What Fresh Hell Is This?

August 6, 2013

When Editorials Collide

Every now and then the editorial board over at the Tribune-Review takes issue with something the editorial board over at the Post-Gazette publishes.  More often than not, they don't like what they read.  Surprising, I know.

Which in itself is fine.  Conflicting between editorial boards is a good thing.  But only if both are honest with, you know, the facts.

And we all know by now that the relationship between Scaife's braintrust and the facts is iffy, at best.

Take a look at this from this morning:
Huh?: Those economic “scholars” at The Toledo, Ohio, Block Bugler once again are shilling for a higher minimum wage — this time for fast-food workers and to $10.50 an hour. And, hey, it argues (a word we use loosely), it would raise the price of a Big Mac by only a nickel. “That's a small amount to pay for meaningful change,” it says. Actually, it's a steep price to pay, given that the real result would be fewer of these entry-level jobs.
What they're talking about is this P-G editorial.  Look closely at how the braintrust characterizes the idea of raising the minimum wage to $10.50.  Now let's go see what the P-G editorial board actually says about it:
The low wages don't do great things for the restaurants, either. According to Time magazine, the National Restaurant Association estimates that a fast-food outlet sees 75 percent turnover in employees every year. The story also reported that a letter signed by more than 100 economists said that raising the minimum wage to $10.50 would add only a nickel to the price of a Big Mac.

That's a small amount to pay for meaningful change. We think most Americans would be willing to fork over a few more cents for a Happy Meal if it meant happier times for the workers who make them.
Wait, you mean that wasn't just an argument from the editorial board, but it was from something from Time Magazine?  And it's a group of 100 economists who are making the argument NOT the P-G editorial board? 

Huh, I guess that still would be some real "economic 'scholars'" but just not at the P-G.  Funny how that part got left out.  The argument looks a lot different if it comes from 100 economists, doesn't it?

Here's the Time article, by the way - the real source of that idea.

But why would those actual "economic scholars" say that about raising the minimun wage to $10.50?

Here's what they say from the petition:
We, the undersigned professional economists, support the “Catching Up to 1968 Act of 2013, ” sponsored by Congressman Alan Grayson of Florida. This measure would raise the federal minimum wage from its current level of $7.25, established in 2009, to $10.50 per hour , and with automatic increases indexed to inflation thereafter.

As is conveyed by the title of the bill itself, the real , inflation-adjusted, value of the federal minimum wage has fallen dramatically over time. In 1968, the real value of the minimum wage was $10.65, so that, in fact, an increase today to a $10.50 federal minimum would not even bring the minimum wage fully back to the 1968 standard.
Businesses can readily absorb these small cost increases through minor increases in prices and productivity as well as enabling low-wage workers to receive a slightly larger share of businesses’ total revenues. On average, even fast-food restaurants, which employ a disproportionate share of minimum wage workers, are likely to see their overall business costs increase by only about 2. 7 percent from a rise today to a $10.50 federal minimum wage. That means, for example, that McDonalds could cover fully half of the cost increase by raising the price of a Big Mac, on average, from $4.00 to $4.05.
And as to whether that will decrease  minimum wage employment, they say:
Opponents of minimum wage increases frequently argue that such measures will mean fewer employment opportunities for low-wage workers because businesses will be less willing to hire workers at the increased wage level. But the weight of evidence from the extensive professional literature has , for decades, consistently found that no significant effects on employment opportunities result when the minimum wage rises in reasonable increments. This is because the increases in overall business costs resulting from a minimum wage increase are modest .
And there's more:
Moreover, the overwhelming factor determining employment opportunities for low - wage workers is macroeconomic conditions — whether the economy is growing or in a recession. Thus, in 1968, when the U.S. minimum wage reached $10.65 in real dollars, the overall unemployment rate was 3.6 percent. By contrast, during the depths of the 1982 recession, the real value of the minimum wage had fallen to $8.05 while unemployment peaked at 10.8 percent
You can even check out the economic scholarship supporting the petition here.  Where's the work supporting the braintrust's position?  Someplace NOT bought and paid for by Scaife foundation money, that is.

There's a lot behind the P-G editorial, isn't there?  Not so much for the editorial from the braintrust.

When editorials collide, said George Pal to his bride, I'm gonna give you some terrible thrills.

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