When presidential-hopeful Bernie Sanders addressed a packed auditorium in Birmingham this week, many UA students listened intently from the crowd. Among them was Kyle Campbell, who wrote an op-ed in The Crimson White last week echoing Bernie’s principles in calling for an increased minimum wage in Tuscaloosa – up from $7.25 to $10.10.
Kyle and Bernie both correctly identify an American tragedy: minimum wage Americans are working full work weeks (traditionally defined as about 40 hours per week) while barely surviving. According to a recent Gallup poll, 50 percent of Americans are working much more than that, but to the same effect.
But the dialogue surrounding wage growth is missing the mark, and the result could lead not to a leveled playing field, but an environment where the rich keep getting richer and the poor keep getting poorer. The question about what we should pay for low-skilled labor misses the more fundamental question we face in a modern economy – is there a market for low-skilled labor at all?
I think the answer is no. But we first should dive into why labor is priced the way it is.
Labor has a price. People are people, and no monetary value should ever define a person’s worth. But a person’s labor, however, is different.
Labor is a tradable commodity, just like sugar, gold or coffee, and has a market price based on a person’s skills. If a person’s only skills are ones the market considers low (classic examples would be fast food frying or grocery shelving), the market is only willing to pay a certain amount. That doesn’t mean the person is without worth – not at all. But his or her skills might be. Would you pay $5 for your Waffle House coffee that the market prices at $1.69?
The way to lift people out of poverty is not to subsidize stagnation by paying people more than their labor is worth. That leads to the automation of simple tasks like flipping burgers and stocking shelves, and in the current economy, that creates more losers than winners. Kyle is right that we haven’t seen massive unemployment occur in the past, but in this brave new world, history may not serve a faithful guide, and the cost of being wrong could be huge.
Instead, we must make the skills of the American laborer more intrinsically valuable, which we can only do through bettering our public education system. A great public education should be a right for all Americans and offers a pathway to skill-building that makes the intrinsic worth of labor increase.
In 2008, Bill Gates testified before the U.S. Congress identifying that by 2020, the U.S. would have 120 million high-skilled, high-paying jobs, with only 50 million Americans educated enough to fill them. Our economy has outpaced our ability to educate workers for it, and the answer is not paying more for work that is marginally less valuable. Education, both in K-12 and at higher levels like four-year and non-four-year options, must be our focus, as it is designed to produce laborers for an economy that no longer exists. And like Kyle’s well-researched argument for raising the minimum wage, I think the argument can appeal to both liberals and conservatives.
For liberals, there is no more democratic and free ideal than a quality, cost-free education for all Americans. Continuously raising the minimum wage to keep in step with inflation will keep America’s working poor alive, but still on the bottom rung. Education, however, offers them a competitive place in our rapidly advancing world and provides a better avenue for socioeconomic advancement than price floors that incentivize people to continue working in unskilled, unfulfilling jobs, where there is a real threat of automation. That is an environment where only corporate interests win. The purchasing power of a gradually increased minimum wage would diminish rapidly as employers passed the price on to consumers, driving inflation.
Conservatives, while you may support strong education programs and not raising the minimum wage, you may find bigger government spending on K-12 education and cheap college distasteful. But the reality is America’s work force is suffering, and there’s almost no way to survive without skills on this minimum wage, driving more people to welfare programs – not through laziness but through an inability to provide for themselves because of a flaw in the markets. Educating Americans saves us billions in the long term and keeps the American economy booming.
In order to solve America’s wage problem, we must be creative and proactive. We cannot perpetually jog behind the juggernaut of the American economy, being beaten at every step, pretending that we live in the same economy that we enjoyed in the 1950s. We cannot continue to be reactionary to changes we can see coming. Compassion is having the forethought to make difficult decisions in the short term that offer us a better future. Tuscaloosa may deserve a raise today, but it also deserves a brighter future tomorrow.
Ben Jackson is a sophomore majoring in accounting and finance. His column runs biweekly.
