$1.50 Per Day

Trey Smith

The Business, Labor, and Consumer Affairs Committee will hold a Public Hearing on HB 2409 on Monday, March 28, 8:30 a.m. in Hearing Room B of the State Capitol.  Among other things, HB 2409 seeks to penalize any worker who earns tips of $30 or more per month.

Think about that for a moment.  If a waitress works Full-Time (20 days per month), that works out to $1.50 in tips PER DAY.  Not, $1.50 per CUSTOMER served nor $1.50 per HOUR.

A half-time worker (10 days per month) would fall under the purview of this law if she/he made $3.00 in tips PER DAY.

It would be next to impossible for any tip earner not to receive AT LEAST $1.50 or even $3.00 per shift. You could be the laziest tip-based worker in the world and it would still be next to impossible not to meet this ridiculous threshold. 

Consequently, if enacted, this bill would apply to almost every single person who receives tips as part of their wages, from someone slaving away at a local diner to those lucky enough to be employed at upscale establishments.

To learn more about this bill and its sponsors, see previous BlueOregon entries Calling All Rich Waitresses and Financial Friday.

  • Aaron (unverified)

    Let us go to those districts of those that sponsored this bill and educate the people on what thier reps are doing to them during the next election cycle. If not then we are to blame for the lack of disciple on be good progressive citizens.

    This bill is DOA on it transferring too the Senate.

  • Aaron (unverified)

    It is HB 2409 and not HB 2049.

  • (Show?)

    Just saw a blurb on the news about this, a restaurant owner saying that servers can earn $40/hour in tips and if we cut their minimum wage then the cooks can get paid more.

    So in the spirit of bipartisanship, I think the Dems should offer a compromise. Change the bill to apply only to servers who average $40.00/hour in tips.

    (I couldn't believe they picked that $30/mo figure. Talk about making your own arguments look stupid...)

  • afs (unverified)

    We have GOT to take control of the State House.

  • Trey (unverified)

    Aaron, I just HATE IT when I do that. I wish I could blame it on dyslexia or something similar -- Can't though, it's just carelessness.

    Thanks for being observant AND in pointing it out. I fixed it.

  • David Wright (unverified)

    Am I missing something, or does this bill essentially just remove the inflation indexing of the minimum wage for those employees making at least $30/month in tips? In other words, it establishes the minimum wage for such employees at the fixed rate of $7.25/hr, the current minimum wage, correct?

    Now, I understand that this is a rollback of wage increases that such employees would otherwise get, so in that respect it takes away from the employees.

    But a person working full-time (average of 172 hours per month) and getting at least $30 in that time frame (which is the FLSA definition of a "tipped employee" apparently, hence the use of that amount in this bill), is actually making more than 17 cents/hr above minimum wage now. Thus, they are not really "minimum wage workers".

    And that $30/month is, as was pointed out, absurdly low. Even getting $1/hour in tips is pretty lean -- but such a hypothetical employee is making $1/hr over minimum wage.

    The point here I think is that tip-earning employees already earn more than minimum wage, in some cases substantially more. As I understand it Oregon is one of only a handful of states which does not allow tip credit towards the minimum wage, so any tips earned really are in addition to that minimum hourly wage.

    If the point of a minimum wage is truly to establish a floor for wages, then it does not seem unreasonable to me to actually count tips earned towards that floor. Would you rather have Oregon credit say up to half or more of the minimum wage amount in tips earned (as is allowed under federal law) instead of this bill? Compared to that standard, this bill is a trivial compromise.

    And for those who are concerned about losing out on the inflation index -- restaurant bills tend to track inflation, and generally tips are a percentage of the bill. Thus, presumably tip income will also increase as inflation increases, so tipped workers already get some inflation-indexing in their earnings above and beyond that tied to the minimum wage.

    I understand these are not going to be popular points here, but I offer them to show that reasonable people can see this bill as promoting more fairness in our minimum wage law.

    Cheers... ;-)

  • Trey (unverified)

    David, You are mixing two bills. HB 2409 concerns the Tip Credit/Training Wage and HB 2331 seeks to repeal the annual adjustment.

    From my perspective, the minimum wage should be paid by the employer. Tips, by their very nature, are not mandatory. A tip is a cost borne by the consumer. Why should an employer save money from an expense he/she doesn't incur?

  • David Wright (unverified)


    Sorry, I was speaking about HB 2409 which as I said effectively eliminates the minimum wage increase for those workers who earn tips of at least $30/month. It doesn't really give "tip credit" per se, because no amount of an employee's tips would directly count towards the minimum wage level. Rather, it establishes a "tip wage" (as do many other states) which is not indexed. It also sets up the 60-day discount for minors (50 cents/hour less than the indexed minimum wage).

    I just looked at HB 2331 which as you say repeals the annual adjustment for all workers.

    I understand your point of view about the minimum wage -- and strongly disagree with it. First off, direct wages are costs borne by the consumer as well, via the price of the meal (in the case of a restaurant). The tip is simply an optional component of the customer's overall expense.

    But secondly, and far more importantly in my opinion, is the philosophical distinction you're making between the minimum wage as an obligation for employers (your point of view) versus the minimum wage as a benefit for workers (my point of view -- and, I strongly suspect, the way most people see it).

    I don't think I expressed myself on the fairness issue well enough in my original post. If the point of a minimum wage is to establish a minimal earnings level for employees in the state (and I understand that's not your point of view, but I still think that's the traditional point of view) then not counting some income for certain types of employees towards that minimal earnings level is unfair to those employees who do not get exempt earnings. It essentially establishes a higher minimum earnings level for those who are lucky enough to get tips, while leaving behind those who do not.

    And I'd remind you again that Oregon is one of only a handful of states that does not currently allow any sort of tip credit or tip wage. Not that being unique is a bad thing... but that does tend to support the idea that my point of view is the predominant one. In other words, the philosophy behind having a minimum wage at all is to provide a guarantee to the worker that an hour of labor will be compensated at no less than a minimal rate. Tips are certainly compensation, and they are taxable income, therefore they should by rights count towards the minimum wage at least to some degree.

  • Aaron (unverified)


    Not a problem, HB 2049 is potential a good bill for the state house too pass.

    Another way of getting the issue out is too protest in front of these resturants that testified for support of this bill. Show these businesses support the idea of "2nd class" wage earners.

  • afs (unverified)

    David Wright... first I see you all over the Sizemore thread ranting against unions. Now I see you on this thread attacking waitresses. You really need to turn off the Lars-aganda. Greed is one of the seven deadly sins, not something to be celebrated. You should be ashamed of yourself for being a person who is lucky enough to have a few things in life, and you spend your free time attacking those who do not. What kind of person gets off on spending vast amounts of their free time lobbying for beating down on the poor?

  • Marcello (unverified)

    The minimum wage is a form of corporate welfare for large and small businesses alike. As a society, we seem to have decided that working people should not die of starvation, at least not in large numbers. And with the current minimum wage laws, we have told employers that if they pay one third to one half of the money (bless thair heart) needed to keep their employees and their families out of homelessness and starvation, we will gladly have taxpayers pay most of the rest in the form of earned income credits, food stamps, Medicaid, public funded housing, etc. Wal-Mart alone benefits from billions of dollars a year in public financial support for their minimum wage employees. So does the local tavern owner, on a much smaller scale.

    In the long run, having the government keep alive businesses that don't have a solid business model is not good for the economy. It does not promote the healthy competition that our capitalistic society needs to stay ahead in a global economy.

  • David Wright (unverified)

    AFS - It is really amazing how you can capture the essence of a person you've never met, simply by not carefully reading what they have written online... <nobr>:-D</nobr>

    It seems to me that I'm not the one "ranting" here. I've simply described my point of view, and in particular the philosophical basis for my point of view, to demonstrate that rational people may disagree on these points without necessarily being evil or nefarious or thoughtless. And, in return, are my arguments and/or premises discussed and debated in a free exchange of ideas?

    By some, certainly. And I am very grateful for that valuable dialogue.

    But then there's you, who instead of actually explaining to me why my rationale is demonstrably wrong, simply resort to attacks on my character. Fascinating.

    My posts regarding unions and this minimum wage issue are about ideas for fair, reasonable, consistent public policy. It's not about "beating down on the poor". Far from it. It's about caring whether public policy is good or bad -- fair or unfair -- reasonable or unreasonable -- consistent or inconsistent (which, in my opinion, goes a long way towards the fair/unfair thing). We may disagree on which policies fall under which categories, and why -- which is why the open and honest debate is valuable. But it really doesn't matter that I'm neither a union employee nor a union employer, neither a minimum wage employee nor a minimum wage employer. I'm a member of the public, and that gives me a vested interest in good public policy, as it does for you and everyone else here.

    So just to be clear here: I'm not trying to attack anybody -- to the extent that I'm "attacking" anything, it's what I consider to be bad policy.

    By the way, I don't pay any attention to the esteemed Mr. Larson... I tried watching the cable broadcast of his show once and couldn't take the inanity for more than 10 minutes... so any correlation between your so-called "Lars-aganda" and my posts is purely coincidental. I arrive at my positions freely based on my own reasoning and common sense (and yes, a dash of bias like everyone else), not because I've read the daily talking points from central HQ. Not everybody who disagrees with you is a mindless Lars-drone.

    Did you want to take issue with anything that I actually wrote? Or did you just want to stick with the easy way out by calling me a shameful greedy bastard based on your assumptions about my motivations?

  • Eric Berg (unverified)

    The most recent Oregon AFl-CIO Weekly Update has some great information on HB 2409 and opportunities to fight the legislation.

    The Oregon Restaurant Association has been attacking the minimum wage the the past three legislative sessions. After I get done paying my bill, I often ask to speak to the owner of the restaurant if the place has an ORA membership thing in the window. I respectfully ask if he or she knows the ORA's position on the minimum and why I should continue spend money at their place knowing some of it goes to funding the ORA's attack on the minimum wage. I add that I know the the food service industry is tough.

    This started during the 2001 session when the owner of the Eastbank Saloon wrote an anti-minimum wage op-ed piece representing the ORA boardthe ORA Board. I happened to be reading it at the saloon. I was told by someone at the Eastbank that I was welcome to take eat and drink elsewhere. The Eastbank's halibut burger with a Guinnesss or two used to be one of my favorite bar-pub meals. I haven't had it since.

  • Trey (unverified)

    David, You wrote "Tips are certainly compensation, and they are taxable income, therefore they should by rights count towards the minimum wage at least to some degree."

    OK, let's say Susan averages $7.20 per hour in tips. Are you suggesting that her employer would only owe her 5 cents per hour in wages so she would be at $7.25 minimum wage? Or, since you did qualify your statement with the caveat, "to a certain degree", should the employer double that amount to 10 cents per hour?

