Thursday, March 10, 2016

Us vs. Us: Elite Pit Poor Against Each Other

Pictured: Donald Trump who argues minimum wage is too high

Wages in America have fallen far behind the rate of inflation and the cost of living. The last time minimum wage was raised was in 2009 when the Fair Labor Standards Act (FLSA) raised it to $7.25 an hour. Some states and other localities such as cities have raised their minimum wage levels higher than this, but not to level it once was.

Many argue against it including Donald Trump who said on MSNBC's Morning Joe, "But I think having a low minimum wage is not a bad thing for this country." He argued that most people wouldn't have to worry about it if they just did a good job working hard.

Others argue against Presidential candidate Bernie Sanders' proposal to eventually raise it to $15 over multiple years. In these arguments, they use fast food workers as the example of a minimum wage worker. Out of the 3.3 million workers making the federal minimum wage or lower in America (tipped employees, student-employees, and more make under the federal level), 1.5 million are in the food industry according the Bureau of Labor. This doesn't take account for those that are making minimum wage in areas that are above the federal level, but pay a higher minimum wage due to cost of living in those particular regions (e.g. California is $10 an hour). Approximately 35 percent of food industry workers in total in American make minimum wage or less.

The strawman argument made is that if minimum wage is raised to $15, the majority of those that will benefit will be teenage kids working for an employer such as McDonalds. The average minimum wage employee is 35 years old according to John Schmitt, the senior economist with the Center of Economic and Policy Research in Washington DC. Just over 88 percent are over 20 years old and over 50 percent are over 30 years old. Fifty-four percent of minimum wage employees work full-time and another 32 percent work half-time (up to 34 hours a week). This also doesn't take account of those making just over minimum wage, but under the $15 an hour. This includes retail store managers such as Gamestop who pay head store managers $12 an hour to run businesses that make $2 million a year and carry a low payroll percentage already. They too would benefit from the raise.

Those that utilize the strawman argument online often make comparisons with teenage fast food workers to professions such as EMT's and military people who make under $15 an hour as well. This is a false argument though. To start, EMT's and other medical professionals making under $15 would benefit from a minimum that is raised to $15. Second, there is no scenario saying that fast food workers deserve it more or that they would receive the pay raise, but not those in the life saving professions. Thirdly, they too have been the victims over the years of not receiving raises that correlate with the cost of living.

Instead of people pitting fast food employees against these noble professions, why are they not banding together to fight those who have benefitted from their hard work? The average CEO makes 350 times more than their average employee, let alone one that makes minimum wage for that company. The average CEO in America makes $12.3 million a year which is almost $5 million a year ahead of the second highest paying country in the world to CEO's, Switzerland. Walmart's CEO, Doug McMillon makes $25.6 million a year not counting his company paid cars, paid air travel, and other benefits. This is 1,133 times higher than the average full-time Walmart employee who makes $22,591, or about $10.86 an hour.

This has ballooned from the 20-1 CEO to average pay ratio from 1950. This also doesn't account for other board members and top brass within these companies who also saw their incomes balloon higher than the average employee. While CEO's saw their pay rate rise as high as 1,750 percent since 1950, the average worker hasn't seen the same pay hike.

In 1968, the minimum wage was $1.60 which doesn't sound like a great deal, but when adjusted for inflation, has as much buying power as someone who make over $21 an hour today. That means if you make under $21 an hour today, you are no better off than a minimum wage employee was 48 years ago. You would have to make $41,680 a year ($21 an hour at full-time) to have the equal buying power of a minimum wage employee in 1968.

Today, 63 percent of Americans make under $41,680. That is 63 percent of Americans who make wages that have not kept up with inflation and the cost of living. There are teachers, first responders, business managers, and many other professions that make less than that. This means the face of person that has knocked down by the elite shouldn't be a fast food employee, but instead should be someone such as a soldier, teach, or EMT, for they too have been gypped.

While those who the strawman argue against minimum wage being raised to $15 an hour love posting pictures of fast food employees as the face of their argument, those who make less than $21 should ban together and counter this argument.

It's not one or another when it comes to fast food employees versus someone such as an EMT. The elite use this example to pit the poor against the poor. This takes the heat off what they themselves make. If you make under $15 an hour, you should direct your anger at those who run your place of business and not those who make around the same amount.

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