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Blumner: It's not hard: a living wage

America has the Labor Day blues. • An airtight case has been made for government to do more to address the country's punishing wage stagnation and income inequality. But another Labor Day comes and goes and there is little hope for change, even from a president who gets it. • President Barack Obama understands that making work pay better is the issue of his presidency. • Obama pinpointed what went so wrong for American workers in a July speech. It was the severing of "the link between higher productivity and people's wages and salaries." To refocus the national conversation he launched "A Better Bargain for the Middle Class." Then, in his commemoration of the March on Washington for Jobs and Freedom, Obama said the problem of growing income inequality remains "our great unfinished business."

But Obama's proposed solutions of increasing minimum wages, tax reform and strengthening labor rights have little chance of passing a Republican-controlled House that protects America's privileged class above all else.

Here are the harsh facts: Between 1979 and 2012 the median worker saw an increase in wages of just 5 percent even as productivity grew 74.5 percent, according to the Economic Policy Institute. Where did all those gains end up? They flowed up, of course. Between 1979 and 2007, the top 1 percent saw their income nearly quadruple.

In 2012, CEOs at Standard & Poor's 500 stock index companies made 354 times that of average workers, compared with 42 times average workers in 1980.

How galling that the 1 percent are celebrated when they build hospital wings and symphony halls to name after themselves, when so much of their fabulous wealth comes by diverting the gains that used to flow to working people.

It reminds me of a profound insight by author Barbara Ehrenreich. She wrote that society's real philanthropists are the working poor. They are the ones who "neglect their own children so that the children of others will be cared for; they live in substandard housing so that other homes will be shiny and perfect; they endure privation so that inflation will be low and stock prices high."

College affordability is a central feature of Obama's helping hand. He's fought for more generous financial aid and lower-cost college loans. But education is not the key to rising incomes it once was. The last 10 years have been a lost decade even for white-collar and college-educated employees. Workers with an undergraduate degree had lower wages in 2012 than in 2002, EPI reports.

Leverage is what workers need to start getting a fairer share of national wealth. And they need government help to get it.

Obama is calling for a boost in the minimum wage, an essential step when today's minimum of $7.25 is worth less than in 1963. (Florida's minimum wage is $7.79.) This will benefit all workers by putting upward pressure on wages.

Obama wants fairer tax policies that stop rewarding the movement of jobs and profits by U.S. corporations offshore. On what planet is it fair that General Electric in some years pays less in federal income taxes than nearly everyone reading this?

But Congress isn't likely to cooperate.

Obama has to take unilateral steps. For one, he can give home health care workers wage and hour protections. The administration proposed rules in December 2011 that would finally allow this workforce of nearly 2 million low-wage workers to be covered by minimum wage and overtime laws. Finalize them.

The government also can choose "high road" contracting in which the federal government's $500 billion annual buying power goes to contractors and subcontractors that pay employees a living wage. That would cover one in five American workers.

Over the last 40 years the nation's richest companies decided that its workers would no longer share in rising profits. This happens only when workers are powerless.

Obama's greatest challenge is helping the American worker change that calculation.

Blumner: It's not hard: a living wage 08/29/13 [Last modified: Friday, August 30, 2013 5:17pm]
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