    Let's say Susan works at an upscale establishment and pulls in an average of $15.00 per hour in tips. If she is hired at the $7.25 rate, are you suggesting that a) the employer owes her nothing in wages and b) the excess in tips per hour over $7.25 should be taken from her?

    Finally, you state, "If the point of a minimum wage is to establish a minimal earnings level for employees in the state...then not counting some income for certain types of employees towards that minimal earnings level is unfair to those employees who do not get exempt earnings."

    Why is this unfair? The employer can always pay these nonexempt workers (i.e., cooks) a larger base salary to reward them for their hard work.

  • eric carlson (unverified)

    I found the House Bill, but I do not quite understnad it, I was wondering if someone could point out the part that penalizes the worker.

    SECTION 4. { + (1) If an employee earns tips and is required to report those tips to the employer under section 6053 of the Internal Revenue Code and the regulations promulgated thereunder, the employer may not employ the employee at a wage rate lower than $7.25 an hour. (2) This section applies only to an employee who: (a) Customarily receives or is allocated $30 or more a month in tips; (b) Has been notified by the employer of the provisions of this section before the start of the pay period to which the employer seeks to apply the provisions; and (c) Keeps tips received by that employee or receives a share of tips pooled with other employees. (3) An employer may not take any action to displace employees, including partial displacements such as reduction of hours, wages or benefits, for the purpose of hiring an employee at the hourly rate determined under subsection (1) of this section. + }

    You can find the rest of the bill here, if you can not find out what is going on from this snippit.

    Thanks for the help Eric: Revolutionary

  • afs (unverified)

    David Wright - Lifting up those in lower classes so that they can legimately compete with all other citizens in the society so that the society benefits from the ideas of the maximum number people in it's society is good public policy. The more people that are freed from focusing all their efforts on simple survival, the better the society functions. That's because once people can focus on things other than the simple struggle for food and shelter, they are capable of contributing to a society's idea's base. Apple happened because Steve Jobs and others had time to put think about making those new affordable computers that a few technical hobbists were taking home and personally imputing assemble language into, and make them accessable to those other than technical geeks by sticking a monitor and keyboard on them. Microsoft happened because Bill Gates was able to take time away from simple survival and think about operating system software for all those new computers that had just started getting built. When people have some time and energy left over from doing what they have to do for mere survival, they get to contribute to innovation. Society benefits from increased innovation.

    David, what you promote is oligarcy. The control of society by the monied few. What I promote is a meritocracy. The maximum number of people in society freed enough from the struggle from simple survival so that they are capable of contributing to the improvement of society. You want people who have done nothing for society other than being handed a trust fund by their parents to continue to hold a position of crushing dominance in US society. I promote that those with talent be able to rise to be the important decision makers in society.

    Don't tell me about capitalism, David. You are not a capitalist. You are a mercantilist. You are exactly what Adam Smith and the Founding Fathers of this country were fighting against. Capitalism requires a marketplace free of govenment protected trading monopolies to flourish. The American Revolution was against the combination of the British East India Company and the British crown and aristocracy. British aristocrats were protected from the anyone rising up from the masses of British society by the crushing weight of the monopoly of the British East India Companies crown-protected monopolies. The Boston Tea Party was a protest against British Government interference in the free market...

    "...Hancock organized a boycott of tea from China sold by the British East India Company, whose sales in the colonies then fell from 320,000 pounds to 520 pounds. American women played a large part in the boycott and it was one of the first times women collectively attempted to influence public policy in the Colonies. By 1773 the Company had large debts, huge stocks of tea in its warehouses, and no prospect of selling it because smugglers such as Hancock were importing tea without paying duty. The British Government passed the Tea Act, which allowed the East India Company to sell tea to the colonies without the usual colonial tax, thereby allowing them to undercut the prices of the colonial merchants and smugglers.

    The ships carrying tea were prevented from landing as most American ports turned the tea away; at Boston however, the East India Company had the assistance of the governor—preparations were made to forcibly land the tea under the protection afforded by British armed vessels.

    On December 16, 1773, the night before the tea was due to be landed, the Sons of Liberty, a group of about 60 local Boston residents, possibly organized by Samuel Adams, burst from the South Meeting House and headed toward Griffin's Wharf, dressed as Mohawks. There, three ships—the Dartmouth, the Eleanor and the Beaver—were loaded with crates of tea. The men boarded the ships and began destroying the cargo. By 9 PM, with only one incident, they had smashed 342 crates of tea in all three ships and had thrown them into Boston Harbor. They took off their shoes, swept the decks, and made each ship's first mate attest that they had destroyed only the tea. The whole event was remarkably quiet and peaceful...."


    You conservatives are promoting everything the American Revolution was fought against. The GOP wants to protect the rich, and their corporate monopolies. Us progressives are the ones who promote removing the manacles of govenment-protected multi-national corporate monopolies so that small businesses can succeed in the free market. The progressive movement is now the home of those who promote capitalism.

  • David Wright (unverified)

    Eric -- The key is in that first section, where the rate for tipped employees is fixed at $7.25/hr (the current minimum wage for everyone) without the annual inflation index that would otherwise apply to non-tipped employees in the future.

    For example, last year the minimum was $7.05, the increase this year was $0.20 or roughly 2.83%. Assuming for the sake of argument that next year's increase is 3% that would put the standard minimum wage at $7.47/hr, but under this bill those who make tips would still be at $7.25. Hence, a $0.22/hr "penalty", where the guy washing dishes in the kitchen is making $7.47/hr but the gal waiting tables is only making $7.25/hr plus tips of say (as Trey suggested) $7/hr or so, for an actual rate of $14.25/hr.

    Trey -- Strictly speaking, of course I do think that all tips should count towards meeting the minimum wage since they are all part of the employee's compensation (though the very idea that "excess" tips should be confiscated and given to the employer is absolutely ridiculous -- minimum wage is a floor, not a ceiling). However, I understand that's an unrealistic goal that isn't implemented anywhere else in the country, but I'm still willing to compromise to improve the system if not quite make it perfect.

    A quick review of how other states handle tip credit shows a wide range of amounts that are credited, from fixed dollar amounts (such as the federal standard of $3.02/hr) to various percentages of the actual tip income (in some cases as much as 50% or more).

    The appropriate amount to credit should be up to the legislature to decide. Ideally I would tend to favor some fixed dollar amount, and perhaps that could be expressed as a percentage of the overall minimum wage. For the sake of argument, let's say 25% of minimum wage, which in 2005 would be $1.81/hr. That means that in the hypothetical examples you gave above, when Susan makes $7.20/hr in tips, her employer would be obligated to pay her $5.44/hr in direct wages, so her total would be $12.64/hr. In that case, her employer is only getting a break of $1.81/hr (compared to the wages they have to pay to the non-tipped staff), but Susan is still able to make well above minimum wage.

    At the upscale establishment the same thing applies. Susan makes $15.00/hr in tips, plus the $5.44 that her employer is obligated to pay, thus she gets $20.44/hour. And the guy in the back of the house is still only getting $7.25.

    Now, we aren't talking about literally establishing a tip credit here -- HB 2409 doesn't do that. What it has the effect of doing, though, is basically phasing in a virtual tip credit equal to the amount of the inflation increase each year. As a practical matter, in that example I cited above to Eric, the first year tip credit might be 22 cents. If the following year saw another 3% increase (to $7.69) then the tip credit would be 44 cents, etc. Of course, if at some point in the future the virtual tip credit got excessive, the legislature could simply go back in and revise the statute to bump up the fixed wage from $7.25 to whatever they want.

    As to your point about the basic fairness when tips don't count towards meeting the minimum wage -- it's precisely because it's a minimum wage. It's the bare minimum amount of compensation that an employee can get for work performed. If the employer pays the cook more than minimum wage, then the minimum wage is moot, is it not? But this really gets back to the basic disagreement we have over whether the minimum wage represents the smallest amount an employer may pay an employee, or the smallest amount an employee may earn. And once again, looking at how tips are considered in 43 other states demonstrates that the point of the minimum wage is to guarantee a minimum earning level by the employee, not to guarantee that the employer be entirely responsible for that minimum earning level. I understand that you disagree, and I can see your point of view and respect it.

  • David Wright (unverified)

    AFS -- Rant, anyone? <nobr>:-D</nobr>

    Thanks for the history lessons.

    And for completely mischaracterizing my opinions.

    And for apparently misunderstanding what a "meritocracy" is.

    And for misusing "oligarchy" (I think what you meant there is "plutocracy").

    Hey, here's a quick reference for you, enjoy.

    And for misunderstanding what "mercantilism" is, a fairly critical component of which is strict government regulation of commerce and the national economy -- not exactly a hallmark of the GOP, or conservatives, or whatever label you'd like to paint me with.

    But thanks for playing...

  • Tom Civiletti (unverified)

    Who do these waiters think they are? I'm sure there are many table scraps they can take home to supplement their income.

    Seriously, how does paying waiters preclude restauranteers from paying cooks and dishwashers? This is the typical owner class tactic of dividing the working class against itself. Are workers dumb enough to allow that?

  • (Show?)

    No number of examples with tips averaging $7.00-$15.00/hour makes a credible point in this discussion when the legislation specifies a $30.00/month threshhold.

  • afs (unverified)

    David Wright...

    "Oligarchy is a form of government where most political power effectively rests with a small segment of society (typically the most powerful, whether by wealth, military strength, ruthlessness, or political influence). The word oligarchy is from the Greek for "few" and "rule". Some political theorists have argued that all societies are inevitably oligarchies no matter the supposed political system.

    Oligarchies are often controlled by a few powerful families whose children are raised and mentored to become inheritors of the power of the oligarchy, often at some sort of expense to those governed. In contrast to aristocracy ("government by the 'best'"), this power may not always be exercised openly, the oligarchs preferring to remain "the power behind the throne", exerting control through economic means. Although Aristotle pioneered the use of the term as a synonym for rule by the rich, for which the exact term is plutocracy, oligarchy is not always a rule by wealth, as oligarchs can simply be a privileged cadre..."


    The reason I use the term oligarchy, not plutocracy, is because of the continuation of power in family lines in powerful, but sometimes less than truly wealthy families. The best example of this would be the kids of Ivy League grads and Military Academies getting admission preference to those institutions. There is no question that Ivy League grads and Military accademy grads have advantages in US society that others do not have, and the feature of so many kids of Ivy League grads having such a leg up in the admissions process is clearly a aspect of unearned contunuation of power, but it's an aspect that's not directly wealth-based. For example, the Bush family wasn't really truly "filthy rich" until George H. W. Bush left the presedency and jhoined the Carlyse Group, and George W. Bush sold his interest in the Texas Rangers. Don't get me wrong, the Bush family was quite priveleged before, but they weren't truly multi-millionaires until the events I mentioned earlier. However, nobody argues the power the Bush family has held for decades.

