Raise the Minimum Wage in Return for Approving Keystone XL? A Bad Deal

John Thune on 'Morning Joe' two weeks ago tossed around the possible idea (with other guests, errr......political poltroons) of having a "deal" in which a raise in the minimum wage (to $10.15 an hour) might be effected in return for the Dems allowing the Keystone XL pipeline to go through. (Let's forget for the moment the hike in the minimum wage DID technically pass at the last Senate vote by 54-46, but the Reepos phoned in a "filibuster" because the 60 majority wasn't attained.)

Thune, in his monologue, insisted that unless the economy is expanding we can't afford a minimum wage hike. The Keystone - by providing some 50,000 odd jobs- would presumably allow such expansion, which is why this compromise deal is being knocked around by the pols. Thune added that we can't simply raise the minimum wage by itself if the jobs aren't there and companies aren't experiencing demand for their goods.

What he doesn't get is that there is little demand because people aren't being paid the income that allows them to spend, given their other obligations (mortgages, rents, utilities, groceries etc). Even now, 6 years after the financial collapse, 14.5 percent of families are food-challenged. They are having difficulty paying for food in the richest nation on Earth..  Hence, merely approving the Keystone will not in itself be adequate to generate aggregate demand across the board to expand the economy.

Beyond all that, approval of the Keystone would add monumental extra costs to the health and environment: more cancers, more illnesses from polluted air- water. In addition, the added carbon deposition - especially from tar sands oil - would be too much to halt the worst effects of global warming,

Bill McKibben in an appearance on Chris Hayes’ UP in 2011, noted the major contributor to push us into this hothouse hell is none other than implementation of the Keystone XL pipeline because of the concentrated carbon it will unleash over years. To remind readers, this pipeline will deliver tar sands oil from Alberta, Canada to Gulf Coast refineries for export to an international market. The pipeline would have an initial capacity of 830,000 barrels per day and would leave a carbon footprint equivalent to building more than seven new coal-fired plants. By the time it reaches full capacity the enhanced carbon deposition will be nearly 3 gT/yr. In other words accelerating the timeline to reach the 550 gT maximum carbon load the planet can bear.

All of this discloses that no deal should be made and the minimum wage ought to be increased based on its own value of increasing aggregate demand.  It makes no sense to approve Keystone and get 50,000 more jobs but then impose recurring costs that effectively are fifty times higher than any economic benefits.

Despite misleading claims of “benefits” by TransCanada, the downsides of this ill-conceived project remain the same and include:

1)  Building a future of dirty energy,  hastening our pace toward an uninhabitable world. The fact is the Keystone XL is a massively detrimental dirty energy project that would open a major export artery for toxic tar sands oil across the U.S. for at least 50 years. In that interval, massive spills and contamination of our water supply (already threatened by fracking) will accelerate cancers and other endemic health problems.

2)  It’s an unnecessary risk. The U.S. itself doesn’t need this crap oil especially since we’ve reduced our oil consumption by nearly two billion barrels per day over the past five years. This stat will continue to improve with the growing number of electric and hybrid cars.

3) Water pollution: A planned Keystone XL pipeline would pass through Nebraska’s Sandhills region, endangering the Ogallala Aquifer, which forms the drinking water for millions as well the water source for one third of American agriculture. In other words, a massive tar sands oil spill could pollute not only the water but crops used for food consumption. During the tar sands oil extraction process, vast amounts of water are needed to separate the extracted product, bitumesidesumaen, from sand, silt, and clay. It takes three barrels of water to extract each single barrel of oil. At this rate, tar sands operations use roughly 400 million gallons of water a day.

Higher gas and food prices: TransCanada has admitted one of its goals is to raise oil prices in 12 midwestern U.S. states thereby increasing revenue to the Canadian oil industry by $2b to $4b. Meanwhile, U.S. farmers, who’ve already spent $12.4 b on fuel (in 2009) could see expenses rise to $15b  if the pipeline goes through,  a cost which will surely be passed on to Americans as higher food prices.

5) Increased respiratory disease and cancer: The pollutants released by mining and refining tar sands will incept acid rain, smog and haze as well as other effects associated with lung disease and cancer. The solid or semi-solid waste, embedded in the toxic sludge, will unleash astronomic rates of kidney, breast, colon, pancreatic and liver cancers by the ingestion of the water soiled by the tailing ponds.

