Columns » Ernest Dumas

A noble cave-in

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By week’s end, the legislature will have passed and Gov. Huckabee will have signed into law a bill raising the minimum wage for nearly all Arkansas workers, and every one who cast that vote will go home feeling noble for having lifted up the least of their brethren and sisters.

They should be allowed that glow and even given a little credit because they were not so stubborn as to cling, in the face of certain rejection by voters, to the old chamber-of-commerce bromide that wage laws are bad for everyone, including poor workers.

Let no one be mistaken that the minimum wage bill would have passed either house or that Gov. Huckabee would have even included it in a special session except that it had to be done to stop a constitutional amendment requiring perpetual increases in the minimum wage that would be tied to inflation. The sponsors of the amendment agreed to halt the petition effort in exchange for enactment of the one-time increase from $5.15 to $6.25 an hour.

That is the perverse history of the minimum wage in Arkansas. Although Congress enacted the first federal minimum wage in 1938 and most states had adopted laws covering workers who were exempt from the federal standard, Arkansas resisted. But in 1968, Gov. Winthrop Rockefeller, who was in a nasty tug of war with the Democratic legislature, called a special session and proposed the first state minimum wage. Democrats were supposed to be tribunes of the working stiff and they could not let a Republican claim that mantle. Unions might switch their loyalties. So the legislature, just a little sullenly, passed the first state minimum wage.

But that is one of the few times in history that a Republican took the lead in guaranteeing that the lowest workers made enough to feed and clothe their families. Republican control of either the legislative or executive branch in Washington or in state capitols nearly always has meant a stagnant minimum wage. The federal minimum wage has not been raised since 1997, making this the second longest flat period in history (the longest was Ronald Reagan’s administration and one year of the first President Bush), and it is now at the lowest point in five decades as a percentage of the average wage of nonsupervisory workers — 31 percent.

Americans long ago, in numbers that rarely shrink, embraced the idea that everyone’s toil, whether by brain or limb, deserved enough reward that their families could subsist. That is why constitutional amendments and initiated acts across the states are passing overwhelmingly, except where governors and legislatures act to co-opt the issue, as Michigan did last month and Arkansas’s fearless leaders are doing this week. An Arkansas poll promised overwhelming passage of an escalating minimum wage at the general election. Nationally, four of five voters favor a higher minimum wage.

While lawmakers were caving in and the chamber of commerce was taking a neutral stance publicly, some commentators and right-wing academics were still marching out the old Republican arguments raised at every single minimum-wage act in history: businesses will stop hiring and will lay off tens of thousands of workers so it is the poor people, you see, who will pay the price. It has never happened, even when George Bush I agreed to sharp step increases in 1990 in the trough of a recession. The 1997 increases, nationally and in Arkansas, were followed by the highest job growth in history.

You would think that they would worry about the burgeoning gulf in incomes in the United States, documented in almost every release of economic statistics. Even a hoary conservative like Alan Greenspan warned in his valedictory that something needed to be done about the vast and growing income inequality in America and the sinking living standards of the poorest workers. Even this trifling minimum wage will help a little.

The purchasing power of a minimum-wage worker’s weekly pay has fallen 17 percent since 1997. And what has happened to the incomes of America’s richest 1 percent or 10 percent in that period? They have soared. And what has happened to the big employers?

Friday, the Commerce Department reported that pretax profits in the fourth quarter of 2005 grew 14.4 percent over the previous quarter. (Wait until you see after-tax profits with the Bush corporate tax cuts.)

Profits accounted for 11.6 percent of gross national product, the largest share in more than 40 years. The Wall Street Journal reported the explanation of economists: employers achieved huge profit growths in recent years by sharing less and less with their workers.

The companies, not Arkansas’s 127,000 minimum-wage workers, are the real constituency of most legislators and the governor, which makes this week’s action remarkable even if it was predictable.

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