The Metrics of Protest – A Christmas Carol for 2012: Good News in the Fight Against Low Pay?

Ebenezer Scrooge, a screen shot from "A Christmas Carol" (1971 film) © American Broadcasting Company | www.cedmagic.com

It’s the holiday season and most American households are struggling, many desperately, as the economy continues it’s dismal performance. Yes, unemployment is down to 8.6% from 9% and higher (where it had been stuck since 2008) but that modest “improvement” was mainly due to discouraged workers dropping out of the labor market. The employment and hiring rates remain at historically low levels.

But while there’s been lots of attention paid to unemployment and to the income gains of the top 1%, there has been far too little focus on the need to combat poverty level wages. We are enmeshed in a toxic brew of joblessness, low hours (involuntary part-time employment), and low pay (1/3 of all workers earn below 2/3 of the median wage – see below).

It is said that Charles Dickens intended A Christmas Carol as a “sledgehammer blow on behalf of the poor and unfortunate” (“Father Christmas,” New York Times, December 7, 2011). One of the great lessons of Dickens’ accounts of 19th century London is that poverty for families with working-age adults is rooted less in joblessness than in low pay. But they’re connected: the threat of job loss undermines the ability of workers to demand decent pay and working conditions.

In the first pages of the A Christmas Carol, Dickens writes:

“The door of Scrooge’s counting-house was open that he might keep his eye upon his clerk, who in a dismal little cell beyond, a sort of tank, was copying letters. Scrooge had a very small fire, but the clerk’s fire was so very much smaller that it looked like one coal. But he couldn’t replenish it, for Scrooge kept the coal-box in his own room…”

And when Scrooge overhears his pathetic clerk mutter Merry Christmas to Scrooge’s nephew, his response is “… my clerk, with fifteen shillings a week, and a wife and family, talking about a merry Christmas. I’ll retire to Bedlam.”

Yes, keeping a veneer of Christmas cheer while maintaining a family on 15 shillings a week in the employ of . . .

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The Metrics of Protest: Black Friday and Low-Wage America

Black Friday at Walmart © Dustin | BlackFriday.com

The headline on the front page of the Thanksgiving Day The New York Times: “Opening Day for Holiday Shopping Shows Divide.”

The next day – Black Friday – Bloomberg ran a story with the headline “U.S. Workers’ Pay Slide Poses Consumer Risk. ”

It may turn out to have been a “Black Friday” for top end retailers, but it’s a bleak season for low income America and the businesses that cater to it. According to the Times’ story: “Wal-Mart’s profits declined in the third quarter as it kept many prices low so its shoppers could afford them.” Michael T. Duke, Wal-Mart’s chief executive, told analysts that ‘There is a real sense that the economic strain is taking its toll.” Without the fuel of credit that had increasingly been required to power spending by low-income workers, Wal-Mart now has to resort to layaway plans for its shoppers.

As 10 percentage points of national income has been directed away from the bottom 80% to the top 1% since 1979, those paid the lowest wages have seen their buying power erode the most. While the quality and quantity of education force can explain much of the distribution of income within the bottom 99% (together with personal networks, effort and luck), differences in educational attainment have nothing to do with the transition of the American economy to extreme inequality since the 1970s. It is also quite clear that among developed countries, America is exceptional: only the UK comes close to US-style extreme inequality.

The lesson is that extreme inequality is the outcome of political choices that have empowered a tiny minority. It has to do with political choices, the way institutions function, and social norms; it is not a natural market payoff to investments in education. The shift of income to the top .1% (which has driven the growth of the top 1%) reflects the market power of a small number of CEOs and finance, medical and legal professionals.

Here are some metrics that focus on what has happened to the wage/salary earnings of American workers.

Employee compensation in the . . .

Read more: The Metrics of Protest: Black Friday and Low-Wage America