    "Meritocracy is a system of government based on rule by ability (merit) rather than by wealth or social position. “Merit” means roughly intelligence plus effort. One implication is that whatever level in society a citizen reaches is held to be what such an individual deserves. Meritocratic can also sometimes be used to describe a government, or other body, that stresses formal education and competence despite other features (e.g. ancestry or sex)."


    I promote that people that work for a living in the US should earn a standard of living that leaves them free of basic survival concerns and allows them to continue to develop their abilities in order to allow society to benefit from the maximum amount of the people in the society to contribute to the society's further development. Full-time Walmart employees cannot do that. You want all of America to become just like Walmart, with a few hideously wealthy Walton family heirs beating on any and all attempts by employees to join together and declare they deserve to earn a basic decent living standard in exchange for their full time work, with the government protecting the Walton family's trust funds from Walmart full-time employees who little they qualify for food stamps in many states.

    I characterized your opinions perfectly, David. You just realize what you say doesn't sound too good when it's said without all the highly crafted poll-tested language Karl Rove is so good at creating. Attacking waitresses and trying to cut their already paltry minimum wage only works with Karl Rove's talking points and poll-tested language magic. You just sound greedy without Karl Rove's magic transformations.

  • David Wright (unverified)

    Doretta -- Is there any threshhold at which you'd find these discussions "credible"?

    $30/month works out to about 17 cents an hour at full-time annual employment. About 35 cents an hour at half-time employment.

    Can we agree that it is unlikely for any tip-earner to make anything like that small an amount per hour in tips?

    Once more, I suspect that the $30/month was selected to correspond with the federal definition of a tip worker. But if you don't like that amount, what amount would be more to your liking?

    Or, if your problem is not with the amount of the threshhold but with the very idea itself, why even raise the $30 as an issue?

    Just curious...

  • Trey (unverified)

    David, I agree that you and I view the role of the minimum wage differently. From my perspective, the minimum wage is the baseline amount that should be paid DIRECTLY by the employer. Tips respresent an amount over this; generally tied to the worker's own efforts (i.e., most often an attentive waitress will earn more in tips than a nonattentive one).

    And I agree with what others have stated and I stated earlier -- There's nothing that prevents any restaurant owner from paying cooks, buspersons and dishwashers MORE than the minimum wage. If a restaurant owners believes it's unfair that a waitress/waiters earns $12 per hour (minimum plus tips), then the owner should gladly rectify the unfairness by paying the behind the scenes staff at least $12 per hour.

    The current minimum wage is nowhere near a genuine subsistence level. If it WAS, I might lend some measure of credence to your arguments.

    By the way, do you work for the minimum wage today?

  • afs (unverified)

    David Wright - "Is there any threshhold at which you'd find these discussions "credible"?"

    Show me one person who made the average salary of a Corporate CEO from their tips, and then we'll talk. One. Just one.

    If you can prove to me that there is a hole in the US tax system that just one person used to earn as much as the average corporate CEO earns, then I'll agree that there is a reason to be concerned that someone can take advantage of a hole the tax system to become affluent. If you cannot, you are simply looking for distractions and distortions to demonize the poor.

    Get busy, David... you have some googling to do.

  • David Wright (unverified)

    AFS -- Ah, so when you originally claimed that "oligarchy" was "the control of society by the monied few" (your words) you were apparently using a previously unknown definition of "monied". Interesting.

    It would be rather silly of me to really promote oligarchy, as I am neither wealthy nor privileged. However, as one with talents, skills, and intelligence, it makes perfect sense for me to support meritocracy, which in fact I do. So you're dead wrong on that one, my friend. You've really gone off the rails thinking that I want the country to be nothing but wall-to-Wal*Marts. Hardly. But, who am I to know what I really think? I've got the great AFS to tell me!

    You've also described a rather utopian view of economics, where everybody gets a "living wage" and is thus free to contribute to the betterment of society. I'd be very curious to hear how a dramatic increase in labor costs across every sector of the economy would actually end up benefitting those at the low end of the spectrum. Seriously, let's hear the economic basis for that assertion. Remember to include both SUPPLY and DEMAND in your answer. Because I think you'd find that if the US tried to actually implement such a system, in a global economy, our society would collapse and virtually everyone's standard of living would plummet. But if you can demonstrate that I'm wrong about that, and not simply claim that I'm wrong, I'd like to hear it.

    Accusing me of being a Rove drone (since the Lars thing didn't work out for you) is really funny. I happen to think that Karl Rove is one of the most dangerous people in the top levels of government right now, for precisely the reasons you mentioned about manipulating public opinion with misleading rhetoric.

    Now, here's a thought. Instead of attacking me, or your false projection of my ultimate motivations -- why not dispute my argument? See how that works for you? Why, you just might get me to see the light. Show me where my facts are wrong. Or explain to me why I should interpret those facts differently.

    I mean, if you're RIGHT after all, shouldn't your argument stand on its own without any need to attack me, the opposing messenger?

  • afs (unverified)

    David Wright: "I'd be very curious to hear how a dramatic increase in labor costs across every sector of the economy would actually end up benefitting those at the low end of the spectrum."

    Ever heard of the 50's, David? What caused the boom-times of the 50's was the huge increases in salaries across the board for lower and middle income individuals, combined with Roosevelt/Truman/Eisenhower's 87% top tax bracket paying for progressive government policies and building infrastructure in which the economy could operate more efficiently (like the interstate highway system), combined with the GI Bill education benefits. Basically, almost the entire middle class in the US was created in the 50's by huge increases in baseline wages across the board for the lower classes combined with progressive education policy leading to huge class mobility.

    Huge increases in lower class income means huge increases in economic growth. Lower classes spend the money additional money they recieve from wages and spent money flows through the economic cycle. The rich hoard increases in wealth and tax reductions. The only thing giving money to the rich does is SUCK CAPITAL out of the working economy. Rich people hoarding wealth destroys economic growth. Wage increases for the lower classes fuel economic growth.

  • (Show?)


    I think that there's room for a minimum wage within your definition of a meritocracy.

    I don't presume to know your work history, but I've met hundreds of hard working poor people who have been unable to rise up the ladder for all kinds of reasons. Some are poorly educated, some have IQs low enough that they can't master the skills needed to rise to the next level, and some are afflicted with mental or physical disabilities.

    Notice that I'm only addressing the segment of the poor who have the requisite work ethic. For these folks Oregonians have decided that there is a "floor" in the meritocracy that hard working motivated people can stand on. Oregonians believe that if you work like a dog, you should at least be able to provide the bare minimum for your family. (food, shelter, health care, education)

    Above that level--------Bring on the meritocracy!!

    As for food service employees, I eat in a lot of diners in east Multnomah County and I've been known to have a nice gourmet dinner in NW on occasion too. The tips earned by the waitresses at the Polar King in Gresham are orders of magnitude lower than those earned by waiters and waitresses at Ruth's Chris Steakhouse, but in either case, why should the employer have any say in the disposition of tips. The financial interests of the employer are addressed in the pricing on the menu. Period.

  • David Wright (unverified)

    Trey -- As soon as we start talking about employers paying anybody more than the minimum wage, the question of what the minimum wage rate is becomes moot, does it not?

    If I pay my cooks $12/hr, does it matter in the slightest whether minimum wage is $4/hr or $8/hr?

    Which gets back to my original point that a minimum wage is the floor for earnings. It's a public policy statement, a way for government to say that no employee will earn less than X amount for an hour of work. Or, as you prefer, that no employer will pay less than X amount for an hour of work. And the difference between those two statements is the difference between us.

    Now, ultimately every minimum wage law as a practical matter does include a bare minimum that the employer is responsible for (generally lower than the overall minimum wage level). So there is at least a component of every minimum wage that works as you describe. And most minimum wage laws have a component that works as I describe. So there is clearly room for a compromise on this point, more than 80% of the states in the country have done so to some extent.

    The question is, to what extent?

    Currently, the answer in Oregon is NO compromise in favor of tip credits. I think it's reasonable to ask for SOME compromise. That's all.

    And no, I don't work for minimum wage currently. I don't know that I've ever worked for minimum wage, actually, though my first "real" job was within a nickel. $3.40/hour to be precise.

    You're right, it's not a living wage.

    It would suck mightily to try to live on $7.25/hour.

    It would be a major incentive to find a better paying job.

    No, that's not easy to do. Yes, we (government) should do more to facilitate people improving their skills and gaining opportunities to advance.

    But no, dramatically increasing the minimum wage is not an economically viable way to improve everybody's standard of living.

    However, I'll extend the same invitation to you as I did to AFS -- demonstrate for me how ensuring that everybody in the country earns a "living wage" (however you'd like to define that) wouldn't cause economic ruin, and I'll change my tune. I'm not opposed to everyone doing better for themselves, so show me how it can be done. You might just gain a convert! <nobr>;-)</nobr>

  • afs (unverified)

    David... I have a book for you to read. It a little older, but it available free on-line. It called "America- What went Wrong." It's based on a Pulitzer Prize-winning series of articles that was published in the Philly Enquirer.

    You seem to have bought "trickle-down economics" hook, line and sinker. You need to learn what really happened up through Reagan and Bush I. This is a great book to do it, especially since you can read it free online now.


    This book should be handed out free to all newly registered Democrats as a primer to correct years of right-wing propaganda.

  • David Wright (unverified)

    AFS -- Regarding the CEO question, WTF??? Who on Earth is claiming that waitresses are "getting rich" by exploiting a "loophole" with tip income? I certainly haven't. So I'm not inclined to Google any such thing, because that is an absurd red herring.

    However, thank you for your subsequent post where you at least took my question seriously. The 50's were indeed an era of unprecedented economic boom and tremendous overall increases in standard of living for Americans. Good times, economically. Well, for white folk anyhow. I'm not sure about everyone, but for the sake of argument I'll stipulate that the 1950's was overall an economic success.

    Now, would you like to rollback the state of the world to the 1950's, so that we can duplicate that success? You know, with an unprecedented level of American economic hegemony? Times were good for America in no small part because times were bad for most everyone else in the world. Europe and Japan were simply not the competitive economic powerhouses that they are today. Korea? China? Southeast Asia? India? Forget about it. None of them had a chance of competing with American industry.

    We could support a better standard of living for everyone because we had a large base of high-wage manufacturing jobs. We had those jobs because we had technical capabilities and capacity that nobody else had, so we were the only game in town. The whole world essentially had to buy from us or do without. It was a unique global situation that most certainly does not apply today.

    Now, was that standard of living due to the minimum wage level? Or other economic factors that allowed so many jobs to be available at well above the minimum wage?

    Here's an interesting page I found with historical federal minimum wage levels since inception. Notice that during the period of 1950-1960, in real (2004) dollars the minimum wage was not far from where it is today. 1956 saw a jump in the nominal wage, resulting in a spike in the real wage, but even so in real terms the minimum wage in the country was lower during the 1950's than Oregon's is today.

