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Resurrecting America's Minimum Wage
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The Fall and Revival of Our Minimum Wage Laws

Just over a decade ago, minimum wage laws had largely vanished from the American political debate.

Although they still remained on the books, they had fallen sharply in real terms, with the federal figure of \$7.25 per hour being roughly one-third lower than at its 1968 peak. Relative to the overall productivity of the American economy, the decline had been far greater, amounting to a loss of more than 60%.

Even starker than these practical changes had been the collapse of their ideological support. For decades, conservatives and Republicans had grown increasingly more hostile to their role, arguing that minimum wage laws damaged the economy and hurt the prospects of the very workers they were intended to help, with free market libertarians regularly demanding their abolition.

More surprisingly, these same sentiments had also become quite common on the other side of the aisle, with many Democrats and liberals quietly admitting that their Republican opponents were probably correct on this particular economic issue. As early as 1987, the editorial page of the New York Times had provocatively called for a minimum wage of \$0.00, and by the late 1990s leading liberal economists such as Paul Krugman had grown highly skeptical. The younger generation of influential progressive pundits such as Ezra Klein and Matthew Yglesias had fully imbibed these neoliberal sentiments, and were sometimes scathing in their criticism of such policies, which they derided as based upon populist ignorance and demagoguery.

During this same period, private sector unionization had also declined, dropping from around 30% of the work force down to less than 7%, and despite all efforts to reverse it, that trend has continued in the decade since then, with the figure now down to 6.1%. So any objective observer might have expected that our traditional minimum wage laws would follow this same inexorable trajectory, steadily falling into complete irrelevance, and with few influential elements of either political party casting any tears for their gradual disappearance.

Yet oddly enough, something entirely different happened. In early 2012, hardly any American political figures were focusing much attention on minimum wage policy yet just four years later the topic had become one of the hottest economic issues in the country, with both California and New York enacting \$15 per hour legislation, nearly doubling their previous rates.

A sudden explosion of state-by-state wage hikes began soon after 2012, and the ideological positions of Democrats and even many Republicans were transformed during that same period.

Across the last half-century, working-class Americans have suffered an almost unbroken series of economic defeats, and this sudden, unexpected resurrection of high minimum wage policy probably stands as one of the very few notable exceptions.

I’m proud to have played a significant role in that reversal of such seemingly irreversible historical trends, and with the ten-year anniversary having recently passed, I’ve decided to produce a comprehensive retrospective account of that important history.

Immigration, Poverty, and the Minimum Wage

One of the oddities of my involvement in this particular issue is that I had never previously paid much attention to economic matters. Although a class in introductory economics was one of the most popular offerings at my undergraduate college and all my friends took it, I never considered doing so, having absolutely no interest in the subject. Not only have I never taken a single course in the “dismal science,” but I’ve never even opened an economics textbook, let alone read one from cover-to-cover, a declaration I have sometimes made during my public debates with highly-credentialed economics professors.

Yet those who wander into an unrelated area quite by accident may sometimes grasp important truths that might remain unnoticed by those who have spent years or decades immersed in the subject, and I think I may have benefited from this situation.

From the early 1990s onward the main focus of my public policy interests had been the highly-contentious issues associated with race, ethnicity, and social policy, including immigration, Affirmative Action, and Bilingual Education. My involvement had been much more than merely theoretical, and I had played a major role in the controversial public campaigns on those issues, especially those in my own state of California. Meanwhile, I had also published widely on the same topics in the leading conservative periodicals, culminating in a 1999 cover story in Commentary, providing a narrative analysis recapitulating those important events of the previous few years.

My “English” campaigns came to a successful conclusion in 2003 as I recently described in a lengthy retrospective account. Afterward, I was preoccupied with unrelated software projects, and largely withdrew from the public policy arena, which had anyway become overwhelmingly focused on Middle East foreign policy issues in the wake of the 9/11 attacks.

However in 2011 I decided to publish a sequel to my 1999 article, updating my perspective on those same issues of immigration and race. These topics had previously been very important in California politics but had now also reached the center of the national agenda, and I included numerous ideas and observations I had gradually accumulated over the previous dozen years.

Much of my article followed along the lines of what I had previously written. The first half demonstrated that although a large influx of non-white immigrants tended to provoke the racialist fears of local whites, these concerns were transitory and soon dissipated. As a consequence, those conservatives or Republicans who regularly sought to ride such an anti-immigrant tidal wave to political power were pursuing fools’ gold, and they inevitably destroyed their long-term prospects. This had been the case with the total collapse of California’s once-mighty Republican Party in the aftermath of Pete Wilson and Prop. 187.

My previous article had been written in 1999, near the height of America’s Tech Boom, and economic factors had played a very minor role in my analysis. California’s middle-class whites were doing well financially, and the plight of those who had suffered, such as the aerospace engineers downsized at the end of the Cold War, had hardly been due to an influx of immigrant laborers.

But by 2011, American workers were facing economic hard times, and I concluded that several decades of very high immigration levels had played a major role in creating this predicament. I analyzed the situation at considerable length and proposed an unexpected solution.

The Politics of Rich and Poor

In recent decades, American society has undergone an almost unprecedented concentration of wealth, now reaching the point at which the top 1 percent possess as much net wealth as the bottom 90-95 percent. This same top 1 percent received over 80 percent of the total increase in American personal income between 1980 and 2005, and that trend has almost certainly accelerated since then. Late last year New York Times columnist Nicholas Kristof sounded the alarm that America might soon reach the extremes of wealth and poverty found in the notoriously polarized societies of Argentina and the “banana republics” of Latin America, then needed to retract that claim when he discovered that we had already long since passed most of those countries in that regard. And in a widely discussed Vanity Fair article, Economics Nobel Laureate Joseph Stiglitz characterized today’s America as being a country “Of the One Percent, By the One Percent, and For the One Percent.” This state of affairs is clearly not beneficial to the less wealthy 99 percent of our society, but he also pointed out that the obvious potential for social instability should deeply concern the more thoughtful members of the One Percent themselves.

Furthermore, much of this economic decline has been absolute rather than merely relative. Adjusted for inflation, median personal income has been stagnant for the past 40 years, and a substantial fraction of the population has seen a sharp drop in its standard of living, a situation almost without precedent in American history. Meanwhile, the costs of numerous budget items such as healthcare or higher education have risen very rapidly, thereby forcing more and more families into what Paul Krugman has characterized as a system of permanent “debt peonage” or what Warren Buffett has similarly described as a “sharecropper’s society.” As a result, nearly a quarter of American households have zero to negative net worth, and a single unexpected illness or economic setback can push them to the brink of destitution.

To some extent, this long stagnation in financial well-being has been masked by the material benefits derived from the exponentially growing power of our electronic technologies and also by the false sense of wealth temporarily provided by the housing bubble. But with the collapse of the latter, many Americans are finally discovering just how poor they really have become. And in many respects, this economic situation seems far worse in America than in most of the other wealthy countries we have long regarded as our economic peers, so it cannot simply be blamed upon problems of technological displacement or the rise of China or global free trade.

It is perhaps not entirely coincidental that this 40 year period of economic stagnation for most Americans coincides exactly with 40 years of rapidly rising immigration levels. After all, the concept that a huge influx of eager workers would tend to benefit Capital at the expense of Labor is hardly astonishing, nor does it require years of academic research into the intricacies of economic theory.

Consider, for example, the case of self-educated union activist Cesar Chavez, a liberal icon of the 1960s who today ranks as the top Latino figure in America’s progressive pantheon. During nearly his entire career, Chavez stood as a vigorous opponent of immigration, especially of the undocumented variety, repeatedly denouncing the failure of the government to enforce its immigration laws due to the pervasive influence of the business lobby and even occasionally organizing vigilante patrols at the Mexican border. Indeed, the Minutemen border activists of a few years back were merely following in Chavez’s footsteps and would have had every historical right to have named their organization the “Cesar Chavez Brigade.” I think a good case can be made that during his own era Chavez ranked as America’s foremost anti-immigration activist.

But today’s union leaders have grown almost completely silent on the obvious impact that large increases in the supply of labor have on the economic well-being of ordinary workers. A crucial explanation is that for reasons of citizenship and language, the overwhelming majority of immigrants are employed in the private sector, particularly the small-scale non-unionized private sector. Meanwhile, population growth tends to increase the need for teachers, police officers, firefighters, and other government employees, thereby benefiting the powerful public-sector unions that today completely dominate the labor movement.

• • •

This relates to another perfectly valid criticism raised by anti-immigration activists, namely that the net fiscal impact of many immigrants is substantially negative. The notion that large numbers of immigrants and their families subsist on welfare or that Mexican immigrant mothers often have five or ten children is sheer nonsense. Immigrants actually have very high labor force participation rates and relatively low rates of welfare dependency, while the vast majority of their families stop at two or three children, a number somewhat higher than that of today’s native-born whites but really no different from the typical American family during the hallowed 1950s. And since, as mentioned earlier, immigrant crime rates are about average, there is no large additional cost for police or prisons.

The fiscal difficulty lies not on the expenditure side but on the tax side. Most immigrants, especially illegal ones, work at relatively low paid jobs, and the various taxes they pay simply cannot cover their share of the (extremely inflated) costs of America’s governmental structure, notably schooling. Furthermore, for exactly this same reason of relative poverty, they receive a disproportionate share of those government programs aimed at benefiting the working poor, ranging from tax credits to food stamps to rental subsidies. Immigration critics have persuasively argued that the current system amounts to the classic case of economic special interests managing to privatize profits while socializing costs, wherein immigrant employers receive the full benefits of the labor done by their low-wage workforce while pushing many of the costs—including explicit income subsidies—onto the taxpayers. Obviously, all these same factors are equally true for non-immigrant Americans who fall into the category of working-poor, but the large continuing inflow of low-wage workers greatly exacerbates this basic fiscal problem.

Immigration and the Political Trap

But even if we conclude that our high immigration levels represent a serious national problem, is there any possible solution? The political reality is that both major parties are enormously dependent upon the business interests that greatly benefit from the current system and are also dominated by disparate ideologies—libertarian open-borders and multicultural open-borders—whose positions tend to coincide on this issue.

As an extreme example of the bizarre ideological views of our current political elites, consider a less-publicized element of the immigration reform plan that President George W. Bush trumpeted during his 2004 reelection campaign. This provision would have allowed any foreigner anywhere in the world to legally immigrate to America if he accepted a minimum-wage job that no American were willing to fill, an utterly insane proposal which would have effectively transformed America’s minimum wage into its maximum wage. Naturally his opponent, Sen. John Kerry, saw absolutely nothing wrong with this idea, though he did criticize various other aspects of Bush’s immigration plan as being somewhat mean-spirited.

Furthermore, while significant Democratic support for curtailing immigration appears almost unthinkable given the party’s internal dynamics, a committed Republican effort—unlikely though it might be—would seem doomed to failure due to the racial aspects of the issue. Republicans would immediately be subjected to withering Democratic attacks in the media—whether or not these were fair or sincere—and as a result would lose much of whatever remaining non-white political support they still retained, while the GOP plan would never have the slightest chance of gaining majority support in Congress, let alone a filibuster-proof majority. The Republicans would suffer massive political damage without any possibility of achieving legislative success, and knowing that, would never undertake the effort. So they don’t.

After all, even strictly enforcing existing immigration laws is almost impossible in our current political and media climate. Although the press has recently highlighted the hundreds of thousands of undocumented residents annually deported under the Obama administration—and this has sparked a sharp political backlash among his pro-immigrant supporters—such a number is negligible compared to the estimated total of 11 million or so. Only the most utterly egregious employers of those workers have ever paid serious penalties, and the dollars involved are usually trivial compared to the economic benefits of ignoring the law. In almost all cases, “employer sanctions” have amounted to just a (small) cost of doing business. When both worker and employer have a strong mutual interest in evading a law, enforcement becomes very difficult and cumbersome, just as we have seen in the case of our endlessly violated drug laws.

Even so, attacking the employment side of the equation remains the most effective approach. Virtually all immigrants come here for jobs, so eliminating government benefits would merely serve to further immiserate millions of families, who would remain in this country regardless. Having immigration agents conduct random sweeps through ethnic neighborhoods would engender enormous fear and anger and also deter immigrants from reporting crimes, while constituting a massive violation of traditional civil liberties. Even building a fence and doubling the border-patrol would probably have just a small impact across such an enormously long border, not least because an estimated one-half of all illegal immigrants enter the country legally and then overstay their visas. If the magnetic appeal of the American job market could somehow be reduced or eliminated, such ancillary measures might prove useful, but if the jobs remain, the immigrants will remain here as well.

Escaping the Low-Wage Society

So we are faced with several apparently insoluble and reinforcing dilemmas. Passing legislation to curtail immigration seems a political non-starter with both parties, and enforcing such legislation even if passed is equally unlikely. Yet as an almost inevitable consequence of the current system, the bulk of the American population—including the vast majority of immigrants and their children—falls deeper and deeper into economic misery, while government finances steadily deteriorate, leading our country to a looming calamity whose outcome appears both dire and quite difficult to predict. Over the last century, the political consequences of a largely impoverished middle class and a bankrupt government—whether in Latin America or in Central Europe—have often been very unfortunate.

By contrast, the sharp constriction in the labor supply resulting from steep reductions in additional immigration would dramatically boost worker wages, especially at the low end, with current immigrants themselves being among the greatest beneficiaries. An increase of a couple of dollars per hour or more could make huge improvements in the difficult existence of the working poor, perhaps allowing them to exit the debt treadmill and stand a better chance of eventually rising into a revitalized middle class. Admittedly, corporate profits might suffer a little and some businesses at the lowest end might disappear; but corporate profits are already doing quite nicely these days, and it makes no sense for developed countries to desperately compete with the impoverished Third World for jobs that are only viable under Third World salaries. Immigration restrictions that raised working-class wages by a couple of dollars an hour would also do wonders for the fiscal health of the Social Security system and government finances in general.

But perhaps the obvious escape from this seemingly inescapable political trap is as simple as merely reversing the direction of cause and effect. Consider the consequences of a very substantial rise in the national minimum wage, perhaps to \$10 or more likely \$12 per hour.

• • •

The automatic rejoinder to proposals for hiking the minimum wage is that “jobs will be lost.” But in today’s America a huge fraction of jobs at or near the minimum wage are held by immigrants, often illegal ones. Eliminating those jobs is a central goal of the plan, a feature not a bug.

