May 01, 2014

Minimum wage, $10.10, $15, homelessness and other issues

As the Senate, just in time for May Day, gave President Obama a rejection on bumping the federal minimum wage to $10.10 an hour, and Seattle activists continue to push for $15 an hour there, there are several other related issues.

First, a brief look at both measures.

The federal bill was decent overall. Beyond the actual rise, the 30-month phase in was long enough. And, hiking restaurant servers' minimum, at tipping restaurants, to 70 percent of the regular minimum, is good too. The biggest weakness is not indexing the minimum wage.

The Seattle bill? Socialist activist Kshama Sawant seems to be overreaching. Yes, Seattle is more expensive than the Midwest, but it's not that expensive. And, not including tips as part of that, so there's no separate minimum for servers? Yes, it probably would hurt a fair amount of restaurants. Fake protests aside, there's real concerns too.

And, not every other claim by the pro-$15 side in Seattle totally rings true, either. The biggest is linking the minimum wage hike with homelessness.

Well, social services type folks have generally split the homeless into three groups, with two of them often having some degree of overlap.

The first is those who have some sort of financial mishap. Would a higher minimum wage help them? Maybe, maybe not. Personal bankruptcies leading to homelessness are caused by medical cost burdens more than any other single cause. A higher minimum wage, at the Seattle level, is very likely going to lead to cuts in health care. Workers would have to pay a lot more out of pocket for private plans or else lose private coverage entirely. Beyond medical debt, a number of other financial issues can drive people into either short-term or long-term homelessness.  Right now, housing foreclosure is probably No. 2, especially for older people not working full-time. A higher minimum wage might help that, or it might lead to such people having their hours cut, if the hike is too high. Anyway, it's simplistic at best to connect a higher minimum wage to helping this roughly one-third of the homeless.

Yes, remember, I mentioned that homeless can be divided into three groups. While exact numbers fluctuate, they're roughly equal.

The second third? The mentally ill on our streets. A higher minimum wage won't help them. 

Better insurance may, in some cases. In many cases, though? Only a partial reversal of late-1960s libertarianism on de-institutionalizing some mentally ill may reach them. Short of that, there's not much you, I or society can do for schizophrenics who forget to, or simply refuse to, regularly take their medications. A higher minimum wage has nothing to do with that.

The third group, which overlaps somewhat with the second? Addicts and alcoholics. Again, a higher minimum wage will do nothing to help them.

Homelessness? Would be nice if the solution were so easy.

And, I think at least a few people in Sawant's camp know it's not so simple. Call me back in five years to see how well Obamacare has addressed the insurance-related issue, and also to see if Seattle, or San Francisco, or similar cities, or various states, have addressed how to get the mentally ill on the streets to be medication-compliant and, if necessary, in shelters focused on the mentally ill. Ditto for harm reduction measures for addicts/alcoholics, short of "open use" shelters. I'm divided on the issue of letting addicts or alcoholics have anything on site in a shelter. If they are allowed that, IMO, it should only be under supervision, with supplies kept by the manager. Open, individualized addictive drug or alcohol use shouldn't be allowed in shelters, though. And, without wanting to sound too much like a 12-Stepper talking about people "hitting bottom," however you phrase it, many of the non-mentally ill addicts and alcoholics, even if homeless, aren't (yet?) ready to quit.

And, with their mild climates and drug-friendly stereotypes, Seattle and San Francisco probably attract a fair number of out-of-area addicts/alcoholics. I'll bet Vancouver, B.C., does too.

Homelessness is also affected by housing costs, which in turn are affected by other issues. The same moderate climate that may draw homeless people, when mixed with scenic views, draws people to move there in general and raises housing costs. Is rent control part of the solution? Public housing which targets a wider income range than current, usually stereotyped, public housing? 

So, minimum wage advocates? I agree with the goal, in broad outlines. But, stick to the minimum wage.

That said, I suspect this is advice for deaf ears in Seattle. Seattle, home of the "black bloc" in the 1998 WTO meetings protests. Seattle, just across the border from Vancouver, home to Adbusters, friendly to such ideas. I'm not saying Sawant and the people in her corner are that confrontationalist; however, some degree of "overlap" wouldn't surprise me at all.

My ideal? $10.10, with no subminimum for restaurant servers. Restaurants can then decide whether to keep tipping as a policy or not. Oh, and index the minimum to inflation, please? Seattle's mayor's plan, to hit $15, but with a seven-year phase-in, isn't quite as bad as Sawant's. Still a bit stiff. If Seattle wants to stay ahead of the nation, maybe $12/hour with a six-year roll-in?

1 comment:

Simon said...

Never understood how the worlds richest nation couldn't afford a basic living wage especially when it puts money into peoples hands so they can spend and create demand in the economy.

Other countries or US companies in other countries can, but no can do in the US.

& sure we have a higher minimum wage and still have homeless people but I would bet we don't have as many people with full time jobs and still relying on food shelters so their family don't go hungry.