It’s not about the Money
Those who argue against raising the minimum wage do not get it. The naysayers spin broken webs of economic facts and figures rooted not in the reality of our natural environment but inside the charts and computer algorithms of a virtual world divorced from physical reality. It’s not about the money. I want to stand up and shout, “It’s not about the money; it’s about people! Real live human beings!”
I really want to jump up and yell, “It’s not about money, you insert language most foul!” Such verbal intensity, however deliciously vulgar, would just rile up the troll militias, so I won’t cuss here. It’s challenging enough to feel compassion and empathy for my fellow human beings, including those who exhibit cruelty and heartless stupidity. No matter. We all suffer. Everyone single one of us experiences suffering. Life is Struggle.
The working classes get life is a struggle. So do artists and small business owners. So do the unemployed, the underemployed, the homeless, the foreclosed, the laid off, the poorly paid, the uneducated, the overeducated, students deep in debt, the hungry, the sick, the pissed off. Reformers understand action is better than indulging in cynicism, apathy, and do-nothingism. Revolutionaries understand reform only goes so far before it dead ends in a mirage. Struggle serves to move the working classes from enduring ever more suffering to survive to rising up to stand in their power and thrive.
During these bleak but exciting times I volunteered for Kshama Sawant’s openly Socialist campaign for Seattle City Council. I joined with other veterans of the Occupy Uprisings from the Green Party of Seattle and the Seattle branches of the Socialist Alternatives to serve to get her elected. Other Socialist Alternatives ran strong campaigns elsewhere, especially Ty Moore in Minneapolis, Minnesota.
It proved a tight race. Still counting ballots days after the Election. We rocked the city and made waves across the nation. Ripples were felt around the world. It was an astonishing experience. A small, highly disciplined organization raised well over $110,000 and marshaled over 300 volunteers, many of them part-time volunteers such as myself. What helped us stand out in addition to our red t-shirts was our uncompromising stand for a $15.00 an hour minimum wage.
When I read of economists and business owners whining over raising the minimum wage, my gosh, they sound as if it’s still the 1950s and a kid with a broom can still get a starter job sweeping the floors of Mr. Smith’s hardware store. One local author lamented raising the minimum wage in 2014 because, hey, way back in 1970 when he landed his first job he didn’t expect to support a family with it.
I would imagine if his circumstances were different, if he was a single parent with children way too early and enduring neverending discrimination because of race, gender or whatever, he may have thought differently even back then. To be fair, I really do not know of this writer’s personal situation forty-some years ago.
Another local writer also disliked the idea of mandating a higher minimum wage as it ignores the marketplace’s profit-driven incentives to set wages, usually keeping them low, and interferes with a business owner’s private hiring policies. She lamented the decline of education and the lack of advanced trainings to update old skills and learn new ones. People should go to school first and get an education before getting a job.
You can’t imagine my astonished dismay. After I lost my high-paying, full-time position in January 2008 at the beginning of the Great Recession, I finally landed a new job by mid-April 2008. It was part-time in retail for a locally prestigious company. The job was fun, and I interacted with lots of people and cool products. My job came with good benefits, unusual for a part-time position, but that didn’t make up for the lack of cash in hand and money in the bank. I could not pay the mortgage or feed a family of five with those earnings.
I was surrounded by a number of other older men and women who’d also lost full-time jobs that once paid them well enough to buy cars and homes. Their jobs are gone, but they still had mortgages and car payments and college tuition to pay. We had decades, indeed centuries of experience between us middle-aged “elders.” We were all college grads. Some of us had master’s degrees. A few were even PhDs. And all we could find were part-time retail jobs with random hours. Expensive education didn’t help us here.
We were, of course, all grateful for those jobs. We made new friends, kept busy, and developed a sense of community. Many times we look forward to coming to work. We felt we were assets. We provided value. We made the company beyond great. Yes, we made it awesome! All of us, old, young, and middle-aged alike, worked together in service to our customers. And none of these intangibles covered major dental care or paid to repair the roof, fix the car, or put a growing teenager into college.
Many among the young and single crowd were working two and sometimes three part-time jobs. Some were in school full-time and worked part-time, which is doable. It’s what I did back in college and in grad school. Some of my coworkers, however, were in school full-time and worked two part-time jobs, and, yes, they admitted privately their grades suffered and so did their relationships.
Desperate to generate more income, I leapt forward into another solopreneur enterprise. Oh, I felt proud joining the swelling ranks of the microbusiness revolution. I failed, fell flat on my face. The relentless and grinding financial stress led to my wife, in similar straits as me, and I separating. We eventually divorced. We endured a chain of crises stemming from this Great Recession. I ended up homeless, semi-homeless, and ill with depression. I was broker than broke. I grew to hate Capitalism although I enjoy business and love to work. And yet I was responsible in some way as I participated in our Capitalist economy. We all do. Systems are composed of people.
