• Redefining the minimum wage
    November 13,2013
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    The New York Times said the following in an editorial:



    Business has been brisk at the Seattle-Tacoma International Airport, with a record number of passengers spending record amounts of money eating and shopping. But for an estimated 6,500 workers at the airport and its nearby hotels, car rental agencies and parking lots, the activity has not translated into economic security, let alone prosperity.

    Wages for airport-related jobs average an estimated $11 an hour, ranging from less than $10 an hour for airline contractors, like baggage handlers and cabin cleaners, to about $13 an hour for car-rental employees.

    That could soon change. Although the votes are still being tallied, the people of SeaTac, the small city south of Seattle where the airport is, have shown support for a ballot initiative to raise the minimum wage of the airport’s transportation and hospitality workers to $15 an hour, starting Jan. 1.

    That would make the minimum wage at Sea-Tac airport considerably higher than Washington state’s minimum of $9.19 an hour. It would be more than the $12.93-an-hour minimum at the San Francisco International Airport, which was enacted in 2000. And it would blow away the federal minimum of $7.25 an hour, in place since 2009, and exceed a proposal in recent legislation, sponsored by congressional Democrats and supported by President Barack Obama, for a new federal minimum of $10.10 an hour.

    All of which makes $15 an hour sound too high. Hardly. Over the last half-century, American workers have achieved productivity gains that can easily support a $15-an-hour minimum wage. In fact, if the minimum wage had kept pace over time with the average growth in productivity, it would be about $17 an hour.

    The problem is that the benefits of that growth have flowed increasingly to profits, shareholders and executives, not workers. The result has been bigger returns to capital, higher executive pay — and widening income inequality.

    Efforts by the states and the federal government to raise the minimum wage are an important way to counter that dynamic. But they must be seen as modest and partial steps in the direction of fair wages. Other steps include more progressive income taxes, enhanced rights to form unions without retaliation, and government job-creation programs, because a tighter labor market would force employers to compete for workers.

    Fast-food workers, Wal-Mart employees and staff of federal contractors have all been agitating recently for higher pay from profitable employers. They deserve raises, and they deserve to have the federal government behind them.
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