Ballard News clipping taken from the Microfilm collection of the University of Washington
Fat cats in 1913 were making $50 thousand a year, equivalent to $1.4 million today.
History Leads: $15 minimum wage? Why stop there?
There has been a lot of talk in recent years about the over compensation and gross salaries of corporate CEO types. According to GMI Ratings, who conducted a survey of over 2,000 American CEO’s, 2013 saw the top ten highest paid CEO’s making more than $100 million, and the top two making over $1 billion because of stock options –- the first being Mark Zuckerberg of Facebook.
This phenomenon is not something new. The Ballard News reported on the same things happening in April 1913 (exact date unknown). Oilmen and grain brokers from Chicago were making over $50 thousand dollars a year. In modern currency, that is about $1.4 million. Corporate fat cats were not alone. President Taft was in office from 1908 to 1912 and made $75 thousand a year, which is the modern equivalent to $1.7 million for serving as master and chief of the free world. Currently, President Obama makes an annual salary of $400 thousand, plus perks like a travel expense account.
Meanwhile, in the world that most of us live in there is heavy dispute and deliberation over a $15 minimum wage at Seatac and potentially in Seattle.
100 years ago State Senator George U. Piper introduced Washington's first minimum wage bill. The wage varied in industries but hung around $9 a week for women and children. Since then Washington State has wavered a bit, but has had largely progressive minimum wage laws.
Currently, Washington State’s minimum wage is $9.19 -- well above the federal rate of $7.25. But the people are asking for more. $15 an hour calculates to just over $31 thousand a year. In some circles this amount is considered just over a newly calculated poverty line.
In a 2011 a study done by the University of Washington, researchers came up with a different measure called the Self Sufficiency Standard:
“The Self-Sufficiency Standard measures how much income a family of a certain composition in a given place needs to adequately meet their basic needs — without public or private assistance.”
The measure takes into account real life nuances in variables such as geographic location, ages and need of each family member, types of transportation, health care (employer paid or personal), and even down to how much it costs an individual to eat out compared to in-home prepared meals (grocery costs).
The figure they came up with for self-sufficiency for individuals in King county is $10.90 an hour working full time (full time is 8 hours a day, 22 days a month). This calculation shows housing as the largest expense at $997 per month, taxes at $295, food as $259, health care at $113, and transportation as $108.
Furthermore, the hourly wage they measured to sustain one adult and one preschooler is $22.49/hr. And for a household with two adults supporting two children, working individuals need to each make $14.81 and hour.
Coincidently, $14.81 an hour is pretty close to $15 an hour and is exactly what fast food demonstrators have asked for in the past and what workers in Seatac have obtained.
The study tells us there is no one size fits all in minimum wage and its silly to think so. The feds are operating on an archaic notion of “one law for all the land” and uses clumsily formatted measures to justify a mirage of economic conditions. Or, maybe the minimum wage is just a safety net, and its up to the states to determine what a good measure of wage actually is since its their state and they should know.
According to the United States Census Bureau, the poverty threshold for an individual under 65 years of age is $11,945 per year and $15,130 per year for a household of two and $19,090 per year for a household of three.
What’s interesting is that the formulas used by the Bureau to determine poverty thresholds in the U.S. do not take into account contextual variables, such as geographical conditions like state/city taxes and other costs of living that vary from place to place.
With any bureaucracy there is a lag and the federal measure of minimum wage has not changed with the economic conditions of the times. According to a study done by the Center for Economic and Policy Research, if minimum wage kept up with worker productivity it would have been $21.72 an hour in 2012.
What's more is that the president's salary does a better job of keeping up with cost of living. The last time it was bumped was George W. Bush's first year in office (2001) and it jumped from $200 thousand to $400 thousand. A nice raise, indeed.
A deeper, contextual measure for wages that changes with inflation and takes into account the cost of living and life situation as seen in the UW study, could be the solution for better socio-economic equality. What's more is why change the minimum wage every few years, when we could just use an algorithm that constantly changes it for us like airline tickets or the stock market? In an age when the NSA can collect every click I make online, I'm sure a rudimentary minimum wage that keeps up with cost of living is feasible. Its just a matter of what the People want.
The fat cats need the masses. So people need to ask themselves: Do I want to continue to work two or three jobs just to "get by" because wage is too low? If there is no "Change," we may well be doomed to exist in the lag and indignant scent of this economic miasma and ugly cyclic pattern of disparity in wage we have been seeing in America since at least 1913.