Therefore we have the responsibility to destroy and replace this diseased system before it consumes us all. The system broke a long time ago. It’s been broken for decades. Each attempt to reform our capitalist system, however noble the intention, has failed and leaves the globalized economy in greater crisis than ever. Capitalism has run its course in the progression of human economic development. One of the first steps necessary in replacing it is to ensure individual workers earn enough to take care of themselves.
This is the bottom line: an adult human being must be paid enough to earn a living. People need to be paid to get out of poverty and stay out, or else they remain trapped in a form of de facto slavery. In addition to job skills, people must be educated how to manage their money wisely. This raises quality all the way around. Prosperity increases and workers learn to thrive. Some may move on to become entrepreneurs and employ other workers. Some workers may choose to form cooperatives so as to own their own business, taking the risks as well as the rewards. Eventually we may shift toward democratic socialist structures where workers run and market their own businesses and distribute the wealth between themselves and their enterprises. But unless people earn enough in the first place, none of this will happen.
What is the bottom line for any successful business? Once I took an informal survey and asked around. Many will immediately blurt, “Money!” or “Profit!” I’ve seen a few grin and rub their palms together with a twinkle in their merry eyes as they say, “To make a lot of money! Oh, yeah, baby! Lots and lots of mo-nay!” What else is there? Well, one person did answer with, “To keep customers happy.” Another one responded with, “Service! To serve our customers.” What about the workers? The managers? The owners? The janitors as well as the sales staff?
The bottom line for any successful business is people as human beings and the relationships between them. Respect those human beings and honor the relationships between them as well as between people and their business. The business prospers.
The current system of interlocking corporations and banks exploiting an unsustainable Capitalist system will eventually collapse under the weight of the growing poor, the shrinking middle class, and environmental destruction. Those Capitalists who oppose raising the minimum wage cannot hold the status quo together and will eventually bury themselves.
Senator Elizabeth Warren is a headstrong Democrat from Massachusetts who seeks to reign in and reform Capitalism rather than destroy and replace it. Sen. Warren rocked the boat hard back in March 2013 as she cited a study suggesting the federal minimum wage would be somewhere close to $22.00 an hour if it had kept up with rising worker productivity. Another economist who studied this issue demonstrated $33.00 an hour would actually be the real minimum wage.
Other economists refute these observations with their own formulations. Some claim Sen. Warren “cherry picked” her facts. The debate becomes arcane and the math riddled with opinions. Yet the pro-Capitalist Editorial Board of the strongly pro-business New York Times declared in November 2013 the minimum wage would be close to $17.00 an hour for working people. Alas, but only if shareholders and executives hadn’t systemically sloughed funds off income into corporate profits and higher salaries and dividends for the profiteers in power.
Although entrepreneurs are not educated to startup and run businesses, many workers jump in anyway. Large numbers are reported to fail, mostly from poor planning and lack of knowledge and from being undercapitalized. Being awesome with a skill set for certain trades is far different from being awesome at growing a business. The percentages of failure range from under 50% to the oft-cited “85% of all new businesses fail within the first year.” Or, as others say, “within three to five years.”
One of the deeper underlying causes of business failure is one of the most overlooked: Capitalism encourages neverending and thus unsustainable growth. Developing sustainable, steady-state enterprises functioning with a range of economic-environmental homeostasis requires wise stewardship of resources while removing the focus on generating profit. Cash flow is key, yes, but not profit as defined as generating and accumulating large quantities of money one can turn into assets.
Other economists and business owners have challenged these business-failure statistics. The debate becomes as arcane and opinionated as the one over the minimum wage. Business as organic human beings engaged in creation, envisioning products and services, production, marketing, sales, distribution, trade, regulation, and commerce, etc., while living inside the Earth’s biosphere is reduced to mathematical formulations focusing on profits, losses, assets, and liabilities. It seems economists know little about business and business owners know little about economics. This conundrum ends up dividing people when we would all be better off seeking common ground so as to better understand one another and achieve results.
How many times, though, have you heard an entrepreneur or other kinds of small business owners claim economists and politicians don’t know jack about business and how to run a business? I sure have. They make a valid point. And yet the marketplace is the court the game is played on, the game being the business of business as it is measured and defined by economists and regulated or not by politicians who may or may not be shamelessly in business with Big Business. Competition instead of cooperation isn’t even questioned and is assumed to be the desired reality. Business is business, and money is the bottom line for those who aspire to be Robber Barons and Titans of Industry, those who see opportunity among the misery and misfortune of others to advance their own power at the expense of everyone else.
