Raising the minimum wage

Updated: Friday, February 21, 2014
Raising the minimum wage story image
KALAMAZOO, Mich. (NEWSCHANNEL 3) - The White House effort to raise the minimum wage nearly three dollars-an-hour over the next two years has drawn huge criticism from the right.

But our Tom Van Howe, who tonight is back in his corner, says once you get past the rhetoric, a wage hike for some of our poorest people is an idea that’s long overdue.

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Are there problems with this new wage proposal? Sure. There are with any new law.

But getting straight to the heart of the matter: getting by--assuming you’re working full-time--on less than $15,000 a year is no picnic. This proposed wage hike would put a substantial amount of cash--something like $100 a week--in the pockets of more than 16 million workers.

It would move roughly a million people out of poverty.

And guess what those workers will do with that extra money? They’ll spend it. They’ll pump billions of new dollars back in to local markets.

One writer for a national magazine says those billions don’t mean that much in our $17-trillion dollar economy; that it’s hardly worth the effort.

He’s missing the point.

It would mean working people, young and old, would get a 30 percent wage increase. These are working people. These are not people on the dole. We’re not talking about handouts or welfare fraud.

And while twenty grand a year is hardly the American dream, it’s a step toward dignity...Toward a tiny bit of breathing room.

Republicans are citing a Congressional Budget Office report that says a wage increase will cost us a million jobs.

Well, that’s not quite what it said. The CBO report  was vague  and said the hike could cause the loss of somewhere between none and a million jobs. Many economists are leaning toward the White House  view that job loss will be at the low end of the spectrum.

Some job loss is probably inevitable. It’ll push some employers to cut back, others to accelerate automation. But that’ll happen eventually anyway.

And before you absorb all the anti-wage hike rhetoric, take a closer look at the growing disparity between the people we’re talking about here and the incredibly rich.

  • Even at $10.10 an hour, the U.S. minimum wage will be lower after adjustments for inflation that it was in 1975.

  • The 85 richest people on earth have the same amount of wealth as the lower half of the world’s population.

  • Those 85 people are just a handful of the richest one percent who have 65 times the total wealth of the bottom half of the population. Sixty-five times!

  • American corporations have more than $2 trillion tucked away in off-shore and foreign banks to avoid the reach of the IRS. Actually, its probably more than that. We don’t know for sure.

  • In this country, since the start of the recovery four years ago, 95 percent of the gains have gone to the top 1 percent. No trickle down. They got two great tax cuts in the last decade, but nothing trickled down.

  • CEO's are still taking home 300 times the earnings of the average worker.

So can someone please give me a convincing argument that those who struggle most don’t  deserve $2.85 an hour more than they’re getting now?

In this corner...I’m Tom Van Howe.

Business News

Last Update on March 27, 2015 17:24 GMT

ECONOMY-GDP

WASHINGTON (AP) -- U.S. economic growth slowed in the fourth quarter and economists are looking for an even weaker showing in the first quarter as severe winter weather takes a toll on the economy.

But the slowdown is expected to be short-lived. Stronger growth is expected for the rest of the year as a recovering job market supports healthy gains in consumer spending.

The Commerce Department says the overall economy, as measured by the gross domestic product, grew at an annual rate of 2.2 percent in the October-December period, an estimate that was unchanged from a month ago. The economy had surged at a 5 percent rate in the third quarter.

The final look at fourth quarter GDP found consumer spending was stronger than previously estimated but business restocking was weaker.

CONSUMER SENTIMENT

WASHINGTON (AP) -- Bad weather and rising gasoline prices pushed U.S. consumer sentiment a bit lower in March.

The University of Michigan's consumer sentiment index slipped to 93 this month from 95.4 in February. Richard Curtin, chief economist for the survey, notes that despite the monthly drop, consumer optimism was the highest in a decade for the first three months of 2015.

Sentiment dropped most this month among low-income households, which are especially sensitive to high utility bills in the winter. Confidence rose for mid- and high-income households. Curtin predicted that an improving job market would boost consumer spending the rest of the year.

AIRLINES-COCKPIT RULES

COPENHAGEN, Denmark (AP) -- Europe's aviation safety agency is recommending that airlines across the continent always have two people in the cockpit of a flying aircraft.

European airlines, including the Lufthansa Group that includes Germanwings, have been making commitments to implement the measure after it emerged that the co-pilot of Germanwings Flight 9525 had apparently locked himself in the cockpit to crash the plane.

