July 24, 2007 at 10:17:41

Pay CEOs less, minimum wage workers more

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By Holly Sklar (about the author) Page 2 of 2 page(s)

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Even the state with the highest minimum wage, Washington at $7.93, doesn't match the buying power of the federal minimum wage at its peak in 1968. Worth $9.56 in today's dollars, the 1968 minimum wage was more than $2 higher than the scheduled raise in the federal minimum wage to $7.25 on July 24, 2009.

Too bad we can't use Hermione's magical Time-Turner to send the minimum wage and CEO pay both back to 1968.

The minimum wage sets the wage floor. If the minimum wage had stayed above $9, Wal-Mart and McDonald's, our nation's largest employers, couldn't routinely pay wages much lower.

Wal-Mart's wages would be closer to Costco, which pays starting wages over $10 an hour. Costco CEO Jim Sinegal has long asserted, "Paying your employees well is not only the right thing to do, but it makes for good business."

McDonald's starting wages would be more like In-N-Out Burger, which has a minimum wage of $9.50 an hour and has long ranked first or tied for first nationwide among fast food chains in overall excellence.

Our nation's minimum wage would be closer to Harry Potter's U.K., where the minimum wage already tops $10, child poverty rates have fallen sharply, and the economy is stronger than ours.

Overpaying CEOs and underpaying workers is bad for business. Studies show that showering stock options on chief executives lowers shareholder returns, and increases the likelihood companies will cook their books, default on debt and go bankrupt.

Higher worker wages benefit business by increasing consumer spending, reducing costly employee turnover, raising worker morale and productivity, and improving product quality and company reputation.

In the words of Gary Theilen, owner of Theilen Farm and Cattle in Enid, Okla., "As a small-business owner who has always paid well above the minimum wage, it has been my experience that paying living wages makes good business sense. It is good for business, workers and the community."

Theilen has joined business owners from across the nation in endorsing higher minimum wage at Business for a Fair Minimum Wage http://www.businessforafairminimumwage.org/.

Paying workers enough to live on is the minimum employers should do.

Copyright (c) 2007 Holly Sklar

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Holly Sklar is a widely published op-ed columnist whose books include "Raise the Floor: Wages and Policies That Work for All of Us" and "Streets of Hope: The Fall and Rise of an Urban Neighborhood," the widely taught story of how the Dudley (more...)

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