Let us explore the likely implications of this simple proposal. The analysis that follows should be regarded as impressionistic and plausible rather than based on any sort of rigorous and detailed research. It is intended to raise possibilities rather than provide answers. Also, let us assume for the moment that these higher wage requirements would be very strictly enforced.

First, the vast majority of workers in America’s surviving manufacturing sector—whether in unionized Seattle or non-union South Carolina—already earn far more than the existing minimum wage, so their employers would hardly be affected, resulting in almost no impact on our international competitiveness. The same would be true for government employees, resulting in negligible cost to the taxpayer.

By contrast, the bulk of the low-wage jobs affected fall into the category of domestic non-tradeable service-sector jobs, which cannot be replaced by overseas workers. Many of these jobs would disappear, but a substantial fraction would remain viable at the higher wage level, with employers either raising prices or trimming profits or more likely a mixture of both. Perhaps consumers would pay 3 percent more for Wal-Mart goods or an extra dime for a McDonald’s hamburger, but most of these jobs would still exist and the price changes would be small compared to ongoing fluctuations due to commodity prices, international exchange rates, or Chinese production costs.

Meanwhile, many millions of low-wage workers would see an immediate 20 percent or 30 percent boost in their take-home pay, producing a large increase in general economic activity, not to mention personal well-being. We must bear in mind that an increase in the hourly minimum wage from the current federal level of \$7.25 to (say) \$12.00 would also have secondary, smaller ripple effects, boosting wages already above that level as well, perhaps even reaching workers earning as much as \$15 per hour.

The likely impact upon immigrant workers, whether legal or illegal, would be quite varied. Those most recently arrived, especially illegal ones with weak language or job skills, would probably lose their jobs, especially since many of these individuals are already forced to work (illegally) for sub-minimum wages. However, workers who have been here for some years and acquired reasonably good language and job skills and who had demonstrated their reliability over time would probably be kept on, even if their employer needed to boost their pay by a dollar or two an hour.

Thus, the force of the policy would fall overwhelmingly on those immigrants who possessed the weakest ties to American society and still retained the strongest links to their country of origin. By contrast, those immigrants—legal or otherwise—who had lived here for some years and therefore had gradually become part of the community would mostly emerge unscathed, probably receiving a very welcome boost to their family income. Some anti-immigration activists might find this prospect extremely distasteful, but half- or two-thirds of a loaf is better than none.

Moreover, although this wage structure would tend to “grandfather” a considerable fraction of existing illegal immigrants, it would constitute a very formidable barrier to future ones. Paying \$12 per hour might be reasonable for a reliable employee who had worked with you for several years, but would be much harder to justify for an impoverished new arrival speaking minimal English and with no track record. To a large extent, the undocumented job window in America would have permanently slammed shut.

In effect, a much higher minimum wage serves to remove the lowest rungs in the employment ladder, thus preventing newly arrived immigrants from gaining their initial foothold in the economy. As a natural consequence, these rungs would also disappear for the bottom-most American workers, such as youths seeking their first jobs or the least skilled in our society. But over the last few decades, these groups have already been largely displaced in the private-sector job market by immigrants, especially illegal ones. Whereas 40 years ago, teenagers and blacks tended to mow lawns and work as janitors, in most parts of the country these days, such jobs are now held by recent arrivals from south of the border. So the net loss of opportunity to Americans would not be large.

Furthermore, recently arrived illegal workers must very quickly find employment if they hope to cover their living expenses and remain here rather than being forced to return home instead. But first-time American job-seekers are already living with their families and anyway have no other home to draw them away, and consequently could spend months seeking an available job. Thus, a higher minimum wage would tend to disproportionately impact new immigrants rather than their American-born competitors.

• • •

The enforcement of these wage provisions would be quite easy compared with the complex web of current government requirements and restrictions. It is possible for business owners to claim they were “fooled” by obviously fraudulent legal documents or that they somehow neglected to run the confusing electronic background checks on their new temporary dishwasher. But it is very difficult for anyone to claim he “forgot” to pay his workers the legally mandated minimum wage. Furthermore, the former situation constitutes something of a “victimless crime” and usually arouses considerable sympathy among immigrant-rights advocates and within ethnic communities; but the latter would universally be seen as the case of a greedy boss who refused to pay his workers the money they were legally due and would attract no sympathy from the media, the police, juries, or anyone else.

Very stiff penalties, including mandatory prison terms, could assure near absolute compliance. Virtually no employer would be foolish enough to attempt to save a few hundred dollars a month in wages paid at the risk of a five-year prison sentence, especially since the workers he was cheating would immediately acquire enormous bargaining leverage over him by threatening to report his behavior to the police.

The proposed change would simply be in the rate of the minimum wage, rather than in the structure of the law, so certain relatively small modifications and exceptions, such as including estimated tips for some restaurant employees, might be maintained, so long as these did not expand as a means of circumventing the statute.

Depending upon the state, the current American minimum wage ranges between \$7.25 and \$8.67 per hour. But is a much higher national minimum wage such as \$12 per hour really unreasonable by historical or international standards? In 2011 dollars, the American hourly minimum wage was over \$10 in 1968, during our peak of postwar prosperity and full employment, and perhaps that relationship was partly causal. Although exchange-rate fluctuations render exact comparisons difficult, the minimum wage in Ontario along our northern border is currently well over \$10 per hour, while in France it now stands at nearly \$13. Even more remarkably, Australia recently raised its minimum wage to over \$16 per hour, and nonetheless has an unemployment rate of just 5 percent. With the collapse of America’s unsustainable housing-bubble economy of the 2000s, our unemployment rates seem no better and in many cases considerably worse than those of affluent Western countries that have refused to pursue our race-to-the-bottom low-wage economic strategy of recent decades.

An important aspect of all these proposals is that they are largely self-enforcing. Workers would be perfectly aware of the simple minimum wage laws, and harsh penalties would deter employers from taking the risk of violating them. The disappearance of low-wage jobs would remove the primary lure for new illegal immigrants, and generous cash relocation packages would lead many existing ones to eagerly turn themselves in and seek deportation. Although the Border Patrol would continue to exist and immigration laws would remain on the books, after a short transition period these would become much less necessary, and a vast existing system of government bureaucracy, business red tape, and taxpayer expense could safely be reduced.

Even principled libertarians, fervently opposed to the very concept of a minimum wage, might find this system preferable to the status quo, which contains an enormously complex web of regulations and employment restrictions; the civil libertarian nightmares of identity cards, national databases, and workplace raids; and an existing minimum wage on top of all these other things.

The Political Balance Sheet

The political response to this package would obviously not be uniformly favorable, but would almost certainly be more so than for any typical immigration-restriction proposal.

Most of the larger corporations, especially those in the industrial sector, would be minimally affected by the wage changes, while benefiting from the (eventually) decreased burden of immigration-related reporting and paperwork requirements.

Many large retail establishments would be forced to pay higher wages, but since these requirements would be uniform, hitting all of them simultaneously, they would be able to raise prices in unison to cover much of the additional expense, a situation very different from one in which well-paid unionized companies are driven to the wall by their lower-paid non-unionized competitors. Furthermore, during the course of this severe recession, giant companies such as Wal-Mart have disclosed disturbing trends of declining sales, and this has widely been ascribed to the growing impoverishment of their lower-middle-class and working-poor customers. A dramatic rise in the wages of low-end groups would reverse this situation and probably boost the fortunes of Wal-Mart and its peers.

Large agricultural interests are heavily reliant upon illegal labor, but while they might be unhappy about raising their workers’ pay by a significant amount, they would find this situation vastly preferable to actual enforcement of today’s immigration laws, which would immediately put them out of business. Anyway, although agricultural labor is difficult and unpleasant, most field workers already earn well above current minimum-wage levels, averaging just over \$10 per hour in 2009, so the required increase would be much less than what one might assume. And unlike the situation decades ago, only a small fraction of today’s illegal immigrants are employed in agriculture.

Many small textile manufacturers and other businesses that survive only by relying upon very low-paid immigrant labor, working in near-sweatshop conditions, would probably be driven out of business. But that is the intent of the proposal.

The reality is that most of the larger, more powerful business interests in America are much less heavily impacted by minimum wage laws than by all sorts of other regulatory and legal issues, not to mention healthcare and pension costs. A simple change in minimum-wage rates would provoke only a small fraction of the organized business opposition generated by many of the other sweeping national proposals of recent decades, notably healthcare reform. Small business interests, influential in Republican circles, would certainly oppose the measure, but they would largely stand alone.

• • •

A greater difficulty on the Republican side of the aisle would involve the entrenched ideological positions of many conservative elected officials and pundits, who over the years have come to vaguely regard minimum wage laws as being “bad,” both economically and even spiritually, having substituted dogma for thinking. As an example, conservative firebrand Rep. Michele Bachmann recently hinted that the solution to America’s current economic problems might involve substantially reducing our existing minimum-wage rates. Presumably, she believes our country would prosper by cutting its wages to Sub-Saharan African levels, then naturally importing millions of Sub-Saharan Africans happy to work at those rates.

But we should also recognize that these days a crucial component of the Republican electorate consists of working-class whites, often strongly religious ones, who tend to live in non-unionized low-wage states or who otherwise generally subsist, sometimes with considerable difficulty, on the lower rungs of the economic ladder. Proposing a large wage increase to a socially conservative evangelical Christian who works at Wal-Mart and currently struggles to pay her bills would be the sort of simple, clear message that might easily cut through an enormous amount of ideological clutter. And even if Rush Limbaugh, who earns tens of millions of dollars each year, denounced this proposal as “big-government liberalism,” for once his views might not find receptive ears. I suspect that a very substantial fraction of Michele Bachmann’s supporters fall into exactly this socioeconomic category.

The minimum wage represents one of those political issues whose vast appeal to ordinary voters is matched by little if any interest among establishment political elites. As an example, in 1996, following years of unsuccessful attempts to attract the support of California politicians, disgruntled union activists led by State Sen. Hilda Solis, now serving as President Obama’s secretary of labor, scraped together the funds to place a huge 35 percent minimum wage increase on the state ballot. Once Republican pollsters began testing the issue, they discovered voter support was so immensely broad and deep that the ballot initiative could not possibly be defeated, and they advised their business clients to avoid any attempt to do so, thus allowing the measure to pass in a landslide against almost no organized opposition. Afterward, the free-market naysayers who had predicted economic disaster were proven entirely wrong, and instead the state economy boomed.

Finally, we should remember that many of the most militant and ideologically fervent grassroots activists within conservative ranks are vehemently anti-immigration, often largely on racial grounds, and sometimes focus on that one issue to the exclusion of most others. For them, the very realistic prospect of dramatically cutting the numbers of America’s huge undocumented population, reducing future illegal immigration to a mere trickle, and even perhaps encouraging a substantial fraction of our legal immigrants to return home would be tremendously attractive, and they might make life very uncomfortable for any Republican politician who opposed this plan without providing a realistic alternative in its place.

The political calculus among Democrats would be much simpler. Any neoliberal Democratic officeholder who balked at a large rise in the minimum wage by citing the economic theories of Milton Friedman or the research reports of Goldman Sachs would be trampled into the dust by his enraged constituents, disappearing forever.

• • •

A little over a century ago, Henry Ford took the bold step of doubling the regular wages of his assembly-line workers to the then remarkable sum of \$5 per day, thereby achieving international fame as well as enormous business success for his own company. According to most accounts, this event was a crucial factor in creating the prosperous middle class that eventually dominated America’s 20th-century history, and Lenin later hailed Ford as one of the world’s greatest revolutionary heroes, urged his followers to closely study Ford’s writings, and argued that so long as America possessed leaders of such wisdom, no Communist revolution would be necessary there.

These days, times have changed. But perhaps a similarly bold step, which similarly raises the income of America’s working class and similarly crosses many ideological lines, would help safeguard and maintain the national prosperity that men like Ford originally created.

Resurrecting the Minimum Wage as a Policy Proposal

Running more than 12,000 words, the article was the longest I had ever published, and certainly the most ambitious, ranging from an extensive and innovative overview of American racial polarization to proposing an enormous rise in the minimum wage as the surprising solution to our immigration problems. Indeed, the latter argument was so unexpected a suggestion that a prominent immigration policy activist told me it was the first new idea he had encountered in two decades of involvement in that topic.

Although I would like to take full credit for noticing the deep connection between these two seemingly unrelated issues, I cannot do so. During the 2006 battles over immigration reform in Congress several years earlier, former Democratic Presidential nominee Michael Dukakis had co-authored an op-ed in the New York Times entitled Raise Wages, Not Walls making that same exact point. But although I had tried to promote his idea in immigration policy circles at the time, no one had expressed any interest.

Fortunately, my lengthy article did not suffer a similar fate, and the responses were quite gratifying from numerous points along the ideological spectrum.

Alexander Cockburn was America’s premier radical journalist and his Counterpunch webzine near at the height of its leftist influence. The previous year he had heavily promoted my analysis debunking high Hispanic crime rates, and he now published a 3,900 word column, extensively quoting and endorsing my proposed solution to our immigration conundrum.

Even more gratifying was the response from the rightward segment of the political spectrum. Prior to becoming president of the Manhattan Institute in 2019, Reihan Salam had served as chief domestic policy analyst at National Review, the conservative flagship publication, and he quickly released a five-part series entitled “Ron Unz on Immigration,” discussing and analyzing my piece, which he heavily excerpted within his 8,500 word discussion. The treatment he provided was highly respectful, even flattering, with the opening paragraphs reading:

Ron Unz has written a very important essay on immigration for The American Conservative…Unz makes a number of convincing points…Because Unz’s article is so consistently thought-provoking, I’m going to write several posts on it…the essay rewards your sustained attention.

For decades, America’s conservative movement had increasingly rejected minimum wage laws as a deviation from free market principles and any conservative policy expert would find it very difficult to buck such a tide. But even more damaging had been the incessant battle over immigration, pitting the supportive Republican financial and political elites against their fiercely anti-immigration right-wing base, an exceptionally bitter conflict that threatened to doom the party’s future. And if these two issues were actually as closely linked as my analysis suggested—with a large hike in the minimum wage being the least painful means of defusing the immigration battle—perhaps Republicans might have to grit their teeth and consider it.

As I had discussed in my article, during the 1990s the harder-core racialist right-wing had been purged from the mainstream conservative movement, but still maintained a vigorous presence on the Internet. These individuals were largely immune to the free market dogma of their mainstream counterparts, and one of their most influential figures, blogger Steve Sailer, strongly endorsed my analysis in a long column and a couple of posts.