    So given that we were talking about how government guarantees of minimum wage levels could ensure everyone's prosperity, what were you saying again? I think you have it exactly backwards -- the boom times were not caused by dramatically increased salaries, the increased salaries were supported by the boom times. A similar though far less dramatic effect occurred during the 90's thanks to the technology boom.

    Oh, and for the record, I too think that the Bush tax cuts were irresponsible and not economically stimulative. It was a bad public policy. And the continuous push for ever more tax cuts combined with ever more spending is unconscionable. But we aren't talking about tax cuts for the rich. We're talking about wage controls for the poor. Remember, this is all about the minimum wage now...

  • David Wright (unverified)

    AFS -- Thanks for the link, I will check it out.

  • David Wright (unverified)

    Pat -- Thanks for the comments.

    I understand your point about the minimum wage trying to support those who through no fault of their own are unable to advance themselves above the minimal level of employment.

    I'm not sure what that has to do with this discussion, though, since minimum wage doesn't just apply to them. It applies to anybody with a job, whether they earnestly work like a dog, or loaf around. And regardless, that doesn't address whether a minimum wage should be a burden on the employer or a guarantee to the employee. Based simply on what you've said, you've described a guarantee for the employee, which is also my position.

    I honestly believe that most minimum wage workers are of the earnest hard-working sort, no argument there. And I have not argued (yet...) for the abolition of the minimum wage. I haven't even argued for the abolition of the automatic inflation indexing in Oregon, at least not for all workers (obviously HB 2409 does abolish indexing for tip workers).

    I have simply argued for the recognition that the wages an employer pays to a tip earner do not make up the entire compensation that employee receives for the work performed.

    I agree, the "disposition" of an employee's tips should not be up to the employer. I didn't say they should be. Again, I'm simply saying that those tips which are earned, and must be reported to the employer anyway (presumably for inclusion on the employee's W-2), should also be counted to some extent towards that employee's minimum wage guarantee.

    A position which, admittedly, does not make sense if you take Trey's view that a minimum wage is a burden on employers and not a guarantee to employees. In most states it's a little of both. That seems a fair compromise to me. And essentially, HB 2409 takes a tiny step towards implementing that "little of both" philosophy. I can understand why most people on this site don't like 2409. Hopefully now most people can see why someone could like the bill for reasons other than as a way to stomp on poor waitresses.

  • brian (unverified)

    See, I knew you "blueheads" in Oregon were actually Libertarians :)

  • afs (unverified)

    David, if you think America can't return to the prosperity of the 50's you are wrong. Norway and Sweden have never had an economic hedgemony of any kind, yet their standard of living is consistantly the highest in the world. How does Scandinavia do it? By investing in it people and in a high level of technological research and development. The boom times of the 50's will be nothing compared to the potential boom to the economy that nanotechnology and bioengineering have the potential to offer.

    America doesn't need to be a hegemony to excel. It needs to be smart and technologically proficient. It's citizens need to be better educated than other nations and have access to a better technological research infrastructure to prosper. It's not about manufacturing or economic muscle. It's about ideas and innovation. The 50's weren't built on manufacturing. The world was full of factories in the 50's. What created the 50's in the US was industrial efficiency. We didn't just manufacture goods. We manufactured goods more efficiently than other nations that had plenty of factories of their own. The US also had progressive policies which allowed the people who made the goods to actually buy some of the goods, and that reinforced further economic growth in the US. The 90's was another innovation based boom. A boom based on America producing the best computer technology in the world. That can all happen again by doing the same things again that made it happen. US Government investment in computing technolgy was directly responsible for the immense success of the tech sector in the 90's. The bubble only gave back some of the value the US economy gained from computer tech in the 90's and only in those companies that had the least actual tangible value. All those Microsoft, Apple, and Intel billionaires are still billionaires for a reason. Same thing for Amazon and Google.

    Remember, the GOP doesn't need boomtimes. They have their money. They don't need more. Social mobility caused by economic prosperity is the enemy of the GOP.

    David... read the book. If you are for real, and you are just a well-intentioned but misinformed victim of right wing propaganda, then I'll be the first one to admit I was wrong about you. I may be strident, but I'm also the first one to admit I'm wrong when it does happen. But for me to publically eat my hat, someone has to earn it. You need to read them book first. Expect to be quizzed.

  • Suzii (unverified)

    I was just talking to a colleague who said he was able to get through the U of O while working only three jobs (at any one time). But only, he said, because two of those jobs involved extremely generous tips and the third got him hooked up for paid internships. Which got me interested in digging up a few numbers:

    1. The cost of the U of O has gone up 17% in the past two years, much faster than the minimum wage.

    2. The U.S. consumer price index rose 0.4 percent in February (from January), but prices excluding food and energy rose only 0.3 percent. Which means that food and energy, which are a larger proportion of expenditures for poor people than for rich people, are increasing in cost faster than inflation as measured by the consumer price index.

    3. Oregon's minimum wage (ORS 653.025(2)(b)) tracks the CPI.

    Which suggests to me that the minimum wage isn't keeping up with the actual cost of living at the bottom end of the income scale -- i.e., where it's relevant -- and the restaurateurs should be counting themselves lucky instead of asking for more.

  • Randy2 (unverified)

    Without wading into the merits of the discussion of the proposed legislation, I think David has brought up an interesting question: what do we as a society define as a minimum wage? For me, it seems to highlight the essential divide between progressives and conservatives. Do our laws seek to insure a minimum standard of living for all who are able to work or limit the costs of those who create business and employment?

    I would think progressives would focus their arguments on minimum standard of living instead of employer mandates, but that's not what I see on this thread.

    My daughter, a single mother of 2 works as a waitress and 1 or 2 other jobs. I look at her standard of living (including the tips I know she receives) and I see this family (not just my daughter) living at a standard below what they should. With 2 girls in school (and available to all the germs and colds kids are), she is literally one doctor's trip away from not making the rent next month.

    Her potential unpaid medical bills will find their way into your finances. How? Higher costs for providing medical care and higher prmiums. But, of course, a doctor's visit is the last resort for her and the girls, so they muddle through various colds, ear infections and fevers as well as they can.

    Working at mimimum wage at 2 - 3 jobs plus her tips doesn't yield a standard of living for her family anywhere near what I think this country should provide for the young and poor; and don't even get me started on what we are doing as a state to those 2 young girls as they use up their education years at increasingly substandard schools.

    David posed an interesting question. I'd be interested in hearing others' definitions of what "minimum wage" means as a state policy. And whether $7.25 an hour is enough for a single person, let alone a family, to live on.

  • Bill Holmer (unverified)

    OK Randy2, I'll take a crack at it. As state policy, the minimum wage is society's statement about the value of work and where the lowest rung on the economic ladder should be.

    It is not meant to be a "living wage" designed to provide some minimum level of support for a family of four. Those who say "try to raise a family of four on the minimum wage" are tilting at windmills. It ain't going to happen, nor should it.

    We want to have a minimum wage which will strike a balance between providing dignity for work while not making it so expensive that employers will choose not to hire the marginal employee or automate the job. It's no coincidence that Oregon has been at the top nationally in terms of the minimum wage and unemployment.

    A teenager coming into the job market for the first time at the minimum wage who wants to live independently will probably have to share living quarters with one or more roommates close enough to work so that a car isn't necessary. And by the way, a cell phone and cable aren't necessities.

    I remember when people used to "save up" to get married and start a family. But that was back in the 50's that afs pines for.

  • Christy (unverified)

    I wait tables 4 days a week, in addition to working a regular 8 to 5 job Monday through Friday. I make good money, but I work 70 hours a week. I simply could not subsist in either job alone, as I have credit card debt and student loan debt to pay off. I am sure this story is not mine alone.

    When I look around at the other servers at my restaurant, they are all getting by --- barely. We do not necessarily work 40 hours a week, as there are days when it is slow and we get sent home. So, tips oftentimes make up for hours lost due to ice storms or a closed patio due to rain or a slow night.

    Just to give you my perspective...

    Lowering the minimum wage for servers would be logistically interesting. There are times where my paycheck barely covers my taxes from the tips I have earned. If I made less per hour, I am really curious how that would work out.

    Another point involves the employment situation in Oregon. I have a Master's degree, for goodness sake, and I wait tables. I am sure that I am not alone. I am lucky that I have another job, but many servers and bartenders subsist on their wages. To lower their pay could be a crisis for those who are already barely getting by... People who love this state and make it better, but are unable to get a job in their trained field... People with student loan debt, etc.

    It is progressive of us, as a state, to have a high minimum wage, and progressive of us to extend that minimum wage to tip-earners. We should not go back on that...

    And is anyone else just sick and tired of the ORA???

  • Trey (unverified)

    Christy, Thanks for sharing your personal story. I think this debate needs more stories like yours. It's always easier to demonize a group (e.g., waitresses, waiters, "terrorists", etc.) if they are faceless. However, when people are afforded the opportunity to see and understand the genuine struggles of others, it offers a greater opportunity for understanding and empathy.

  • afs (unverified)

    This ought to provide answers to a lot of questions raised on this thread. It's from the Center for American Progress (home of the sexy wonk)

    Can Wal-Mart Families Make Ends Meet?

    by Joan Kuriansky August 9, 2004

    "On June 19, 2001, six current and former female employees filed a sex discrimination suit against Wal-Mart, the largest employer in the world. In June 2004, a federal court judge certified Dukes v. Wal-Mart as a class action that could benefit up to 1.6 million current or former female employees of Wal-Mart. Judge Martin Jenkins found that the plaintiffs presented largely uncontested statistics that "women are paid less than men in every region, pay disparities exist in most job categories, that the salary gap widens over time and that the higher one looks in the organization, the lower the percentage of women."

    The importance of this suit cannot be overstated. At one time in our history, compensation scales and work place practices in the private sector were often driven by public sector policies; today it is often the reverse. Both big and small employers increasingly determine their own wage and labor practices in relation to their competition; often that competition is Wal-Mart. With stores in over 4,750 locations and over 1.4 million employees, Wal-Mart's influence extends into every corner of the country, from rural communities, to suburban malls, to urban downtowns.

    More women are working today than ever before, including nearly four out of five mothers of school age children. Yet too many women are in jobs that do not pay self-sufficiency wages, do not provide benefits such as health care, and are the first to be cut during an economic downturn. In fact, women make up the majority (60 percent) of low-wage workers.

    Many of these women are Wal-Mart employees. Currently 72 percent of Wal-Mart's workers in sales are women. On average, they are paid $7.50 per hour with no health benefits. Dukes v. Wal-Mart alleges that women earn on average $1,400 less than men per year, representing approximately nine per cent of their overall paycheck. Many of these women are single parents who are solely responsible for the welfare of their families – a sure formula for poverty.

    Wal-Mart anticipates hiring another 800,000 employees between 2004 and 2008 of which three quarters of a million may well be women. If Wal-Mart's practices continue unchecked, an increasing number of women will be thrust onto the lowest rung of paid work, exacerbating the pervasive occupational segregation that women face in today's service industries and impeding the ability of America's low-income families to make ends meet.

