’t want $15 in hand, instead of $8.25? But the immediate gratification of that increased paycheck might have some very damaging long-term effects.

I won’t argue that increasing the minimum wage will simply lead to an inflationary cycle that will proportionately increase prices, which will necessitate still higher wagers, which will increase prices still further, ad infinitum. Economists have endlessly gone back and forth arguing that aspect of the issue. Conservative economists tend to argue that an enforced higher minimum wage does not comport with a free market system and that it drives an unnatural spiral of inflation. Liberal economists often deny both those charges. I tend to partially agree with the conservatives on this point, although there’s likely to be a lag time before an increase in general costs becomes evident after a wage hike. In addition, many other factors contribute to increasing costs, obscuring whatever part higher wages might play in any generally higher cost of living.

It should be obvious though that increasing wages doesn’t automatically put people in a better position down the road. The percentage of the U.S. population deemed to be living at or below the poverty level is currently about the same as it was when Lyndon Johnson launched his War on Poverty. The income needed to rise above poverty has naturally increased significantly, in tandem with wage increases, since the 1960’s. So according to that measure, all the social welfare programs and all the increases in wages that have taken place since the 1960’s have done nothing to decrease the number of people defined as “poor.” We have been running faster and faster, instituting more and more social welfare measures, just to stay in place.

But I’ll leave the endless merry-go-round of argument on this point to the economists. I want to argue against raising the minimum wage from a different angle. I want to advance considerations that have almost never been mentioned in the general economic debate.

In my first essay on this subject, “Wage Slaves – The Case Against Raising the Minimum Wage,” I pointed out what a catastrophic effect high wages can have on the environment. In high wage economies, material resources get wasted at a prodigious rate. Since material is cheaper than labor, all manufacturing processes in which there is any flexibility of approach are consequently designed to use a maximum of material and a minimum of labor. The parts of fish, animals, and plants that don’t lend themselves to being machine-processed for use – are simply discarded. Manufacturers are limited to standardized, high-volume output that can be produced without recourse to much manual processing. On the home front, everyone I know is aware of how expensive it is to have anything repaired these days. So despite our best intentions, we all feel forced to generate more waste by throwing away anything that develops the slightest glitch. Buy a new one, throw out the old. Who can afford to hire someone at $30 an hour to repair something that only costs $25?

In my previous essay, I also pointed out how high wages lead to uncongenial workplace conditions. As wages are raised yet again, more employees are laid off and the remaining workers are left to do double duty. This skeleton crew of workers are burdened and harried and supervised into maintaining maximum efficiency at all times. There’s little breathing room for friendly human interaction any more. It all has to be “Go, Go, Go!” We’re almost coming full circle back to sweatshop conditions. Sweatshops once were possible because so many poor, powerless laborers were available that they could be paid low wages since there were always more workers waiting in line to take the jobs. Now sweatshop conditions loom in many workplaces because employees command such high salaries that employers can only afford to hire a few of them. Those few have to do all the work that might more congenially be spread among many.

But in that first essay, I touched on yet another reason to oppose raising the minimum wage – a reason I would like to elaborate on here. Higher wages create extreme hardships for senior citizens, for the disabled, and for people caring for those either too young or too old to care for themselves. These people need human services above all else. As human services become more expensive relative to material goods, it’s these individuals who can be most profoundly disadvantaged.

Younger people might realize some temporary improvement in their lifestyles when they get increased paychecks because a large part of their budget is typically devoted to buying material things such as electronics, cars, household furnishings, and other consumer goods. A higher hourly wage allows them to get more of these things, which incidentally are already relatively cheap because they are often manufactured in countries with low wages.

However, older people concentrate less on acquiring more “stuff.” Their most urgent need is usually for human help. They already have their homes furnished and they generally aren’t very interested in acquiring as many new computers, phones, cars, etc., etc. What they need instead are plumbers, painters, carpenters, drivers, and caregivers. Most senior citizens are already struggling on this score because such help is scarce and very expensive. Any further increase in wages would tend to put these services further out of reach. Seniors would increasingly be left to suffer as their dwellings fall into disrepair and as they sit alone, dependent on relatives or occasional volunteers for the personal assistance they need.

I have been a volunteer driver for senior citizens. My friend Addie’s situation was representative of what many of the elderly have already been suffering as a result of our relatively high pay scale. Addie lived in a subsidized apartment in senior housing near the old Cabrini Green projects in Chicago. Like Addie, most of the residents in the building were African-Americans in their eighties and beyond. Addie was 96-years-old. She had come up from the cotton fields of the South where she had worked as a youngster. When she arrived in Chicago in the 1930’s, she immediately got a job, even though it was the height of the Depression and jobs were scarce. She earned 25¢ an hour +cleaning Pullman train cars. She worked 50-hour weeks, scrubbing down the cars with bleach and other strong chemicals, making them spotless for the passengers who would be re-boarding to go on to New York or Los Angeles. So Addie’s average weekly take-home pay was under $12.00

She carefully saved as much of her money as she could, while still helping her daughters and other relatives when they fell on hard times. She retired when she was 68-years-old, with a history of over 50 years of hard labor. She did get Railroad retirement benefits, the apartment subsidy, and some other incidental help. But she had never been officially married, so she, like many of the single women in her building, were not able to collect any spousal Social Security.