6) Climate disaster: Any future tar sands development – say via Keystone XL- will mean “game over” for the planet according to NASA climate scientist James Hanson. I already noted earlier how much extra load of carbon will be added and how it impinges the 550 gT critical threshold.


There should be no connection at all between raising the minimum wage and the Keystone XL pipeline. The latter is a horrific idea that neither the planet or the nation can afford while the former is long past due and would spark an increase in aggregate demand because it would give millions of workers the income to spend - which is what our GDP and economy is all about.  All the research done regarding effects of raising the minimum wage - except those coming from right wing think tanks - show it to be a boon for the economy - and with only minimal cost effects for most employers.

It is the right thing to do and the human thing. And besides, if we refuse to provide this increase in income we can't complain as ever more families have to go on food stamps to survive! It's either more food stamp beneficiaries or higher minimum wage. Take your pick!

Harvard Prof Misses the Boat on Inequality Arguments

The forlorn wage slave depicted in the graphic is the ultimate "beneficiary" of Neoliberal globalism and the "New World Order". That is, he is the embodiment of the marginalized U.S. worker - whether corporate temp forced to work overtime for his daily bread, minimum wage burger flipper, or the adjunct prof who has to forage for food stamps and throw away tins of Spam in dumpsters - while putting together a base income by teaching 20 hours a weeks at 5 community colleges.

Welcome to the Neoliberal realm, the realm of constant and growing income inequality. Where citizen security is a myth and all denizens are expected to be beholden to the Market god.   How did it come about that Mr. Worker's salary has barely budged in 25 years, and that he's falling ever farther behind? Well, one can look at the changes introduced from the time the Neoliberal order was imposed, including:

 1) The re-definition of productivity: that is, productivity is now defined by "cutting jobs and finding ways of making the same products with fewer people". As pointed out by one Neolib mouthpiece  (F. Zakaria): "At many major companies profits have returned to 2007 levels but with many thousands fewer workers".

2)The force of globalization: making a single market for many goods and services which don't require American workers for production, OR American consumers to buy them. This single market amounts to more than 400 million having entered the global labor force, from China, India, South Africa, Indonesia and elsewhere. All now with money to spend, and all willing to work at one third or less the pay of an American, and for NO benefits!

Unmentioned is that the sole remaining "life raft" for the stressed worker:  his Social Security and Medicare, is now also under threat by the Neolibs, thanks to their rat warren known as "Fix the Debt" and its instigators such as Peter G. Peterson.   Nor do the purveyors of the New World Order bother to mention how their yen for more military excursions and interferences, conflicts, increased defense  budgets are designed to bleed the public purse ever lower - to justify cuts to "entitlements".

Into this miasma of economic despair we have the recent essay ('A Top Heavy Focus on Income Inequality', Sunday Review, NY Times) by Sendhil Mullainathan, an Econ Prof at Harvard.   He basically asserts in his piece that we are focusing excessively on the "one percent"  and that this focus on the wealthiest "has a cost".

He does name the usual suspects, i.e. the contributory factors: "hourly workers face an increasingly volatile working life, not knowing how many hours you will have or when you will work them. Or how you will jiggle your work or your family, or how you will make a rent payment that takes no account of the fact you may be working fewer hours."

All of these, he insists, are left off our radar when we only focus attention on the 1 percent, because we "aren't talking about the problems".   However, he misses the point - or maybe it eludes him- that these same 1 percent (or 0.1 or 001 percent) are totally responsible for many of the working conditions imposed, including:  refusing to pay a living wage,  providing benefits - especially healthcare or merely allowing time off for pressing family issues.

In other words, the inequality in income and conditions sown are directly traced to the Neoliberal mindset of the business owners who have adopted that model. Moreover, as Chrystia Freeland noted in her book, 'Plutocrats: The Rise of the New Global Super-Rich and the Fall of Everyone Else', these elites no longer feel a social compact with their workers, i.e. to pay higher taxes to support an increase in their life style,  enabling greater spending power and more security.  While in decades past, the massively wealthy acknowledged on some level the need to contribute to the welfare of the whole society via just taxation, they no longer believe so - they have now signed onto the Neoliberal imperative that all workers are expendable. 