Naturally, these thoughtful individuals constituted a distinct minority among conservatives, who had spent decades drenched in criticism of the minimum wage as a “big government program” or even “socialistic.” Indeed, Sailer’s comment-threads were filled with shock and horror at his support for so heretical an idea.

As a perfect example of this ideological tendency, an extreme free market libertarian such as Bryan Caplan was horrified by my suggestion that the minimum wage be raised rather than abolished, and was equally critical of any possible reduction in immigration, although he strongly endorsed my demolition of anti-immigrant myths in what he described as my “bizarrely mixed bag.”

But far more surprising to me was the extremely dismissive and hostile reaction my proposal encountered among the younger generation of influential progressives, individuals probably representative of the mainstream policy wing of the Democratic Party. As far back as 1987, the Editorial Page of the New York Times had famously suggested that the the minimum wage should be set to \$0.00, and for nearly a generation such neoliberal dogma has steadily been absorbed by mainstream Democrats. In such circles, minimum wage issues probably had an old-fashioned, musty odor, identified with the image of 1950s steelworkers carrying lunch-pails. But smart and sophisticated New Democrats considered such notions to be aimed at the ignorant or the backward, and an embarrassment within their modernized party.

I highlighted this surprising discovery in the first follow-up column to my article, which Cockburn extensively quoted with some amusement:

For many years now, conservatives have denounced the so-called “long march through the institutions,” the process by which left-liberals gained control of universities and the media, and thereby the power to set the terms of our national policy debate on a whole host of major issues. Meanwhile, conservatives have been desperately paddling upstream, sometimes winning momentary political victories, but steadily losing ground over the decades. Today’s mainstream conservatives often endorse policies which would have been almost incomprehensible to their liberal counterparts of the 1970s.

But there has also been a simultaneous, though much less remarked “long march” in exactly the opposite direction as well. On many economic issues, today’s prominent “progressives” and “left-liberals” endorse notions that might have appalled the right-wing fringe of the Republican Party during the Eisenhower or even the Nixon Eras.

A perfect illustration may be seen in a brief discussion of my recent TAC immigration cover-story by the political pundits on MSNBC’s new “Up With Chris Hayes” show. After someone suggested raising America’s current minimum wage to a level between that of Canada and France, Ezra Klein of the Washington Post—founder of the famed Journo-List group and one of the most prominent young progressive journalists in DC—emphatically denounced the notion, arguing that it would lead to a massive black market in labor and wreck job prospects for millions of American workers. His criticism for such obvious nonsense was contrasted with his fullsome praise for the economic policies of Republican presidential candidate Gov. Rick Perry of Texas, who had created vast numbers of new jobs over the last decade, failing to mention that a huge fraction of these new jobs were at or below the poverty level.

Now young Mr. Klein majored in political science rather than economics, but it seems likely he took at least a class or two in the later field, and thereby acquired his understanding of economic doctrines, presumably heavily filtered through the lens of the Milton Friedmanites who today dominate most such academic departments. Given that Klein is a staunch progressive, he obviously rejects the overly conservative idea of eliminating the minimum wage entirely, but simultaneously also rejects the radical-extremist suggestion that America’s minimum wage might be restored to its 1968 level in current dollars. Instead, he realizes that our current minimum wage, less than half that in Australia, is highly optimal and even necessary given that American workers are so greatly inferior to their Australian counterparts. The widespread current prosperity of America’s middle class constitutes tangible proof of such theoretical claims…

In recent years, numerous political analysts have pointed out that the Democrat Party has been hemorrhaging the votes of working-class whites. This political development is of great political importance, but remains utterly mysterious to all observers.

Although Klein may have been uncommonly rude in his insulting rejection of a large hike in the minimum wage, his views seemed broadly representative of those in elite Democratic Party circles.

From his perch on the pages of the New York Times, Princeton Economics professor and Nobel Laureate Paul Krugman probably ranked as America’s most influential liberal columnist, and as far back as the late 1990s, he had sharply criticized high minimum wage laws in much the same terms as Klein, arguing that they were job-killers. Beginning with the Clinton Administration, most of the Democratic leadership had fully embraced neoliberal economics, with its severe disdain for traditional nostrums such as wage laws, and shifting the course of this ideological ocean-liner would hardly be an easy undertaking.

 

After the first couple of weeks, the discussion of my long September 2011 article had subsided, and I wondered whether it might ultimately have any long-term influence. Perhaps I’d set a few people thinking, but the decades-old elite policy consensus on the other side seemed unlikely to crack.

But a very welcome development came in January, when prominent economist James K. Galbraith revived the topic by running a short column in Foreign Policy strongly promoting my suggestion under the gratifying title “How to Save the Global Economy: Raise the Minimum Wage. A Lot.” Although a strong progressive, Galbraith was a very mainstream figure, long active in elite Democratic Party circles and he highlighted all of my counter-intuitive arguments about why a seemingly extreme 65% rise in the federal minimum wage would actually make excellent sense as public policy.

Galbraith’s piece provided an opportunity for Salam to revisit that same topic in a National Review column, even speculating that it might become a useful political weapon in the Republican Presidential primary. Front-runner Mitt Romney had endorsed indexing the federal minimum wage to inflation, and had been bitterly attacked for this heresy by his Republican rivals, but Salam wondered whether he might even dare to go much farther:

I find it unimaginable that Romney would support a steep increase in the federal minimum wage. Yet were he to do so, he would devastate his Republican rivals. A significant minimum wage increase is backed by a large bipartisan majority, leaving aside its substantive merits.

Soon afterward, prominent columnists Andrew Sullivan and Paul Craig Roberts took up similar suggestions that Republican candidates might benefit enormously by endorsing my \$12 minimum wage proposal, while CNN/Fortune ran an lengthy article on the surprising possibility of Republican support entitled “A New Day for the Minimum Wage?,” exploring the economic and political implications and respectfully treating my own analysis.

Under pressure from the Republican establishment, Romney soon retreated, but the issue remained alive, at least among journalists. In a series of pieces, Cockburn denounced Romney for his cowardice on the issue but argued that most Democrats, including President Barack Obama, were just as bad. Sen. Tom Harkin was praised as the exception for recently introducing a \$9.80 wage bill in Congress, but the AFL-CIO was condemned for its feeble efforts on the issue. His Nation column was entitled “The Most Vital Issue in American Politics Today,” and described the support for a \$12 minimum wage as “a smart coalition stretching from…Ron Unz to James K. Galbraith.”

Galbraith himself soon renewed his support in a CNN column, a venue that reached a mass audience. And most remarkably of all, Bloomberg Financial News also published an editorial calling for a large hike in the minimum wage.

During all these months, I’d been publishing a series of informal web columns describing these ongoing developments, but without any substantial article on the topic. My very long previous article had launched the debate, but it had primarily been focused upon ethnic relations and immigration, with the discussion of minimum wage issues only introduced after nearly 9,000 words on those other, seemingly unrelated topics. So my analysis was being widely read, but almost always in the form of short, quoted passages in the writings of others. Fortunately, an excellent opportunity came along to remedy this.

Michael Lind had been a co-founder of the centrist New America Foundation, which in the previous dozen years had rocketed to an influential position in the DC political landscape, and he currently directed its Economic Growth Project. He congratulated me for having played such an important role in resurrecting the minimum wage as a policy issue and restoring it to DC discussions, and he suggested that I write a long article on the subject for his organization, which I gladly agreed to do.

Unlike the heavy political analysis of my previous article, this piece was almost entirely focused on the policy side, making the case that a large rise in the minimum wage was the best means of improving the financial well-being of the working poor. I also emphasized the connection with our unsustainable Higher Education Bubble, noting that impoverished teenagers were often forced to take out ruinous student loans, hoping that a meaningless degree would save them from a life of permanent poverty. But a higher minimum wage would accomplish the same result in a much more efficient manner.

Just as I had hoped, my lengthy New America Foundation report attracted some attention in DC policy circles, helping both to legitimate the issue and my own role in it.

But as an unexpected bonus, my paper attracted the enthusiastic interest of progressive icon Ralph Nader, who had already been pushing the issue, and with my support he launched a sustained lobbying effort in DC and among his other contacts.

Nader had been a prominent figure in American public life since I had been a toddler, and although the Democratic Party establishment now reviled him for contributing to Al Gore’s 2000 defeat, he still possessed a lifetime of credibility on the left of the political spectrum.

The media shapes our reality, and this was especially true of the DC political ecosystem, so persuading its inhabitants to seriously consider a previously denigrated idea was a difficult undertaking. Moreover, a large minimum wage hike was viewed as a hopeless project given that Republican House Speaker John Boehner had already declared that he would rather commit suicide than raise the minimum wage.

But Nader began steadily rubbing dry sticks together, hoping that a few sparks might catch and ignite a media flame. My detailed New America Foundation report provided some kindling along with the surprising man-bites-dog sparks that the Republican publisher of the American Conservative was advocating a wage hike much larger than that proposed by any Democrat.

Nader assiduously made these points with various political journalists, and after a month or two he achieved a breakthrough. Washington Post columnist Matt Miller publishing a very favorable piece endorsing a large wage hike that included extensive quotes from myself and others, while blasting President Obama for having done nothing on the issue despite his original campaign promises.

But the column also demonstrated the very difficult road ahead. The Post was a centrist-liberal publication and Miller a centrist-liberal columnist, but his suggestion provoked a huge outpouring of more than 600 comments and these were overwhelmingly negative, with the hostile remarks being almost indistinguishable from what would have greeted a similar suggestion at National Review or FoxNews. Slate financial columnist Matthew Yglesias, a friend and close contemporary of Klein, was also rather doubtful at Miller’s claims. Decades of neoliberal conditioning would not be easy to overcome.

Fortunately, an important break soon occurred and Nader called me in excitement with some tremendous news. For several years, Economics Nobel Laureate Joseph Stiglitz had been focusing on inequality issues, with his widely-discussed Vanity Fair article having made “the One Percent” a topic of public discussion, and he had been exploring different means of improving the plight of the working poor. Apparently, like most modern members of his academic discipline, he had been very skeptical of the benefits of a high minimum wage, but Nader had known him for years and diligently worked to change his mind. According to Nader, Stiglitz finally came around on the issue and decided to share his views with his friend Paul Krugman, who underwent a similar change of heart.

So partly due to Nader’s efforts, two of the most influential progressive economists in America became publicly supportive of a high minimum wage, thereby providing enormous cover for other Democrats and representing a crucial shift in the debate.

Yglesias published another very critical Slate column, even arguing that Krugman and most of those political figures supporting a higher minimum wage were probably doing so in bad faith, simply endorsing a position that had tremendous popular appeal but which they quietly knew was bad for our society. However, the tide was now clearly running in the other direction.

Miller’s Post column had urged President Obama to include a minimum wage hike in his forthcoming State of the Union Address, and he unexpectedly did exactly that after having largely ignored the issue during his previous three years in office. Although Obama’s figure was a rather derisory \$9.00, the topic received a considerable amount of the subsequent news coverage. Perhaps Miller’s very critical column or Nader’s lobbying efforts had helped bring this about.

The White House had now placed the minimum wage issue on the table, soon backed by the public endorsements coming from Krugman, Stiglitz, and the New York Times. So the topic had finally been established as part of the regular DC policy debate, at least on the Democratic side of the aisle. Given Republican control of Congress, nobody expected anything to actually happen, but at least the idea was now considered a legitimate subject of regular discussion and focus after having been almost entirely ignored for many years, and the New York Times began pushing the issue with front-page stories highlighting the wage-stagnation of American workers.

Taking the Minimum Wage to Public Platforms

With the minimum wage now a legitimate topic of debate, the Aspen Institute soon organized a panel discussion, and probably as a consequence of the Miller column, invited me to DC as a participant.

The session went very well, and as I wrote at the time, it provided me an opportunity to strongly emphasize an under-appreciated political paradox.

[A] much higher minimum wage may actually be far easier to enact than the paltry \$9.00 or \$9.50 figure advocated by Obama, Krugman, or the NYT. The reasoning becomes obvious when you lower your gaze from the commanding heights of America’s boardrooms or faculty lounges to the practical realities of our society.

The only direct beneficiaries of a \$9.00 minimum wage will be those currently earning in the range \$7.25 to \$9.00. Such American workers are relatively few in number, and being quite poor, tend to skew overwhelmingly Democratic, when they even vote at all. Meanwhile, the extra dollars being dangled in front of their eyes are hardly enormous, especially when we consider those gains would largely be offset dollar-for-dollar by losses in their EITC payments. A proposal that offers a little extra money to a small fraction of the electorate that already votes Democratic in overwhelming numbers will have a difficult time passing the Republican-controlled House.

By contrast, consider the politics of a minimum wage proposal in the \$12.00 range. According to my estimates, a remarkably large fraction of all American workers would benefit, and when we add in their husbands, wives, parents, and children, the total is probably a landslide majority of the entire voting population. Furthermore, the promised gains are huge—many thousands of extra dollars to each worker in most cases. And at such higher current wage levels, the beneficiaries are almost as likely to be Republicans—especially Southern Republican conservatives—as core Democrats. Rush Limbaugh might denounce the idea all he wants, but would his hundred-million-dollar tongue really carry the day against the offer of an extra \$10,000 per year, cash-money, to a financially-strapped family of social-conservatives living in Georgia?

Although for more than a year I’d been hoping that my minimum wage proposal might be implemented, I hardly regarded this as likely, given the enormously entrenched political and ideological opposition. At best, I hoped that I might continue to win over a few journalists or policy experts here and there, gradually laying the basis for legislation at some point in the future.

Partly as a consequence, I had been devoting only a small fraction of my time and effort to this project. I penned a new column whenever significant developments occurred, but otherwise was working on unrelated matters, and this situation continued until late 2013.

Although most Democrats now publicly supported a wage hike, it was hardly a political priority for their party. Krugman and Stiglitz had endorsed the proposal, but Yglesias was probably correct in claiming that most Democratic policymakers didn’t really believe in the issue but were merely mouthing rhetoric in order to to avoid the attacks of their liberal base. With union backing, Democrats had introduced a bill to raise the federal figure to \$10.10, but it failed miserably, with all the Republicans and some conservative Democrats voting no.

Meanwhile, in sharp contrast with those wage issues, an enormous bipartisan effort was underway to pass immigration reform legislation, including amnesty for many millions of illegals. The proposal was backed by the top leadership of both parties and an ocean of corporate lobbyist funding, with the severely outmatched opposition consisting of a grass-roots coalition of anti-immigration conservatives.