U.S. airlines revamped their policies regarding staffing in the cockpit following the Sept. 11, 2001 terrorist attacks. But the procedure is not standard in Europe or Canada.

The European Aviation Safety Agency's executive director, Patrick Ky, says "while we are still mourning the victims, all our efforts focus on improving the safety and security of passengers and crews."

The president of the German pilots union Cockpit tells The Associated Press that his organization would support measures requiring two people in the cockpit at all times during flights, but he cautions that such a move wouldn't solve all security problems.

UNITED STATES-ASIAN BANK BLUES

WASHINGTON (AP) -- U.S. resistance to a Chinese-led Asian regional bank is leaving it isolated among its Asian and European allies.

That's giving some heft to China's frequent complaints that Washington wants to contain its rise as a world power.

One of America's closest friends in Asia, South Korea, announced Thursday it will join the Asian Infrastructure Investment Bank. The institution is intended to help finance construction of roads and other infrastructure.

The U.S. has expressed concern that the new bank will allow looser lending standards, undercutting the World Bank and Asian Development Bank, where the U.S. and Japan have the most clout.

But since Britain broke with Washington two weeks ago, other major European economies have signed up for the Chinese-led bank. Australia also appears poised to join.

GREECE-BAILOUT

ATHENS, Greece (AP) -- Greece's alternate minister for international economic relations says his government is prepared for a "rupture" with the country's creditors if its current bailout negotiations don't go well.

Euclid Tsakalotos said Friday the government would not be negotiating properly if it didn't envisage a rupture with its partners, although he would not say what exactly a rupture might entail.

Greece's government is in talks with its creditors -- eurozone nations, the European Central Bank and the International Monetary Fund -- to unlock urgently needed funds from the country's bailout. It must present a list of reforms by early next week, which it hopes will lead to the disbursement.

Tsakalotos, speaking on private Star TV, said the government was intentionally creating ambiguity with its partners regarding its intentions as a negotiating tactic.

SILICON VALLEY-SEXUAL DISCRIMINATION

SAN FRANCISCO (AP) -- Jurors deciding the outcome of a much-watched gender discrimination lawsuit against a prestigious Silicon Valley venture capital firm are set to enter their third day of deliberations.

The jury of six men and six women are due back in San Francisco Superior Court on Friday in Ellen Pao's lawsuit against Kleiner Perkins Caufield & Byers.

Pao says the firm discriminated against her because she was a woman and then retaliated by denying her a promotion and firing her when she complained about gender bias.

Kleiner Perkins denies the allegations and says Pao had a history of conflicts with colleagues that contributed to the decision to let her go.

The case has put a spotlight on gender imbalance and working conditions for women in Silicon Valley.

ARCTIC OIL DRILLING

WASHINGTON (AP) -- U.S. oil storage facilities are filling up and the price of oil has collapsed, but an Energy Department advisory council says the U.S. should push now to exploit the trove of oil in the Arctic waters off of Alaska or risk a renewed reliance on imported oil.

The U.S. has drastically cut imports in recent years and transformed itself into the world's biggest producer of oil and natural gas by tapping huge reserves in shale rock formations. But the National Petroleum Council's study predicts that the shale boom won't last much beyond the next decade.

Exxon Mobil CEO Rex Tillerson chaired the committee that drafted the study. He says oil companies need to start probing the Artic because it takes decades of preparation and drilling to bring oil to market.

Geologists estimate the Arctic holds about a quarter of the world's undiscovered conventional oil and gas deposits. But environmental advocates say the Arctic ecosystem is too fragile to risk a spill.

OBAMA-CHEMICAL BOARD

WASHINGTON (AP) -- The U.S. Chemical Safety Board is operating without a permanent leader. Its chairman has been forced to resign, following accusations of mismanagement.

A White House official says Rafael Moure-Eraso (rah-fah-YEL' moh-RAY' eh-RAH'-soh) stepped down Thursday at the administration's request. The official spoke on condition of anonymity to discuss personnel matters.

The National Safety Council says the independent federal agency under Moure-Eraso repeatedly fell under scrutiny for board departures, delayed investigations and other issues. Members of the Senate Environment and Public Works Committee had accused Moure-Eraso of violating his oath of office and the law. Committee members had requested his resignation.

The board is responsible for investigating chemical accidents. Its members are appointed by the president and confirmed by the Senate.

President Barack Obama has nominated Vanessa Sutherland to succeed Moure-Eraso.

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