Monday, July 28, 2014

A minimum wage political stunt to make you 'feel' but not 'think'

Last week for Ohio Watchdog, I wrote about the latest political stunt to push a higher federal minimum wage.

It's all about a "Live the Wage" campaign and you can read the details here.

But here's the gist: There are a bunch of people out there - primarily on the left side of the political aisle, along with unions - who want to raise the minimum wage to $10.10 an hour.

They so want that targeted number that their latest telephone conference to announce a new initiative was held at - wait for it - 10:10 a.m.

The new ploy is called "Live the Wage" and it's similar to the bogus food stamp challenge that was so popular - and so criticized - just a short time ago.

You see, the thinking is that if only members of congress (who earn about $83 per hour) would try to live on a minimum wage, they'd see how hard it is to do. Then, after experiencing that hardship, they'll rush to vote to increase the current rate of $7.25 per hour to $10.10.

Yes - it's all about an appeal to emotion.

Of course it's hard to not have money, especially in a society that is constantly pushing you to buy things.

And no one aspires to be poor. It's not like you wake up one morning and decide your goal is to earn only the minimum wage.

Even people who are currently working at a minimum wage job don't think that's all they'll ever be paid. That's just not in the human psyche.

So with the new campaign, supporters of the increase challenge you to live on $77 per week - after taxes and housing expenses, that is. You see, housing varies so much from city to city that it's just not a doable challenge if you don't take out the average cost.

And $77 is what they say is all that's left to live on if you're a full-time worker earning the federal minimum wage. (Never mind that 21 states, including Ohio, already have a minimum wage greater than that.)

The supporters of the wage hike use a lot of emotionally-charged words in their push. Phrases like 'work hard' and 'play by the rules' and 'support a family.'

Except, as my Ohio Watchdog story shows, most people who get paid the minimum wage are NOT supporting families. In Ohio, less than 2 percent are single parents with children in the home. And the average household income for a person who earns minimum wage is nearly $66,000.

What this means is that the vast majority of people we're supposed to feel sorry for are teens or college students who are working while going to school and living with their parents (at least when they're not living at school, which their parents are most likely paying for as well).

Or they are seniors who are willing to take a minimum wage job to supplement their retirement income, especially because if they earn too much, they could see reductions in that retirement income.

Or they are spouses who are earning extra income to supplement the family budget. This could be because they desperately need that second income - even at minimum wage - or because they want it to pay for items they'd like to have but don't necessarily *need.*

So the emotional appeal - that you need to feel sorry for these poor people who are trying to support a family of four on only $77 a week - falls extremely flat in light of the facts.

But you're not supposed to pay attention to the facts. You're supposed to *feel* - but not *think.*

The other fact you're not supposed to consider is that minimum wage is a starter position, usually reserved for the least-skilled individuals with no experience. Nearly all people who start out making a minimum wage are going to be earning more than that within a year, many in less time than that. Many companies use it as a probationary wage, increasing it slightly after 90-120 day when the new employee has proven their ability to come to work on time and do the job.

And most companies will be a pay increase after one year. Even the woman on the conference call with the politicians when they announced this stunt - the one who was supposed to represent the average worker who just couldn't get by on $77 a week - admitted that she got a raise and was no longer earning just the federal minimum.

But interestingly, no reporters who were on the call with the Live the Wage supporters asked about that.

Former Ohio Gov. Ted Strickland, who was on the call, started his week of minimum wage living early. He said it was really tough.

Well no kidding. I don't know how much he's making as head of the Center for American Progress Action Fund, but the last CAP Action Fund president earned $164,000 in 2012 (according to the 990 form the non-profit is required to file). So it's no surprise if he finds it "tough" to go from that to $77 a week - who wouldn't?

You get used to living at a certain income and when your income suddenly drops, you have to make adjustments. You can't eat out as much. You buy cheaper cuts of meat - probably more chicken than beef tenderloin. You forgo $20 salads at swanky restaurants in exchange for tuna fish sandwiches you make at home. You cut down on alcohol since you just don't have the funds to pay for it.

Or you do what U.S. Rep. Jan Schakowsky did - eat like this:
That probably looks like most family's menu for the week. Oh the horror!

The point is - most individuals can live on a minimum wage salary if they have to. They'll make sacrifices and change their habits based upon a limited income, but they'll do it.