    On July 22, 2004 Wider Opportunities for Women (WOW) released a report, "Coming Up Short: A Comparison of Wages and Work Supports in 10 American Communities." The study provides a national snapshot of what families need to make ends meet. The report is based on the use of the Self-Sufficiency Standard, which looks at the actual costs of working and raising a family in a particular community without private or public work supports. The Self-Sufficiency Standard establishes a minimally adequate, bare-bones budget for 70 different family types on a county by county basis.

    The report uses concrete, geographically-specific figures to compare how much income a family of three needs to survive in different areas of the country. Across the 10 communities we studied, the cost for a single wage earner to support an infant and a preschooler ranged from $27,660 per year, or $13.10 per hour, in New Orleans, to $59,544 yearly, or $28.19 per hour, in Boston. On average, the federal minimum wage covered just 34 percent of the family's basic costs.

    Nowhere in the country can a Wal-Mart worker earning $7.50 per hour make ends meet. In fact, our study finds that only when our sample parent earns an hourly wage of $12.00 and receives a whole range of public and employer-based work supports can her family achieve a level of economic security. These supports include subsidized child-care, food stamps, housing subsidies and health coverage for children through Medicaid.

    There are three fundamental strategies that Wal-Mart can employ to become a responsible corporate citizen and meet the needs of its workers and their families. First, Wal-Mart should provide self-sufficiency wages and decent benefits to all its employees. To do this, Wal-Mart will need to educate itself about the real costs of living for employees in the particular community in which its stores are located and develop a pay scale that reflects those costs of living.

    Second, Wal-Mart should establish clear paths for professional advancement including wage progression policies that are available to all employees free of racial, ethnic, gender or age bias. Wal-Mart Human Resources Departments should use WOW's Self-Sufficiency Standard or a similar tool to help employees plan career paths, access work supports, and make decisions about education and training. The corporation should make a clear commitment to promoting the self-sufficiency of its workers and supervisors should be held responsible for meeting this goal and incorporating it into personnel policies. Such policies have been shown to be good for employers as well as employees, reducing turnover and absenteeism and improving training and morale.

    Third, rather than oppose workers' efforts to unionize, Wal-Mart should encourage the self-determination of its workers. Union membership among women has been increasing and with good reason. Studies have shown that female employees working in unionized workplaces earn 31 percent higher wages than those who do not. Wal-Mart competitors, like Costco, have been pioneers in paying self-sufficient wages and supporting their worker's right to organize while increasing profits at the same time.

    Finally, regardless of Wal-Mart's own actions, local communities and federal and state governments can and should act to promote self-sufficiency for Wal-Mart employees. For example, communities where Wal-Mart intends to locate should explore whether Wal-Mart is prepared to adjust its compensation packages to meet the wage needs of residents in that community. Local governmental entities should withhold permits or tax incentives to prospective Wal-Mart stores that do not adopt such policies or, alternatively, offer incentives to those stores which do promote positive labor practices. Federal and state governments should pass minimum wage laws to narrow the self-sufficiency gap for low-wage workers. They should also provide access to affordable education and training opportunities that prepare job seekers for high demand-high wage jobs, and offer critical work supports - such as child-care subsidies, food stamps, and Medicaid - to working families struggling to meet their basic costs.

    Wal-Mart can and should begin to adopt fair labor policies now, not wait for the hammer of justice to fall. And community leaders and policy makers must hold Wal-Mart accountable for its practices. If they do so, there will be fewer poor women and families in the communities where Wal-Mart reigns. Helping employees make ends meet should be of interest to Wal-Mart; it is certainly of interest to the rest of us."

    Joan Kuriansky is the executive director for Wider Opportunities for Women.


    Bill Holmer - You might have a point IF the minimum wage were still the floor for wages in in the US work force. Unfortunately, for millions and millions of workers, the minimum wage is the ceiling rate.

    By the way, I don't pine for the 50's. I point back to it as an example of how we can all benefit from a huge economic expansion in the US economy again. Like I said elsewhere, economic growth is the enemy of the GOP. It causes the #1 enemy of the Republican party, social mobility.

  • David Wright (unverified)

    Christy -- quick point on the tax situation -- no doubt if your calculated tax withholding for a given check was more than your gross pay on that check, then your total gross pay would be withheld for taxes (i.e., they won't take more than your total wages). Depending on how sophisticated your employer's payroll software is, it might withhold more money from future checks to cover the difference (if it's a "self-correcting" system), but in any event at the end of the year when you file your tax return, if you hadn't had enough taxes withheld through the year for your actual income, you'd unfortunately end up owing the IRS.

    This is a situation that could happen whether or not HB2409 is passed, by the way.

    Also, nobody is talking about you making less per hour. HB2409 does not reduce your minimum wage. It would just stop increasing that minimum wage automatically.

    Now, at the risk of sounding like I'm "attacking" Christy (which I do not intend to do, she just happened to provide some helpful information I can use), this is a real-world example of why some people think that tip earners don't necessarily need minimum wage increases.

    Christy points out that sometimes (I want to make it clear that I understand this is not all the time) the wages check she is paid (presumably at the minimum of $7.25/hr) barely covers her tax withholdings based on her tip income.

    What can we infer from this?

    Well, with FICA of 7.65%, worst case federal tax of 15% and state tax of 9%, that means that total tax withholdings from a check would be 31.65% of income (it'd actually be less because those tax rates are the highest marginal rates I'd expect to apply, but I'm using an intentionally conservative calculation).

    That being the case, for $7.25/hr to represent the entire withholding amount, that would translate to an overall hourly rate of $22.90/hr (wages + tips).

    Now, nothing at all against Christy, I'm sure she's worth every penny and more. BUT, is somebody making $22.90 an hour really a "minimum wage worker"? In fact, if such a person was paid NO wages by her employer, she'd still be making more than double the minimum wage just in tips alone.

    And is it really that unfair for somebody making $22.90/hr to continue making "only" $22.90/hr when the dishwasher in the back gets a 22 cent raise to $7.47/hr (assuming as I did in a previous post another 3% inflation increase next year)? That's all HB2409 does to Christy. Never mind that as menu prices increase to cover increased meal costs, her tip income will also go up...

    Again, I understand that Christy isn't making $22.90/hr every hour she works all year long. But it's illustrative of how far above the minimum wage tip earners really are. Even if she only gets half as much tip income most of the time as she does during those occasional good times, that would still be in the neighborhood of $15/hr. Still double the minimum wage even after the next automatic increase.

    Christy, you raise another excellent point regarding general employment prospects in Oregon. I know several people who are underemployed, as you are (hell -- as I am), because there just aren't enough jobs available in their chosen field here.

    I would suggest THAT is perhaps a more important issue to deal with in order to boost the economy and improve everyone's standard of living. If too many people are trying to get by on minimum wage jobs that don't pay enough -- is the problem that the minimum wage is too low, or that there aren't enough better paying jobs available? I would suggest the latter.

    By the way, Christy, I totally sympathize with you on the credit card thing. I was out of work for 16 months about 3-4 years ago, and I'm still struggling with tens of thousands of dollars in debt as a result. It's not a fun place to be, is it? Good luck, I sincerely mean that!

    Trey -- individual examples are a terrible way to set public policy. Yes, it puts a face on the problem and helps people relate. But it doesn't necessarily help to promote the best general solution to the problem, in fact it can have the opposite effect. Terry Schiavo was an individual example that resulted in some terrible public policy (laws) at the state and federal level. Public policy rules should be based on a genuine philosophy and solid reasoning. Whatever policy is enacted, there will be individual winners and losers. Pointing to an example of either is no indication of whether the policy itself is good or bad. And sometimes, as I just did with Christy's information, a single example can be used as either a pro or a con -- so how does that really help inform the debate?

    What's the guiding principle on any given question, regardless of how Individual "X" will be affected? That should really inform the public policy debate.

    Also, maybe I just haven't been paying attention, but who has been "demonizing" waitresses? I haven't seen anything like that, but maybe there's something I've missed.

    By the way, from what I've seen of the ORA arguments for this measure, I think they're pretty weak. An extra 22 cents an hour (or whatever it turns out to be) next year isn't going to break anybody. I happen to think they're right on the basic "fairness" issue, but not as regards fairness between two groups of their workers (wait staff and kitchen staff). I don't think they give a rat's about fairness for dishwashers, and their argument in that regard is pretty laughable. But just because their argument is weak doesn't mean they aren't right, just for different reasons (the reasons I've outlined throughout this thread).

  • David Wright (unverified)

    AFS -- I'm still slogging through that link you sent me. It's kind of interesting reading, but honestly I have serious questions about the lazy, superficial analysis the author(s) use to try to support their points.

    Not that they are wrong about what they assert -- they could be right -- just that their supporting argument is full of holes.

    I could write for hours just picking apart the very first (highly misleading) graphic they use, showing the "shift of wealth" with the top 4% of the country from 1959 to 1989. Completely bogus. Oh, the numbers they use might be right (although they are mislabeled -- they deal with tax returns filed, not workers as claimed), but the numbers do NOT mean what the authors say they mean, so their conclusion does not directly follow from the evidence. I don't want to get off on a seriously off-topic rant, so I'll leave it at that for now. <nobr>;-)</nobr>

    But I wonder, to the extent that they are accurately reporting the facts (and when they present a misleading graphic first thing, you have to question that), do they really know what they are talking about when they offer suggested reasons for how those facts came to be?

    Anyhow, as I say I'm still reading it in my spare time...

    I haven't bought into trickle-down economics hook, line and sinker as you suggest (again with you telling me what I think???) I have different economic views than you, to be sure, but I'm not so crazy as to think that we can tax-cut our way to prosperity. If it were up to me, I'd restore all of the mistaken Bush tax cuts across the board. And tax cap gains at the same rate as normal income (though I'd reduce the top tax rates to compensate). And abolish the FICA taxes (which is a silly separate -- and regressive -- element anyhow) and roll them into the normal income tax. Hell, I'd completely overhaul the system and make a lot of enemies at the GOP.

    But anyhow, what does current (and past) tax policy have to do with the question of why we have a minimum wage in the first place, and when and how we should raise it?

    By the way: "[E]conomic growth is the enemy of the GOP. It causes the #1 enemy of the Republican party, social mobility."

    Hardly. GOP membership is generally correlated with higher socio-economic status. Social mobility actually tends to help the GOP because it increases their potential support base.

    And no kidding, we could all benefit from a huge economic boom such as we experienced in the 50's. That's sort of like the coach, when asked how he plans to win the big game, replying "By scoring more points than the other team."

    My question to you (which you have not answered) is, how do we score more points?

    Nanotechnology and Biotech are promising, and may well create quite a bit of wealth for some people. But explain to me how those areas will involve widespread, highly-paid employment, to take up the slack in the labor market?