So no surprise now they would rather keep the minimum wage universally low despite the fact that last year American taxpayers shelled out more than $250 billion on welfare programs for the working poor. (Nearly 40 percent of food stamps are paid out to households with at least one wage earner.)

But, of course, the reason is obvious: these business elites aren't exposed to these taxes themselves, so they don't care! They are allowed so many corporate tax loopholes that the burden falls on the average middle income taxpayer, or pensioner, already subject to enormous outlays in other areas. Thus, the richest, the wealthiest can afford to sustain their laissez faire attitude while their workers sink beneath ever increasing debt.

None of this is processed or registered by Mullainathan. To his credit, however, he does observe that:

"We should try to observe that everyone has a fair opportunity to find a great life. It's a quest that will require political will and ingenious policies. President Obama's proposed expansion of the earned income tax credit  (ETIC) goes in this direction, but more is needed."

Indeed! But I argue the policies needed aren't that "ingenious" and they ought not be that controversial.  Before I go on, let me point out that while the ETIC referenced by the Harvard prof does help - lifting millions out of poverty - the low minimum wage creates a perverse incentive for businesses to drive wages lower - below the poverty line. The net effect is more than one-third of the ETIC is pocketed by employers through low artificially low labor costs, according to a Princeton University economic  analysis.  This bring us to the first point of what must change:


1) Raising the minimum wage, to $10.10 /hour which would put it at about the level the minimum wage was in 1968, corrected for inflation.   According to the Economic Policy Institute an increase in the minimum wage to $10.10/ hr. would boost the incomes of 27.8 million workers.  Contrary to the trope that the main beneficiary is a 20-something burger flipper at 'Jack in the Box',  Rolling Stone ('The Minumum Wage War',  March 13, p. 34) notes it:

"is a full time working woman in her thirties, responsible for half her family's income"

This is something to really think about and implement, but its execution depends on those top 1 percent (or 0.01%) business owners agreeing to it, as opposed to hiring lobbyists to fight it. This is also why we can't take our eyes off the 1 percent as the Prof suggests we do.

2) Integrate into working conditions a paid family leave AND paid sick leave!  Both of these would be significant in enabling hard pressed workers to harmonize the demands of work with family life. In the case of sick leave, it would also be a boon to the economy overall. For example, the spread of norovirus outbreaks nearly every year claim up to 900,000 workers - who then suffer from time lost, even as they spread the disease to others by being forced to report for work, or lose pay. Allowing at least 3-5 sick days per year, like most civilized nations, would eliminate these enormous costs to the economy.

3) Obamacare's full implementation - separating health care from work will be an enormous boon to millions who otherwise would have to keep noses to the grindstone. Now, they will be able to retire or pursue entrepreneurial goals, and enable younger workers to have their jobs.

All of these can be done. and should be done, but their acceptance and implementation will depend on the cooperation of the one percent.

Which is why fixing the problem of income inequality in this country must include them!

Don't Like Welfare? Then Demand A Liveable Wage for Workers!

Fast food workers demand higher wages in August.

Question: When was the last year a worker earning $90 a week (net) could live on it? I am talking about food, rent, and transport etc. The answer is 1968, when the dollar was worth approximately 4.5 times what it is now. I can vouch for this because I was such a worker, at an Oil Company in New Orleans, taking a hiatus from university studies. As a geologist's assistant responsible for preparing geological stratum sections (disclosing salt domes), I took home 90 bucks a week, and I also needed no welfare support to make it.

The rent for my efficiency apartment,  located in the upscale Garden District (off St. Charles Avenue, and 3 blocks from Loyola) came to  $75 a month.  My electric bill was usually about $30 a month and groceries came to about $35 a week, and that was being extravagant - with fare such as steaks, shrimp, etc.. Add in going out to eat at the 'Buck Forty Nine' twice a week and food came to around $40 or so a week. Transport was a cinch at 15 bucks a month. It cost one thin dime to get on the St. Charles trolley and go directly to my job on Lee Circle, and one thin dime to get back. Add in the trolley fare for dates, escorting Loyola coeds to the Saenger Orleans downtown on Canal St. for a flick, then dinner, and you had the balance.