Addie was remarkably healthy, did all her own cooking, and most of the daily apartment maintenance herself. However, after she fell and broke a wrist, she needed some help. Working through the tangle of red tape, she finally contacted an agency that sent out a caregiver – whom Addie had to pay $20 an hour. The caregiver would come and sit with Addie, watching television with her, occasionally making her a sandwich. For every hour of this care-giving, Addie had to pay almost double what she herself had earned in an entire week!

Addie couldn’t possibly afford to hire the caregiver for more than 4 hours a day at those rates. Any more hours would have stripped her of her life-savings in short order. So she’d have the caretaker assemble a light supper ready in the refrigerator, line up her medicines where she could reach them, and leave her settled on her couch with her TV remote. “I’ll be OK. I’ll be fine on my own through the night,” she’d say. A few of the other building residents would drop in to check up on her.

But she and I would shake our heads and ruefully laugh at the cost and quality of the “help” she’d been able to procure. This was before President Trump’s election. However, immigration was even then being raised as an issue. Addie and I took the opposite view of most of the politicians speaking on the subject. We’d conspiratorially jest that, instead of discouraging the fleeing Mexicans - we’d hire a convoy of buses, go down to the border, and wave as many potential workers in our direction as possible. Addie and everyone like her needed more HELP, HELP!

The contrast between what most politicians were advocating and what was really needed on the ground was made even clearer whenever Addie’s free-wheeling grandson would drop by for a few minutes. Her grandson would bombard us with complaints about the job he’d recently quit (one of a chain of jobs). They hadn’t paid him enough – there just wasn’t any decent work to be had. As he stood there outlining this sorry state of affairs - as he stood there ripe for the blandishments of any politician who promised a higher minimum wage – Addie and I would exchange sad, knowing looks. She’d hand her grandson a $20 bill and ask him if he would pick up a pound of butter for her and bring it when he next visited. He could keep the change. The nephew would lean down, kiss his “granny” on the cheek, and say, “Sure thing! Anything for you, Granny.” Then he’d breeze out again, into that wide world where there was presumably no work to do and vastly insufficient compensation for doing it. He wouldn’t be seen again for a month or two. When he would re-appear, he’d be predictably butterless. (I expanded my volunteer duties to do a lot of shopping for Addie and some of the other residents in the building.)

I know similar scenes were being repeated in virtually every apartment in that large housing project – and likely in most such projects, apartments, and houses all over Chicago and the U.S. When government officials promise to raise the minimum wage, they are catering to the complaints of people like Addie’s grandson – meanwhile leaving Addie herself teetering on the brink of impoverishment.

It wasn’t always quite that difficult for people in the lower middle class and above in the U.S. When my grandparents were raising their children in the early 1900’s, they and all their neighbors could count on having some affordable household help available. In those days, such help was often provided by young Irish women who had emigrated away from the difficult times in Ireland. Having household help was as crucial then as it is now, but often for different types of chores. My grandmother and the “maid” would work together boiling vats of water for wash days. The next day would be ironing and sewing.

But there were also the ageless kinds of work to be done. The household help would be available to spell my grandmother when a new baby was brought home or when one of the children would get sick. Now a family has to be making a fairly high income to afford help raising children, particularly in-home help. The majority of Americans are left to work, raise children, and take care of all the other daily chores – without any help whatsoever. Every man, and woman, is an island, struggling through alone. Single parents all over are often strained nearly to the point of breakdown, trying to do it all without affordable help.

One of my volunteer associates told me about the tragic case of the father of a severely disabled daughter. In her vegetative state, she had frequent seizures. She needed around-the-clock care. Despite all the promise of aid and agencies that the government would make – there was in fact virtually no relief available for people in such a situation. After years of tending to the daughter on his own, the aging father couldn’t do it anymore. He killed his daughter - then himself.

Almost every senior care facility, every hospital, every nursery – could use more help. The elderly are left to sit endless hours in wheelchairs in hallways because there’s no one to help change their diapers, to feed them, to simply sit with them in companionate ways. On the rare occasions when the world looks at the desolate predicament of such individuals, blame is often hurled at what’s taken to be the money-grubbing corporate owners of these care facilities. Well, such blame is sometimes deserved. But the bottom line is that there simply aren’t the people available to do this work, at least not for the wages that even the most benevolent facility owner could afford to pay. Raising the minimum wage will not be likely to attract more people to this calling, and it will only impel both greedy and generous facility owners alike to cut staff still further and to cut more corners.

Our society truly doesn’t need to “create” more jobs. If politicians and their constituencies would think in terms of “work,” rather than “jobs,” they would realize there is plenty of work to do out there. That means increasing awareness of how much we need additional people. We need more kind-hearted, willing immigrants. We need more people to leave their less-than-crucial jobs as corporate liaison communications department coordinators and make themselves available to do society’s truly necessary work.

Most of all, we need these people to be available at affordable rates. While no one would want to go back to the old sweatshop conditions in which desperate people worked long hours for pennies – neither should we raise wages so high that HUMAN intelligence and HUMAN presence become prohibitive. The human touch will remain essential to our generating good products and good services. We can’t afford to price it out of the market.