    Norway and Sweden... are you referring to the UN's "Human Development Index", which as of 2003 ranked Norway #1 and Sweden #3?

    And the United States #7 (admittedly down one spot from the prior year). Out of 175 countries.

    Now, that's not a bad way to rate countries I suppose. Of course, we're talking about economic prosperity here, so let's look at the economic aspect (GDP per capita in purchasing power parity US$). In 2003 the United States was #2 ($37,800) behind #1 Luxembourg ($55,100) (they were 15th in HDI), and just ahead of #3 Norway ($37,700). Sweden was a distant 25th ($26,800).

    So all things considered, I'm not sure that Norway and Sweden are much better off than we are now. And I have serious doubts that their economic systems, even if people would accept them here, would actually translate to similar prosperity with such a dramatically larger population and economy in the US.

  • afs (unverified)

    David Wright - David, I said you were being tested. I wanted to find out if you were genuinely interested in becoming knowledgable. I did not think you were, but against my better judgment, I gave you a second chance. Now it's clear you are more interested in talking than speaking knowledgably. "America What Went Wrong" is based on lazy superficial analysis, huh? Sure it is. That must be why the 9-part series of articles that ran in the Philadelphia Enquirer the authors based the book on won a Pulitzer Prize.

    And David Wright knows better than all the people that both win and hand out Pulitzer Prizes. Must be all the evidence he found that he cited in the pronouncements against the book he just posted. Oh yeah... what evidence? It's wrong because David says it's wrong, huh? And the closest he comes to any actual statements of evidence was his statement, "the number may be right, but they don't mean what the authors say they do." So David admits the numbers in the graphic are probably correct, and can't do anything better than ad-lib that the numbers are right, but he's certain the correct numbers are wrong, anyway. Sure they are, David.

    Oh... and this is the worst part... You want to know just how deep into the book David actually read before he started ranting? Take a look. Look at the graphic he linked, and then page down this link until you see it.


    That right... David's big experiment in reading a book ended after the Acknowledgements section. David saw a picture he didn't like and started ranting. DAVID DID NOT READ ONE WORD OF THE ACTUAL TEXT OF THE BOOK before he started publically ranting against it.

    David, I told you you were going to be tested. I told you up front that I was going to make you look like a complete ass if you started going off on rants without reading the book. Well, I didn't have to. You did that all by yourself, David. You didn't read a word of the book, and you ranted about the only picture you looked at. David, you couldn't look more illiterate if you tried.

    David... GDP/per capita. Lots of right wingers quote that number. The reason that right wingers quote that number is that because that number masks all that multi-national corporation money that never sees the hands of a single citizen of the country it's made in is included in the incomes of nations citizens that never see that additional money in the actual living standard. That number is so bad that Delaware residents show up as having GDP/per capita incomes of hundreds of thousands of dollars per year. I'm sure Delaware residents would be shocked to learn that. It's a false effect due to all the corporations that have their corporate charters registered in the State of Delaware.

    Norway, Iceland, Sweden on the human development index. Hmmm... you mean the best you can come up with in attacking my statement is that when I said Scandinavia had the highest living standard in the world, I swapped the Scandinavian nations of Iceland and Sweden in the #2 and #3 places on the list. Ewwww... that's a damning assault, David. LOL. And what year were those numbers from? 2003. What were they in 2004?

    "UN Human Development Index From Wikipedia

    The UN Human Development Index (HDI) measures poverty, literacy, education, life expectancy, and other factors. It is a standard means of measuring well-being, especially child welfare.

    Top thirty countries

    1. Norway
    2. Sweden
    3. Australia
    4. Canada
    5. Netherlands
    6. Belgium
    7. Iceland
    8. United States
    9. Japan
    10. Ireland
    11. Switzerland
    12. United Kingdom
    13. Finland
    14. Austria
    15. Luxembourg
    16. France
    17. Denmark
    18. New Zealand
    19. Germany
    20. Spain
    21. Italy
    22. Israel
    23. Hong Kong (SAR)
    24. Greece
    25. Singapore
    26. Portugal
    27. Slovenia
    28. South Korea
    29. Barbados
    30. Cyprus


    <h1>1 Norway, #2 Sweden... where did we see that info before?</h1>

    Now... Let's look at the US.

    Standard of living in the United States From Wikipedia, the free encyclopedia.

    The standard of living in the United States is one of the highest in the world by almost any measure. On measures such as the UN Human Development Index the United States is always in the top ten. However, the United States is consistently ranked lower than Scandinavia, Canada, Australia, and Japan; Canada and Norway have alternately held the top spot for some time.

    The United States measures better in certain categories than others. Americans are some of the wealthiest people in the world, with a very high GDP per capita. Americans are top in the world for most material possessions. The number of televisions, vehicles, and other such products per person are considerably higher than in any other country. For instance the United States has some 754 televisions for every thousand people, no other major state is even above 700, with Japan being closest at 680/1000.

    The United States also consistently has one the lowest unemployment rates in the world, usually only beaten by Japan.

    While the United States' mean wealth is the highest of any major country and its median income is near the highest in the world, there may be a relatively unequal income distribution. Much of the extra money in the United States is the result of a much wealthier top section of the population. The United States also has more people below the defined poverty line than 26 other countries; however, the measures used to establish a poverty line are controversial and may not always be comparable amoung countries. The wealthiest ten percent of Americans are 15 times richer than the bottom ten percent. In Japan, for instance, the ratio is only 4.2:1. Some regard this imbalance as a product of the United States' long policy of having a more free market economy, while other countries are more ready to sacrifice net wealth in favour of equality.


    Ahhhhhhhhhhhh... now the truth comes out. The US is way down at #27 in regards to numbers of it's citizens below the poverty line, and the wealthist 10% in the US are 15 times richer than the poorest 10%.

    Now do you see how this all comes back around to minimum wage?

    "Poverty line From Wikipedia, the free encyclopedia.

    The poverty line is the level of income below which one cannot afford to purchase all the resources one requires to live. People who have an income below the poverty line have no discretionary disposable income, by definition.

    The actual monetary value of the poverty line differs from place to place but is usually near some fixed value within a country. This occurs because the resources needed for living have different prices in different places. Even within a country, the poverty line can be markedly different between cities and farming towns, between areas of cold and warm climate, and so forth.

    Almost all societies have some of their citizens living in poverty. The poverty line is useful as an economic tool by which to measure such people and consider socioeconomic reforms such as welfare and unemployment insurance to reduce poverty. It is not in a society's interest to have a large percentage of its citizens living below the poverty line as they have no disposable income and thus adversely affect economic growth. A baseline goal for a progressive government is to have all of its constituents possess an income level at least that of the poverty line.

    Determining the poverty line is done by considering the essential resources that an average human adult consumes in one year and then summing their cost. The largest of these resources is typically the rent required to live in an apartment, so historically, economists have paid particular attention to the real estate market and housing prices as a strong poverty line affecter.

    Other factors are often thrown in to handle various circumstances, such as whether one is a parent, elderly, a child, married, etc. Some analysts also prefer to factor in "value of life" resource costs, such as entertainment, in societies where merely surviving is considered a little below the true poverty line.

    A poverty line is an arbitrary indicator, in the sense that having an income marginally above it is not substantially different from having an income marginally below it: the negative effects of poverty tend to be continuous rather than discrete, and the same low income affects different people in different ways. It has been defined in several ways:

    * Social Security benefit based: if a government guarantees to make income up to some particular level then being below that line is presumably being in poverty - the problem is that if a government becomes more stingy, then poverty may appear to decrease;
    * a relative income line, related to some fraction of typical incomes: the European Union uses 60% of national median equivalised household income;
    * a relative figure fixed in time and only adjusted for inflation -- thus avoiding the possibility that if income inequality increases, then poverty may otherwise also increase;
    * needs based, where an assessment is made of the minimum expenditure needed to maintain a tolerable life: this was the original basis of the poverty line in the United States, which has since been uprated for price changes.

    A poverty line does not have to measure income alone. It could measure expenditure, or take into account material deprivation, showing a lack of what are judged to be necessities.

    Poverty line is also based on the performance of local and federal government. This occurs when government makes bad decisions regarding types of jobs that will set up in an area."


  • Tom Civiletti (unverified)


    Don't you know that Americans are not supposed to pay attention to what is going on in the rest of the world when we develop policy? You probably support the UN, the World Court, and the Geneva Accords, too. Get with the program. Things are different here. Policy that asttempts to reduce poverty are unAmerican, as they interfere with the Free Market, sic., and undermine self-reliance.

  • David Wright (unverified)

    AFS -- Sorry, man, but you're the one who looks like an ass when you repeatedly mischaracterize something I've said and go off on a rant of your own.

    I did indeed read the whole page you linked to (obviously that particular page is only the first in a series that make up the entire book) and considered what they wrote before I even got around to really thinking about the information in the graphics. I didn't go into it looking for reasons to dispute what they say. But the more I thought about what they said (you know, instead of just blindly accepting it), the more questions it raised, so I did a little independent research.

    I simply noted in my post here that the very first graphic they presented was misleading. And it is. I conceded that their fundamental point may be correct, just that their support for it appears to be weak.

    And I didn't go off on all the reasons why the example graphic (the first one they used, not the only thing I read) because the point of this thread was about Oregon's minimum wage. But since you insist that I don't know what I'm talking about, here's a taste... (I sincerely apologize to everyone else reading this thread for the excessive length here!)

    First off, I don't have all the numbers required to offer a complete alternative analysis. I'm not trying to provide the "correct" answer here, just to demonstrate that these authors haven't provided the "correct" answer either.

    The numbers cited in the graphic are labeled in a highly misleading way. The graphic says (as of 1989) "The top 4% make as much as the bottom half of U.S. workers." But the actual numbers are tax returns filed, not workers. What's the difference? Well, for all of the "married filing jointly" returns there's no way to tell (from the aggregate data) how many actual workers are involved there. That number includes both two-worker families and single-worker families.

    So again, we're not talking about 51% of workers in the U.S. as the graphic says. We have no idea how many actual workers are involved there, we just know that it's not 51%. However many workers are really involved, it's actually going to be more than the 49.2 million cited, because all of those returns represent at least one worker, and some unknown number represent more than one. Now, a subtle point about the construction of the graphic is that they are using outlines of people to represent the numbers, even though the numbers don't represent people. A more accurate depiction would be to show outlines of tax returns, though of course that wouldn't have the same impact.

    Quick example to demonstrate -- remember last year when the presidential candidates released their tax returns, as they traditionally do? The Bushes released their joint return, and the Kerrys released their individual returns.

    Two families, four individuals, three tax returns filed.

