Category: Labor Economics

Long Beach Supermarket Workers Lose Jobs Due to Higher Minimum Wage

(p. A15) As these things always do, it started out with the best intentions. In January [2021] the City Council of Long Beach, Calif., adopted an ordinance requiring large grocery-store chains to pay employees an extra $4 an hour. The idea was to reward them for the risks they took by doing their jobs amid the Covid-19 pandemic.

It didn’t turn out that way. In response to the ordinance, Kroger Co. announced it would close two Long Beach supermarkets.

. . .

As one of the world’s largest retailers, Kroger makes an easy villain. But instead of blaming “reckless capitalism,” might the fault lie with the reckless politicians who passed this measure? Thanks to their intervention, instead of finding an extra $4 an hour in their paychecks, nearly 200 grocery workers will now have no paychecks at all unless they are transferred to another store or find another job. It’s but the latest illustration of economist Thomas Sowell’s dictum that whatever a government might set it at, “the real minimum wage is always zero.”

For the full commentary, see:

William McGurn. “The Human Cost of a Minimum Wage.” The Wall Street Journal (Tuesday, February 16, 2021): A15.

(Note: ellipsis, and bracketed year, added.)

(Note: the online version of the commentary has the date February 15, 2021, and has the same title as the print version.)

Raising Minimum Wage to $15 Will Likely Cause 16% Rise in Low-Skilled Job Loss

(p. A15) A recent Congressional Budget Office report estimated that 1.4 million jobs would be lost if a new $15 federal minimum wage is signed into law. Advocates were quick to dismiss the CBO’s conclusion. “It is not a stretch to say that a new consensus has emerged among economists that minimum wage increases have raised wages without substantial job loss,” said Heidi Shierholz of the Economic Policy Institute, which has also circulated a letter signed by economics Nobel laureates and others making the same claim.

. . .

To provide an accurate reading of the research, Peter Shirley and I surveyed the authors of nearly all U.S. studies estimating the effects of minimum wages on employment published in the past 30 years. We asked them to report to us their best estimate of the employment effect, measured as the “elasticity,” or the percent change in employment for each 1% change in the minimum wage. Most authors responded, and in the few cases in which they did not, we pulled this estimate from their study.

The results are stark. Across all studies, 79% report that minimum wages reduced employment. In 46% of studies the negative effect was statistically significant. In contrast, only 21% of studies found small positive effects of minimum wages on employment, and in only a minuscule percentage (4%) was the evidence statistically significant. A simplistic but useful calculation shows that the odds of nearly 80% of studies finding negative employment effects if the true effect is zero is less than one in a million.

Across all the studies, the average employment elasticity is about minus-0.15, which means, for example, that a 10% increase in the minimum wage reduces employment of the low-skilled by 1.5%. Extrapolating this to a $15 minimum wage, this 107% increase in the states where the federal minimum wage of $7.25 now prevails would imply a 16% decline in low-skilled employment (broadly consistent with the recent CBO study). That sounds like a substantial job loss.

For the full commentary, see:

David Neumark. “Raising the Minimum Wage Definitely Costs Jobs.” The Wall Street Journal (Friday, March 19, 2021): A15.

(Note: ellipsis added.)

(Note: the online version of the commentary has the date March 18, 2021, and has the title “Raising the Minimum Wage Will Definitely Cost Jobs.”)

Gerardo Guillén García del Barco Wants to Build in Cuba “Without Being Hindered by Bureaucracy”

(p. A10) HAVANA — Car dealerships, book publishing and hedge funds are still prohibited. Bed-and-breakfasts are not. Zoos, scuba diving centers and weapons production remain banned. Veterinary services aren’t.

As Cuba’s Communist government continues its piecemeal expansion of the fledgling private sector, Cubans are carefully parsing a list of the economic activities that the government proposes to keep under its control.

. . .

The new list seems to open major new space for manufacturing. Cubans will now be able to apply for licenses to open cheese, paint and toy factories, for example, though the government has not yet defined the permitted size of such ventures.

While some Cubans hailed the list as an important step forward in the country’s economic liberalization, it left others complaining that the government had not gone far enough.

