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    Did you know...that the Register of the Kentucky Historical Society, first printed in 1903, is the oldest peer-reviewed publication dedicated to Kentucky history?Subscribe to the Register (only $40 per year).
  • Historian to Lexington council: hike the minimum wage
    Posted On: Jul 06, 2015

    Historian to Lexington council: hike the minimum wage

    EDITOR’S NOTE: Jenean Hampton, the Republican nominee for lieutenant governor, argues against the minimum wage in the Bowling Green Daily News. Hampton, who is an ultra-conservative, pro-“right to work” tea party activist, says: “The minimum wage is not meant to be a livable wage; it is an entry-level wage intended for lower-skilled positions in which most workers don’t stay long. Workers earning minimum wage are able to learn new skills and move on to other positions or companies at higher salaries commensurate with the market. However, artificially increasing the minimum wage will force companies to either raise prices and/or reduce the number of employees to stay competitive. Raising the minimum wage has historically reduced or eliminated entry level positions and led to higher unemployment rates for teens and minorities.”

    Ron Formisano, a retired history professor and historian, demolishes her argument in the following op-ed piece from the Lexington Herald-Leader


    Mark Twain did not say, as legend has it, that "When the end of the world comes, I want to be in Kentucky, because everything there happens 20 years after it happens anywhere else." But on the minimum wage some Urban County Council members want to prove the apocryphal Twain remark correct.

    Laws raising the minimum wage are sweeping the country, with 29 states and two dozen cities surpassing the federal embarrassment of $7.25, worth less than it was in 1968. Several red-state legislatures and electorates have voted to raise the wages of their poorest citizens. In a Pew poll, 73 percent of Americans favor upping the federal base, but when does this Congress care about public opinion?

    So states and cities are taking matters into their own hands, undeterred by lawsuits elsewhere.

    IKEA, Costco, Aetna, Gap, In-N-Out Burger, Shake Shack, Ben & Jerry's, Whole Foods and even welfare queens Walmart and McDonald's (some workers) are bumping up wages. Some small businesses oppose, but many support, higher minimums.

    Claims that raises cost jobs have been proven wrong repeatedly. Several cities and states raised their minimums years ago; that gave economists test cases to measure the impact on jobs and the economy.

    Their studies show job loss did not happen or was insignificant; higher wages were offset by lower turnover and savings from unneeded training, small price increases and higher worker productivity.

    In 2014, Goldman Sachs economists surveyed the impact of higher wages in 13 states that had raised the minimum and found "negligible" job loss, and faster economic growth in those states.

    Even Goldman Sachs is on board but the Lexington council needs to dither? Average weekly wages in Kentucky in 2014's first quarter were $811, "significantly lower than the U.S. average of $1,027" according to the University of Kentucky's Gatton College annual report.

    The economists producing comparative studies are not being paid to fix their findings. The National Restaurant Association, some chambers of commerce and large chains that sell something they call "pizza" do just that: pay for desired results.

    Perhaps council members Fred Brown, Amanda Bledsoe, Ed Lane, Jennifer Scutchfield, Susan Lamb and Bill Farmer will consider the success of other cities and states that have raised wages. Would they or University of Kentucky professor Ken Troske, who somehow knows absolutely that 2,000 people would lose jobs, work for $7.25 an hour?

    What about the arguments of more than 600 economists, including seven Nobel laureates and eight former presidents of the American Economic Association, who last year wrote to President Barack Obama declaring that raising the federal minimum would not harm employment and would help the economy?

    Various right-wing groups such as the American City Council Exchange, an offshoot of the Koch brothers' political lobby Americans for Prosperity, have given money and "model laws" at the local level to push "right to work" (for lower pay) laws and to prevent raising of minimum wages — and have done so in Kentucky.

    Has this or a similar group supported any of Lexington's council? This issue should be decided by Lexington, not by money from distant billionaires. Lexington's citizens have a right to know.

    Ron Formisano is a retired history professor and author of Plutocracy in America: How Inequality Destroys the Middle Class and Exploits the Poor (Johns Hopkins).

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