These businesspeople hold up free enterprise as a worthy goal to pursue, and wave broke, laid off workers and people with a dream but not a plan and ambition but not any savings to jump on in as the water’s always fine. Easy credit makes it easy and socially acceptable to go deep into debt to keep swimming in the deep end. The capitalists profit from all this mayhem at the bottom and in the middle.
The point is, however, our Capitalist system encourages people to jump into the “free market” without much preparation to swim or sink. The marketplace is anything but free, however, as it’s dominated by large consortiums of interlocking corporations and Big Banks free to exploit and plunder at will. So it is no wonder many small business owners, many who end up taking home less pay than their employees in the beginning, dread raising the minimum wage to what is an appropriate level for them to live with dignity and health.
We can develop strategies to subsidize small business owners within a certain time frame, profit-and-loss statements, or cash flow and liabilities versus assets structures. Do small businesses under consideration have a plan? What’s their line of credit? How deep in debt are they? What are the overhead costs? What are the amortization costs on their upgraded buildings and the depreciation costs on equipment purchases? What would work to restructure the current crazy-quilt tax structures to abolish certain taxes that impede small businesses? Is this business economically sustainable? Is the business environmentally and socially responsible? What do those terms mean to different groups of people? Can we be more effective in the transition from finance capitalism to democratic socialism if we reduce and streamline paperwork? You tell me. Work together with us.
Too many people are desperate and broke. Too many people are laid off, unable to find work, uneducated or overeducated, and are saddled with young children and burdened with aging parents. Too many people are led to believe they will somehow make it in the Land of Opportunity. The bottom line is people dive in ill prepared to realize their dreams and goals. Capitalism is not an economic system with a sense of cooperative collaboration, shared use of common resources, or any sense of social responsibility as is Democratic Socialism.
Anyone who starts a business must be prepared to do so. Practical preparations include having a business and marketing plan. Another is having enough capital available. And the business must be able to pay living wages to all of its employees. Other financial and legal responsibilities must be met, too. I look forward to the time when this capitalistic approach to work and business becomes dusty memories of the past. We have more frequent and better chances than ever to build a Democratic Socialist world as we transition away from the chaotic breakdown of Finance Capitalism. Developing worker-owned businesses and other forms of cooperatives to harness innovation and productivity are vital steps as we move toward wise stewardship of our global commons.
In the meantime, however, workers must be paid a living wage. Especially if one works one job or has a career. If workers are salaried or paid on commission-only, they still must be paid enough to live. There are a large number of workers in small biz. Recent data provided by the U.S. Small Business Administration lauds entrepreneurs for creating 23,000,000 small businesses across America with over 600,000 being franchises. Small businesses provide 55% of today’s jobs and help produce 54% of all sales within the United States. With large companies either merging into transnational behemoths or downsizing and laying off workers, many chose to jump into self-employment.
Recent strikes by fast-food workers across America have pointed out this issue. The workers at Seattle-Tacoma International Airport in SeaTac, Washington voted in Proposition 1 to raise the local minimum wage to $15.00 an hour. The backers are already turning to look at Seattle and other neighboring cities, especially in the wake of Kshama Sawant’s openly Socialist Alternative campaign for Seattle City Council. The ballot and vote counting remains ongoing. Even if she loses, the call to raise the minimum wage has galvanize much of the state with ramifications across the nation. The Capitalist’s pie in the sky has landed and burst, folks, and guess who’s gonna clean up the mess? The workers! As well as the Socialists, the Greens, and other leftist organizations.
Fit the system to work for the people, not the other way around. Transform the economic and financial system to serve the needs and responsibilities of human beings.
Going beyond mere change begins with small business owners supported and mentored to be prepared when they jump onto the “basketball courts” of the marketplace. Going beyond mere change begins with workers being able to work one job and earn at least a minimum wage they can live on without, as McDonald’s said this year, turning off the heat in the winter, buying cheap, low-quality food, and working extra jobs without rest or time with family.
Raise the minimum wage to $15.00 an hour. The world is not going to end. There won’t be mass layoffs, hyperinflation, or loss of investment capital. Because it’s not about money. It’s not about the money. It’s about people. It’s about life.
William Dudley Bass
7 November 2013
Sources with a Focus on Minimum Wage and Rate of Business Failure
Controversies and Debates
Doughney, Mike. “Most small business fail in the first five years,” Ex-Cult Resource Center. February 2008. http://www.ex-cult.org/Groups/Amway/otherside/tosp05.htm.