“It’s messed up,” said Gerardo Guillén García del Barco, 26, an architect in Havana whose profession the government plans to maintain under its sole control. “Every time something appears that looks like a panacea, it ends in nothing.”

“My dream is to do exactly what I’m doing today but within a legal framework,” he said, explaining that he left a government firm and now works freelance without a license. “I want to do my own architecture without being hindered by bureaucracy.”

. . .

Last Saturday [Feb. 6, 2021], in announcing the planned expansion of private economic activity, Marta Elena Feitó, Cuba’s labor and social security minister, said that the changes would “unleash the productive forces” of the population.

For the full story, see:

Ed Augustin and Kirk Semple. “Cubans Study a Shrinking List of Prohibited Private Enterprises.” The New York Times (Friday, February 12, 2021): A10.

(Note: ellipses, and bracketed date, added.)

(Note: the online version of the story has the date Feb. 11, 2021, and has the title “Cubans Study a Shrinking List of Banned Private Enterprises.”)

Cancelled Slate Podcaster “Heartsick” That Ideas Cannot Be Debated and Words Cannot Be Spoken

(p. B5) The online publication Slate has suspended a well-known podcast host after he debated with colleagues over whether people who are not Black should be able to quote a racial slur in some contexts.

. . .

Mr. Pesca explored the argument over the use of the slur in a 2019 podcast about a Black security guard who was fired for using it. In one recording of the episode, Mr. Pesca said, he used the term while quoting the man, but asked his producer to make a version without the term. After consultation with his producers and his supervisor, who objected to his quotation of the slur, they decided to go with the version without it, he said.

“The version of the story with the offensive word never aired, and this is how I think the editorial process should go,” Mr. Pesca said in the interview.

No action was taken against him after a human resources investigation into his quotation of the slur, Mr. Pesca said. He said he had apologized to the producers involved.

. . .

Mr. Pesca, who has worked at Slate for seven years, said he was “heartsick” over hurting his colleagues but added, “I hate the idea of things that are beyond debate and things that cannot be said.”

Jacob Weisberg, Slate’s former chairman and editor in chief, who left the company for the podcast start-up Pushkin in 2018, called Mr. Pesca “a huge talent and a fair-minded journalist.”

“I don’t think he did anything that merits discipline or consequences, and I think it’s an example of a kind of overreaction and a lack of judgment and perspective that is unfortunately spreading,” Mr. Weisberg said.

For the full story, see:

Katie Robertson and Ben Smith. “Podcast Host Suspended After Debate Over Slur.” The New York Times (Weds., February 24, 2021): B5.

(Note: ellipses added.)

(Note: the online version of the story has the date Feb. 22, 2021, and has the title “Slate Suspends Podcast Host After Debate Over Racial Slur.”)

$15 Minimum Wage Is “a Potentially Catastrophic Policy Error”

(p. A2) Opponents of a large increase say policy makers should be especially concerned with job losses in low-wage industries, such as the leisure and hospitality sector, which shed 3.8 million jobs last year.

More than 37% of workers who earned the federal minimum wage in 2019 were employed in restaurants, hotels and other parts of the hospitality sector, according to the Labor Department. Retail workers accounted for nearly 23% of minimum-wage earners, and education and health employees, including home health aides, represented 14%.

“It’s a potentially catastrophic policy error,” Kevin Hassett, former President Donald Trump’s top economic adviser, said of the $15 minimum wage. The pandemic, he said, pushed many small businesses to the brink of bankruptcy, but those restaurants and other firms are holding on, expecting profits later this year when the economy can open up. A minimum-wage increase would cut into those expected profits and cause businesses to close, he said. “It’s going to cost a lot of people their jobs.”

Mr. Hassett said low-wage workers have been disproportionately harmed by the pandemic, and that the government should support them through direct payments rather than mandating that private firms raise wages.

The nonpartisan Congressional Budget Office found in a 2019 study that raising the federal minimum wage to $15 an hour by 2025 could cost 1.3 million Americans their jobs. The same study found the higher level could boost the pay of about 27 million workers and lift 1.3 million Americans out of poverty.

