Terrific interview with Nick Hanauer, "a venture capitalist who was one of the first investors in Amazon, has the distinction of being one of America’s few progressive billionaires" on income inequality in America.
The whole thing is well worth a read, but here are some highlights:
And Americans today spend a minimum of $150 billion a year in tax subsidies that go to people not who don’t have jobs, but who have jobs, and are in poverty. There is no earthly reason why Walmart and McDonald’s and Walgreens and these other giant, profitable institutions should have one worker in need of public assistance. It’s ridiculous. And it’s not just getting them out from under the need for public assistance; it’s like, that’s what drives the economy! The person earning the federal minimum wage of $7.25 isn’t going out to eat at restaurants. They’re not taking piano lessons. They’re not going to the gym or the yoga studio. They’re not sending mom flowers on Mother’s day. What good is this person in the economy? If you raise it to $15 an hour, they’re doing all of those things. And all of a sudden, not just business thrives, but small business thrives.
Today, the average full time worker works 47 hours a week. And they work those [extra] seven hours mostly for free, because today, less than 10% of salaried workers are entitled to overtime. If you earn more than $23,600 a year—if your employer pitches you a fake title like “assistant manager,” they don’t have to pay you overtime. And as a consequence, all over the country people are working for $27,000 a year and working 70 hours a week doing basically: one person doing the job of one and a half. So as an employer I can get two people to do the work of three, and think about what that does for profits... what I’ve done effectively is not just increase my profits, but I’ve taken a job out of the economy, and in so doing I’ve softened the labor market. And the softer the labor market is, the more leverage I have in my wage negotiations. And as a consequence we have this relatively high persistent unemployment. But if employers have to pay people overtime, they’re not going to want to do that.
I think the country has moved right. I think the idea that giant profitable corporations should pay their workers enough so that they don’t need food stamps—since when is that left wing? How did that become “leftie?” That doesn’t seem leftie to me. That seems common sense.