My original entrance into the wage issue had come after seeing the deep but unrecognized connection with immigration. Immigration reform now seemed a political juggernaut in DC with a large array of powerful supporters, while raising the minimum wage still drew little interest or backing. Therefore, I began trying to hitch a ride on that other effort, writing a series of columns in which I presented a variety of arguments suggesting that the two issues should naturally be coupled together in a single package.

The main immigration proposal backed by the business lobby including granting amnesty to illegals while also loosening the restrictions on future legal immigration. This would obviously be very damaging to the economic interests of ordinary American workers, but such harms might be mitigated if combined with a large hike in the minimum wage. Similarly, the most effective means of deterring future waves of illegal immigrants would be to raise the pay of our lower-end jobs by the same methods, thereby making these attractive to citizens and legal residents. An article in Bloomberg Businessweek cited my arguments and I later summarized them in a column I published in leftist Salon, which also got some good responses.

There seemed an ideal opportunity for a strange-bedfellows alliance. The outmatched and desperate opponents of immigration amnesty were seeking any means of deflecting the powerful coalition they faced, and I suggested that they should consider attaching a minimum wage hike as a “killer amendment.” Liberals and union supporters would find it very difficult to vote against a \$12 federal wage, and if it passed, the powerful business coalition backing the amnesty might split. Meanwhile, if the immigration bill nevertheless became law, a \$12 minimum wage might at least mitigate some of the ill effects they dreaded.

I was very pleased to see my arguments gain some traction. VDare, the leading “hard-core” anti-immigration webzine endorsed my proposal under the title “Make Immigration Unprofitable,” as did a longtime progressive in the New Republic. And most remarkably of all, a leading financial writer at National Review—the central ideological pillar of the mainstream American right—gingerly endorsed my argument that a \$12 minimum wage should be included in any immigration package. I pointed out that this article gave an extremely powerful rhetorical weapon to economic progressives, who could now say “Even National Review supports a \$12 minimum wage!”

 

However, stasis is the hallmark of the American political system. The enormous political coalition backing immigration reform failed to overcome its determined opponents, and the legislation died in Congress, along with any hopes I had had of attaching a minimum wage rider. But along the way, I’d succeeded in freeing some additional right-wingers from their mental shackles and having them consider the major benefits of a large wage hike. Although most of Congress and DC soon largely forgot the issue, they did not.

Meanwhile, my extensive writing and other work on the related issues of immigration and wages had attracted considerable attention, and I was invited to participate in a couple of high-profile events on the East Coast during Fall 2013, which were to have fateful consequences.

Some years earlier, a public debate series called Intelligence Squared had been founded in NYC, hosting weekly two-on-two debates on important public issues. These were held before a live studio audience and rebroadcast on television stations across the country, as well as being simulcast on NPR. My debate took place in late October 2013 and I afterward described the interesting circumstances:

Under the regular operating rules, the organizers held before and after votes of the large New York City audience, regarding the winning side as being the team that shifted the margin in their direction. Given my two decades of past writing on immigration issues, I found it quite ironic and amusing that I had been selected for the “anti-immigration” side of the debate, together with Kathleen Newland, co-founder of the eminently pro-immigrant Migration Policy Center. This indicates how yesterday’s fringe ideas have now become the accepted mainstream views of the American elites. The resolution under consideration was certainly as extreme and radical a formulation of the views of economic libertarians as might be imagined: “Let Anyone Take A Job Anywhere.”

Under the literal interpretation of such a proposal, one can easily imagine twenty or thirty million of the world’s desperate poor coming to America within the first few years of enactment, drawn from a global pool numbering in the billions. The resulting social and economic changes would be on a scale unprecedented in human history let alone America’s past, and the potential for an utterly destructive outcome leading to the collapse of our society seems completely obvious.

Nonetheless, at the pre-debate vote the supporters of this proposal outnumbered opponents by a landslide margin of some twenty-five points, 46% to 21%, while one-third of the audience remained undecided. Indeed, during the televised pre-debate discussion between the moderator and the Intelligence Squared chairman, some doubts were expressed that any intelligent person could oppose such a sensible free market policy in labor mobility.

Once the debate began, I focused on the obvious point that the law of supply and demand ensured that a huge increase in the number of willing workers would greatly reduce their economic bargaining power against their employers. Wages for ordinary Americans have been stagnant for forty years and it is probably more than pure coincidence that the last forty years have witnessed one of America’s greatest waves of foreign immigration. Adopt a proposal that immediately increases such immigration levels by a factor of five or ten, and America’s minimum wage would be transformed into its maximum wage, with the natural outcome being economic devastation for most working Americans.

Certainly America’s affluent and highly-educated urban elite—the sort of New Yorkers attending the debate—would benefit in the short run from enacting a policy that drastically cut the share of the national income going to shopkeepers, nannies, construction workers, and probably 90% of all other Americans. But the eventual social reaction to the total impoverishment of the American middle and working classes might lead to the sort of extreme political reaction we sometimes read about in the history books.

Such points might seem totally obvious to me, but many of the audience members had seemingly never encountered them before, and the results were striking. After ninety minutes of hearing both sides of the issue, there was a swing of thirty-two points toward our opposed position, and we won handily. As a point of comparison, at the reception prior to the show we had been told that the largest previous swing at any Intelligence Squared debate had been the shift of eighteen points that occurred during a 2006 debate on the nature of Hamas in the Mid East conflict.

I have little doubt that those many hundreds of earnest New Yorkers who decided to spend their time and money to attend an evening policy debate rather than see a Broadway show or watch Gravity in 3-D, consider themselves well-informed people, who regularly read The New York Times and many of the leading liberal opinion magazines. But such purportedly “liberal” outlets studiously avoid mentioning that a massive influx of foreign workers would be an economic catastrophe for the bulk of the American population. Hence the apparent surprise of so much of the audience at the notion that a huge increase in the supply of workers might produce a sharp decline in the market value of their labor and the income they receive.

Given this ideological landscape, I was very pleasantly surprised when one of my debate opponents, Prof. Vivek Wadha, a high-profile technologist and free market academic, repeatedly endorsed my suggested minimum wage hike as a crucial component of any proposal for allowing much larger numbers of foreign workers to seek work here. He reasonably argued that measures along those lines would be necessary to protect the American middle class against an economic race to the bottom produced by competition with massive numbers of foreign workers. I readily concurred that a much higher minimum wage would go a long way to reducing the ill effects of heavy immigration levels, and at times the moderator had to intervene to steer the discussion back to the stated topic of the debate.

It is greatly encouraging to see a prominent figure of the free market economic right place logic and common sense above ideological dogma, and such indications are beginning to raise my hopes that a minimum wage hike so widely popular and beneficial might actually be enacted, notwithstanding America’s totally gridlocked and dysfunctional political system.

So not only had my immigration arguments swayed an initially skeptical NYC audience, but a huge hike in the minimum wage had proved so attractive an idea that one of my free market opponents had repeatedly raised it as a solution, almost shifting the debate to that other topic. This seemed to fully confirm my political analysis of the previous two years. Under the right circumstances, a big wage hike might prove both excellent public policy and political dynamite.

 

Two weeks later I was in DC as a speaker and panelist at an economic conference on jobs and investment co-sponsored by Economists for Peace & Security and the New America Foundation, with the organizers being James Galbraith and Michael Lind. My presentation was based upon the paper I had produced for the latter’s organization a year earlier.

The event drew a large audience of Washington’s leading economic progressives, many of them having strong establishment ties, and the keynote address was delivered by Jason Furman, Chair of Obama’s Council of Economic Advisors. Yet among the dozen-odd participants, I was the only one discussing the minimum wage, which otherwise barely rated a mention by any of the speakers. This confirmed my impression of how little attention the topic was currently receiving in DC policy circles.

However, once I presented the issue, outlining the tremendous policy and political benefits of a large hike to \$12, the response was extremely positive, both from the other presenters and the audience. It seemed clear that few if any of them had seriously considered the idea in the past, but when properly explained, the advantages became obvious.

After my panel concluded several prominent individuals came up to ask me further questions, and Michael Tomasky, one of my fellow panelists, immediately interviewed me for his Daily Beast column, focusing upon my counter-intuitive argument that a much larger wage hike was more politically viable than a smaller one.

Transforming a Policy Idea into a Political Campaign

My presentation at the DC conference had gone very well, and it brought my economic analysis to the attention of much wider policy circles, but the most important part of my trip had taken place behind the scenes.

For two years I’d become increasingly convinced that my minimum wage proposal was very strong both as public policy and political strategy, but equally convinced that it had almost no chance of being enacted by Congress, and the collapse of immigration reform had ended any hope of piggy-backing it on such other legislation. Ralph Nader had gloomily informed me that as the months went by he was having a harder and harder time getting his phone calls returned, a development that hardly surprised me. Unlike so many other political issues, a higher minimum wage lacked any strong organized constituency in DC, while it faced powerful and determined opposition, opposition that dominated the Republican-controlled House. An outstanding idea seemed likely to fail for want of any narrowly concentrated group of supporters.

Meanwhile, some of my own circumstances had changed. For over six years I had served as publisher of The American Conservative, but I had recently been forced out due to the sort of conflicts endemic in small ideological organizations, as I later recounted.

My role at the magazine had primarily been a financial one and I soon decided to launch a new webzine of my own, an effort that became The Unz Review. But the TAC departure had cleared my decks for other possible projects, and I began to wonder if there were some way I could break the DC political logjam and move my minimum wage proposal forward. Archimedes once famously declared that using leverage he could move the world if he had a place to stand, and one morning in late October I had suddenly glimpsed a possible political vantage point. In early December I published a long column summarizing the important developments that had soon followed my return from the DC conference:

As most readers have no doubt already heard, early last week I filed the text of an initiative that would raise California’s minimum wage to \$12.00 per hour, a figure far higher than that of any state or city in America. The heavy resulting coverage in The New York Times and numerous other major media outlets demonstrates the timeliness and public resonance of the issue, which taken to a national level should boost the incomes of America’s lower-wage workers by well over \$150 billion each year, a very sizeable amount.

The idea was hardly a new one to me, given that I’d first proposed it in a 12,000 word cover story published during late summer 2011 and subsequently advocated it in a long series of articles and columns, notably including a major 2012 paper published by The New America Foundation. In February of this year, I’d spoken about the idea at an Aspen Institute panel in DC, and more recently it had repeatedly come up during a televised late October Intelligence Squared debate in NYC while I’d made a presentation advocating a \$12 minimum wage two weeks afterward at a DC economics conference organized by Economists for Peace and Security.

But who’d paid attention to all my writings and speeches over the last couple of years? Almost nobody.

Well, that’s not entirely correct. Quite a number of prominent policy experts, opinion journalists, and political activists had been intrigued by my unorthodox arguments, leading to those aforementioned speaking engagements. Economist James Galbraith and the late Alex Cockburn had extensively discussed my lengthy original article, as had blogger Steve Sailer, and National Review’s Reihan Salam actually published a five-part series analyzing my views. A few months ago, progressive activist T.A. Frank writing in the New Republic had explicitly endorsed the immigration aspects of my proposed \$12 per hour minimum wage hike, and—much more remarkably—so had Andrew Stuttaford of National Review. Two weeks ago a Michael Tomasky column in The Daily Beast had explored my counter-intuitive argument that a larger minimum wage hike would actually have much greater political viability than the \$9.00 figure advocated by President Obama.

However, all these discussions were restricted to the tiny gilded ghetto of opinion journalism and policy presentations, never reaching the news headlines providing most normal Americans with their knowledge of the world between their devouring focus on the latest antics of the Kardashians and Miley Cyrus. Frankly, I doubt if more than one American in ten thousand had ever encountered my proposal of a \$12 minimum wage.

Then, just over a week ago I printed out a one-page sheet of paper with a single operative sentence and took a pleasant Amtrak train ride to the Sacramento office of the California Attorney General, dropping it off there together with my \$200 filing fee. And in the twenty-four hours surrounding that insignificant event, the political landscape of America suddenly changed, or at least the media reporting of it did.

Given the potential national importance of the issue and the man-bites-dog aspect of my conservative sponsorship of what was purportedly a liberal cause, I had hoped that The New York Times, our national newspaper of record, might be willing to cover the launch of my campaign. But I’d never dreamed my filing of the measure would receive the coverage that it did, with the NYT sending around a photographer and giving the story fully half the square inches on its National News page. Late Monday evening, my shocked friends began emailing me about what they’d suddenly noticed on the NYT homepage and one of them sent me the astonishing screenshot he’d taken. Coverage from numerous print, radio, and cable news outlets followed on Tuesday, notably including a sizable ABC News story and a long interview on the NPR-affiliated California Report. All this had been produced by a one-page piece of paper with a single operative sentence plus a \$200 filing fee.

Policy proposals in our country are endless in number and tremendously variable in quality. Elected officials and activists give speeches every day of the week promising this and that and the Moon and almost never delivering anything at all. This continual buzz of broken and impossible promises constitutes the background noise of the American political system and is therefore routinely ignored by almost everyone, certainly including the media. But when someone proposes a \$15 billion annual hike in the incomes of the lower-wage workers in America’s largest state and people realize—Gee, it might actually happen!— that’s another situation entirely. One sentence, one piece of paper, and a \$200 filing fee has generated at least a hundred times the total attention that I had previously received for the 30,000 words I’d published on this same subject over the last couple of years.

 

Strangely enough, I only very recently considered this obvious idea. I had spent the last decade almost totally out of the political arena, mostly involved in software projects, but prior to that I’d organized and run a long series of very high profile initiative campaigns, both in California and around the country, most of which won in huge landslides. Indeed, in 1999 my initiative success led the New Republic to put me on their cover with the headline “This Man Controls California,” a prideful high point that was naturally enough soon followed by the overwhelming defeat of Prop. 25, my Campaign Finance Reform initiative.

During those years I had quickly discovered that one of the most valuable aspects of a major initiative campaign was its role as a focal point for massive public discussion of a crucial issue. For example, my “English” campaigns of the late 1990s/early 2000s generated over 100 articles in The New York Times and over 500 front-page stories in other newspapers, probably producing many times more media scrutiny of the contentious bilingual education issue than had occurred across all of America during the previous thirty years combined.

And yet for the last couple of years I had never considered any of this. My focus had been entirely on the sound policy reasons for raising the federal minimum wage to \$12, but I had freely admitted to my friends that the likelihood of anything ever actually happening in our dysfunctional and log-jammed political system was roughly nil. I crafted all sorts of effective arguments, suggested innovative ideological strategies, and gathered important demographic research data. I published all this material in a long series of pieces, which perhaps a few dozen people here and there read and appreciated, and naturally nothing came of it. Never once during this period did I consider doing an initiative on the subject.