For the full story, see:

Eric Morath. “Minimum-Wage Push Re-Ups Debate.” The Wall Street Journal (Thursday, February 4, 2021): A2.

(Note: the online version of the story was updated February 3, 2021, and has the title “Biden Wants a $15 Minimum Wage. Here’s What People Say It Would Do to the Economy.” The penultimate sentence quoted above, appears in the online, but in the print, version.)

The nonpartisan Congressional Budget Office study mentioned above is:

Congressional Budget Office. “The Effects on Employment and Family Income of Increasing the Federal Minimum Wage.” July 2019.

Nonpartisan CBO Estimates $15 Minimum Wage Would Cause 1.4 Million Job Loss

(p. B5) WASHINGTON — Raising the federal minimum wage to $15 an hour — a proposal included in the package of relief measures being pushed by President Biden — would add $54 billion to the budget deficit over the next decade, the Congressional Budget Office concluded on Monday [Feb. 8, 2021].

. . .

Critics of the plan noted a different element of the report: its forecast that raising the minimum wage to $15 would eliminate 1.4 million jobs by the time the increase takes full effect.

“Conservatives have been saying for a while that a recession is absolutely the wrong time to increase the minimum wage, even if it’s slowly phased in,” said Brian Riedl, a senior fellow at the Manhattan Institute. “The economy’s just too fragile.”

For the full story, see:

Jason DeParle. “$15 Minimum Wage Would Cut Poverty And 1.4 Million Jobs.” The New York Times (Tuesday, February 9, 2021): B5.

(Note: ellipsis, and bracketed date, added.)

(Note: the online version of the story has the date Feb. 8, 2021, and has the title “Minimum Wage Hike Would Help Poverty but Cost Jobs, Budget Office Says.”)

The nonpartisan Congressional Budget Office report mentioned above is:

Congressional Budget Office. “The Budgetary Effects of the Raise the Wage Act of 2021.” Feb. 2021.

Walter Williams Wrote That a Minimum Wage “Encourages Racial Discrimination”

(p. 26) Walter E. Williams, a prominent conservative economist, author and political commentator who expressed profoundly skeptical views of government efforts to aid his fellow African-Americans and other minority groups, died on Tuesday [Dec. 1, 2020] on the campus of George Mason University in Virginia, where he had taught for 40 years. He was 84.

His daughter, Devon Williams, said he died suddenly in his car after he had finished teaching a class.

. . .

In the 1970s, during a yearlong stint at the conservative-leaning Hoover Institution on War, Revolution and Peace at Stanford University, Mr. Williams was commissioned by the Joint Economic Committee of Congress to study the ramifications of a minimum wage and of the Davis-Bacon Act, which mandated that laborers in federal construction projects be paid no less than the locally prevailing wages for corresponding work on similar projects in the area.

He outlined his findings in a 1977 report: A minimum wage causes high rates of teenage unemployment, especially among minority workers, and actually “encourages racial discrimination.”

He concluded, he recalled in an interview with The New York Times for this obituary in 2017, that the Davis-Bacon Act had “explicit racist motivations.”

Suppose, he said, that there are 10 secretaries, five of them white and five of them Black — all equally qualified — who are applying for a job. “If by law you must pay them all the same wage,” he said, “it doesn’t cost anything to discriminate against the Black secretaries.” Without such a mandate, he suggested, the Black secretaries would have a better chance at being gainfully employed, even if at lower pay.

In his book “The State Against Blacks” (1982), Mr. Williams was similarly critical of a host of government measures involving labor — from taxicab regulations to occupational licensing — that in his view wound up disproportionately harming Black people in the name of preventing discrimination.

For the full obituary, see:

Robert D. Hershey Jr. “Walter E. Williams, Conservative Economist on Black Issues, Is Dead at 84.” The New York Times, First Section (Sunday, December 6, 2020): 26.

(Note: ellipsis, and bracketed date, added.)

(Note: the online version of the obituary was updated December 7, 2020, and has the title “Walter E. Williams, 84, Dies; Conservative Economist on Black Issues.”)

Williams’s book, mentioned above, is:

Williams, Walter E. The State Against Blacks. New York: McGraw-Hill, 1982.