Jacobson, William A. “Elizabeth Warren cherry-picked $22 per hour minimum wage number,” Legal Insurrection, 19 March 2013. http://legalinsurrection.com/2013/03/elizabeth-warren-cherry-picked-22-per-hour-minimum-wage-number.
Leavitt, Gaydon. “Why over 85% of Small Businesses Fail,” Innovation Simple. Utah. 25 November 2011. http://innovationsimple.com/small-business/why-over-85-of-small-businesses-fail.
Lessinger, Jesse. “Fight Poverty Wages! Fast Food Workers Rise Up,” Socialist Alternative.Org: News & Analysis, 28 January 2013. http://www.socialistalternative.org/2013/01/28/fight-poverty-wages-fast-food-workers-rise-up.
Longley, Robert. “Why Small Businesses Fail: SBA says 50% fail during first year,” About.com: News & Issues > US Government Info. http://usgovinfo.about.com/od/smallbusiness/a/whybusfail.htm.
Mills, Karen. “Cutting the Red Tape For Small Business,” SBA.gov: U.S. Small Business Administration, 12 December 2012. http://www.sba.gov/community/blogs/cutting-red-tape-small-business.
Monroe, Audrey. “Low-Wage Workers Fight Back!” Socialist Alternative.Org: News & Analysis, 2 September 2013. http://www.socialistalternative.org/2013/09/02/low-wage-workers-fighting-back.
Staff of NELP. “A Strong Minimum Wage Can Help Working Families, Businesses and Our Economy Recover,” NELP: National Employment Law Project Briefing Paper, January 2011. http://nelp.3cdn.net/02b725e73dc24e0644_0im6bkno9.pdf.
Editorial Board, The. “Redefining the Minimum Wage,” The New York Times: The Opinion Pages, 11 November 2013. http://www.nytimes.com/2013/11/12/opinion/redefining-the-minimum-wage.html?_r=0.
Ramsey, Bruce. “A $15 minimum wage won’t help you land your first job.” The Seattle Times: News: Opinion, 23 October 2013. http://seattletimes.com/html/opinion/2022102889_bruceramseycolumnminimumwage23xml.html.
Russell, Patrick J. “$15 minimum wage will increase business,” The Seattle Times: Editorials/Opinions: Northwest Voices, Letters to the Editor. 25 October 2013. http://blogs.seattletimes.com/northwestvoices/2013/10/25/15-minimum-wage-will-increase-business.
Sawant, Kshama. “Questions and Answers: We Need a $15 an Hour Minimum Wage,” Socialist Alternative.Org: News & Analysis, 1 September 2013. http://www.socialistalternative.org/2013/09/01/questions-and-answers-we-need-a-15-an-hour-minimum-wage.
Sawant, Kshama. “The Minimum Wage: Putting Some Myths to Rest,” The Stranger: Slog, News & Arts, 4 June 2013. http://slog.thestranger.com/slog/archives/2013/06/04/the-minimum-wage-putting-some-myths-to-rest.
*Note: Dr. Sawant’s essay above “putting myths to rest” proved popular and was reprinted elsewhere including in Common Dreams: Building Progressive Community and Socialist Alternative.Org: News & Analysis.
Schmitt, John. Why Does the Minimum Wage Have No Discernible Effect on Employment? Center for Economic and Policy Research, Washington, D.C., February 2013. http://www.cepr.net/documents/publications/min-wage-2013-02.pdf.
“Small Business Trends,” SBA.gov: U.S. Small Business Administration, http://www.sba.gov/content/small-business-trends.
“What are the major reasons for small business failure?” SBA.gov: U.S. Small Business Administration, http://www.sba.gov/content/what-are-major-reasons-small-business-failure.
Varner, Lynne K. “Minimum-wage debate in SeaTac should be about higher education,” The Seattle Times: Opinion, 3 October 2013. http://seattletimes.com/html/opinion/2021960028_lynnevarnercolumnhigheredxml.html.
Varner, Lynne K. “Education offers more wage guarantee than SeaTac’s Prop 1,” The Seattle Times: Editorials/Opinions: Opinion Northwest, 4 October 2013. http://blogs.seattletimes.com/opinionnw/2013/10/04/premium-on-education-better-alternative-than-seatacs-prop-1.
Wing, Nick. “Elizabeth Warren: Minimum Wage Would Be $22 An Hour If It Had Kept Up With Productivity,” The Huffington Post. 18 March 2013. http://www.huffingtonpost.com/2013/03/18/elizabeth-warren-minimum-wage_n_2900984.html.
Copyright © 2013, 2015, 2016 by William Dudley Bass.
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Wise Stewardship of and for our Earth & Solarian Commons.