Monthly Archives: October 2013

Mark Obenshain on “the so-called living wage”

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Mark Obenshain on “the so-called living wage”

Back on May 7, 2006, State Sen. Mark Obenshain (R-Harrisonburg) published a Commentary piece in the Richmond Times Dispatch on the evils of the living wage. Obenshain has not authored many published articles, and this short piece provides a glimpse into his likely thinking should he occupy the Commonwealth’s Attorney General’s office, now inhabited by Ken Cuccinelli II.

Obenshain

The topic of the living wage arose because some University of Virginia students had demonstrated in favor of the university’s placing a floor under what it pays staff who clean the restrooms and maintain the grounds, etc., for Thomas Jefferson’s beloved brainchild.

University of Virginia rotunda

Obenshain calls it a “so-called living wage policy.”

Signs of the times

Obenshain titled his commentary “A Teachable Moment?; UVa’s Casteen Could Have Taught Lesson in Econ 101.” While some people might think it commendable that the students cared about someone other than self, Obenshain, au contraire, is cool with their being jailed:

“For four days in April, UVa president John Casteen was the target of a ’60s style sit-in protest by students agitating for the university to adopt a so-called living-wage policy. After trying to talk, cajole, and even starve the students out of his office, Casteen finally called the cops. UVa police ultimately hauled the protesters away and gave them the opportunity to finish their protest at the Charlottesville-Albemarle Regional Jail.”

If anything, Obenshain seems to have favored a sterner response, although he does not say what. (“As it turns out, Casteen just wanted his office back.”)

“Here is what the protesters want at UVa: They want the university to raise the minimum wage it pays its employees to $10.72. Moreover, the protesters want the university to quit doing business with any private enterprise that refuses to adopt the same minimum hourly wage.”

Imagine the effrontery. Some students on Jefferson’s historic grounds actually wanted the university to adopt a policy of paying $10.72 per hour to employees who bag up and cart away used tampons or clean up the school’s cafeterias and other eating places.

As Obenshain points out, “Right now, unemployment in the Charlottesville-Albemarle region is about 2.1 percent.” His take-away? ” There is absolutely no indication that the university is unable to hire qualified people for jobs classified at the bottom of its pay scale.” In other words, the standard CEO-type argument for paying more–that higher pay is needed to attract job candidates–cannot be made.

That argument absent,  in this mindset there is no argument  for improving the pay of those at the bottom:

“The bottom of the UVa pay scale is already $9.37 per hour–81 percent higher than the federal minimum wage and nearly 40 percent above the state’s minimum hiring rate!”

Today, caviar; tomorrow, the world!

It would be nice to hear Obenshain–or Gov. Robert F. McDonnell, or now-Attorney General Cuccinelli–say this kind of thing about CEO pay.

But this kind of justification is precisely what is not offered about CEO pay, in the public discourse–that it’s already higher than the minimum amount paid to other CEO’s, that it could be lower, etc. They just don’t go that way. They just don’t say, never get around to saying, “Hey, it could be lower, you know.”

The mindset displayed in Obenshain’s commentary is more recognizable. When confronted by something you dislike, such as the proposition that people doing the dirtiest jobs should be paid a little better, always make a threat:

“Some of those employees recognize that if the university’s minimum hourly rate of pay goes up, the university will have a choice–employ fewer employees or raise tuition. A victory by the living-wage campaign could mean no wage for an unlucky few.”

Let’s hope the author did not do himself justice.

Here’s where he spent more ink:

“Capitulation to the protesters’ demands also would have a tremendous impact in the private sector. Many businesses competing with UVa in the limited labor market immediately would have to pay more to attract and retain qualified help. “

–And by paying more, we mean what, exactly?

“A UVa business partner might be required to raise its entry-level pay from $6, $7, or $8 per hour to $10.72 per hour.” [emphasis added]

That way catastrophe lies. As ever in this kind of thinking, consequences run the short gamut from dominoes falling to apocalypse now:

“That business would have to charge the university more for goods and services because of the increased labor cost” [no evidence]

One thing leads to another:

“–which the university undoubtedly would pass on to students or to taxpayers.” [no evidence]

And on:

“That business might even flounder and fail because competitors that are not UVa business partners would have lower labor costs.”

I always like that one–the argument that the only way a business can stay afloat is by underpaying its employees, or at least the ones at the bottom.

Imagine: a business failing because it could not pay its employees the going or market rate. So much for ‘responsibility’. Incidentally, when was the last time that happened?

Polonius economics. As follows the night the day, we proceed to the inevitable billboard mantra:

“The bottom line is that the market, not the state, is best equipped to set wages. This is simple economics.”

Ah, back from the brink.

The simple economics here are pretty clear–the piece boils down to a Send-Me-Money message, from a state senator to businesses averse to the minimum wage.