Now, fast forward to today's workers earning 90 bucks a week take home. Do they even exist and if so can they make it? Not likely! A fast food worker earning $7.25 an hour today and putting in a 40 hour week will stand to take home just over $246, or more than two and a half times what I earned.  But can he or she afford to live like I did? Hell no! Rents in most urban areas start at around $650 a month if you're lucky. In the same area I lived in New Orleans 44 years ago, they're now $780 a month and more. How is a worker earning only $246 a week going to make it, with also having to shell out at least $100 a week for groceries, and likely $150 a month for utilities (electric, gas, water). Add in cost for transport, even if the worker is lucky enough not to need a car (to which maintenance costs must be added) and you have a small economic nightmare.

"Do the math" as they say, and you find the workers such as those shown will always end up short and without enough to eat, or to pay for medical needs. No surprise then, that they will need additional monetary input which I didn't need in 1968. (And NO, it isn't fair or right to tell them to "work two jobs". That's the response of an asshole.) 

I bring this up because a new study on behalf of the National Employment Law Project has disclosed that "about 52 percent of the fast food workforce receive some kind of public assistance, compared with 25 percent of the general workforce." (Denver Post, 'Fast Food Help Takes A Big Bite Out of Welfare', p. 12A, Oct. 16)

The study also found that California led the country with $717 million spent in welfare for those workers. The study was completed by the University of California- Berkeley Law Center, and the University of Illinois at Urbana-Champaign.

Commenting on the dismal stats, Corrine Fowler of the Colorado Progressive Coalition was quoted:

"It's pretty outrageous that workers can't meet their basic necessities even after working 40 hours."

Indeed, and this is why fast food workers in nearly 60 cities had pressed for a living wage - defined as $15 an hour - to help them meet their basic needs, which again, are no where near as extravagant as the welfare haters would have you believe.

Doing the math, as I showed above, indicates that only a totally uninformed putz (or math deficient putz), Tea Party idiot or asshole would bitch about people getting welfare who are working hard - at least 40 hours a week - and can't make it, so need government assistance.

Author Charles Reich is blunt in his book  ‘Opposing the System’, Crown Books, pp. 125-126:

“The claim that government is free to reduce or cut off welfare and other forms of support for people in economic need is totally mistaken. Welfare is not a gift, nor is it, despite frequent assertions, a transfer from those who earn a living to those who are not.  Welfare is rather an obligation from society – and from those who are working- to those who have been deprived of work and the opportunity to earn a living. If we want to speak of transfers, it would be more accurate to say that those with a secure place in the economic system are enjoying a transfer of wealth from those who have been excluded from the economic system. Welfare then is partial compensation for a deprivation of livelihood that allows others to work.”

Clearly, a welfare model then must be based on the premise that welfare is an obligation from society and not a ‘gift’ or Freebie, i.e. reluctant transfer from the working to the non-working.

As Barbara Ehrenreich, the author of 'Nickel and Dimed' , noted, working at Walmart didn't even help her pay both food and rent at a dump motel. She had to go on food stamps to survive. (At least with that one 40 hr. job). There is a real moral problem here too, since without a living wage, economic warfare is all that remains- with each little person fighting and struggling against each other little person for survival.

Predictably, of course, the Employment Policies Institute declared if they paid any such living wage their profit margins would collapse unless they raised prices, and Cheeze Louise, the Customer demands low prices!

Puh-leeze! The Economic  Policy Institute has found the needed increase would be minimal and not kill any fast food addict's budget.  As an example, your bare bones special "dollar burger" from the BK  "Dollar menu" would go up to maybe $1.25. Big freakin' deal! Look, if you can afford a buck you can sure as shit also afford a buck twenty-five. NO one in his right mind is going to argue and tell me that a paltry 25 cents will spell the difference between buying the damned burger and not buying it!

Besides, after you cough up that extra quarter or whatever, you then won't have to bitch about so many getting welfare!

YES! Give Those Fast Food Workers A Living Wage!

The workers in the photo are upset and on strike, as they have every  right to be. Their wages are pathetic, most at a $7.25/hr minimum wage, and as one explained on an ABC News segment two nights ago (to finance reporter Rebecca Jarvis) there is no way they can survive on such pay, or feed a family or pay rent and medical bills. The worker then looked Jarvis in the eyes and asked her: "You put yourself in my place. How would you get through?" Jarvis could only blink a few times before cutting away, back to Dianne Sawyer in the studio.

