If Oregonians want to address the growing gap between rich and poor, it would seem we have two options: Reduce the income of those making the most or raise the income of those making the least.
There are those who will categorically oppose either method.
Raising taxes, or even simply closing some of the many tax loopholes benefitting those in the upper income brackets, is described by opponents as a job killer and anti-democratic. Those making high wages need the full financial support of the state or they will take themselves, and their business, to a state or country more conducive to the unimpeded stockpiling of wealth by the individual.
Raising the minimum wage is also described as a job killer and anti-democratic: Those making high profits via the employment of large numbers of minimum-wage workers need the full financial support of the state or they will take themselves, and their business, to a state or country more conducive to the unimpeded stockpiling of wealth by the corporation.
The solution, it is represented, comes not from government interference but from the “free enterprise system” which, we are told, would ensure a level playing field if only the government would stop telling business people and corporate leaders what to do.
It’s hard to imagine a situation in which the role of government is strictly limited and the corporation is given a free hand in dealing with the wage worker, but we don’t need to rely on imagination:
Roll back the years and you will find just that sort of situation following construction of the first intercontinental railroad, which opened Idaho, Montana, Washington and Oregon to large-scale extraction industries. Wheat, mining, logging and construction all needed “human machines.”
In those years, much of the labor in the Pacific Northwest was migratory: Huge crews were needed for a relatively short period of time each year to harvest wheat on the Columbia Plateau in the fall, in the mining and logging industries during spring and summer, and on railroad construction crews.
This huge, migratory workforce had little community and could not vote.
Work conditions in many industries were so poor — horrific working conditions, dangerous mining conditions, low wages — that in 1892, mine owners and workers engaged in an all-out war — the workers were winning, since they had all the dynamite — until U.S. troops were called in and martial law was declared.
Violent confrontations occurred again in 1899, conditions only improved with federal intervention during WWI.
“Free enterprise” with no government regulation was problematic, it seems.
Raising the minimum wage seems like a better alternative.
Polls show that most Oregonians support raising the minimum wage — although most believe $15 an hour is too high — giving state legislators room for compromise.
Basing policies on what should happen in an ideal world instead of reality is a bad idea. Especially when government is making decisions about how private industry ought to do business without taking time to thoroughly study the potential harms.
Such is the case with movement in the Oregon Legislature to bump up the state’s minimum wage to as high as $15 per hour, which seems to be the most popular option. In the name of social justice, Democrats are pushing in this direction, seemingly without regard for the actual economic situation facing many small businesses.
In rural Oregon, store owners and many companies are struggling to get back on their feet after the Great Recession. And farmers and ranchers are already pinched by the growing cost of complying with state and federal mandates.
How about small stores that give teens the opportunity to learn customer service skills while they earn minimum wage? Would having to pay someone with no job experience $15 per hour outweigh the benefits?
Marie Bowers Stagg, a fifth generation farmer in Linn and Lane counties, calculated the fiscal impact of raising the minimum wage further – Oregon already has the second highest in the nation – and provided Legislators with these statistics:
Her current cost on a per acre basis for seven employees is now $9.07 and would rise to $13.65 with a $15 per hour wage.
That means, said Stagg, her farm would need to produce at least 75,000 more pounds of ryegrass each year to stay profitable. She said yield is dictated by many factors that might not make that possible.
If the Legislature went ahead with plans to raise the minimum wage, she said the farm’s seasonal workforce would likely be hired from outside the country because that would be more cost effective.
Small enterprises not in agriculture will not have an alternative to the added wage costs, so many will end up reducing the workforce to meet the added expense.
That should be a big concern to the Legislature when more than 97 percent of Oregon employers are small businesses and the state has the second highest unemployment rate in the U.S.
Activists say a $15 minimum wage would put more than $1,000 a month in a full-time worker’s pocket. However, a recent analysis by Oregon’s nonpartisan Legislative Revenue Office suggests the figure for a single parent might actually be $49 per month once lost food stamps and tax refunds are factored in.
And what about employees who now make more than $15 per hour because they have a higher skill set? Won’t businesses also have to increase their earnings to make the added responsibility worthwhile?
Shouldn’t all these factors be thoroughly studied before government leaders do something that might actually end up costing people jobs?
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