If they have a house with a mortgage they can't afford on that salary, they'll sell it and move into an apartment they can afford. They might get a roommate - or two - in order to make it more affordable. They make adjustments to their travel methods, maybe opting for public transportation or ride-sharing. They shop at Goodwill or re-sale shops rather than at the mall. They might even sell things, like clothes, video games and equipment or other items. They might choose to take on two jobs.

Even if they do those things, they probably won't be in such a situation for long. They'll get a raise, network, get more experience and most will get a better-paying job. Eventually they'll be back to where they were before, living comfortably.

And the less than 5 percent of minimum wage earners who are heads of a household have a host of resources available to them: food stamps,TANF, Aid to Dependent Children,housing vouchers, transportation vouchers, utility assistance, job training and host of other government benefits and private charities. They won't really be living on just $77 a week, when all that is included.

The problem is, most people know this. Most people with a job have worked at a minimum wage position (me included) and we know what it was like. We also know we didn't stay there long, and that doing a good job and showing your employer your value as a worker was a key aspect of moving out of the minimum-wage position. We remember what it was like to live on Ramen noodles and we know we could do it again - if we had to. We just make sure we don't have to.

We also know that rising the minimum wage means too many people who need entry-level, no-skill jobs will be priced out of the market. The work that they are qualified for and can do won't be worth that much money. Unemployment will rise even more. It won't give us the kind of economic growth we need.

And supporters of the hike have no arguments left that can't be debunked by a little bit of common sense.

So now you're supposed to *feel* ... because if you'd only *feel* what it's like to live a minimum wage, all your logic and reason will fly out the door and you'll jump on the bandwagon to raise it.

Instead of thinking about why businesses aren't hiring, what kinds of costs job providers are having to pay that prevents them from using money for hiring, why the economy isn't growing like it should or why millions of people are out of work, politicians are ridiculously trying to 'feel the pain' of living on $77 a week - as if that will give them great insight into why the number of unemployed is at a record.

Don't you think it's funny that no one ever tries to live like a small business owner for week? To feel what it's like to try to make a payroll, deal with government forms and mandates, handle local government rules and regulations, deal with happy and angry customers, supervise a work staff, promote your business, do the accounting and somehow find time for family and friends and an actual life outside of work?

One day in the life of small business owner is much more difficult and stressful than trying to live on $77 a week.

That's the reality of this ridiculousness - and that's why the whole "live the wage" publicity sham is such a travesty.

Friday, July 18, 2014

People will abuse powdered alcohol, Ohio lawmakers say

My latest at Ohio Watchdog...

By Maggie Thurber | for Ohio Watchdog

PALCOHOL: In a YouTube video,
Palcohol inventor Mark Phillips
 shows how the product works
and addresses what he calls
the “completely false” claims
about his product.
We have powdered coffees, powdered juices, powdered soups, powdered eggs, powdered milk.

Why not powdered alcohol? After all, it’s light, portable and convenient.

But we’ll abuse it, two Ohio lawmakers say.

Reps. Ron Gerberry, D-Austintown, and Jim Buchy, R-Greenville, introduced House Bill 594 to prohibit the sale of powdered or crystalline alcohol in Ohio.

Alaska and South Carolina have already banned the substance while New York, Vermont and Minnesota have pending legislation to do the same.

“The potential for abuse of this product far outweighs any value it may have in the marketplace,” Gerberry said in a news release.

“The public health risk of powdered alcohol is too great for our state to ignore,” Buchy said in the same release. “We have to do our part in putting forth reasonable laws that protect our children and prevent the availability of drug forms that have a higher potential for abuse.”

Their concerns mirror those of U.S. Sen. Chuck Schumer, D-New York, who asked the Food and Drug Administration to ban it.

In April, the Alcohol and Tobacco Tax and Trade Bureau, which regulates taxing and labeling of alcohol products, approved seven flavors of Palcohol. They then temporarily rescinded those approvals due to a technical issue with the package fill levels. Palcohol made some changes and resubmitted the labels for approval.

According to Schumer, the FDA supersedes the TTB approval in the presence of significant health concerns.

He said “experts” should “step in before this mind-boggling product, surely to become the Kool-Aid of teen binge drinking, sees the light of day” and “stop this potentially deadly product in its tracks” to avoid the “hospitalizations and death that are likely to follow.”

Nonsense, says its inventor.

Read more

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