The ironies represented by these years of total blindness almost stagger the imagination. In my original 2011 article I had explicitly cited the example of Hilda Solis’s 1996 California minimum wage initiative—which won in a huge landslide—as proof of just how popular such an issue would be politically. Late last year, I similarly told all my East Coast friends about the amazing success of that handful of San Jose State college students who qualified and passed a \$10 minimum wage hike in one of America’s largest cities against the opposition of nearly the entire local political establishment. My writings regularly mentioned successful initiatives to raise the minimum wage and I continued to pride myself as having spent years as America’s “initiative guy” but my faltering brain cells never once connected these two items. None of us are ever as smart or as insightful as we sometimes pretend to be.

 

Fortunately, a brief opening eventually appeared in the heavy layers of fog beclouding my mind, and one morning I glanced up from my coffee and newspapers and thought “Wow!” Even more fortunately, the idea came to me while there was still reasonable time to qualify an initiative for the November 2014 ballot, which I am now doing.

One standard roadblock in the preparation of a successful initiative is the lengthy legal drafting process, usually involving many weeks of careful scrutiny to ensure that the measure’s complex language possesses both the political and legal viabilities necessary for survival. This was certainly the case with the many dozens of detailed paragraphs contained in my 1998 “English” initiative. But raising the California minimum wage requires merely a single sentence, an amendment of the existing statute with higher figures substituted. An initiative of such a highly unusual type allows the operation of a total stealth campaign organized to avoid all media leaks, the sort of campaign that provides considerable advantages if successfully implemented.

So far, I’ve certainly been extremely pleased with the results, though much of this is clearly due to the general media landscape of the last couple of months, in which the plight of America’s low-wage workers has grown to become a regular headline story, intensifying as the Holiday Season grew near. Stories of Walmart workers being asked to donate food to other Walmart workers went viral even while I was sitting at my computer finalizing my initiative language and the political strategy behind it. Sometimes the wind happens to blow in exactly the right direction.

And how it has blown! According to Topsy, the NYT article breaking the story of my initiative effort generated a remarkable 707 Tweets, ranking in the Top 100 on the Internet. Then a couple of days later, a lengthy and related NYT story on the general plight of low-wage retail workers, which was clearly based on weeks of detailed reporting effort but also mentioned my own California campaign, scored an astonishing 1400 Tweets.

Unsurprisingly, the coverage my effort has received from the liberal media has mostly been very friendly and supportive, though sometimes expressing shock at the notion that a conservative could be backing such a supposedly liberal proposal: “Hell Freezes Over” was the title of a lengthy column in the progressive San Diego Free Press. Columnists Michael Hiltzik of the Los Angeles Times and Jerry Large of the Seattle Times and Prof. Jeffrey Sommers in The Milwaukee Journal-Sentinel have similarly been very pleasantly surprised to see their own views echoed by someone located across the ideological aisle, and numerous other liberal bloggers and pundits have had the same reaction. A certain Michael Pettengill writing on Prof. Mark Thoma’s blogsite was even more direct, wondering why progressives such as “Krugman and Thoma” never framed the economic issue as effectively as I had.

Indeed, a not-uncommon refrain from some disgruntled Democratic activists was been the perspective of Jon Walker writing on the liberal blogsite FireDogLake, who bemoaned the irony of a “lone conservative…pushing the Democratic establishment…to the left on this issue.” This angry reaction was surely reinforced by the initial public statements of a union spokesman in the original Times piece and elsewhere, who argued that the recently passed legislative statute raising the California minimum wage to \$10 per hour by 2016 was more than adequate and criticized my own efforts aimed at a much larger figure as an unwelcome “distraction.” In fact, recent academic studies have suggested that California’s cost-of-living is as much as 30% above the national average, implying that even a \$10 rate here is closer to our existing federal \$7.25 figure, leaving our state with the highest poverty rate in America, and clearly demonstrating the total inadequacy of the California’s \$8.00 current minimum wage.

Obviously, not everyone has supported my proposal. Reihan Salam, National Review’s chief policy analyst, quickly published a lengthy profile of my effort, quite respectful but also skeptical that all of my arguments were correct. Doctrinaire libertarian economics professor Bryan Caplan—my erstwhile opponent in the recent televised debate—strongly opposes all minimum wage laws and argued that raising the costs of low-wage service workers to \$12 per hour would lead to a do-it-yourself economy, defeating the intended purpose; I tend to doubt that the resulting one percent rise in Walmart’s prices would actually produce such a massive consumer reaction. And Caplan’s close colleague New York Times Economics Columnist Tyler Cowen dismissed such local efforts to raise the minimum wage as “a classic instance of expressive voting at the expense of good economic policy,” leading one of his sharp-eyed commenters to very effectively quote my own past arguments back at him.

But dogmatic conservative or libertarian policy experts—eggheads—are one thing, and the sort of people who actually guide and influence the conservative base are another. So far I’ve been interviewed on three of the West Coast’s largest conservative-talk-radio stations and the responses have been extremely gratifying, with the hosts initially surprised that there could be any “conservative” case whatsoever for a major hike in the minimum wage, but quickly seeing the reasonableness of some of my arguments. As I’ve repeatedly pointed out in the past, our current low-wage economy allows companies to pay their own workers much less than a minimum cost of living, with the large gap being necessarily filled by government social welfare programs. I think it makes much more sense for businesses to pay their own workers rather than shifting the burden to the ordinary taxpayer, though obviously business lobbyists and business-funded thinktankers might disagree.

Another of my arguments about political strategy will also receive a thorough exploration. Over the last couple of years, I’ve often suggested that a much larger hike in the minimum wage has far greater inherent political viability than a smaller boost because its benefits extend far beyond the lowest-wage, overwhelmingly Democratic voters, instead reaching well into the socially-conservative Walmart base of the Republican Party, especially in the South, an argument that columnist Michael Tomasky recently considered. The situation on the ground in California may not be nearly so strong, but should still provide a preliminary test of my hypothesis.

In any event, I do believe that my \$200 filing fee for my California minimum wage initiative was money well spent, sparking exactly the sort of national media discussion—a public dialogue on American wage policy—that I’d intended, and one that will probably continue on, with ever increasing intensity, until the November polls close on Election Day 2014.

A national rise in the minimum wage to \$12 per hour would increase the income of American workers by well over \$150 billion each year and—with the exception of the problem-plagued ObamaCare—possibly constitute the most significant domestic policy change since the late 1960s. In 2012, my late friend progressive journalist Alex Cockburn described it as “the most important issue in America today.” During the two-plus years I’ve been pressing this proposal, I always told people it would never happen in a million years. Now I’m not so sure.

This summary account from December 2013 accurately described the background and launch of my California Higher Wages initiative campaign, but for obvious reasons at the time I had avoided emphasizing the extraordinary audacity of my undertaking.

Lacking any organization, collaborators, or backing I had decided to launch a sudden campaign to raise the California minimum wage to \$12, by far the highest in America, and thus shift \$15 billion each year into the pockets of California’s lower wage workers, thereby transforming the world’s eighth largest economy. My only tools for achieving this feat would be a one-page sheet of paper containing a single operative sentence and a \$200 filing fee.

Although I’d originally gotten the idea a few weeks earlier, I hadn’t mentioned it to a soul prior to my trip to DC for the conference, and once I arrived I arranged to meet Galbraith at his hotel and took him into my confidence. After he agreed that the political prospects seemed hopeless for the wage hike we had spent the previous two years promoting, I told him I held a single sheet of paper that would suddenly change everything, and once I explained my plan, he was captivated by its boldness.

Later that same evening, I met for dinner with Ralph Nader and his chief aide with similar results. Both of them had become quite pessimistic about the chances of any success in DC, but they immediately saw the potential impact of a successful campaign in California.

After the close of the conference, a mutual friend arranged a private meeting for me with a senior AFL-CIO leader, and I spent an hour or two at a local Starbucks outlining my California plans. Although the unions had certainly supported a wage hike, their efforts had been stymied in Congress, and anyway the figure they had backed was far below my \$12 proposal.

The crucial point I emphasized to him was my paradoxical argument that a much higher figure had enormous political advantages. Not only was it much more likely to capture the imagination of the media and the public, but it naturally included far more beneficiaries and offered them an increase thousands of dollars larger. He immediately grasped the logic of my analysis, and whether or not he believed I was correct, I had clearly planted a seed in his mind. Two weeks later, I saw him quoted in a top national newspaper as the key supporter of a large wage hike.

After my return to the West Coast, I began formulating my plans and charting a return to California politics after an absence of more than a decade, working by myself and with merely just a few days of preparation. Once or twice the stupendous difficulty of my undertaking came home to me, and I had the mental image of a lone seafarer in a simple Viking longboat seeking to navigate the stormy Atlantic Ocean and reach the New World on the other side. Perhaps my project was an impossibly hopeless one, but I gritted my teeth and decided to proceed forward.

Using a California Campaign to Reshape the National Debate

Over the years I had gradually come to recognize that our media creates reality. Based upon this insight, an initiative campaign might have a national political impact far beyond the narrow issue being decided, and I had demonstrated this during my successful “English” campaigns a dozen years earlier.

On paper, the success or failure of a ballot measure was entirely determined by whether it eventually received more than 50% of votes cast, but this was extremely naive. Victorious initiatives might be set aside by the courts or have their provisions ignored by government officials and therefore achieve little if anything. So sometimes the campaign itself was far more important than the ultimate vote, given that it lasted for months and might potentially serve as a powerful lens to focus and shape media coverage upon a crucial issue, thereby having an enormous impact regardless of the results on Election Day. Under the right circumstances, the national attention surrounding a \$12 minimum wage initiative in America’s largest state might give me exactly the fulcrum I required to shift American politics on that issue.

I had been completely absent from the political arena for more than a decade, but prior to that I had run a number of major initiative campaigns, functioning as my own consultant in that highly-specialized field. So I knew what had to be done.

Getting and shaping the initial media coverage was an absolutely crucial first step, and information was the currency used in that effort. Back then, social media had not yet come onto its own, and the traditional mainstream media was still all-powerful, organized into a hierarchical structure with the New York Times at the very top. The Times set the national agenda for what was newsworthy, and lesser outlets usually followed its lead.

My previous political successes were some years in the past, but they had left me a considerable amount of residual political capital and credibility, and I eagerly invested all of it in my new project, contacting a reporter I had known at the Times and offering her an exclusive on the potentially important story that was about to unfold.

Fortunately, she and her editors took my project even more seriously than I had hoped, and the launch of my campaign filled half the space on their national news page the same day that I took the train to Sacramento to file the measure and pay my \$200 fee. The results were immediate, and even while still in transit I was interviewed for a sizable ABC News story and by an NPR-affiliated program. The Times story itself was soon Tweeted out more than 700 times, ranking in the top 100 on the Internet, while my efforts were mentioned in a related story in the same paper a couple of days later, a lengthy article that was Tweeted out more than 1,400 times.

The following week the Times organized a symposium on proposals for improving the living standards of low-wage workers, and my name led the roster of their ten contributors. This gave me a powerful platform to place my arguments before a large national audience for the first time, and the responses were overwhelmingly positive and gratifying.

Prior to this point, the notion of hiking the federal minimum wage by 65% to \$12 would have seemed an outlandish absurdity to almost any responsible American policymakers, but now it was suddenly being taken very seriously by our national newspaper of record. Moreover, the surprised readers discovered that the arguments backing that seemingly outrageous proposal were actually quite cogent rather than wild-eyed and rhetorical, and this began reshaping the framework of reality assumed by our journalists and policy elite alike.

A couple of days later, Norm Ornstein, a centrist and very respectable policy expert based at the conservative AEI thinktank, published a long Atlantic piece favorably highlighting my effort under the emphatic title “The Moral and Economic Imperative to Raise the Minimum Wage.”

And in the first of many such media appearances, I was invited onto a regional public affairs show to present my surprising arguments for a very high minimum wage:

  • Living Wage Battle
    Thuy Vu, Ken Jacobs, Ron Unz
    KQED Newsroom • December 11, 2013

For two years, I had been writing articles and columns on this issue, but I was now suddenly reaching a national audience a hundred-fold larger with my arguments.

 

Most political campaigns are run by professional operatives scornful of policy issues; they rely upon focus-group tested slogans and talking-points, and their arguments lack any depth if challenged by serious journalists. But I had spent the previous two years honing my analysis in tremendous detail, and I could immediately send my articles and other background information via email or fedex to any reporter who contacted me, while easily answering any questions that arose. This helped to explain the exceptionally favorable media coverage we immediately received.

Take, for example, the Economist, which caters to an elite global audience. When its California correspondent contacted me, I spent an hour discussing the issues with him on the phone, then provided him the lengthy policy articles that I had previously published. The next issue included extensive coverage of the severe economic plight of America’s low-wage workers and focused on a higher minimum wage as the possible solution, including a news story quite sympathetic to the idea and a long editorial explicitly endorsing a large wage hike. The newsweekly probably ranked as the world’s most influential free market oriented print publication, and the sharp reversal of its former skepticism regarding the minimum wage must certainly have turned some heads.

Similarly, the California-based Reason Foundation soon released a poll showing enormous support for a minimum wage hike, a finding rendered especially credible coming from a libertarian organization whose ideological principles were exactly contrary to such a proposal.

The previous month my DC friends working on the wage issue had lamented that the Democrats had completely lost any interest in the project and were no longer willing to even return phone calls, and I had been the only participant to focus on that issue when I spoke at the progressive economics conference in mid-November. But the launch of my California campaign had now generated four or five weeks of very favorable coverage of the issue in the elite media, and this completely transformed the political dynamics. Near the end of December a front-page story in the Times revealed that the Democratic Party had decided to make a large minimum wage hike its top national political issue during the 2014 election year.

The Los Angeles Times then still ranked as my state’s dominant newspaper, and I quickly placed a piece there, setting out arguments with a particular local focus. Californians had always prided themselves as living in a wealthy state, polar-opposite to the impoverished Deep South that they viewed with extreme disdain. But I revealed that after taking into account the cost of living, our state actually had the highest poverty rate in America, and only passage of my initiative could lift us above Mississippi and Alabama, a situation that surely must have shocked and horrified most readers. My column was widely Tweeted out in Democratic Party circles and the interim Mayor of San Diego quoted my writings in his own piece endorsing a minimum wage hike, a topic that was fast becoming a central political issue.

