ON TAP Today from the American Prospect
MARCH 27, 2020
Kuttner on TAP
Oh, No! Better Unemployment Benefits Raise Low Wages. The Republican senators who tried a last-ditch effort to water down the stimulus bill had one major concern: If federal unemployment benefits were increased, companies that depend on low-wage labor might have trouble coaxing people back to work for a pittance. Oh, the horror!
As The Wall Street Journal lead editorial put it, in inimitable fashion, “Amazon, Walmart, CVS and delivery services are seeking to hire hundreds of thousands of workers to meet a surge in demand even as the virus spreads. Many are boosting pay, but how are they supposed to compete with workers who can stay at home and make more?”
And the Journal warned gravely, “The enhanced benefits expire after four months, but we’ll bet Speaker Pelosi’s pension that Democrats will be back demanding an extension through the end of the year and calling Republicans ‘cruel’ if they disagree.”
Duh—how prescient of the Journal. Democrats should indeed take full advantage of this crisis to get reforms that are long overdue: more adequate replacement of lost wages for laid-off workers; full unemployment coverage for gig workers, freelancers, and other 1099 employees.
As for poor Amazon, Walmart, and others of the world’s most profitable companies that may find it harder to get workers to risk their life and health for lousy jobs, there is a remedy that the Journal may recognize as part of standard economic supply-and-demand theory: Raise their wages!
And don’t tell us that this would be inflationary. The crisis that this economy faces is deflation.
The historic function of unemployment comp is not just to keep idle workers from starvation, but to raise what economists call the “reservation wage,” otherwise known as a desperation wage, that workers are compelled to take to survive. And if the corona crisis raises that wage to $15 an hour or more, it’s one of the very few good side effects. ~ ROBERT KUTTNER
Diane Ravitch's blog 
Amazon and Walmart want to pay starvation wages for hazardous work. Not surprising, still enraging.
LikeLike
I maintain that COVID-19 is the great equalizer in terms of everyone – regardless of SED – fearing it, suffering from it, being quarantined by it, and potentially dying from it.
It will expose who is better cared for and how that care is based on privilege. It will show the frailties, the corruptions, and the sheer unsustainability of a for-profit, privatized American health care system.
It will blow the lid off of who benefits from the stimulus package and what true level of equity people derive from it based on their share of taxation.
This virus will more acutely expose grotesque disparities in income, housing, education, access to and quality of healthcare, food, transportation, and even dignity, hope, and self esteem.
Under one very pensive and limited lens, COVID-19 one of the best things to happen to the USA because it will expose inequities like never before. It will force people to shed their labels and realize that at the end of the day, we are all fallible and human. The virus does not discriminate, even if the plutocrats do. . . .
LikeLiked by 1 person
Forgive me if I don’t feel sorry for the big box stores who have to pay their workers more. They are making money off of this virus and if they have to give a little back – they should. After all, their employees are risking their lives for their bottom line.
Next on my list is a call for the employers of emergency services to double the salaries of the EMTs in NYS who are lucky if they get $15 an hour. These workers are literally on the front lines, many of them volunteering for extra shifts, and a free cup of coffee at Starbucks isn’t enough compensation.
LikeLike
The GOP, the CEOs, corporate elites, libertarians, the Ayn Rand mob (but I repeat myself) are lacking in empathy, compassion and any basic human feelings towards the great mass of Americans. They want to gut the whole social safety net, can’t have any of that socialism stuff in GOP world. Even the horrors of this pandemic will not change the minds of these right wing ideologues; they will just bring up Italy and Spain and say that things are so bad there because of their socialized medicine. The only solution is to vote the GOP out of office and to infiltrate the Democratic party with more Bernies and AOCs. Nothing, NOTHING will ever change in this country until we can sideline the GOP for a few years. Good luck with that.
LikeLike
I’m always amazed at the argument from the free-market fundamentalists that paying workers more is somehow inevitably inflationary. It’s utter nonsense. This is only true if companies actually raise prices as a result of paying their workers more. The only reason they’d have to do that is if they refuse to cut their profits instead. So what they’re really arguing is that they would rather cause inflation than share some of the profit with their workers who do, of course, generate those profits in the first place. For them, the invisible hand can only distribute benefits in one direction: upwards. Any hint that it might need to distribute some of the wealth generated downwards is regarded as heresy at best, as an impossibility much of the time.
LikeLike
It was not an impossibility during the 1930s, when the labor movement began to heat up quickly.
LikeLike
The real point here is that they are saying that helping out the workers make them lazy. So what does handing out cash like candy to big business do ? It makes them irresponsible since no matter how bad they mess up they know that the GOP will bend over backwards to help them. Like always its privatizes the profit socialize the loss.
LikeLike
Socialism and welfare for corporations; capitalism for the rest of us.
LikeLike
The great majority of people want to work. Why don’t Repubnithugs get that? Wouldn’t they rather have the structure, not to mention self-respect of a job that puts food on the table? it’s only human. Would they prefer to be on the dole, prone on a couch eating chips, unhealthily fat & depressed? They focus on depriving/ not incentivizing a dysfunctional minority that has always been among us– remaining oblivious to the huge proportion of post-industrial/ globalization now-lower-middle/ working class workers [including many educated young folk] raised on high-work-ethic middle-class values, whose opportunities are currently restricted to minimum wage jobs. Thanks in large part to their [Republicans’– supported by 3rd-way Dems’– elected office-holders’] 40 yrs’ of failure to confront & deal w/economic upheaval w/a view toward socio-economic health of the public. They’ve spent 4 decades promoting trickle-up to the favored/ connected, & sauve-qui-peuve to everybody else, & now that everybody else is up s*** creek, blame them for being one paycheck away from bankruptcy.
LikeLike
Most of the Republicans are “glass half empty” people. They tend to see the poor as “less than.” I was glad that Bernie called them out on it in congress. They eschew collectivism.
Currently, several red states are playing a game of chicken with Covid-19 by refusing to shutdown in order to keep the economy moving. This virus is no joke, and people will pay for this bad decision with their lives.
LikeLike
Raising wages raises costs for goods and services. So it means nothing.We need to have it come from obscene profits. Yes, they took risks and the payoff needs to reflect the risk. There needs to be a point where it’s shared. We need Bernie’s voice as a part of the whole – but not the whole. People don’t realize that a portion of your Social Security check (about 10%) goes directly to Medicare and Medicare only pays 80% of the medical costs. Seniors are going broke paying for a 1 day procedure. The next 4 years will be the hard. It will be more about leadership than anything else. It’s not looking good.
LikeLike