Naps Aid Immunity, Energy, Alertness, Memory, and Mood

(p. D4) Sara E. Alger, a sleep scientist at the Walter Reed Army Institute of Research in Silver Spring, Md., has been a public advocate for naps, particularly in the workplace, except in cases of insomnia. Along the way, she has had to fight anti-nap prejudice.

“Naps in general have a stigma attached to them as something you only do when you’re lazy or when you’re sick,” Dr. Alger said.

Wrapped inside nap phobia in the United States is often a message reminding us to be productive during what we now think of as normal working hours, although that concept is relatively new.

Modern attitudes about napping go back to the Industrial Revolution, according to Matthew J. Wolf-Meyer, an anthropologist at Binghamton University in New York and the author of “The Slumbering Masses: Sleep, Medicine, and Modern American Life.”

“For a long time, people had flexible sleep schedules,” Dr. Wolf-Meyer said. Farmers and tradespeople had some autonomy over their time. They could choose to rest in the hottest part of the day, and might take up simple tasks during a wakeful period in the middle of the night, between two distinct bouts of sleep.

As the 1800s went on, more and more Americans worked in factories on set shifts that were supervised by a foreman. “They work for a total stranger, and a nap becomes totally nonnegotiable,” he said.

Staying awake all day and getting one’s sleep in a single long stretch at night came to be seen as normal. With that came a strong societal expectation that we ought to use our daylight hours productively.

. . .

Although there are no hard data so far on whether naps have been on the rise during 2020, sleep scientists like Dr. Alger think it’s likely. The many people who now work remotely no longer need to worry about the disapproving eyes of their colleagues if they want a brief, discreet period of horizontality in the afternoons.

If most offices reopen next year, as now seems possible, perhaps greater tolerance toward the adult nap will be one of the things salvaged from the smoking wreckage of the working-from-home era. (In a tweet last week, Dr. Wolf-Meyer called the pandemic “the largest (accidental) experiment with human #sleep ever conducted.”) . . .

Experts say that people who get seven to nine hours of sleep a day are less prone to catching infectious diseases, and better at fighting off any they do catch. Afternoon sleep counts toward your daily total, according to Dr. Alger.

This immunity boost, she said, is in addition to other well-known dividends of a good nap, like added energy, increased alertness, improved mood and better emotional regulation.

Included under the last rubric is a skill that seems especially useful for dealing with families, even if you never get closer to your relatives this year than a “Hollywood Squares”-style video grid: “Napping helps you be more sensitive to receiving other people’s moods,” Dr. Alger said. “So you’re not perceiving other people as being more negative than they are.”

Napping also helps you remember facts you learned right before nodding off. Given the way things have been going lately, of course, you may not see this as a plus. You could look at it from the reverse angle, though: Every hour before Jan. 1 that you spend napping is another hour of 2020 you won’t remember.

For the full commentary, see:

Pete Wells. “This Thanksgiving, Nap Without Guilt.” The New York Times (Wednesday, November 25, 2020): D1 & D4.

(Note: ellipses added.)

(Note: the online version of the commentary has the date Nov. 24, 2020, and has the title “This Thanksgiving, It’s Time to Stop Nap-Shaming.”)

The book by Wolf-Meyer, mentioned above, is:

Wolf-Meyer, Matthew J. The Slumbering Masses: Sleep, Medicine, and Modern American Life. Minneapolis, MN: University of Minnesota Press, 2012.

Early Animation “Followed Only One Rule”: “Anything Goes”

(p. C5) The story of Disney Studios is a central strand in Mitenbuler’s narrative; Disney became the formidable force that the other animation studios would look toward, compete with and rail against. Max Fleischer, whose studio was responsible for the likes of Popeye and Betty Boop, groused that Disney’s “Snow White,” released in 1937, was “too arty.”  . . .  The wife of one of the Fleischer brothers, though, said they had better watch out: “Disney is doing art, and you guys are still slapping characters on the butt with sticks!”