 

With the suffering of low-wage workers now a ubiquitous national story and a minimum wage hike gaining momentum as the possible solution, mainstream conservatives tried to deflect the proposal. But surprisingly enough, they generally suggested an increase in welfare payments as the proposed alternative, and I was scathing in my response, emphasizing the extreme irony of that position:

Sometimes this position was explicit, as when economist Martin Feldstein took to the pages of The Wall Street Journal to argue that American wages and welfare should be merged into a single, seamless system able to provide a decent living for everyone in our country. More often, conservative critics of raising the minimum wage have been far less candid, touting the benefits of the EITC, without admitting that it constitutes America’s largest cash-welfare system in thin disguise, whereby the government renders working-poor households somewhat less poor by sending them annual checks based on a complex formula.

The notion of individuals and businesses carrying their own weight seems just as alien to the sort of present-day Republicans whose perspectives are welcome within the confines of the elite media. For example, a long New York Times column by Prof. Gregory Mankiw, a former top economic advisor to President George W. Bush, suggested that it was unfair and morally wrong to expect businesses to cover the costs of their own employees since the responsibility was obviously that of our society as a whole. Whereas Hillary Clinton famously declared that “It Takes a Village to Raise a Child,” the sort of thinkers who will probably be advising her Republican opponent in 2016 are suggesting that “It Takes an Entire Country to Run a Business” (or at least to pay the business’s employees). Back when I was younger, I think this notion was called “Communism,” but these days it’s considered Mainstream Republicanism.

Under Ronald Reagan, the Republican Party praised the benefits of working for wages and denounced collecting welfare checks, but his lobbyist-ridden epigones have completely reversed that popular message, then wondered why their popularity has sharply declined.

Meanwhile, harder-core right-wingers had begun flocking to my proposal.

Still, there yet remain a few hardcore Reaganites around, who have not yet received the memo that what’s good for low-wage business lobbyists is good for America, and one of them is longtime conservative icon Phyllis Schlafly, who at age 89 is just a bit too old to be persuaded that advocating higher welfare payments is what all good conservatives should be doing. In a forceful column entitled “Minimum Wage and Welfare: The Tradeoff,” the redoubtable Mrs.—never Ms.—Schlafly points out that a big hike in the minimum wage would automatically produce large cuts in existing social welfare programs and hence save ordinary taxpayers huge sums of money. Making work pay while cutting welfare and taxes seems like a pretty effective campaign theme to me, and perhaps Schlafly should consider entering the presidential primaries, naturally on the Democratic side.

Almost from the moment in 2011 that I first outlined the widespread benefits of a \$12 minimum wage, the proposal was taken up and treated in very respectful, even favorable, fashion by many of the writers grouped around VDare.com, the hardcore anti-immigrationist website, with Steve Sailer writing several columns discussing the idea, and John Derbyshire, James Fulford, and Peter Brimelow also weighing in. But many years of FoxNews attacks on the minimum wage had taken a toll with rank-and-file rightwingers, and the hundreds of anonymous commentators on the resulting discussion threads were overwhelmingly hostile to this notion of a minimum wage hike. Radical changes in worldview require a little time to simmer.

Two years provides plenty of such simmering time and when the media coverage of my \$12 per hour California minimum wage initiative moved the topic back to the forefront of the rightwing blogosphere a few weeks ago, the discussion was transformed. Once again, Steve Sailer ran a long blog post on the topic, reprinting my New York Times column, and a follow-up but this time the reaction of his commenters seemed overwhelmingly favorable rather than hostile.

Rightwing libertarian Randall Parker ran a piece on the crucial importance of a big hike in the minimum wage, saying that although he’d much prefer a \$15 figure, \$12 was still an important step in the right direction. Anthropologist Peter Frost devoted several paragraphs of his year-end science round-up to the minimum wage issue, strongly endorsing a higher figure and accusing conservative opponents of being shills for big business. HalfSigma, now rechristened “Lion of the Blogosphere,” published a couple of posts as well, taking a similar position, as did Audacious Epigone.

Posts by rightwing bloggers generate long threads of angry rightwing commentary, and in all these cases a strong majority of that commentary endorsed the big minimum wage hike, with the discordant voices sometimes being ridiculed as gullible idiots or told to “go back to RedState.com.” One of the highly insulting terms that hardcore rightwingers apply to mainstream conservatives is “Fox-tards” and these days opposing a \$12 minimum wage may get you branded with that sort of epithet.

The realization that a large hike in the minimum wage would automatically reduce social welfare spending was a powerful notion that deeply resonated with committed conservatives; and when properly understood, the obvious impact upon immigration was even more appealing to the numerous right-wingers who had come to feel totally abandoned by their Republican Party leadership on that issue. During the first half of January—less than seven weeks after I had filed a one-page sheet of paper with the California Attorney General—all these factors came together and my campaign finally achieved a critical mass of conservative political support, a development recognized by the mainstream media. As I wrote at the time:

Last week, the front-page headlines on the SF Chronicle described the surprising shift of conservative sentiment toward the pro-minimum wage direction, citing my own views and those of Phyllis Schlafly. No sooner had the story run than Bill O’Reilly—one of the biggest conservative voices in America—gave his blessing to the proposed Democratic minimum wage hike, making that statement on his own top-rated FoxNews television show.

Although the O’Reilly Declaration was considered absolutely stunning in mainstream media circles, I strongly suspect that its origins lay in an article that ran a few days earlier in the Daily Caller, one of the most widely read and influential mainstream conservative publications in America. Prominent media figures such as O’Reilly tend to rely upon their research staffs to help formulate and guide their policy positions, and the Caller is high up on the reading lists of those latter individuals. When Neil Munro, the Caller’s White House Correspondent, penned a piece provocatively entitled “\$12 an Hour is Conservative Rocket Fuel, Says Ron Unz,” they surely took notice. Indeed, the article constituted a 2,500 word nuclear strike against the entrenched Republican Establishment on that issue, and O’Reilly may merely be the first of many prominent conservatives swayed by that powerful piece of expository journalism, aimed with pitch-perfect effectiveness at its strongly conservative audience.

With President Obama and the Democratic Party having declared their plans to make raising the minimum wage one of their central political themes for the 2014 campaign, liberal media outlets hardly need to convince their troops to support the cause, though rounding up 75 prominent economists, including seven Nobel Laureates, helps give it an academic stamp-of-approval. But in such liberal and mainstream media circles, there exists quite a bit of curiosity regarding my own \$12 per hour campaign in California, given that my figure is comfortably higher than that proposed by either state or national Democrats. Slate, oldest of all Internet webzines and these days owned by the Washington Post, filled that void with a very thoughtful discussion of the 2011 origins of my minimum wage effort. Slate and the Caller together bracket much of the ideological spectrum in the world of Washington politics, and to the extent that they both seem strongly sympathetic to a big minimum wage hike, the likelihood of it actually happening, even on the federal level, is greatly increased.

Unifying Democrats and Splitting Republicans

This situation represented the fulfillment of the political strategy I had envisioned.

On the Democratic side, the progressive base and its union allies strongly supported a wage hike but that goal had been ignored or treated dismissively by the party’s disdainful neoliberal elites. However, once I managed to establish the issue in the political arena and convinced some A-list conservatives such as Schlafly and O’Reilly, the political dynamics completely changed. Angry progressives could now use these conservative supporters—and my own astonishing \$12 proposal—as a club to beat their party leaders into submission by proclaiming “Even Phyllis Schlafly and Bill O’Reilly support a wage hike!” So by gaining the support of a group of high-profile conservatives, I had helped to completely unify Democrats behind the same issue.

Republican opposition still remained very strong, with decades of Milton Friedmanite economics not so easily dislodged by just a few weeks of contrary arguments. But I had gradually won over the more thoughtful and open-minded conservatives by the logic of my case, and I expected that more of them would eventually follow the Economist, the Daily Caller, and other opinion-leaders in getting on board what might become an unstoppable freight-train, heavily prodded by the anti-immigration activists in their base. More than two years earlier, my original article had suggested exactly this political scenario, and remarkably enough, it seemed to be unfolding in real life.

Meanwhile, my media strategy continued to make excellent progress during late January and early February, including a NPR debate on Boston radio with Prof. Tyler Cowen, a prominent free market economist and New York Times columnist, which I felt went very well. My purportedly conservative opponents continued to face severe difficulties in explaining why they supported massive welfare subsidies rather than simply requiring private businesses to stand on their own two feet.

Some of my opponents also severely damaged their own credibility through their total ignorance of my background. For example, a Cato policy analyst launched a blistering attack against me as an anti-immigrant fanatic in the San Jose Mercury News, and that provided me a perfect opportunity to respond with an op-ed of my own. I emphasized the enormous benefits of a \$12 minimum wage for California’s heavily-immigrant working-poor, while noting that during the Prop. 187 campaign I had been a top-featured speaker at the largest pro-immigrant rally in American history.

One of California’s most influential conservative organizations was the venerable Howard Jarvis Taxpayers Assocation, and in past years I’d become a little friendly with Joel Fox, its longtime president. Fox had eventually left to become an independent political consultant, and he had subsequently led some of the state’s highest-profile anti-tax campaigns, efforts heavily funded by business groups, while he also published the popular Fox & Hounds political webzine.

As might be expected, his publication had already run several pieces by conservatives sharply critical of my minimum wage proposal, but he now solicited a column from me telling the other side of the story. I felt my piece made a very strong case, leavened by a touch of humor:

For years I’ve joked with my friends that the conservative case for raising the minimum wage is so overwhelmingly strong that I’m worried liberals might eventually change their minds on the issue and begin advocating a cut in the minimum wage.

I made very similar points about the extremely strong conservative case for raising the minimum wage during numerous national radio interviews, including on Seattle’s KUOW and Boston’s WBUR, with the latter show broadcast on NPR.

California was an overwhelmingly Democratic state and Democrats uniformly favored a wage hike, so the measure could easily pass even without significant conservative or Republican support. But persuading those latter elements that a large wage hike was actually in their ideological and political interests would help to neutralize any strong opposition, while also minimizing defections of weak-kneed or moderate, pro-business Democrats. Moreover, the stance taken by California Republicans might heavily color the sentiments of their DC counterparts who controlled Congress, and that would considerably influence the likelihood of similar federal legislation.

A week after my Fox & Hounds piece ran, I published a column in Forbes focused on the unexpected benefits that a large minimum wage hike would provide to Wal-Mart, America’s largest business corporation and the frequently vilified symbol of our low-wage economy. The piece attracted over 20,000 pageviews, 1200 Likes, and 170 Tweets, very solid metrics, and I was later informed that it was brought to the personal attention of at least one Wal-Mart Board member:

E.J. Dionne of the Washington Post devoted his nationally-syndicated column to the issue of the minimum wage and my own initiative effort, while I later took a brief trip to DC to attend an announcement ceremony on the topic at the White House, appearing on Chris Hayes’ MSNBC Show while I was in town.

During that television appearance, I shared a green room with Secretary of Labor Tom Perez. Although he obviously had no idea who I was, I noticed that the talking-points he used on the show seemed to have been almost entirely cribbed from my own New York Times column and other writings, presumably filtered through several intermediate layers of staffers and speechwriters.

This related to a much broader point that had quickly become apparent to me when I’d launched my campaign a couple of months earlier.

Both DC and California contained research groups that had spent years supporting a higher minimum wage, such as the Economic Policy Institute and the Berkeley Labor Center. I’d soon met and become friendly with some of their staffers, drawing upon their past research reports that provided such useful information as the cost impact upon a particular business sector or enterprise. But I’d quickly noticed that although they certainly produced important, solid findings, they seemed to lack the ability to effectively package or market the material for the political arena. Meanwhile, their business-backed opponents generally seemed less focused upon producing objective research than effective propaganda, and therefore often got the better of the exchanges.

Since I’d spent years functioning as my own political consultant in high-profile campaigns, my experience allowed me to provide the necessary marketing or rhetorical flair, thereby placing those same business opponents in a much more difficult situation.

Consider a very obvious example, which I explained at the beginning of a column entitled “Should We Cut the Minimum Wage”?

The current debate raging over the role of the minimum wage is usually presented as being fought between two choices. On the one side are those who advocate a large wage hike and on the other are those who oppose any change. But in reality, there is a third alternative, namely cutting the minimum wage, and that is the more principled counterpart to the proposal for raising it.

The reasoning is simple. Given all the very serious problems of poverty and unemployment in our society, with the existing minimum wage playing a significant role, no one with a straight face can assert that our current system is ideal, the best of all possible worlds. So if everyone who places principles over political expediency admits that the existing minimum wage is part of the problem and set at a damaging level, the obvious question is whether it should be raised or lowered.

Certainly this is recognized by the leading ideological opponents of a minimum wage hike, who hail from the libertarian camp and have always questioned the existence of a minimum wage on both moral and practical grounds. Several months ago I debated George Mason economics professor Bryan Caplan, a leading figure in that camp, and he explicitly called for the abolition of the minimum wage. His views are totally representative of the hard-core libertarian movement that so dominates the economic thinking of conservative Republicans.

Indeed, every single argument advanced against raising the minimum wage is an equally strong one for cutting it. If a higher minimum wage would eliminate jobs for teenagers and “minorities,” then surely a lower minimum wage would boost such employment. If raising the minimum wage would cause employers to use technology to replace their McDonalds servers, lowering the figure would certainly lead to the replacement of automation with low-skilled human labor. It cannot be denied that the very low cash wages of Victorian Era servants produced an enormous plenitude of such positions, and this is still the case today in much of the Third World, with even many lower middle class families regarding the presence of multiple domestics as a natural perquisite of their status. After all, if wages are cut in half, any business or individual employing low-paid workers can immediately fund two job openings for every previous one.

But any public proposal to cut or eliminate the minimum wage constituted political poison, and by forcing my opponents onto that deadly ground, I placed them in a difficult situation.

Or consider the weak and defensive response of the Democrats when they were confronted by what they misperceived as the devastating conclusions of a CBO research report. As I explained at length in a later column:

Three weeks ago the powerful political momentum favoring a large minimum wage hike received a major setback as the Congressional Budget Office (CBO) released its report indicating that the Democratic goal of raising the minimum wage to \$10.10 might lead to the loss of 500,000 jobs.

The CBO is widely respected as non-partisan in its economic analysis, and indeed Douglas Elmendorf, its current head, has a strongly Democratic-leaning background. Republicans and business lobbyists quickly seized upon the conclusions as proof that their longstanding arguments against a minimum wage hike had been correct all along, and that any proposal that risked a half million jobs in these difficult times would be disastrous, amounting to a cynical political effort driven by populist appeal rather than objective economic sense. Their biting accusation was that desperate Democrats were willing to kill jobs in hopes of winning votes from the gullible.