Less clear is why this mindset would be good for the Attorney General’s office. You can offer a lot of criticisms of the state administration of Gov. McDonnell, but you cannot convincingly accuse him, or Cuccinelli, of being insufficiently friendly to business.

 

Today begins the open enrollment period for health insurance

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Affordable Care Act sign-up begins today

October 1, 2013: Today begins the open enrollment period for health insurance.

Under the federal Patient Protection and Affordable Care Act, people who do not have insurance (or Medicare), or who want to switch their insurance coverage, can begin signing up for individual or family coverage.

As we know by now, this move into the 21st century has been stridently opposed–

  1. by people who hate insurance companies and hate the idea of having to buy insurance,
  2. by well-funded lobbyists working for billionaire reactionaries, for the insurance industry, for the tobacco companies, etc.,
  3. and by people who already have some version of insurance coverage, or think they have, and hate the idea that other people might gain some.

 

Benign image

As to these three groups,

I have some gut sympathy for the first bunch. Full disclosure: I have worked stints in insurance companies myself, working among nice people–who typically get employer-provided benefits, too, by the way. But decades of seeing insurance company abuses go unreported tends to undermine one’s faith in unfettered market forces. It doesn’t help that the media outlets thus underreporting are often cross-invested with the insurance industry.

The second bunch are being paid. (End of story.)

The third group is the saddest. In this group, people motivated by race are–as we say–disproportionately represented. The third group also includes a significant number of sad people who are themselves on Medicare or other public assistance, but who are eager to believe that fellow citizens are getting away with something. Remember Matt Taibi’s you-are-there piece in Rolling Stone? A Sarah-Palin-led rally looks like a Medicare convention. I have seen and heard the same thing closer to home.

Ironically, people in all of these groups would themselves have benefited from a reasoned approach to underwriting health care expenses–a single-payer plan. But the major party that represents groups 2 and 3 opposed every such move. It has also opposed almost every move for health and wellness, from lowering the speed limit on highways to limiting access to military-grade weapons of deadly force to reining in the tobacco companies to limiting use of herbicides and pesticides in food growing to limiting deadly emissions in the air to limiting groundwater contamination. Et cetera. The opposition to the Affordable Care Act should be viewed through this prism. Opposition is not a bright-line rejection of ‘government intrusion’. Many individual opponents of the ACA themselves receive public assistance, red states are the biggest drawers of federal funding, and no corporatized industries reject government assistance.

GOP Congress members keep their health coverage

Back to the Affordable Care Act. Some useful links:

For Maryland, go to Maryland Health Connection. Or call 1-855-642-8572. Every plan on the Maryland Health Connection (the Maryland Health Benefits Exchange) includes preventive services.

For Texas, go to http://www.tdi.texas.gov/consumer/cpmhealthcare.html.

Note: The ACA is lowering health care rates for Texans. Gov. Rick Perry is doing his utmost to violate both the letter and the spirit of the health care law, even though Texas has the highest proportion of uninsured people in the nation, including uninsured children.

As the Texas web site states,

“Texas has indicated that it will not create a state-based health insurance marketplace (formerly called the exchange). See the letter from Governor Perry dated November 2012.”

For local workshops in San Antonio Oct. 3 and in Houston Oct. 10, go here.

Texas hearts

Here in summary are some key provisions of the new law:

  • The customer can no longer be denied coverage because of chronic illness or pre-existing condition
  • The customer can include children on the insurance plan until they reach the age of 26
  • There is no annual limit on care (cap on coverage paid by the company, per year)
  • There is no lifetime limit on care (cap on coverage paid by company over lifetime)
  • The insurance becomes effective Jan. 1, 2014, if purchased (in Maryland) by Dec. 18, 2013
  • ‘Navigators’ or assisters are available to help people sign up for coverage
  • For adults at 138 percent to 400 percent of the federal poverty line, tax credits are available through the state health exchanges to help pay for premiums
  • Private coverage is purchased, in most states, through insurance exchanges
  • Some private insurance agents are signing up with the exchanges
  • Medicaid coverage varies by state

Speaking of Medicaid, here is another feature of the Affordable Care Act: the asset base limit got thrown out. In other words, Americans are no longer required to drain or lose everything they have ever earned or saved, over their lifetimes, to become destitute, to become eligible for Medicaid. In states that are not shrinking Medicaid by opposing the new law, Medicaid eligibility will be determined by income.

Anti-Medicaid plotting in red states?

Back to Maryland, and Medicaid:

  • Medicaid in Maryland is expanding to cover adults under age 65, up to 138 percent of the federal poverty line (about $32,500 per year for a family of four, or $15,856 for an individual)
  • Eligibility for Medicaid in Maryland will be based on the federal modified gross income
  • There is no ‘means test’; income verification is provided through IRS returns, Social Security data, and other federal and state data
  • According to the Maryland Health Connection, “Eligibility will be determined in real time in most cases.”
  • Young adults who have aged out of foster care will be eligible for Medicaid up to age 26

Stay tuned.