THE "BATTERED LIBERAL" syndrome which afflicts so many in Washington these days has produced an unattractive sideaffect, a willingness among some confused liberals to trade off pieces of the great liberal pie that belong to someone else.
This is done to show the new conservative crowd in town that thinking liberals can be hard-headed and practical, too, a token of earnestness.
For instance, The New Republic, a neoconservative journal which styles itself as the voice of liberalism, has studied the matter of minimum wage laws and concluded earnestly that conservatives are right about them. On reflection, after 40 years of knee-jerking to the New Deal, The New Republic finds the minimum wage is a bad thing because it inhibits the creation of more jobs for poor kids, especially poor black kids whom, it is well known, The New Republic cares about deeply. This change of heart is known around Washington as "facing the New Realities."
Okay, I am in favor of thinking, even among liberals. But it's my impression that most of The New Republic crowd went to Harvard and that none of them faces the slightest possibility of actually having to work for the minimum wage, not for a little while and certainly not for the rest of their lives. The federal minimum wage is $3.35 an hours, which, despite periodic increases, is unchanged in real terms since 1963.
The 5.6 million Americans who do work for the minimum wage are probably unaware of the New Realities; they are still mired in Old Realities. Millions of people in America work at dull, grubby, deadend jobs and they are still poor, millions of them. If you work full-time at the minimum wage these days, trying to support a family of four, you earn about $6,600 a year. This is a long way below Harvard and even $800 below the official federal poverty line.
But if you undermine the minimum wage, you are depressing the wages of many millions more. For starters, there are another 5 million or so who work below the minimum wage, whose jobs are exempt from its coverage but whose pay levels are still influenced by it. Then there are probably 5 or 10 million more who work at jobs above the minimum wage but whose incomes are pegged to it. Sometimes, this is done explicity in labor contracts for garment workers or retail clerks or others. More generally, the federal wage minimum is an arbitrary floor -- established politically in pursuit of social equity -- which affects wages way up the line from $3.35 an hour.
This is what the old liberals of organized labor fully understand even if new liberals, young people who prefer ro pursue more fashionable causes, do not.
It is why old liberals routinely go to battle stations when Republicans like Sen. Orrin Hatch or President Reagan come forward, once again, with the hoary old ideas of a subminimum wage for teenagers.
A subminimum invites employers to fire older workers and hire younger ones on the cheap. If the subminimum expires for a young worker after six months, it invites the employer to fire that young worker and hire another one. mEven if you are willing to overlook those problems, a subminimum will have a generally depressing effect on wages at the bottom of the American economy, diluting the impact of the federal minimum on America's secondary labor market -- that scruffy sector of low-paying jobs, mostly non-union, where competition is fierce, employee turnover is high and fringe benefits are scant.
The minimum wage, therefore is a wonderful litmus test for contemporary ideology, a simple measure of First Principles. Does the government have any business restricting the free market in labor at the bottom of the economy in pursuit of minimal social equity? If your answer is no, then as a matter of logical consistency you should also be opposed to labor unions, health and safety rules, and the child-labor laws, each of which does the same. And you should also think of yourself as a conservative.
Strangely enough, the minimum wage issue, popular as it is in Republican business theology, is actually an instance in which conservatives are guilty of the classic liberal fallacy -- focusing on one narrow problem and ignoring the much larger consequences which the proposed solution will have. The conservative critique has been superb at identifying this weakness in liberal programs, so I await patiently to see if these points are made in The Public Interest or National Review.
The minimum wage, whether one likes it or not, is connected intimately to all of the other things which conservatives do not like about the federal government -- the welfare benefits in cash and kind provided to poor people, the working variety and the other kind. It is truly mindless to pretend that Congress cannot alter one without directly affecting the other, probably in ways which nobody wants.