    Now, if I simply gave you the amount of income reported on those three tax returns, could you tell me how many "workers" they represented? Three tax returns (picked out of the aggregate numbers compiled by the IRS) might represent 6 people in 3 households with anywhere from 3-6 workers. Or those 3 returns might represent 3 workers in a single household. Or any of a number of possible combinations. The point is, you just can't tell from the aggregate of "3 returns filed".

    OK, so we'll assume that it's true that the income reported on the top 4% of tax returns in 1989 was equal to the income reported on the bottom 51% of tax returns in 1989 -- I have no reason to dispute that, though that's not what the graphic says. But in and of itself, that statistic doesn't mean much other than the very wealthy are very wealthy indeed.

    The point of the graphic, though, it to compare how the percentages changed over 30 years, from 1959 to 1989. And in '59 the ratio was 4% to 35% of tax returns filed.

    Now, I did a little digging into the "numbers behind the numbers" as I mentioned before, since I'm a naturally curious kind of guy. The first thing I did was to figure out how many more tax returns were filed in 1989 compared to 1959. This is easily enough calculated by comparing the 2.1 million returns representing 4% in 1959 (for a total of 52.5 million returns) with the 3.8 million representing 4% in 1989 (total of 95 million returns -- which you can verify was the number of non-business individual returns filed in 1989 by checking on the IRS web site, by the way). Those numbers are consistent with the IRS numbers I found, which is what I meant by the numbers being right but not meaning what the authors say they mean.

    Anyhow, simple math shows that there was an increase of slightly more than 80% in the total returns filed between 1959 and 1989.

    How does that compare with population growth during the same time frame?

    First I compared total census figures from 1960 and 1990, the closest census years to the figures used in the graphic. I found a general population increase of about 38% or so -- less than half the increase in tax returns filed. Interesting.

    But then it occurred to me -- holy smokes, in 1959 a large number of baby boomers would have been counted in the census, but the oldest of them would only be 14 at the time and not expected to file a tax return. Yet, by 1989 all those boomers would be of "tax eligible" age. That's gotta account for the difference, right?

    So I found another source on the census web site that included age breakdowns, and even estimated numbers for each year (not just actual census years). So I did some quick calculations of the population change for those 15 and older (because the age breakdown was 15-24 in that group) from 1959 to 1989. That yielded a little more than 57% increase in "tax eligible" population.

    But still, there were more than 80% more returns filed. Only 57% can reasonably be attributed to additional population, so what about the rest of them?

    If you do the math, and calculate how many tax returns would have been expected in 1989 based strictly on population increase, you get about 82.5 million. But there were actually 12.5 million more than that. Where did they come from? And what impact would they have on the percentages represented in the graphic?

    Clearly, in 1989 there were more tax returns filed per tax-eligible person than there were in 1959. That is simply a statistical fact, and a fact of some significance when considering per-return average income reported, which is important for the purposes of this analysis.

    We can assume that an individual files at most one return, so if the number of returns per person increased, that must mean that some people were filing returns in 1989, that wouldn't otherwise have filed a return in 1959.

    And the authors actually point the way to a likely explanation for at least a large part of these extra returns, when they reported increasing numbers of "Head of Household" filings (see, I actually did read the page...), due to increasing single parent families as well as people supporting relatives such as aging parents.

    So, let's take a look at those single parent families, overwhelmingly single moms. A certain number of those single parent familes in 1989 would have been dual parent families in 1959, quite likely single-earner families but certainly with some dual incomes reported on a single return.

    In 1989, that situation changes for some people so that you've got divorced parents, each filing separate returns. You've added a return to the system that wasn't there before. But in practical terms, you've almost certainly also lowered the average and median income reported on a return.


    For the sake of argument, let's say that family had been earning $50K reported on a single return, with only a single earner. Now, if the parents divorce, the one who had not previously had a job must get a job, quite likely for less (since they are new to the job market) than the $50K earned by the experienced worker. So you've added a new return to the system with a lower reported income, exerting downward pressure on the average and median incomes.

    Even worse if that family had previously had two incomes, say $25K each. Before, the family income was $50K on a single return. After the divorce, there are 2 returns with $25K each. It's a double-whammy statistically speaking because you've got twice as strong of a downward pressure on the average and median. Instead of a single mid-middle class return, now you've got two low-middle class returns -- even though nobody lost a job, nobody's income changed, they just filed their taxes differently.

    Does that account for all 12.5 million "extra" tax returns filed? Probably not. Does it account for the entire increase from 35% to 51%? Probably not.

    But my point is, it almost certainly has some impact on those numbers. There's a fair chance that a lot of those 12.5 million extra returns fall into this category, boosting the number of lower-income tax returns filed, and thus inflating the percentage of total returns filed that would be required to meet any given total income level. It's interesting (though admittedly probably coincidental) that those 12.5 million extra returns represent 15% of the population-adjusted expected returns, and the jump in the percentage of returns needed in 1989 was 16% (from 35% to 51%). I'm sure that the extra 15% didn't all get inserted at the bottom of the income scale. But when you take into account the fact that many of the returns from the nominal group would have their incomes dramatically decreased (as one earner's income is split from a formerly joint return), so that the effect of the 15% extends beyond just that extra 15%, I don't think it's implausible to suggest that the "problem" reported here is distorted.

    And that was my point when I said that the numbers don't really mean what the authors said they mean. They are not factually correct (tax returns versus workers) and even accounting for that, the analysis offered was incomplete.

    As I said, that doesn't mean that the middle class isn't being squeezed out on both ends. It doesn't mean that everything is hunky-dory.

    But it does mean that in this particular case, the authors aren't telling the whole story. Effectively, with supporting materials like the graphic that I criticized, they use the same inane and misleading bumper-sticker messaging without delving into the complexity of the issue that I hate so much about the current GOP.

    So I will continue to read, but read with a healthy dose of skepticism. As should anyone.

    It is true, however, that the rich are improving financially faster than the poor and the middle class.

    The question is, in what way is that really a problem? And, if it is really a problem (as I concede it may be), what should be done to correct the problem? What can be done to correct the problem?

    But first we need good data on the problem itself.

  • David Wright (unverified)

    By the way, I'm certainly not in favor of poverty either. Of course I'd like to find a way for everyone to rise out of poverty.

    I simply assert that raising the minimum wage is not an effective way to do that. And I'm not generally in favor of more socialism than we already have.

    I have no problem with the U.N., I think it's a fine political institution. I'm not convinced that it's a particularly good financial institution, though. Resolving disputes between member nations and promoting greater worldwide cooperation? Great. Telling member nations how to spend their resources? No thanks.

    AFS -- I wasn't knocking your ranking of Norway and Sweden. You missed my point, which was that even by the HDI rating, the United States is in pretty decent shape. Could it be better? Yes. Do we need to emulate the countries of Scandinavia? No, I don't think so.

  • phriedom (unverified)

    David, are you suggesting the single parents correlate with poverty? Thats just crazy talk.

    But seriously. I think that the bit that AFS posted from Wiki actually UNDERSTATES the poverty in the US. IIRC the poverty line in the US isn't set at the amount of money you need to meet your basic needs, it is set at HALF the money you need to meet your basic needs. So if you're only skipping meals and going without heat, thats not official poverty.

  • David Wright (unverified)

    I absolutely agree that, whatever number games are played to determine the official poverty line in this country, poverty is a major problem and drags down everybody in society.

    The $64,000 question is, what's the best approach to take to combat poverty?

    Regarding some of the stats that AFS posted from Wiki...

    "While the United States' mean wealth is the highest of any major country and its median income is near the highest in the world, there may be a relatively unequal income distribution."

    Median income is near the highest in the world. You know, the point at which half the people make more, and half make less. AFS has a point about using per capita GDP (though if it's such a bogus number why does the UN use it to calculate the HDI?), but surely such concerns are mitigated somewhat by looking at the median income ranking.


    "The wealthiest ten percent of Americans are 15 times richer than the bottom ten percent."

    As if that's an inherently bad thing. I'm shocked that the ratio is that low, actually, considering we're only looking at 10% on either end.

    Uneven income distribution is not inherently evil. As I said, large numbers of people living in poverty is a Very Bad Thing. But if nobody was living in poverty, would it matter if the wealthiest people were 50 times richer than the poorest? I think not. Can somebody explain how that 15:1 ratio actually causes poverty (rather than being to some extent a result of poverty)? I'd appreciate the education.

  • Christy (unverified)

    David, I wanted to thank you for such a nice personal attack. Really :).

    Just to clarify, I average around $13/hour working at an upscale restaurant. There are weeks where we are super busy that are exceptional.

    Our dishwashers make $9/hour and our cooks make upwards of that. Everyone is tipped out, although it is on a sliding scale. Kitchen gets 5%, dishwasher gets $5, busser/host gets 15%.

    Luckily, our boss believes in living wages and in promoting team work. And I do not think has anything to do with the ORA.

    Just to continue with the real restaurant example...

  • David Wright (unverified)

    Christy, thanks for the additional info, it's very interesting. And thanks for having a good sense of humor as well! <nobr>;-)</nobr>

    So it sounds like none of the workers at your restaurant would actually be legally impacted one way or another by HB2409 since they aren't making the minimum wage right now.

    Well, unless my assumption about your base wage level was correct (i.e., your employer pays only $7.25/hr to tip earners). In which case, without HB2409, you (and the other servers) would be the only ones that your boss would have to give a raise to next year.

    That is an interesting twist... don't you think, Trey?

  • afs (unverified)

    David Wright - Another example of an economic conservative resorting to spewing thousands of words around the margins of a discussion trying to distract from the central aspect of a discussion. You wrote paragraph after paragraph about the first graphic in the book that appears before the actual text of the book begins. You're still running away from the experience of actually addressing the text in the book itself. You keep on pounding the desktop asserting you've been reading the book, but still have no knowledge of anything in the text of the book. You still have nothing other your own assertions that you are certain the authors are wrong with having read a $%&@*$# word the authors of "America What Went Wrong" said. Gee, that would involve you having to stop talking for a while? And it would involve reading, too? Wow.

    As far as your tax return graphic distraction, I'll dispatch with that in a couple of sentences. Everyone that files a tax return with the IRS has to sign a tax return with their SSNs and include all their individual forms that include their individualized income information like W-2s, etc. Individual returns have one signature, one SSN, and associated W-2s. Joint returns have two signatures, two SSNs, and two little piles of W-2s, etc. The IRS knows exactly how many people are filing returns for that reason. The only situations that leave people unaccounted for are small family businesses in which family members contribute to the operation of the business, but the family member that is the business owner is the only individual that is on the books recieving any income and actually files forms with the IRS. The primary reason for your "mystery increase" in the work force is the percentage of married women in the work force between the end of the 50's to the end of the 80's.

    The other important stat that you tried to distract attention from was this quote from the wikipedia article of standard of living in the United States...

