Plunder and Deceit (14 page)

Of course, if the plan is to unravel and remake the existing society and economy, the degrowthers must not limit their demands, plans, and interventions merely to energy production and use. And they are not. For example, through the EPA, the degrowthers are abusing and expanding its authority under another federal law, this time the Clean Water Act of 1972.
⁶¹
Under the Constitution, Congress has the power to regulate only interstate commerce and only waterways that could be used as commercial channels of navigation across state boundaries. The act's language specifically acknowledges that the states regulate bodies of water within their boundaries, insisting that Congress will continue to “recognize, preserve and protect the primary responsibilities of the states.”
⁶²
But the EPA brazenly issued a rule seizing the authority to regulate virtually any body of water that—no matter how intermittently—flows into a stream or tributary, and in so doing inflated the definition of “navigable waterways.”
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This regulation obligates any property owner, including farmers, ranchers, and homeowners, to expend untold sums of money obtaining permits from the federal government before taking any action that might conceivably—no matter how unlikely such a result is—affect ponds, lakes, or streams on their own property.

Clearly the degrowth movement is not about reasonable conservation efforts, minimizing pollution through practicable policies, or averting the gratuitous destruction of natural habitats and ecosystems. As Rand wrote, the truth is that the first targets and victims of the enviro-statists and their degrowth crusade are the “young, ambitious and poor.” “The young people who work their way through college; the young couples who plan their future, budgeting their money and their time; the young men and women who aim at a career; the struggling artists, writers, composers who have to earn a living, while developing their creative talents; any purposeful human-being—i.e., the best of mankind. To them,
time
is the one priceless commodity, most passionately needed.
They
are the main beneficiaries of electric percolators, frozen food, washing machines, and labor-saving devices. And if the production and, above all, the
invention
of such devices is retarded or diminished by the ecological crusade, it will be one of the darkest crimes against humanity—particularly because the victims' agony will be private, their voices will not be heard, and their absence will not be noticed publicly until a generation or two later (by which time, the survivors will not be able to notice anything).”
⁶⁴

THE MINIMUM WAGE, AND
constant demands for its increase, is said to be compassionate. But the concrete evidence shows it is a job killer, especially for low- or unskilled workers in general, and younger people in particular.

The number of long-term unemployed (those jobless for twenty-seven weeks or more) stood at 2.6 million as of March 2015.
¹
The number of individuals employed in part-time work for “economic reasons” (those individuals who are not part-time workers by choice, or “involuntary part-time workers”) was 6.7 million in March 2015.
²
From a historical perspective, the number of involuntary part-time workers is particularly high. In 1990, for example, there were approximately 4.8 million individuals who were considered “involuntary part-time workers.”
³
A recent poll of the unemployed, completed in May 2014, revealed that 47 percent have “completely given up” looking for a job.
⁴

The labor force participation rate—the percentage of the population age sixteen and over employed for March 2015—stood at 62.7 percent.
⁵
For comparison, the labor force participation rate in 1990 was 66.8 percent.
⁶
The labor force participation rate reflects the percentage of individuals who are actually working and paying taxes. The unemployment rate, by contrast, reflects the percentage of individuals who are actively searching for jobs—not those individuals who have given up searching for employment. The federal government defines unemployment as “people who are jobless, looking for jobs, and available for work.”
⁷

According to an analysis conducted by the Senate Budget Committee, as of September 26, 2014, nearly one in four Americans between the ages of twenty-five and fifty-four was not working. In absolute numbers, this translates to 28.9 million Americans between these ages who are not working versus 95.6 million who are working.
⁸

There are a number of explanations for why the labor force in the United States is shrinking. First, the American population is aging. As the largest population cohort, the ruling generation is getting older and retiring. And a larger percentage of the population is physically incapable of work. Second, as indicated in the recent poll of long-term unemployed, many of those who do not have jobs have stopped looking for work. Discouraged by employment prospects, these individuals have simply dropped out of the labor force despite having a desire and the capacity to hold a job. A shrinking labor force is particularly problematic for the rising generation. Instead of the older generation retiring and subsequent generations filling jobs behind them, jobs are disappearing. Businesses are making the decision not to hire new workers. Fewer available jobs equates to less actual employment. Moreover, as described in chapter 6, unprecedented waves of immigration, legal and illegal, drive down employment opportunities for American citizens, particularly younger people, as does the government's degrowth agenda, as described in chapter 7.

For teenagers, the March 2015 unemployment rate stood at 17.5 percent.
⁹
For the general population, the unemployment rate for whites was 4.7 percent; for African Americans, 10.1 percent; and for Hispanics, 6.8 percent.
¹⁰
Furthermore, younger people are in a much worse position than their parents and grandparents. A survey completed by CareerBuilder indicated that “[w]hile the number of jobs held by [individuals aged 55–64] grew by 9 percent from 2007 to 2013, jobs held by [individuals aged 25–34] have increased a mere .3 percent.”
¹¹
In actual terms, those numbers “translate to a gain of 1.9 million jobs versus 110,000 jobs, respectively.”
¹²

In March 2015, there were approximately 2.1 million individuals who “were marginally attached to the labor force.”
¹³
This means an individual is not employed, wants to find employment, and searched for a job in the past twelve months. These individuals are considered “marginally attached” because they have not searched for a job “in the 4 weeks preceding the [employment] survey.”
¹⁴

Obtaining an entry-level job for teenagers and young adults is a necessary aspect of becoming an adult. Gainful employment inculcates responsibility and a sense of self-worth. It also allows those individuals to supplement the household income—if necessary, helping to support the family. However, obtaining a job for many young people is extremely difficult.

