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

Image

^ 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

—- —- —-

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 When originally enacted, it paid workers enough money to make ends meet without public assistance, Today, $ 7.80 doesn’t do that at all.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

A BAD REFERENDUM — AND WE OPPOSE IT

Image

^ Geoff Diehl (R-Abington) : a good guy makes his pact with an unserious rant

—- —- —-

Massachusetts voters going to the polls next November face at least two referendum questions. One, we support : raising the minimum wage to $ 11.00 an hour. we have already editorialized our reasons for casting a “yes’ on this referendum. The ┬áproposal, we strongly dislike. This one seeks to cancel the three percent gas tax hike enacted earlier this year, by which our state will fund all sorts of needed road and public transit repair and upgrades.

That “Transpo Bill,” as it has come to be known, has already taken one hit : repeal of the software tax included in the original enactment. We agreed that taxing technology was a wrong idea. Technology should be encouraged and aided, not nicked. It is different with the gas tax. Driving wears and tears our roads and bridges; their upkeep is a public charge –and we make it so because driving keeps the economy moving, pun intended — and thus the gas tax.

The same people who initiated the software tax repeal now initiate the gas tax repeal. This time, their motives are suspect. From what they say at facebook and on twitter, they appear to oppose all public spending, or to view it suspiciously, as if public spending were a kind of con man come to scam us. Many of these opponents are Tea sorts, who view public spending as extortion money paid to “moochers” and “illeagl aliens.” We’ve already seen their impact upon the EBT program, a food-buying fund by which those living on the margins try to survive.

A referendum that begins with this mindset is tainted ab initio. By two arguments, its sponsors seek to justify it. We reject both :

1. they tell us that gas tax revenue is often spent by the state on programs other than road and bridge repair and transit upgrades. True enough, but so what ? This happens because the anti-public spending crowd denies the state funds that it needs for those other programs, many of them immediate, such as policing, courts, and administration, to pay for which the State’s Commissioner of Administration and Finance simply decides to defer road and transit work. Denying the State new gas tax revenue is going to worsen this situation, not improve it.

2. they say that pegging gas tax increases to the cost of living index is “taxation without representation.” Representaive Geoff Diehl (R-Abington), one of the repeal referendum’s leaders, and usually one of the really good guys, actually tweeted last night that every single “COLA” hike, every year, should be voted on by the legislature !

Keep in mind that the gas tax hike itself is three percent. On a 20-gallon fill-up at current gas prices — about $ 3.35 a gallon — that’s a tax of $ 2.01 per fill up. the usual “COLA” hike these days runs about two percent. two percent of $ 2.01 = $ 0.04 ! For four cents a fill up we’re to call the legislature into session to vote ?

The entire argument crashes and burns. We already peg our sales tax to prices; and prices go up, automatically, without the legislature voting. That the gas tax hike takes effect without a legislative vote is simply to tie it to the price of gas. Otherwise the gas tax hike would be assessed upon gas only at the price of gas on the day the tax hike took effect.

The referendum proponents already know this. They know the whole flap is a nullity. Its ┬áREAL purpose is to raise the hue and cry against “moochers” and “illegal aliens,” anti-spenders’ favorite scapegoats, and thus to help elect no-spending legislators in Districts outside the Boston media zone, within which the unseriousness of this device would be fully and quickly debunked.

Someday, if and when the no-spending crowd actually adduces a serious reason — and attacks upon its scapegoats’ desperate lives is both flip and despicable — for why they oppose taxes to fund State spending, we will listen respectfully to their arguments and maybe even agree. I’m not holding my breath.

—- Michael Freedberg / Here and Sphere