That Steve Knobbe's formula, pay three people $10 an hour instead of only two at $15, is not the solution it might seem to be is obvious when considering that five could be employed at $6 or even 15 people at $2. Any wage must be commensurate with the cost of living to make sense in the system. It is well-known that wages for most people have not gone up for 30 years, but the cost of living has, and this imbalance has not produced jobs.
The World Bank, the International Labor Organization (ILO) and the Organization for Economic Cooperation and Development have just issued a joint statement to the effect that the largest economies are not producing enough jobs, and those produced are of low quality. This trend affects all the advanced economies of Europe, North America and Japan.
That this is the case is not surprising in the least. It is the exchange of money for goods and services that keeps any economy moving, therefore money in the hands of ordinary people is the key to a healthy economy.
We in Canada have been sold a bill of goods on our economic exceptionalism, as though we lived on Mars or something. If our banks are exceptional, why were they bailed out at the cost to the taxpayer of $84 billion in the recession of 2008?
Are most people aware that our private debt ratio to earnings is 160 per cent? It is this immense borrowing that has seemed to keep our economy afloat, but it is just an illusion. If Canadians have been warned about this it was sotto voce, and casually.
Many Canadians (and others of course) have bought into a highly over-wrought housing market on the prospect of continuing equity growth that is bound to fail. The money, the jobs, the security are simply not there.
In spite of this obvious fact, there are still head-in-sand economics pundits who claim that all is rosy and the huge and growing disparity in wealth and opportunity is of no concern at all. Well, it is in fact a zero sum game: if money has value it is because it is limited, and represents labour and goods.
This is no longer the case since the removal of regulations such as the Glass-Seagal Act of the Clinton era, and introduction of novel (arcane) neoliberal policies. The banking and finance sectors rejected all and any reform measures after the last crisis, so all the problems remain and may be even worse. The corporations who lobby for ever lower taxes have not held up their part of the implicit bargain, the creation of good and permanent jobs, and have in many cases virtually stolen pension money contributed in good faith by employees – and got away with it.
A higher minimum wage is not the complete solution to a dire situation which calls for all-out reform, but it is part of it. Many people believe that this situation, not "terrorism," is Western society's greatest threat.
Doris Wrench Eisler, St. Albert