According to President Barack Obama, increasing the amount federal contractors pay their employees to a minimum of $10.10 an hour (up from the $7.25 minimum hourly wage) “would lift millions of Americans out of poverty immediately. It would help millions more work their way out of poverty—without requiring a single dollar in new taxes or spending.”
¹⁵
Always quick to demonize the opposition, Obama characterized those who disagreed with his position as “out of step and [putting] politics ahead of working Americans.”
¹⁶
He insisted that a minimum wage “means making sure workers have the chance to save for a dignified retirement.”
¹⁷
But forcing employers to pay more for unskilled or less-skilled workers, many of whom are younger, on top of the other statist economic and social policies, discourages employee retention and hiring.

Consider some basic economic truths. If the government mandates that workers who are earning $7.25 must, overnight, be paid $10.10 an hour (or even $15.00 per hour) those new dollars must originate from some source. For example, if a fast-food restaurant that employs twenty individuals is required to pay some or all of them close to 30 percent more per hour, it must account for those dollars somewhere. The restaurant can try to sell more food, it can increase the cost of food, it can cut the hours of its employees, it can hire fewer workers, or it can lay off those currently employed.

In addition, increasing the minimum wage directly and adversely affects youth employment because younger people are most likely to seek low-skilled jobs.
¹⁸
For many teenagers, their employment experience begins at the local fast-food restaurant, bowling alley, or department store. Therefore, any mandate from the government that employers pay an established wage reduces opportunities for America's youth to obtain entry-level jobs.
¹⁹
The supply and demand for professional jobs requiring medical, law, or engineering degrees are not adversely affected by an increase in the minimum wage. They require specialized skills, and those skills translate to higher wages. Low-skilled and unskilled lower-end jobs, often filled by younger people and first-time employees, are the most at risk when the government raises the minimum wage.

In the United States, the concept of a “minimum wage” arose from policies advanced by the Progressive Movement in the early twentieth century.
²⁰
Initially conceived as a floor for wages paid to employees, the first iterations of minimum wage laws applied to women and children in the labor force.
²¹
Established in the states, the first of these laws applied to specific industries such as garment workers. Utah was the first state to set a flat-rate floor for wages that applied to all industries.
²²
These laws, however, were quickly challenged by business owners and, in 1923, the U.S. Supreme Court declared them unconstitutional.

In
Adkins
v
. Children's Hospital
, the Court found the District of Columbia's minimum wage law unconstitutional. It ruled that a minimum wage law improperly interfered with the due process clause's protections pertaining to the freedom to enter into contracts. Specifically, the law unduly impeded the individual's right to contract:

[T]wo parties having lawful capacity—under penalties as to the employer—to freely contract with one another in respect of the price for which one shall render service to the other in a purely private employment where both are willing, perhaps anxious, to agree, even though the consequence may be to oblige one to surrender a desirable engagement and the other to dispense with the services of a desirable employee.
²³

As a result of this decision, many of the early minimum wage laws atrophied. One study conducted in 1991 determined that by the end of the 1920s “seven of the original seventeen minimum wage laws were declared unconstitutional, five others were either repealed or not enforced.”
²⁴

With the onset of the Great Depression and the advent of the New Deal, there was a renewed movement to establish a federal minimum wage applicable to all industries. Shortly after his re-election in 1936, President Franklin Roosevelt engaged in a public effort to improperly influence the Supreme Court. The Court's earlier decisions declaring aspects of Roosevelt's New Deal unconstitutional raised his ire. He threatened to pack the Court with individuals who shared his political and policy views. Though he never carried out his threats, as even members of his own party in Congress objected, Roosevelt's intimidation had the desired effect. In 1937, the Court reversed its position on the minimum wage by upholding the state of Washington's minimum wage law.
²⁵

After this change of course, and at Roosevelt's urging, Congress enacted the Fair Labor Standards Act (FLSA) establishing a minimum wage of twenty-five cents.
²⁶
The law applied to “employees who produced products shipping in interstate commerce.”
²⁷
This provision was a transparent attempt to assuage the constitutional concerns regarding the infringement on private business arrangements between two parties—the suggestion being that Congress has the power to regulate commerce between and among states. Minimum wage laws are now seen everywhere, and politicians at the federal, state, and local levels of government are constantly pressing to increase these minimums.

Instead of alleviating poverty and generating employment, the FLSA's minimum wage provisions actually extended the Great Depression. Economists Harold L. Cole and Lee E. Ohanian found that “high wages reduced employment directly in the cartelized sectors of the economy, and also reduced employment in the non-cartelized sectors through general equilibrium effects.”
²⁸
They concluded “that the recovery from the Depression would have been much stronger if these policies had not been adopted.”
²⁹
As such, mandating a minimum wage eliminated a commonsense approach available to employers when experiencing an economic downturn: broadly reducing all wages to avoid firing employees. In lieu of reducing wages, employers were forced to lay off workers or avoid hiring new workers or both. As Cole and Ohanian point out, this affected not only the specific industries subject to regulation under the FLSA, but the entire economy, thereby helping to prolong the Great Depression.

Nonetheless, the federal government alone has raised the federal minimum wage twenty-two times since its inception. The minimum wage is currently $7.25 per hour, and there are widespread efforts to increase this amount to $10.10.
³⁰
In 2013, the BLS reports, there were 79.5 million workers age sixteen and older who were paid by the hour—this accounts for 58.8 percent of all workers. Some 1.5 million workers earned the federal minimum wage ($7.25 per hour).
³¹
Although those earning the federal minimum wage represent a small percentage of the total workforce, the younger the worker the more likely his employment status is to be harmed by the minimum wage.