The results are in and 60 percent of Massachusetts voters agreed that Massachusetts voters should be paid for up to 80 hours of extra time each year if the voter or someone in the voter’s family is sick (see Question 4). It seems almost too easy. Ask people to vote on whether or not they should get paid more. I’m sort of surprised that we haven’t seen (and passed) ballot questions on giving ourselves 8 weeks of paid vacation annually, a company car, and other executive-level perks.
Who among us does not believe that he or she deserves a 10-percent raise?
[Separately, can sick leave as mandated by this new law function just as well as vacation days due to the fact that the employee can say “my parent was sick”? How could an employer ever verify that? After a certain amount of sick time an employer can usually ask for a doctor’s note, right? But can an employer ask for a doctor’s note regarding a relative of the employee?]
So the question is, why doesn’t this happen even more? Why don’t we have minimum wages of $15, $20, or even $50/ hr. in all the “blue states” if the voters are free to vote themselves pay raises? Why don’t we have ballot initiatives for a mandatory 10% (or 50%) wage increase for everyone? What is stopping this if voters are free to vote themselves unlimited free stuff?
“Would you like other people to pay for these benefits for you?” is as old as politics itself. (For example, that’s how a constitutional amendment was passed to allow the federal income tax in the early 1900s; when it was passed, only a small fraction of Americans would be subject to it.)
Politicians rely on that fact that to vote against such measures on their merits requires two things that the general voting population, on average, lacks: 1) the ability and effort to understand the issue and its ramifications, and 2) a working moral compass.
Izzie: Why don’t people vote for minimum wages of $100/hour? Maybe at least half of the people enjoy earning more than the median. If the minimum wage were $100/hour it would be hard to feel superior unless you were a plastic surgeon or Wall Streeter. But mandating extra vacation or sick time is a raise for everyone that also preserves the distinctions among workers. So there is no downside at all!
But to pass a law you need only 50%+1. So if you assume that all those making less than the median would like their wages raised, that gets you 50% right there and then you only need one more misguided person from the upper half.
According to this blog:
http://worthwhile.typepad.com/worthwhile_canadian_initi/2006/11/when_the_minimu.html
“science” indicates that the sweet spot for the minimum wage is somewhere around 40% of the average hourly wage. Much below this number, it accomplishes little because it is below the market clearing wage anyway. At 40% you can force the worst employers to pay more without causing a lot of firings – most people who are employable at all have productivity that is at least 40% of average. Above 45% or so, you begin to lose significant numbers of jobs because the mandated wages begin to exceed the productivity of many at the lower end of the workforce .
The average US wage is around $20/hr (median is lower) so the indicated minimum wage should be around $8. The Massachusetts minimum wage (not counting the value of paid sick leave) is $8 so it appears to be about right. So somehow, the politicians stumbled into getting it right. $15 is ridiculous from an economic science POV (would cause major unemployment), but politics is not wedded to science.