If conservatives will read their own literature on welfare or, better yet, go talk to some live poor people, they will see that most poor families move back and forth between work and welfare and that the break-point for those decisions is often the gap between a minimum-wage job and the collective benefits of welfare, food stamps, housing studies and so forth. This gap is already quite small and, reasonably enough, many people will choose the security of welfare over the insecurity of a low-wage job, subject to layoffs and termination, especially if the money difference isn't that much. Thus, if Republicans wish to lower the minimum wage, they are effectively making it harder to get off welfare. The conservative answer might be: Well, then, let's lower welfare too. I doubt that confused liberals will accept that remedy.
On the subject of black teenagers and jobs, liberal thinking may be too mush with wishful thinking, but conservative thinking is flat-out illogical. President Reagan, in one breath, points to the thick want-ad pages of The Washington Post and wonders aloud why people can't find jobs when there are obviously so many of them begging for workers. In the next breath, he proposes his solution: Create more jobs which pay lousier wages -- only $2.50 an hour. Question: If slotful teenagers will not take any of those jobs in the want ads, why should we assume they will take worse jobs at the subminimum wage rate? Answer: We shouldn't. The problem of teenage employment, especially among blacks, is more complicated than that.
More ot the point, the subminimum for teenagers is a bad idea whose time has passed. If the government were going to make a special exemption for young people, 16 to 19 years old, in order to encourage businesses to make more work places for this group, it should have done this 10 years ago, not in 1980. During the 1970s, the bulging youth population poured over the economy, oversupplying available spaces in the job market and in education. But now the huge baby boom is past; the youth labor pool is already shrinking and will get smaller and smaller in the next decade. If Ronald Reagan does nothing about the problem of youth unemployment, it will be ameliorated and probably even go away in a few years. He could take the credit for doing nothing.
However, this demographic reality poses a big problem for employers like hotels and restaurants and fast-food chains who hire most of their workers at the entry-level wages of the federal minimum. Any economist knows that the shrinkage of the youth labor pool -- a smaller number of new workers coming into the labor market each year -- should put a powerful upward pressure on pay at that end of the economy, as businesses must bid up wages to secure enough workers. Thus, if the new administration sets about gutting the minimum wage, the effect will be to restrain that natural upward pressure in the world of lousy wages. If the folks at The New Republic do not grasp the implications of this, I guarantee you that the folks at McDonald's do.
Ronald Reagan has a sentimental view of America at work which is fundamentally flawed. It tugs at our nostalgia but collides with the facts. Reagan sees smokestack America, but in 1980 industrial production is no longer the dominant engine of our economy, especially the basic industries which he romanticizes in his antigovernment rhetoric. Reagan speeches evoke blue-collar workers, drawing first-class union wages, owning their own homes and bitching about taxes. He is their friend.
But the "new" worker in America isn't employed in a factory. He or she works in "services," perhaps one of those classy high-tech fields but more likely one of the low-paying, nonumionized areas about which we have been talking. An important labor leader neatly summarized this shift in employment by observing that McDonald's hamburgers now employs more workers than U.S. Steel.
The nation and its politicians will need a while to absorb the full meaning of that fact, but this much we already know: Many government policies directed at one sector of the economy may threaten, even injure, the other. Yet the president does not even acknowledge that the national economic landscape is now more complicated than it was in his Illinois boyhood (for a brilliant account of how Reagan's nostalgia collides with reality, see Emma Rothschild's important article, "Reagan and the Real Economy," in The New York Review of Books, Feb. 5, 1981).
Work.The president talks a lot about the importance of work, the sweat of the brow and all that, charished values which he thinks liberals have ignored. So far, in that regard, Reagan has urged big-city mayors to join his crusade against the minimum wage. A few days later, his chief adviser revealed that the Reagan administration will seek a major reduction in the maximum tax rate on unearned income -- nonwage income like dividends from stocks and bonds. Lower wages for people working in the restaurant kitchen; lower taxes for the stockholders dining out front. If this is the new Reaganomics we have been hearing about -- getting the government off the backs of the rich and the poor alike -- it sounds a lot like the Republicanism of old.
But the president is certainly right about liberals and work. It's time for them to begin thinking again about how they feel about work.