    "The United States also has more people below the defined poverty line than 26 other countries"

    That, of course, completely discounts your whole claim that the extremely uneven income distribution in the United States doesn't matter. David, you say "large numbers of people living in poverty would be a very bad thing." They are living in poverty in large numbers in the US. What do you think it means when the US is down at #27 regarding people in the US living in poverty? Sure, there's lots of money in the US. The rich have almost all of it.

    Again and again, David Wright keeps reasserting his constitutional right to rant about subjects he's only superficially conversant in. Fine. As the GOP proves as often as David does, talking endlessly about things they don't know anything about is a long American tradition that sees no threat of ending anytime soon.

  • David Wright (unverified)

    Ah, AFS, bless you. I can always count on you for more than 100% of my RDA of Irony.

    Do you ever actually read my posts?

    Hell, do you ever actually read your own?

    Do you understand the relationship between cause and effect?

    You kill me, man....

  • Bill Holmer (unverified)

    This thread is starting to unravel.

    My question is, in an ideal capitalistic society, what should the income differential be between the top tier of income earners and the lowest tier of income earners, and why?

  • afs (unverified)

    Bill... I can't comment on the ideal society or the precise ratios necessary to take us there. That requires someone with a PhD and a couple of years to grind numbers to come up with the precise figures. However, I can comment on some principles of basic fairness though. At the point someone has earned a million dollars + a year, they need to be giving half of that money made back in taxes to support the needs of this society. We need to maintain the infrastructure upon which the economy in this society generates capital. We need to invest in the education of the work force. We need to invest in the technological infrastructure to ensure continued innovation. People with estates larger than roughly $5 million dollars need to be paying a 50% tax rate on those estates as well. I don't have a whole lot of problem with the Bill Gates and Steve Jobs of the world having piles of money. They earned their money. I do have a problem with the children of Bill Gates and Steve Jobs getting handed the exact same position in society as an accident of birth. They did nothing to earn the right to that type of priviledged position in this society. Half of the money from the estates of the megarich needs to go toward making sure that everyone gets a start in life free from the struggles that come from life way below the poverty line. There's too much money in the US for so many people to be so deep in poverty.

    So Bill, IMHO, a 50% top tax rate on the ultra-wealthy, and a 50% estate tax rate on estates above 5 million in value (with generous shelters of agricultural lands to protect family farms, but only to those who can establish they actually do work as farmers on said family farms... Harrison Ford's ranch is not a "family farm" just because he calls it a ranch).

    And anyone that works for a living full-time needs to be making a wage that really lifts them up above the poverty line. From the Center From American Progress story I linked and quoted above...

    "Across the 10 communities we studied, the cost for a single wage earner to support an infant and a preschooler ranged from $27,660 per year, or $13.10 per hour, in New Orleans, to $59,544 yearly, or $28.19 per hour, in Boston. On average, the federal minimum wage covered just 34 percent of the family's basic costs."

    If the federal minimum wage only covers 34% of the basic needs of living in this society, the Federal minimum wage needs to be tripled with a law also permanently raising the minimum wage annually to cover inflation. There's no excuse for people not being able to earn the basic cost of living in this society when they work full time and play by the rules in this society.

    David Wright... Yes, I've read your posts. We've all read your posts. It's impossible not to read your posts here, David. You've filled the whole freakin' blog with your posts. Now... stop talking for a while. Start listening to the sound of something other than the sound of your own voice. Everyone here saw you start ranting against a book with Pulitzer Prize winning research before you read the first word in that book that was provided to you for free without having a shred of evidence to base your rant against said book on. I, and everyone else I know, would be utterly mortified if they publically displayed that kind of stupidity. David, the fact that you have no personal sense of shame for displaying such anti-intellectual behavior and are not slowed down when you publically embarassing yourself does not make your ill-informed statements any more valid.

  • David Wright (unverified)


    I post so often to expose your inanities, my friend. You are the one displaying rampant anti-intellectual behavior and sheer willful ignorance. If you do actually read my posts, then I can only conclude you are intentionally misrepresenting them, thus you are the one who should be ashamed.

    "America: What Went Wrong" did not win a Pulitzer.

    The series of articles from October 1991 upon which it was based did not win a Pulitzer.

    The authors, Barlett and Steele, won Pulitzers in 1975 and in 1989, for series in the Philadelphia Inquirer, regarding very specific tax issues.

    Look 'em up: Pulitzer Search Form.

    So I'll stipulate that the book was written by Pulitzer Prize winners. And they make some valid and interesting points in their work, which I have read well beyond the "acknowledgements" section.

    But winning a Pulitzer does not make one infallible. And what I wrote about the very specific problems with the numbers used in their misleading graphic is true, despite your willful disregard for the facts.

    Your little lecture about how people fill out IRS forms is correct, but irrelevant -- and demonstrates that you did not understand what I was saying about the problematic numbers. So I'll repeat it.

    In 1989, 3.8 million was 4% of the total number of "items" (workers? people? tax returns?) in their comparison. Multiply 3.8 million by 25 (or divide by 4%) and you get 95 million total "items". Also, 49.2 million was supposed to be 51% of the same total number of items. Divide 49.2 million by 51% and you get about 96.5 million. So depending on rounding, we can establish that the total number of items in the comparison was roughly 95-96.5 million. Unless these Pulitzer Prize-winners are incapable of performing 5th grade math and botched the percentages in the first place.

    According to the IRS, in 1990 (data for 1989 was not directly available) there were 96,134,800 total non-business tax RETURNS filed for individual income tax (as opposed to corporate returns, partnership returns, etc.) Not SIGNATURES ON RETURNS, but the actual RETURNS. Look it up: IRS Statistics on Tax Returns Filed. That's basically consistent with the total number of "items" used in this graphic.

    Meanwhile, the total adult population of the US in 1989, even just those 25 and older (leaving out a large number of people who would be expected to file a return), was 156,207,000. Look it up: US Census Historical Statistics. That is not remotely consistent with the total number of "items" used in this graphic.

    The total number of returns is virtually dead on with the total items in the graphic (within the tolerances allowed by the numbers cited therein). The number of adults, most of whom would be required to file a return, is nowhere near the total items in the graphic.

    Married women entering the workforce, unless they filed a separate return from their husband (which certainly happens but is relatively uncommon), would not be counted separately as part of the 95 million or so returns from 1989 as you suggested. A joint return, with two signatures, still counts as only one return regardless of whether one or both people are working.

    How many "shreds of evidence" upon which to base my criticisms do you need? I cited plenty before, and just demonstrated that your "rebuttal" regarding tax returns was ridiculously off the mark. Are you now "utterly mortified" for having "publically displayed that kind of stupidity" with your "ill-informed statements"?

    In conclusion, dear AFS, I'm afraid you just don't get it. And if you still don't get it after this, there's really no hope for you. Oh, I expect we'll get to read another post about what an idiotic windbag I am (don't get me wrong, I'll cop to the windbag thing sure enough...) and how, when I talk, it's always to confuse the issue with some mysterious GOP/Jedi Mind Trick, because you apparently just refuse to accept people with opinions that differ from yours. If you must persist in your blind willful closed-mindedness, you can't be helped by me or anyone else.

    Peace, man.

  • David Wright (unverified)

    Bill, sorry for being a major contributor to the unraveling! Guess I've just got to learn to let lying dogs sleep... <nobr>;-)</nobr>

    Thank you very much for changing the subject. I'll be very interested to see what responses, if any, get posted to your question...

  • afs (unverified)

    David Wright: As I said before...

    "...Another example of an economic conservative resorting to spewing thousands of words around the margins of a discussion trying to distract from the central aspect of a discussion. You wrote paragraph after paragraph about the first graphic in the book that appears before the actual text of the book begins. You're still running away from the experience of actually addressing the text in the book itself. You keep on pounding the desktop asserting you've been reading the book, but still have no knowledge of anything in the text of the book. You still have nothing other your own assertions that you are certain the authors are wrong with having read a $%&@*$# word the authors of "America What Went Wrong" said..."

    Where have we seen this before. How about last year when several journalists proved that Bush's Texas National Guard Unit was a champaign unit for the sons of priviledge and Dallas Cowboys to avoid going to Vietnam. Bush didn't even serve his whole commitment to said champaign unit. By the time we were done, we were analyzing the fonts of typewriters and word processors on one of the documents used in the story, and the media completely forget the fact that the charges were proven by the rest of the remaining evidence. Just like the late Johnnie Cochrane played an audio tape by one ugly racist cop that had nothing to do with the trial being conducted, and a man that was proven by DNA evidence to have had his own blood mixed in with two murder victims at the scene of a dual slashing got off free and clear.

    It's called distraction.

    Now, as far as your distraction about total tax returns filed vs. total workers... I looked at the IRS web site for more info, and then called the IRS themselves. The information that the authors published in the graphic is the best available information on the subject. There is no magic way to resolve the gap between the number of people filing and the total numbers of workers in the US economy. There a whole host of factors that affect this number. Everything from housewives with no income to individuals that don't make sufficient income to be required to file taxes to people out of the country working in foreign countries to the homeless to the people who are flat out tax cheats.

    Here's a link to a pdf with all the info the iRS has on measuring tax complaiance...


    What the pdf says is that this all down to is educated guesses. The IRS guess on how many people lawfully comply with their filing laws is 90.7% (including those who lawfully don't have to file federal returns for a particular year). That data is only available for individual returns. Where the IRS is sitting regarding smaller groups is basically the land of cluelessness. They have no idea regarding the breakdown of what groupings those who aren't filing are broken down into (ex. small business vs. wage earners).

    However, as the IRS employee told me when I was talking to her, economic data compiled from total IRS tax returns files is like a total survey of the US economy with roughly 2/3 of the total population that is the subject of the study being surveyed. Gallup uses a survey sample of about 1000 to poll the entire US population and gets a margin of error of about 3%. So... what's margin of error going to be for a poll of US workers with 2/3 of the total population being surveyed? Somewhere down around .000000002% margin of error. The very definition of statistically insignificant.

    In other words, all the information anyone could ever need to know for trends in the US economy is right there in the US tax filing data. Not because the data is absolute, but because the data is such a massive survey of the US worker population.

    Translation... you struck out with your distraction, David. Differences between the US tax filing data and some mythical total US worker population compilation is extremely statistically insignificant. You're gonna have to troll up a new distraction.

  • (Show?)

    Just for completeness, since David asked me the question a zillion posts back and I'm sure everyone stopped reading this thread days ago:

    If the tip criterion in the bill was of the same order of magnitude of the tip examples in the discussion, then I might find the bill and accompanying discussion credible.

    When the discussion is $7/hour and up, but the bill specifies $30/month, that's a miss by one or two orders of magnitude. A 17 cents/hour threshhold means that after one cost of living increase to the minimum wage, that minimum wage tip worker who doesn't get the increase because they make $30/month in tips will immediately be making less than the prevailing minimum wage. Every cost of living increase thereafter will increase that gap.

    That defeats the purpose of the minimum wage even by your standards of what the minimum wage is for.

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