Pollack:
>Besides
>local news and reviews, most intellectuals I know skim the Times between
>the lines for one reason only: as a reliable weather vane of the US ruling
>class consensus. And for that, I think it's still unparalleled.
I agree. Below is an article from today's (12/19/99) Week in Review. The accompanying photo of a woman mopping the floor of a Dunkin Donuts has one of the most sarcastic captions I've ever seen in the Times:
"Earning neither more nor less than the market will bear at Dunkin Donuts. "
New York Times/Week in Review December 19, 1999 The Sounds of Silence By LOUIS UCHITELLE
That deafening silence you hear is the sound of presidential hopefuls debating whether government should intervene in the wage-setting process to help people afford a better life. Today, it seems, everyone agrees that the market does this best.
In the past, American politicians have split, often rancorously, over the issue. Still more profoundly, they were divided over tax cuts and social programs such as welfare, food stamps, child care, education and health insurance. Now there is broad agreement that whatever the specifics, government should limit itself to helping families get along until the market finally raises their incomes.
President Clinton came into office in 1993 in the old style: primed to use government to raise workers' wages. With the country still struggling to shake off the effects of a recession, he proposed a substantial increase in the minimum wage as well as billions in public works to raise the demand for workers. A presidential commission was also set up to study ways to make unions more effective.
In time, however, the public works spending was dropped in favor of deficit reduction. The union commission's recommendations were shelved, and the 90-cent increase in the minimum wage that Congress did approve in 1996 brought the minimum to only $5.15 today. That leaves it well short of its peak in 1968, when its worth was $7.49 an hour in today's dollars.
Since the Reagan years, a gradual metamorphosis has taken place. It appears to be culminating in the current presidential campaign, in which Republican and Democratic candidates alike bow to the efficiencies of the markets, even while acknowledging that income inequality remains a problem.
Wage-setting and labor power, once deeply divisive election-year issues, are barely mentioned. The only question is what is the right tax incentive or social program when the markets require a helping hand.
"Where conservatives and liberals might differ, and it is a nuance difference, is in how each of us would tear down the obstacles to getting ahead," said Lawrence B. Lindsay of the American Enterprise Institute, who is George W. Bush's chief economic adviser.
Lindsay notes that Republicans emphasize tax cuts, which are intended to increase the incentive to work and to hasten the day that a worker takes home adequate pay for a materially decent life . Both sides favor the earned income tax credit, a tax rebate. And while the Democrats endorse a variety of social programs, including food stamps and subsidies for child care, health insurance, education and job training, they are careful to avoid any suggestion that they are interfering in the workings of the marketplace.
"I think the beauty of the earned income tax credit is that it raises living standards and incentives to work," said Gene Sperling, director of President Clinton's National Economic Council and a top adviser to Vice President Al Gore. These programs, he explained, avoid "the kind of constraints on markets that in Europe has hurt the dynamism and job growth."
One reason for this convergence between Democrats and Republicans is the remarkable strength of the U.S. economy, which has boomed since the 1996 election, while the more interventionist economies of Europe and Japan have floundered. Moreover, in 1996, wages finally began to rise faster than inflation, across the board, the first time that has happened since the early 1970s -- although well-to-do Americans have pulled further ahead of low-income families.
This inequality has hardly escaped notice, and no candidate has been more outspoken on the subject than Bill Bradley, Gore's rival for the Democratic nomination. But he, too, stays within the free market framework.
"Bill feels that open markets are a strength of the American economy, but he has also indicated that someone who works year-round, full-time should not end up being poor," said Marcia Aronoff, who advises Bradley on economics issues.
Bradley's solution, like Gore's, is social programs, including national health insurance and an expansion of the earned income tax credit, which now provides up to $5,000 a year for 17 million families earning between $9,000 and $30,500.
The Democratic candidates would raise the minimum wage again, but modestly, along the lines proposed by Sen. Edward M. Kennedy, D-Mass., who tried unsuccessfully to win passage this fall of an increase in the minimum wage to $6.15 an hour over two years -- still well short of the old peak.
Gore and Bradley propose a similar modest increase in the minimum wage. And Sperling says that $1 over two years strikes a balance between "higher wages for low income people and potential harm to job growth."
Bradley would go a few steps further, banning striker replacement, for example, giving unions more power to organize workers and denying government contracts to companies that violate labor law. But those proposals, set forth in a mid-August speech, lack details. "He has not proposed specific remedies," Ms. Aronoff said. "He is open at this point to a variety of ideas."
The market-oriented approach to wage setting has the support of most mainstream economists, who argue, among other things, that government intervention discourages companies from hiring unskilled workers and puts the increased wage cost disproportionately on companies that hire the unskilled.
Business, by and large, seconds this view, arguing that tax cuts and social programs are preferable to higher mandated wages, which come directly out of their pockets.
But this view is by no means universally accepted. Some economists believe that the market demand for workers is only part of the reason for the rise in low-end wages in recent years. Small as it was, the 1996 increase in the minimum wage also nudged up hourly wages at the low end of the pay scale.
Today the federal minimum wage is so low that several states have increased their minimums since the mid-1990s, and more than 40 city and county governments have passed "living wage" ordinances. These in effect are minimums, often $7 an hour or more, imposed on companies that do business with local governments. Less job turnover and more worker efficiency help to offset the cost, some studies have found.
All this is fodder for an old-style campaign debate over wages and labor power in the months ahead. That is certainly the hope of the AFL-CIO, which has endorsed Gore. David Smith, director of public policy for the union, said, "We continue to be disappointed that there is not more broad public attention, in the campaign discourse or the public discourse, about the problems of low wage workers and slow wage growth."
Smith's disappointment may last through November