Look, this is serious shit, especially as we approach Labor Day. It is not fodder by which to make insipid sport, say by posting images on a hate blog showing a person dressed in a fast food uniform (which could have come from anywhere)  spitting on food and then using that as a basis to piss on them and argue they deserve nothing. That sort of shtick is the sign of sick mind. One that needs ECT or perhaps a neural implant to ameliorate whacko tendencies.

These morons, also profoundly ignorant (but likely derived from their moron IQ status)  insist that fast food industry workers are the dummies because, hey, the job is supposed to be "entry level" only! DOH!  Well, tell that to the hundreds of Intel and other tech workers in Colo. Springs who were all tossed out of their jobs back in 2004-05  (due to companies closing or moving operations overseas) and are now working at Safeway, Burger King, KFC, McDonald's and Chili's. Their wages now, most of them, are barely one third what they used to earn. With it, the fortunes of the city itself have plummeted since obviously less is collected in taxes, and city services have also declined. Hence the stories people across the U.S. heard the past two years of COS turning off street lights, shuttering schools and allowing the weeds to grow to monstrous proportions on meridians and other public places.


The backstory here? Evidently, the loss of 15 million American jobs via globalization hasn't been processed by the dummies who still believe fast food jobs are "entry level". Newsflash! Fast food jobs, along with other service jobs (as waitresses etc. with a $2.13 /hr minimum wage and only tips to live off) are now the working NORM!   Because the jobs pyramid has collapsed, especially since the financial meltdown in 2008, these are the about the only jobs people (including many recent college grads) can get!

This also explains why, as noted in a July 29 Denver Post article:

"Economic insecurity among whites also is more pervasive than is shown in government data, engulfing more than 76% of white adults by the time they turn 60, according to a new economic gauge to be published next year in the Oxford University Press."


The Post article noted that "measured across all races" the risk of economic insecurity rises to 79% or nearly 4 in 5. Pardon me, but this indicates a nation of rising inequality and the degradation of most citizens in terms of their economic welfare. One of the reasons is that there are now too few decent paying jobs, by which I mean, paying a living wage - not a minimum wage. This is not adequate to raise  a family on and indeed it is one of the factors creating government dependency that the Rightist deplore.

But they can't have it both ways! If the Rightists scream and yowl at any proposed increase in the minimum wage - yes to at least $15 an hour- they can't also scream and yowl about the increasing use of food stamps!  Obviously, people -families have to eat and if $7.25/hr is inadequate to feed a family then they are going to have to get food stamps to make it to the end of the month! (Indeed, this is one of the strategies McDonald's, for example, recommends, in order to "make ends meet."  Meanwhile, Walmart offers advice on how to secure gov't health insurance via assorted programs such as SCHIP.)

To read some of the Righties' screeds you'd think jobs grew on trees (or fell from the skies), and upward mobility is just a matter of will - not that there is a remaining deficit of some 8 million jobs - which explains why so few college grads are able to pay off their student loan debts. Newsflash! They can't find jobs that pay the rent, provide food and also pay off loans on $8.50- 9.25/hour!

Yes, I also worked at a fast food place (Jackie Gleason's Restaurant in Miami, FL) busing tables - removing refuse such as half-eaten "Norton's hot dogs",  but that was in between quarters at the University of South Florida.  The pay was $1.60 /hour but whatever I saved from the job was ample to pay for my in-state tuition and textbooks. Today, that same type of job has now become a permanent fixture of our service economy and it is the service jobs that dominate. Then assorted idiots wonder why the spending of the American "consumer" has declined in recent years. (Never mind that corporations that could create extra jobs are still sitting on over $1.7 trillion in capital).

As for the claim that increasing fast food workers' wages would increase prices, that also is essentially  bollocks, since the Economy Policy Institute has found the increase would be minimal and not kill any fast food addict's budget.  As an example, your bare bones special "dollar burger" from the BK  "Dollar menu" would go up to maybe $1.25. Big freakin' deal! Look, if you can afford a buck you can sure as shit also afford a buck twenty-five. NO one in his right mind is going to argue and tell me that a paltry 25 cents will spell the difference between buying the damned burger and not buying it!

It is time fast food workers catch a break and their wages are increased to a living wage. They will then be able to buy more -  propping up the sagging economy and stimulating aggregate demand - and they won't have to go on food stamps! Even a moron ought to be able to grasp that!

