The problems of stagnant worker pay and rising global wealth inequality often seem insurmountable — too big to get your brain wrapped around them, too thorny and plutocratically entrenched to uproot with good policy prescriptions.
Then again, consider what Clark College economics professor John Fite had to say some months ago as part of a community forum on Thomas Piketty’s provocative book, “Capital in the Twenty-First Century.”
The current distribution of income and wealth is human-made, Fite said, “not ordained by God.” Which means people can change the laws that govern markets to make them more equitable.
And while raising the minimum wage to increase incomes at the bottom of the pay ladder represents just one policy prescription, it’s also catching on in places such as Seattle, San Francisco, Los Angeles and New York.
Seattle, for example, is incrementally phasing in a $15 minimum wage. The idea has yet to gain a significant foothold in Clark County. Conversely, it also hasn’t been completely banished to the sidelines.
Vancouver-based Evergreen Habitat for Humanity recently announced it increased its minimum wage to $15 per hour. “We want to do our part to end poverty wages in Clark County,” Josh Townsley, the nonprofit’s executive director, said in a news release.
It’s not just nonprofits and governments moving to give low-wage workers a lift up. Facebook, renowned for showering its staff with perks, recently said it will require its U.S. contractors and vendors to pay their employees at least $15 an hour and offer paid time off for sick days and vacation.
The recent passage of phased-in minimum wage increases, coupled with debates of similar proposals by federal and state lawmakers, has, not surprisingly, touched off impassioned comments from backers and opponents.
Opponents argue such market tinkering will shoo businesses away and crater jobs. Proponents contend that raising the minimum wage helps reduce inequality and delivers a much-needed boost to the paychecks of low-wage employees.
Positive outcomes
So far, comparative studies suggest proponents have the right of it. “A number of researchers have found that modestly higher minimum wages can raise incomes for low-wage workers without reducing the number of jobs in an area,” according to The New York Times’ recent careful reading of the issue.
Still, with so many places in the U.S. now elevating the minimum wage, even supporters say we’re entering unmapped territory. “There could be quite large shares of workers affected, and research doesn’t have a lot to say about that,” Jared Bernstein, a former White House economist, told The Times.
Fortunately, we can keep studying outcomes. That’s what will happen in Seattle, where city leaders have charged a team of researchers with examining the impacts of the $15 minimum wage.
As to the thorny problem of global wealth inequality, I’m still wrapping my brain around that one.
But Piketty’s book is next on my reading list, and I can’t wait to take the plunge.