But what if those slapped butts were part of what had made animation so revolutionary in the first place? Mitenbuler suggests as much, beginning “Wild Minds” with the early days of animation, in the first decades of the 20th century, when the technology of moving pictures was still in its infancy. Like the movie business in general, the field of animation contained few barriers to entry, and a number of Jewish immigrants shut out from other careers found they could make a decent living working for a studio or opening up their own. Even Disney, who grew up in the Midwest, was an outsider without any connections.

The work created in those early decades was often gleefully contemptuous of anything that aspired to good taste. Until the movie studios started self-censoring in the early ’30s, in a bid to avoid government regulation, animators typically followed only one rule to the letter: Anything goes.

For the full review, see:

Jennifer Szalai. “BOOKS OF THE TIMES: Ehh, What’s Animation, Doc?” The New York Times (Thursday, December 17, 2020): C5.

(Note: ellipsis added.)

(Note: the online version of the review has the date Dec. 16, 2020, and has the title “BOOKS OF THE TIMES: ‘Fantasia,’ ‘Snow White,’ Betty Boop, Popeye and the First Golden Age of Animation.”)

The book under review is:

Mitenbuler, Reid. Wild Minds: The Artists and Rivalries That Inspired the Golden Age of Animation. New York: Atlantic Monthly Press, 2020.

“Increasing Minimum Wages Can Cause Some Job Loss”

(p. B6) Increasing the minimum wage could lead employers to lay off some workers in order to pay others more, said David Neumark, an economics professor at the University of California, Irvine.

“There’s a ton of research that says increasing minimum wages can cause some job loss,” he said. “Plenty workers are helped, but some are hurt.”

A 2019 Congressional Budget Office study found that a $15 federal minimum wage would increase pay for 17 million workers who earned less than that and potentially another 10 million workers who earned slightly more. According to the study’s median estimate, it would cause 1.3 million other workers to lose their jobs.

For the full story, see:

Gillian Friedman. “Base Wage Of $15 Gains In Popularity Across U.S.” The New York Times (Friday, January 1, 2021): B1 & B6.

(Note: the online version of the story has the date Dec. 31, 2020, and has the title “Once a Fringe Idea, the $15 Minimum Wage Is Making Big Gains.”)

“Hillbilly Elegy” Book (but Not the Movie) Suggests a “Culture of Poverty”

(p. C3) “Hillbilly Elegy,” published in June of 2016, attracted an extra measure of attention (and controversy) after Donald Trump’s election. It seemed to offer a firsthand report, both personal and analytical, on the condition of the white American working class.

And while the book didn’t really explain the election — Vance is reticent about his family’s voting habits and ideological tendencies — it did venture a hypothesis about how that family and others like it encountered such persistent household dysfunction and economic distress. His answer wasn’t political or economic, but cultural.

He suggests that the same traits that make his people distinctive — suspicion of outsiders, resistance to authority, devotion to kin, eagerness to fight — make it hard for them to thrive in modern American society. Essentially, “Hillbilly Elegy” updates the old “culture of poverty” thesis associated with the anthropologist Oscar Lewis’s research on Mexican peasants (and later with Daniel Patrick Moynihan’s ideas about Black Americans) and applies it to disadvantaged white communities.

Howard and Taylor mostly sidestep this argument, which has been widely criticized. They focus on the characters and their predicaments, and on themes that are likely to be familiar and accessible to a broad range of viewers. The film is a chronicle of addiction entwined with a bootstrapper’s tale — Bev’s story and J.D.’s, with Mamaw as the link between them.

But it sacrifices the intimacy, and the specificity, of those stories by pretending to link them to something bigger without providing a coherent sense of what that something might be. The Vances are presented as a representative family, but what exactly do they represent? A class? A culture? A place? A history? The louder they yell, the less you understand — about them or the world they inhabit.

For the full movie review, see:

A.O. Scott. “I Remember Bev and Mamaw.” The New York Times (Friday, November 27, 2020): C3.

(Note: the online version of the review has the date Nov. 23, 2020, and has the title “‘Hillbilly Elegy’ Review: I Remember Mamaw.”)

J.D. Vance’s book is:

Vance, J. D. Hillbilly Elegy: A Memoir of a Family and Culture in Crisis. New York: HarperCollins Publishers, 2016.