Ryan's "Creative War on Poverty" Would Destroy the Poor - NOT Poverty!

Defeated VP candidate Paul Ryan has had a novel brain fart,....errr...plan. He describes it as a "creative war on poverty" designed to vastly reduce the number of Americans on food stamps (46 million, or a "record" according to a lead story in USA Today, Dec. 5, p. 1A).

The piece focuses on one Ohio County (Miami County) which has seen "a sharp increase in poverty among children and the unemployed". More disturbing is that despite an unemployment rate that's among the lowest in the nation (5.8%) a majority of the families are on food stamps. According to these workers, the problem isn't being bums or looking for handouts, but rather not enough good (i.e. living wage) paying jobs that enable a family to get ahead and not merely survive. As one worker quoted in the piece puts it:

"Minimum wage stays the same but the price of food goes up, the price of gas goes up and the electric goes up. How do you pay all your bills with 40 hours a week at $8 an hour?" (The OH minimum wage is actually at $7.70/hr, while the federal level is $7.25/hr. To my way of thinking, with such LOW wage rates, the feds absolutely need to include food stamps just for fairness' sake!)

In answer to the Ohio worker's question: you don't! SO how does Ryan expect to fight poverty in such circumstances? He'd have to ensure price controls on all the rising commodities, from fuel to food, and then MAYBE he can enable a cutback in the access to food stamps. But that's not what he wants! As an old guard Ayn Rand- worshipping libertarian, the last thing Ryan would do is place price controls on anything. That means food and gas prices would continue to go up - leaving very little disposable income for groceries after key bills like mortgage and utilities are also paid, hence driving the need to access food stamps.

As one Ohio pastor (a real one) put it, "without those food stamps and the help of our churches the people starve, especially their kids".

Given Ryan's libertarian instincts this means his only "creative" solution to fighting poverty would be to foursquare eliminate the means of poor people to survive while in poverty! This would be analogous to a draconian dictatorship asserting it will manage a "creative war on overpopulation" but by exterminating one-sixth of the people!  Instead of providing good jobs and remuneration so the people don't have to reproduce so much, this sort of bunch takes the "axe" to the numbers directly!

The other intractable problem noted in the article is the absence of any upward job mobility in the area. That is, the inability of all the low paid workers to find new jobs that pay better. To try to overcome this problem, the workers would have to leave for "greener pastures"- maybe to another state. But to be able to leave, they'd have to first be able to sell their homes, and they can't. NO one wants to buy them! So they are stuck in place with no potential for job enhancement. Even going to school to improve skills requires money for tuition, etc. and they don't have it.

Coupled with this is another problem that neither Paul or his 'pukes mentions much: the offshoring of the GOOD paying service jobs overseas, to reduce labor costs. Approximately 663,000 such jobs have been outsourced to eastern Europe, China and Mexico since 2002 including: information technology, human resources, finance and purchasing orders ('More Service Jobs Go Overseas', USA Today, Dec. 7, p. 1B).  The jobs pay a respectable wage of about $16 an hour - more than double the pathetic $8/hr. of the Ohio workers. In other words, these jobs would have allowed those in the poor areas to have lived dignified lives as opposed to going to food stamps for assistance.

Worse, The Hackett Group, a consulting firm, projects another such 375,000 jobs will be offshored by 2016.  Again, these are from companies "with a least $1 billion in annual revenues" and which represent 75% of the market for offshoring jobs. How can U.S. workers win in such an environment which has engineered a race to the bottom as far as labor costs? The answer is they can't.

Yet Paul Ryan expects us to believe he has a "creative solution" to the war on poverty which now affect nearly 1 in 6 Americans and 21% of all children, nearly 15 million to be exact. (A family of 4 is considered poor if it has an annual income below $22,350. )

Would Paul Ryan, one of the original self-described "Young Guns" on Capitol Hill, take the bread from those 15 million kids in order to win his "war on poverty"? You had better believe it! This is also why Obama and the Dems can't give one inch on the "fiscal cliff" discussions - in terms of spending cuts if the Reeps don't cede REAL increases in tax RATES, as opposed to smoke and mirrors revenue increases via closing unnamed loopholes.

We cannot allow the reptiles to extract painful cuts, or raising the Medicare eligibility age from 65 to 67 by letting them give up nominal revenue while the rich still get richer.