The immediate Democratic response to the report hardly put these fears to rest. Jason Furman, President Obama’s chief economic advisor, largely dismissed the CBO estimates, suggesting that few if any jobs might be lost if the national wage-floor were raised, and claiming that the estimates were contradicted by numerous academic research studies providing contrary conclusions. Such an argument is hardly persuasive. All interested parties in the endless minimum wage debate can always cite numerous academic studies to bolster their case, but the CBO is regarded as relatively neutral and impartial, so merely dismissing those official numbers as “wrong” is not reassuring.

Furthermore, any honest advocate of a minimum wage hike must certainly grant that a large increase would surely produce some level of job loss, and raising America’s national wage floor from \$7.25 to \$10.10—a jump of 40%—is hardly insignificant. The CBO report suggested that somewhere between zero and one million jobs might be lost as a consequence, with the most likely figure being in the 500,000 range. Now I claim no great economic expertise myself and have certainly not reviewed the underlying calculations, but such figures seem perfectly plausible to me. However, I believe that the contending parties and the media have severely misinterpreted their meaning.

First, how substantial is the potential loss of 500,000 jobs relative to the size of the American workforce? One useful point of comparison is number of workers who would benefit from that same minimum wage hike, and when we include the “spillover effect,” most estimates put that total at roughly 25 million, a figure fifty times greater than the likely job loss. So one way of presenting the numbers is that of the low-wage workers directly impacted, roughly 98% would benefit—in most cases by thousands of dollars per year—and 2% would lose. Major changes in government policy inevitably produce both winners and losers, and I would think that any proposal in which the former constitute 98% of the total should be considered remarkably successful.

America’s population of low-wage workers themselves certainly come to this exact same conclusion, supporting a large minimum wage hike in overwhelming numbers. To the extent that they are the population group directly impacted—for better or for worse—should not their own wishes be considered a determining factor?

Consider also that the growing desperation of this exact low-wage population has made them a leading source of government lottery-ticket sales, vainly hoping that a lucky number will improve their miserable economic plight. For most such workers, the fully capitalized value of the proposed minimum wage hike is close to \$100,000 cash-money, and such a hike gives them a 98% chance of winning that amount rather than the 0.0001% chance that buying a scratch-off at 7-Eleven might give them. Is it morally right for the elected officials to deny them the former while encouraging them to squander part of their weekly household-budget on the latter?

And how much would the losers really lose? Economic logic indicates that job-losses would tend to be concentrated at the lowest wage-levels since those are the workers for whom an employer would find the jump to \$10.10 most difficult to justify in business terms. But bread-winners currently earning \$7.25 or \$7.50 already exist at the poverty-level and have high employment turn-over, while also receiving enormous social welfare subsidies from the government. So in many cases neither their personal difficulties nor the amount of their taxpayer benefits would be hugely different if their job suddenly disappeared.

Finally, the CBO conclusions seem to totally demolish one of the central economic dogmas presented by ideological opponents of minimum wage laws.

Rigidly doctrinaire libertarians argue that minimum wage laws serve no valid purpose since our free market in labor ensures that employers must pay all workers their true economic value, no more and no less. Thus, they say that if a worker earns \$8.50 per hour, that is the approximate value of the labor he produces and his job would disappear at any higher required wage. By contrast, economists who support a minimum wage suggest that low-wage businesses benefit from their “monopsony” position in the labor market, and regularly use that great market power to pay workers less than their true value, much like a monopolist can unreasonably bid up the price of his products.

This obscure technical dispute is central to the theoretical basis for minimum wage laws, and I would argue that the CBO figures decisively resolve this question. According to the CBO, some 98% of those low-wage workers impacted by a 40% hike in the minimum wage would keep their jobs at a much higher rate of pay, thereby demonstrating that their economic value to their employer was vastly greater than their current rate of pay, which had been artificially reduced due to their lack of effective bargaining power. When 98% of workers are paid below their true economic value, any assumptions of a truly efficient market in labor are absurd, and the rectifying impact of a higher minimum wage becomes absolutely justified.

During my own media appearances I repeatedly emphasized that the CBO report demonstrated that 98% of American workers would benefit from a wage hike and only 2% might lose, a success ratio as good as anyone could possibly expect from a major change in governmental policy. No other individual seemed to be making that obvious and important point.

Gaining Media Momentum and Additional Elite Supporters

As the days went by, political and media momentum continued to build for a wage hike in general and my proposal in particular. Irwin Stelzer, director of economic policy at DC’s conservative Hudson Institute took to the pages of the Weekly Standard, the neoconservative flagship organ, to publish a major article endorsing a big hike in the minimum wage and right-winger Ann Coulter proposed a \$14 minimum wage in her widely syndicated national column. At the other end of the ideological spectrum, Rolling Stone magazine, with a circulation of 1.5 million, released a blistering 2,700 word feature article entitled “Hey Washington! the Pay Is Too Damn Low: The Minimum-Wage War,” a piece that quoted me extensively.

Around that same time, a couple of even more momentous developments occurred, as I described in a column:

I published an article in Forbes arguing that Walmart—America’s largest low-wage employer and often treated as the Great Satan by pro-minimum wage activists—would benefit greatly from policies that would lift the disposable incomes of their struggling customer base, a point I had been making to people for several years. By fortuitous circumstances, my article was immediately brought to the personal attention of a prominent Walmart board member, and perhaps coincidentally, less than two weeks later, a story on Bloomberg Financial News carried the shocking headline “Wal-Mart Says ‘Looking’ at Support of Minimum Wage Rise”. The breaking Bloomberg story was quickly republished across numerous other major business media outlets and Tweeted out several hundred times,

Within hours, Walmart had denied the Bloomberg account and claimed that its official position on a minimum wage hike remained unchanged as being completely “neutral,” with the remarks of its corporate spokesman having been misinterpreted; but the incident was certainly a very odd one. I find it difficult to believe that Walmart’s official spokesman would be careless in his words and equally unlikely that Bloomberg journalists—who constitute a gold standard for breaking business news—would have totally mischaracterized the position of America’s largest corporation on such a sensitive matter. Slate also found the events very curious, and reported my own speculation that Walmart’s remarks had constituted a trial balloon in support of a minimum wage, with the company quickly caving under massive pressure from the Congressional Republican leadership, who are desperately trying to hold their own ranks firm against a Democratic-sponsored minimum wage hike.

Large corporations try to avoid political crossfire and possible punishment at the hands of a political party that controls the House and half the governorships. But technology multi-billionaires are far less vulnerable and can speak their minds much more freely, if they are so inclined. And one of the most outspoken of such individuals is Peter Thiel, co-founder of Paypal, earliest backer of Facebook, and a legendary figure in Silicon Valley investment circles. Late last week, a San Francisco reporter asked Thiel what he thought about my \$12 minimum wage initiative, and he suggested that the idea might have considerable merit given the enormous problems inherent in our existing social welfare system.

Now there are exist a multitude of different types of conservatives, with Phyllis Schlafly and Bill O’Reilly being social conservatives who are often populist in their economic sentiments. So their support for a minimum wage hike was perhaps not nearly as surprising as the media believed. But Thiel is widely regarded as perhaps the staunchest conservative-libertarian in America on economic issues, having been the largest financial backer of Ron Paul in 2012 and considered far harder-core than the Koch brothers. His public sentiments favoring a \$12 minimum wage constituted an ideological thunderclap, and was treated as such, generating major articles in ThinkProgress and the Huffington Post, and quickly generating over 700 Tweets, nearly twice the number of the Bloomberg piece on Walmart, perhaps because Thiel’s minimum wage support was twice as astonishing as the pro-hike sentiments of our top corporate retailer.

 

For many years, backers of a higher minimum wage had been pushed onto the defensive, and the federal figure of \$7.25 had lost some 15% of its value during the seven years since its last increase. As a consequence, many advocates eventually shifted their efforts into local so-called “living wage” campaigns, working to raise wages for some particular subgroup of workers. For example, unions invested enormous resources in the national “Fight for \$15” campaign, aimed at raising the wages of fast food workers to \$15 per hour, and in Los Angeles, a similar drive was underway to raise the wages of workers at large hotels to that same amount.

For more than twenty years, LA’s premier public affairs discussion show had been hosted by Warren Olney, and in mid-February he invited me on to discuss this proposal. Perhaps to his surprise, I was sharply critical, arguing that legally doubling the wages of 1% of LA’s workers would introduce enormous economic distortions and made much less sense than raising the wages of all of them, a suggestion that seemed to astonish my liberal interlocutors.

A week later he invited me back on his show, this time hosting a discussion of the national issue that was broadcast by NPR and included a New York Times reporter and a couple of other guests. I think the points I made were very effective ones, and by the end of the segment the sole doubtful voice—Clive Crook of Bloomberg View and formerly of the Economist—had largely come around to the pro-minimum wage position.

Elite public affairs discussion shows may sometimes attract an audience of elite listeners. It seems more than a pure coincidence that just a few days later, the Los Angeles Times carried a story that two of LA’s wealthiest billionaires—one a moderate Republican and the other a moderate Democrat—were both calling for a large hike in the minimum wage for all the city’s workers rather than just a few:

The debate on whether Los Angeles hotel workers should be paid at least \$15.37 an hour opened last week with some less-than-expected allies for a “living wage” and some questions from City Council members about whether the proposal goes too far, or not far enough.

Two of the city’s business titans, billionaire philanthropist Eli Broad and mall developer Rick Caruso, broke from the standard business-versus-labor divide when they said in interviews they support a higher minimum wage.

Broad said he favors a gradual increase to \$15 an hour for all workers in the city, not just those at big hotels, as proposed by three members of the Los Angeles City Council. Caruso said he supports a government mandate for higher pay, probably \$12 to \$15 an hour, though he would prefer the higher wage be imposed by either the state or federal government.

Given the donor-driven nature of California politics, these new public positions of billionaires Broad and Caruso seemed likely to have enormous future political impact.

 

Three months had now passed since I had begun my initiative effort, and these had been among the most exhausting of my life.

As a single individual with almost no planning nor preparation, I had launched a campaign to shift the national debate on an issue involving tens of millions of workers and hundreds of billions of dollars. The possibility of achieving any success in this effort might have seemed totally implausible but it had actually happened.

In early November 2013 few prominent Democrats had expressed any interest in the minimum wage, but by late December the party leadership had declared the issue their central focus for the 2014 campaign cycle. Soon afterward, several high-profile Republicans and conservatives such as Bill O’Reilly, Phyllis Schlafly, Peter Thiel, and Ann Coulter had also endorsed a large wage hike, a possibility that would have been dismissed as sheer fantasy just a few months earlier.

To achieve such remarkable results with absolutely negligible resources had required an extremely high degree of leverage, and only the media could provide such leverage. By broadcasting my ideas across the state and the country, the media had allowed me to reshape the beliefs of influential individuals whom I had never met, most of whom probably barely knew my name. So to a large extent, my entire campaign had necessarily been a media operation.

Aside from my numerous interviews with journalists and appearances on radio and television programs, I had published a series of opinion pieces for major outlets, targeting a variety of different audiences. In addition, every week or two I had produced an informal column for my growing distribution list, discussing recent developments and seeking to shape the ongoing debate, and taken together these constitute a useful historical record of the entire project:

 

Although my primary focus had been on shaping the media environment in order to conjure my economic transformation into reality, other practical actions were obviously also necessary.

Qualifying a measure for the California ballot required gathering hundreds of thousands of signatures, a specialized operational skill. Fortunately the experienced petitioning contractor I’d worked with during most of my previous campaigns was available when I approached him. The California Attorney General normally required a couple of months to produce an official title and summary, and I also made arrangements with a printer to produce the petitions once the text had been finalized. Just as in the past, I was functioning as my own consultant.

I had never previously worked with Democrats or labor unions, and indeed they had usually been on the other side of my past campaigns, so I needed to quickly build bridges to them. Although I had been heavily involved in the minimum wage issue for the previous couple of years, all my activities had been at the national level, so the local groups operating in California were generally unaware of my record and they initially regarded me an interloper and perhaps even an opportunist, hardly unreasonable suspicions.

Fortunately, a series of personal meetings with these different unions and other key Democratic Party figures all went very well, and amicable relations were soon established. In the political world, media is an extremely valuable commodity and a currency of influence, and the fact that I had managed to accumulate so much of it so quickly gave me a great deal of legitimacy in their eyes, as did the effectiveness with which I articulated the arguments that they had been trying to present—usually with very mixed success—for the previous several years.

Most political campaigns sponsored by large organizations tend to be ponderous and slow-moving, run by committees and consultants and hence less effective for that reason. When a top California union leader met me for lunch in Palo Alto, he expressed amazement that the operative section of my minimum wage initiative contained merely a single sentence. He explained that when an alliance of some local unions had previously considered doing something similar, their draft proposal had had so many exceptions, exclusions, special cases, and other complexities that it ran thousands of words long and was eye-glazingly confusing. He agreed with me that an extremely simple proposal was far less vulnerable to distortion and hostile attack than something so long and complex.

Even under the best of circumstances, organizations react much less quickly than single individuals, and research groups are often particularly sluggish. For more than a year, the Congressional Democrats had been unsuccessfully pushing a \$10.10 federal minimum wage, so their thinktank allies had produced a wealth of statistical analysis regarding the economic impact. But now that I had suddenly opened wide the political door to a much more aggressive target of \$12.00, they said it would take them several months to produce similar data for that figure, which forced me to rely upon my own much cruder estimates. One of their academic allies sadly admitted to me that they were rather slow to take advantage of new political opportunities when these suddenly appeared.

Some local California politicians did react quickly. State Sen. Mark Leno was a prominent San Francisco Democrat considering a future race for mayor, and a few weeks after my \$12 initiative began to attract national and state headlines, he decided to outbid me, introducing a bill in the State Legislature to set a \$13 minimum wage; with Democrats holding super-majorities in both Houses, it stood a reasonable chance of becoming law. Although the measure might ultimately undercut my own campaign, the effort did fully establish the legitimacy of my proposal in respectable political circles, and it also provoked additional news stories, thereby helping me in maintaining my media momentum.

During one of my meetings with senior California union leaders, they similarly suggested that I consider abandoning my current effort and instead form an alliance with them, after which we would jointly refile a new initiative based upon a \$13 figure. But I explained that although I had no deep philosophical commitment to \$12 rather than \$13, initiative campaigns operated on a rigid timetable, and restarting the clock after three months would enormously increase the cost and difficulty of qualifying a measure for the November 2014 ballot. So my existing initiative represented the only game in town.

