INDEXING THE MINIMUM WAGE — BUT NOT THE GAS TAX ? WHAT’S GOING ON, AND WHY

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^ Massachusetts’s minimum wage is higher than most, but far behind our cost of living.It must be raised — and should be indexed to inflation

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A proposal has been offered, in my twitter feed, to index Massachusetts’s soon to be enacted Minimum wage hike to inflation. I support the proposal.

Inflation right now isn’t a worry. We haven’t had more than two percent inflation in almost a decade. A slow-growth economy with much unemployment and a lot of under-employment isn’t an inflation situation. Someday, however, inflation may well increase, to three percent annually or even four percent. Ten years of four percent inflation reduces any minimum wage figure we enact by 40 percent. that’s one of the reasons why we’re revisiting a minimum wage enacted many years ago,when price inflation stood a large chunk lower.

Indexing the proposed $ 11.00 an hour minimum wage to inflation will keep us from having to revisit the number. Revisiting doesn’t happen when it should; it waits until the number has been significantly degraded. That’s why we’re revisiting our state’s $ 7.80 minimum now. When originally enacted, it paid workers enough money to make ends meet without public assistance, Today, $ 7.80 doesn’t do that at all.

Full time workers should never have to need taxpayer assistance to pay their family’s vital bills. With an indexed minimum, full time workers in jobs paying minimum can at least keep pace. And while we’re at it, for goodness sake raise the minimum wage for tipped workers and airport employees.

Raising the minimum and indexing it help the economy. Need I say it again ? That if people can’t earn enough to participate in the growth economy, it grows less than it could ? And that that hurts all of us, including businesses ? Either we want a strong growth economy or we don’t. If we want it, we should enact laws that help bring it about.

To do otherwise is to force taxpayers to subsidize the low-wage policies of low-wage employers. There is no good policy reason at all why we should allow this. it is wrong economically and wrong morally. It is also a stupid business decision, because low-wage workers don’t stay on the job and don’t want to. They move on. Turnover is huge and wastefully expensive. Plus, a loyal work force is a motivated work force. Any business with any brains wants this.

Low-wage business interests will tell you that they don’t hire because of regulatory uncertainty or because the minimum wage will go up. Don’t belive it for a minute. Businesses hire because demand for their products or services increases. Consumer demand drives the economy. IT is the “job creator.”

So much for the argument about indexing a minimum wage. Yet indexing is also on the table with respect to the gas tax hike enacted by the Legislature and Governor last year as part of the large transportation Upgrade bill. I understand why the Transport bill included tax indexing; I agree with the added revenue’s purpose. But I also understand the constitutional argument adduced by the supporters of a referendum to eliminate the gas tax’s indexing feature. it is a shame that the Transport bill included a provision of specious constitutionality, because this has handed the anti-tax, anti-government crowd a persuasive case it doesn’t deserve.

The “Tank the Tax” crowd says that it’s opposed to indexing on classic taxation legislation principles. I don’t believe them for a minute. They’re opposed to taxes, period; opposed to State services; opposed to the people who need those services — public transportation included. It’s a shame that these folks are now able to cloak, inside a principle everyone holds dear, what they are really after : forcing Massachusetts residents who need public services to fend for themselves.

Let there be no mistake here. The people who wield now their high principle are the same ones talking about EBT fraud as if it were rampant, whereas it amounts to about 0.7 % of the entire EBT budget. They’re the same people who tout the Cato institute’s ridiculous claims that public assistance families average $ 40,000 in benefits, when in fact that the bulk of that figure includes retirees receiving social security, veterans and disabled veterans receiving benefits, and public workers drawing down their retirement payments. And they’re the same people who want to deny in-state tuition to children of undocumented workers — indeed, the same people who demonize undocumented workers as a group, even though undocumenteds work the hardest, for the least pay, at jobs few others will do at any price.

That the indexing feature of last year’s Transport Bill has offered these disconnected people a legitimate argument galls me. it should gall you. We need somehow to amend the Transport Bill so that indexing of its taxes is not needed. The “Tank the Tax” referendum will likely pass otherwise, with huge consequences for people struggling to make do, people who need public transit, people who do hard work beyond the imagining of those whose agenda is not the State’s friend.

—- Mike Freedberg / Here and Sphere

Author: hereandsphere

Here and Sphere is an online journal of news, opinion, reviews, advice, & bits n' pieces of everything else - from HERE to SPHERE...... Co-founded by Michael Freedberg, a long-time Boston Phoenix journalist, and Heather Cornell, a South Coast Massachusetts columnist and editor.

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