Wednesday, January 7, 2015

President Obama's Wage Initiative

It has become conventional wisdom among liberal politicians and pundits that Democrats running in 2016 should embrace a "new populism" centered on combating income inequality and middle class wage stagnation. There are likely some Democrats who need to be persuaded, but President Obama isn't one of them.

As I've written before, Barack Obama started talking about this issue before Elizabeth Warren ran for her current Senate seat. As a matter of fact, he regularly calls it "the defining issue of our time." Way back when he first announced his candidacy for president (more than six months before the Great Recession hit), he said that it was one of the reasons why he decided to run.

What we've heard less about from politicians and pundits are specifics of what can be done to combat income inequality. Basically most all Democrats support raising the minimum wage. But beyond that - what are the policies/proposals that can lead to change?

To answer that question, Danny Vinik interviewed Lawrence Mishel and Ross Eisenbrey, the president and vice president of the Economic Policy Institute (EPI) respectively, and uncovered what they call the "Obama wage initiative."
We believe that the Obama administration has pursued and is pursuing a series of initiatives that could be categorized as an Obama wage initiative, although the administration doesn’t package it as that, which is something that which we think is a mistake.
They go on to list five things President Obama has done as part of this initiative:
  1. DACA and his more recent immigration executive actions
  2. Executive order raising the minimum wage to $10.10 for federal contractors
  3. Fair pay and safe workplaces initiative
  4. Directing the Secretary of Labor to update the white-collar salary threshold for overtime pay
  5. Asked Congress for 300 more investigators for the wage and hour division
Given that the President told Steve Inskeep that he will now be focusing on long-term projects like "making sure that everybody is benefiting from this growth and not just some," I expect we'll be seeing more of this kind of thing in his forth quarter.

So here's a heads up to those promoting a "new populism:" identifying the problem with strong words and fancy graphs won't cut it. Its time to put your solutions on the table.

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