To the Editor,

Warren Smith’s recent Letter To the Editor advocates total abandonment of the minimum wage. He argues that the “free market economy” alone will produce fair wages. In support of that argument, he imagines two hypothetical corporations making hammers, each with the same revenue and costs, other than wages. He concludes that “Beta” corporation, paying the higher employee wage, will be successful over the lower wage paying “Alpha” corporation, simply “by Beta’s desire to acquire a larger and larger share of the overall market in hammers.” And to accomplish that desire, Beta corporation will “expand its investment in plant and equipment and correspondingly hire additional employees away from Alpha by offering higher wages … ”

Two rather obvious problems. First, what makes Mr. Smith believe that Alpha would not also want to acquire a larger share of the overall market and expand its investment in plant and equipment? In fact, Alpha would be in a much better position to do so since it would have more money to make such investment because, as Mr. Smith admits, “obviously … Alpha is the more profitable business” due to lower employee wages. Second, unfortunately, neither corporation would have any problem hiring employees in this economy. There are always workers available for low skill, low paying jobs.

The growing income divide in our society is persuasive proof that corporate executives prefer company profits (and higher wages for themselves) over higher wages for employees. Minimum wage is $7.25/hour, and working 40 hours/week for 50 weeks equals earnings of $14,500! As a result, over 45 million of your neighbors in America are living below the poverty level, including over 10 million actual “workers.” In fact, even $10/hour does not bring a family of four above the poverty level. The argument that the “free market” will miraculously solve this situation is without merit. The indisputable fact is — corporations already know what poverty level income is, and yet, still allow millions of their workers to struggle for survival while protecting historically unprecedented corporate profits.

Income for the top tier of Americans has dramatically increased over the past 20 to 30 years. This small group has reaped the benefits of increased productivity and stagnant wages; there has been little trickle down. Moreover, corporations themselves do not believe in a strict “free market.” They spend millions each year lobbying the federal government for taxpayer paid benefits and bailouts: a Wall Street bailout of $700 billion; corporate jet subsidies of $3 billion annually; billions in farm subsidies; hedge fund manager 15 percent tax rates; etc., etc. Corporations want it both ways, no regulation on employee wages, but lots of government assistance for corporate welfare. There are times when the government does need to step in to secure the rights of its citizens to not only life and liberty, but also to some opportunity for happiness. Money may not buy happiness, but the opportunity for happiness while working full time to earn $14,500/year for your family is pretty limited.

Tom Walker

Chocowinity