Central to my plans were the obvious national implications of my campaign. By all indications, my measure would be extraordinarily popular in California, including among Republicans and independents, and this latter support would only continue to grow as additional conservatives joined Bill O’Reilly and Phyllis Schlafly in eagerly climbing on board what looked like an unstoppable freight train. From the very beginning, our media coverage had been absolutely picture-perfect, and this coverage now increasingly included leading conservative publications.

Although California was an overwhelmingly Democratic state, with its once-proud Republican Party reduced to a shadow of its former strength, the huge population meant that the Congressional delegation included 15 Republicans, more than any state other than Texas and Florida. And with an extremely popular \$12 wage on the ballot, many of these congressmen might be risking their seats if they didn’t support it, especially given the growing conservative backing.

If many or most of these California Republicans endorsed a \$12 wage for their own state, they would find it very difficult to justify their opposition to Congressional legislation establishing a similar figure, let alone the \$10.10 Democratic bill that had been stuck in committee for the previous year. The Daily Caller—so influential within their caucus—had headlined a high minimum wage as “rocket fuel” for Republicans, and O’Reilly, the biggest star on FoxNews, had given the idea his blessing, while the anti-immigration right-wingers of their activist base demanded action.

Under such a scenario, the resistance of the Congressional Republicans in DC seemed likely to crumble, and America would probably see a large federal wage hike within the next year or so.

A Personal Failure but a Political Triumph

Thus, any informed outside observer in early March 2014 would have believed that a political miracle was on the verge of becoming reality.

A campaign had suddenly appeared from nowhere in our largest state and seemed likely to enact an unprecedented hike in the minimum wage, putting an extra \$15 billion per year into the pockets of California’s working-poor. Within just a few months, the effort had already transformed the national debate, also attracting the astonishing support of numerous conservative opinion-leaders and publications, and the momentum from a likely landslide victory would probably break the Republican logjam in Congress, leading to passage of a large wage hike on the federal level.

From a personal perspective, I would have won a stunning political victory comparable to what I had achieved in the English Wars a dozen years earlier.

But matters were not exactly as they seemed.

Having long been away from California politics and lacking any time for careful preparation, I had soon discovered that the costs of qualifying a ballot measure were far higher than they had been fifteen years earlier. Launching my initiative campaign had only cost a few thousand dollars, but the expense of placing it on the ballot and waging even an absolutely minimalist campaign would run well into the seven figures, far more than I could easily afford.

In recent years, American politics had seen the influx of numerous wealthy individuals who eagerly spent millions or tens of millions of dollars on their campaigns, so there was a natural if mistaken assumption that I fell into that same category. Every now and then, I would emphasize to journalists that I was not remotely in the financial league of a Mitt Romney let alone a Warren Buffett, but the crucial misperception remained and I did not do anything to correct it.

A recent phrase I’ve sometimes heard regarding Tech start-ups is “Fake It Till You Make It” and my political campaign start-up had been operating along exactly those same lines.

As the media momentum behind my effort increasingly became a juggernaut, I began to believe there was a good possibility that I would succeed in attracting the necessary financial backing to solve my dilemma.

For example, California’s powerful unions frequently spent many tens of millions of dollars in their initiative battles against opposing business coalitions, and merely a sliver of those sums would be enough to qualify the initiative and add an extra \$15 billion to the annual wages of the state’s workers. Lifting many millions of Californians out of poverty would generate an enormous outpouring of goodwill for the unions and achieve one of their stated political priorities.

Even the crassest economic calculation seemed to support such a decision. Although most unions had few low-wage members, the powerful Service Employees were a major exception, and a \$12 minimum wage would probably boost their annual union dues by \$10 million or more, easily justifying the small one-time financial investment required.

So as I began privately meeting with some of the state’s key union leaders, I candidly explained my position and sought their help. But although they were all sympathetic and recognized the logic of the case I was making, they explained that for unions, such substantial political outlays were controlled by a democratic decision-making process that operated with a long lead-time, so it would take many months of committee meetings and votes to authorize such a thing.

I had never been much of a fund-raiser nor did I have a network of donors, and those political contacts I retained from my past campaigns were overwhelmingly on the conservative or libertarian side, the sort of individuals most ideologically opposed to wage laws from the government.

Given my sudden political prominence, I’d been approached by the organizer of a group of wealthy progressives, who lavished praise on my project. I eventually explained my situation and solicited support from some of the members, but none of those efforts succeeded.

Obviously, any rumors that my initiative lacked the funds to reach the ballot would have dealt a devastating blow to the media momentum I had so carefully accumulated, so at first I was very discreet in my efforts, but I gradually became more and more open as the clock ticked down. I finally explained the situation in a March 18th column:

Given the widespread public attention attracted by the effort and the powerful political tide on the issue, this unfortunate outcome is surely shocking to many people, including myself. Last night I spoke to a national journalist who said that he found it difficult to believe that no wealthy and public-spirited citizen would step forward to ensure a November vote on the subject. California alone certainly contains many, many thousands of individuals able to fund the petition drive with a single check and never even notice the cost, and anyone who did that would certainly gain huge national recognition as a consequence. But no such person has yet appeared on the horizon.

A couple of weeks ago I had taken the dramatic step of repeatedly running a full-page ad appealing for financial support in my local Palo Alto newspaper, whose distribution also includes several neighboring communities, together containing dozens of billionaires and large numbers of others just below that level.

Somewhat to my surprise, a person in exactly that category—moreover someone with decidedly conservative views on economics—quickly came forward and proposed making a donation large enough to qualify the measure for the ballot. But although the dollars were totally insignificant to him, the enormous public attention likely to result from such an unusual ideological pairing soon led to doubts and second thoughts, and by the end of last week, the prospect of this had faded away. Hence on Monday I released my announcement that there was unlikely to be a minimum wage vote on the California ballot in November.

The Democrats were raising many hundreds of millions of dollars for the 2014 Congressional elections, and several Democratic operatives had become enthusiastic that a high-profile minimum wage measure would share the same November ballot, potentially shifting the outcome of many races. So they made various unsuccessful attempts to enlist wealthy donors, and one of them even published an open letter to Nancy Pelosi in the Huffington Post, urging her to fund-raise for the project as a “high-leverage political play.” But there was no response.

In a subsequent column, I expressed disappointment at the failure of my project, but placed the story in a broader context:

A renewed focus on basic economic issues by the liberal wing of California’s totally dominant Democratic Party would anyway be a very welcome change from the situation of the last couple of decades in which avant-garde social issues have drawn nearly all the ideological enthusiasm and donor dollars. Meanwhile, the abandoned majority of ordinary California workers suffered under greater and greater economic hardships in their daily lives, leading to Golden State poverty rates that were the worst anywhere in America.

When we consider the initiative campaigns of the last fifteen years, I can’t recall a single one directly aimed at improving the economic lot of our state’s millions of working-poor, as opposed to giving them the right to smoke medical marijuana or send their children to voucherized schools.

Indeed, at the end of the 1990s one of California’s leading liberal consultants told me that the wealthy donors in his circle showed absolutely no interest in funding the sort of working-class economic issues that had once been central to the Democrat Party, and this explained the lack of ballot measures on such topics. Hilda Solis’s 1996 minimum wage measure had barely scraped together the dollars necessary for qualification before winning a landslide victory at the polls. Instead, that top Democratic consultant joked with me that the ideal initiative for attracting liberal dollars would be one entitled “Save the Gay Whales from Second-Hand Smoke.” But perhaps that is now starting to change, though not quickly enough to put my own initiative on the ballot.

Over the years it has become obvious to me that the political world contained a curious paradox, with important issues attracting either heavy funding or large public support, but rarely both. However, this contradiction is more apparent than real and a moment’s thought reveals the simple explanation of this seeming mystery. Any prominent issue that possesses both dollars and popular appeal is quickly victorious and therefore disappears from the political landscape.

Today in California, the polls show overwhelming support for a large rise in the minimum wage, and the idea has now been endorsed by multi-billionaires of the left, right, and center. Let’s hope that such a potent combination of dollars and voter sentiment quickly produces enacted legislation and causes the issue to permanently vanish from the political radar screen just as would be suggested by my theory.

Despite the financial collapse of my campaign, the political and media momentum I had generated during the previous few months continued for some time on the national level. As I noted in a May 12, 2014 column, establishment Republicans who never would have previously considered the idea began endorsing a hike in the minimum wage, including both the nominee and the runner-up from the 2012 presidential primaries:

On Friday, several top national Republicans including Mitt Romney, Rick Santorum, and Tim Pawlenty all publicly declared their support for raising the federal minimum wage. Such a dramatic political breakthrough—obviously coordinated at the highest levels—greatly increases the likelihood it will actually happen, and tens of millions of low-wage American workers will see a large rise in their annual incomes.

But on Friday, that settled political landscape was transformed as Mitt Romney declared his support on the MSNBC show of Joe Scarborough, himself a former Republican Congressman. As the most recent Republican presidential nominee and a cadet member of America’s ruling financial oligarchy, Romney stands as a Republican pillar, and given his notorious caution such a decision would only have come after exhaustive discussion. It appears certain that a major segment of the Republican Establishment has decided to embrace rather than oppose the minimum wage issue, presumably after extensive polling and focus group analysis.

I think Romney and his advisers fully recognize that if he had taken this sort of economic position two years ago, he would be sitting in the White House today rather than traveling the rubber-chicken circuit, and perhaps a third major run for the presidency lurks in the back of their minds. One of the incidents that doomed Romney’s 2012 candidacy was his remark that 47% of all American voters paid no income taxes and were therefore deaf to GOP economic arguments. I have pointed out that a \$12 minimum wage would shift tens of millions of American low-wage workers into the net taxpayer class, and perhaps Romney’s people have considered this point.

Admittedly, Romney is very much an establishmentarian Republican, whose conservative credentials are mixed at best, and he hardly inspires the party faithful. But Romney’s support for a minimum wage hike was immediately echoed by former Sen. Rick Santorum, a darling of the hard-right and Christian conservatives, whose enthusiastic supporters had enabled his under-financed presidential campaign to sweep several states and give Romney enormous trouble in 2012. When the top two Republicans from the most recent presidential campaign—representing entirely different wings of the party—simultaneously endorse a minimum wage hike, something is definitely afoot. And former governor Tim Pawlenty of Minnesota, also once considered a viable presidential or vice-presidential nominee, quickly joined the chorus.

These very favorable developments occurred even after my campaign’s demise. This suggests that if I had managed to place my measure on the ballot, I could have maneuvered a large fraction of the entire Republican Party into endorsing a wage hike by the November vote.

 

In many respects, the collapse of my initiative campaign was hardly surprising. Business history is replete with companies that pioneer important new innovations but fail to secure the necessary capital to properly exploit them, leaving others to eventually assume that role.

I had successfully established a high minimum wage as an important issue on the political landscape, demonstrating its overwhelming popularity and also making a strong case that it was good public policy. During that process I had won over much of the media as well as many opinion leaders, so my departure left a vacuum that I expected others to fill. Public policies are not subject to copyright, and there was now a political pot of gold lying in the street awaiting an eager pair of hands.

A hike in the minimum wage merely required a simple majority vote in the State Legislature, and the Democrats held super-majorities in both houses. As mentioned earlier, Sen. Mark Leno had already introduced a \$13 wage bill, and he now sought my endorsement and support, which I gladly offered. He felt reasonably confident about passage, and asked me to testify at the hearings he planned to hold later that year. But to his surprise and disappointment, his business lobbyist opponents successfully won over enough Democrats to kill his bill in the Assembly labor committee, though Leno later announced in December that he intended to reintroduce it.

Meanwhile, the national 2014 elections became a total disaster for the Democrats, who lost nine seats—and control—in the Senate, along 13 in the House. This gave the Republicans their largest majority since the onset of the Great Depression and led the media to characterize the outcome as a “Republican wave” election. Total campaign spending had reached \$3.7 billion, a new record, but with the election lacking any central theme, voter turnout was the lowest in more than 70 years.

However, while Democratic candidates fared badly, minimum wage measures were on the ballot in four small, heavily Republican states—Alaska, Arkansas, Nebraska, and South Dakota—along with an advisory question in Illinois, and all won by huge landslides. A similar California wage vote that November would have allowed the Democrats and the media to nationalize the election on that the issue, possibly with major impact on other races across the country. During 2016, 2018, and 2020, seven additional minimum wage initiatives were placed on state ballots, all of them also winning by landslide margins.

In 2015, two rival factions of the Service Employees union in California both launched initiative campaigns to raise the state minimum wage to \$15 per hour, and spent months battling each other for control of the issue, before one group finally dropped out and the other qualified for the November 2016 ballot. Faced with the pressure of a looming popular vote, Gov. Jerry Brown and the overwhelmingly Democratic State Legislature agreed to enact a \$15 minimum wage and it was signed into law on April 4, 2016, with Gov. Andrew Cuomo of New York signing a similar a \$15 wage bill later that same day.

From a policy perspective, I had mixed feelings. Although \$15 might have been fine for Los Angeles, the San Francisco Bay Area, and other urban centers having a high cost of living, the Central Valley was much less expensive, so the figure was probably somewhat too high for state as a whole. But the powerful political momentum I had generated for the issue continued pushing forward, and anyway a \$15 wage floor may still have been better than the existing \$10.

Lacking any campaign or organization to give me standing on the issue, I was obviously no longer of further interest to the media on these developments, and unfortunately few of my powerful policy arguments were articulated by the backers of these measures. Instead, these were party-line Democrats who made party-line arguments, and for that reason their successful efforts attracted relatively little media interest. Meanwhile, the conservatives who had endorsed a large wage hike during the brief lifespan of my campaign may have felt that they had risked themselves for nothing after it collapsed, and they henceforth remained silent. So although individual states raised their wages, little pressure was exerted on Congress, and the federal figure remained unchanged.

And the failure of the leading minimum wage advocates to effectively make their case in public meant that although they did succeed politically, they changed fewer minds on the underlying policy issues. As a perfect example of this problem, consider the views of Gov. Brown, who after resisting the issue, finally signed into law the highest minimum wage in American history. As he took that historic step, his public statement revealed that no one had ever properly explained to him the economic case for such policies:

Economically, minimum wages may not make sense. But morally, socially, and politically they make every sense because it binds the community together to make sure parents can take care of their kids.

But regardless, I’ll settle for my role in shifting the politics of the minimum wage in California, New York, and many other places.

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