UMKC professor sells civility, reveals his minimum wage position

minimum-wage-guyDignity and better pay vs. lost jobs and bankruptcy: Scott Helm of UMKC was referee in that fight.

Through six weeks of meetings, he moderated clashes between advocates and opponents of a higher minimum wage.

The city passed a minimum wage increase last week, and Helm, an associate professor, spoke about the process Monday.

His group, Village Square, is bipartisan and puts together public debates with national experts on touchy subjects like the minimum wage and (upcoming) gay marriage, and a possible new airport.

In a fractured society, they try to build civility and community.

But he did not see much empathy develop between the two sides in the six two-hour long wage meetings, Helm said. “The best thing that came out of it was in the last meeting.”

That was when they agreed on about $9 as a starting point for an increase in the $7.65 state minimum wage.

Of course, business advocates wanted the increase over at least two years with any more increases tied to an area cost of living index.

Supporters of the higher wage wanted it raised to $9 this year and up to $15 by 2020.

The council voted last week to increase it to $8.50 on Aug. 4 and up to $13 by 2020.

So what does Helm, who has a PhD in public administration and economics from UMKC, think of this outcome?

The faculty member with the Henry W. Bloch School of Management agrees with Mayor Sly James, who said data indicated the minimum wage should be increased to about $9.

But Helm said the increase up to $13 in five years could also mesh with those studies, depending on the economy.

He is an empiricist, he said, and minimum wage studies (there are none from city increases) indicate it is beneficial overall up to a 60 percent increase, which would be $12.24 in Kansas City.

But when it comes to details and more, he said, “Both sides can be telling the truth and talking past each other.”

One economic standard for measuring a policy holds that it is good if one person is better off and none are worse off.

Another standard, which he favors, says a policy is good if the overall benefits gained from it are greater than the losses.

There may be some job losses, in other words, but people will benefit from more money, spend that money and grow the economy.

But there is wide disagreement on all this.

William B. Greiner, chief investment strategist for Mariner Wealth Advisors, is an expert who told the city council that an overall increase to $9.89 would be appropriate.

He reported that the minimum wage that started in 1938 was never meant to be a living wage.

It has always been used as an entry-level wage, he reported, and 70 percent of minimum wage workers are part time.

But Helm said that if struggling part-time workers were holding two or three such jobs, it leads to the civil rights argument that the issue is one of human dignity.

“At some point we have to realize that economics is a study not just of money but of societal well-being,” Helm said.

Greiner, in his report to the council, said a better and cleaner way to provide income to the poor is to expand the earned income tax credit.

Helm agrees the minimum wage is clumsy – “an extremely blunt tool to deal with multi-generational poverty.”

Of course, the city minimum wage increase may not survive a court challenge, with even the mayor and city attorneys questioning if it is legal.

But Helm said the battle has been worth it anyway.

If it fails, the market forces that conservatives say should be driving it will do so, Helm said.

There is a nationwide experiment under way as advocates for the poor, unions and others push for cities to raise the wage to $15.

“This is a movement,” he said. “Anyone who thinks it is going to stop is naïve.”

Cities that are raising it will provide data on how it works, and meanwhile businesses will be subject to public pressure and market forces.

“I think you’ll see a lot of people respond to this and get on board very quickly,” Helm said.




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