The President's Mighty Pen
12:00 AM, Mar 15, 2014 • By IRWIN M. STELZER
The president’s next step was a campaign-style tour, the sort in which he engages in times of stress, in which he argued that no working person should have to live in poverty, a proposition with which it is difficult to quarrel. The president then summoned CEOs of several large corporations to the White House to persuade them to raise their minimum wages. Since many of the companies represented are enmeshed in the president’s wider regulatory net, “persuade” might be the wrong word, and “coerce” a better one. Having gone as far down this road as his executive authority will take him, Obama is asking Congress to pass legislation raising the minimum to his $10.10 level. (“It’s easy to remember, $10.10,” Obama said in his State of the Union address.) The nonpartisan Congressional Budget Office says that passage might result in a loss of 500,000 jobs but also might improve incomes of over 16 million households.
Last week he returned to use of the presidential pen, this time to expand the reach of a 1938 law that requires employers to pay certain classes of workers time-and-a-half for any hours worked beyond forty in a given week. In 1975 President Gerald Ford’s Labor Department ruled that workers earning less than $455 a week were covered by the time-and-a-half rule. Obama wants the Labor Department to review that level, which the Obama-favoring New York Times says must be raised to $1,000 per week merely to keep pace with post-1975 inflation. The president also wants “my” Labor Department, as he refers to it, to narrow the number of exempt administrators, supervisors or managers. Because the wheels of the rule-writing bureaucracy grind slowly, it is Obama’s successor who will decide whether these new rules ever go into effect. Diana Furchtgott-Roth, formerly chief economist at the Labor Department and now a scholar at the Manhattan Institute, tells me that if they do, workers will forfeit a current benefit—the informal arrangements employers often make with them to compensate for overtime work with time off, a compensation method often preferred by young workers and hard-pressed working mothers. But she guesses that the rule-making process will outlive the president’s term of office.
Economists disagree about the effect of these exercises in presidential power. But there is little question about two things. The fact that the benefits of this recovery have been concentrated in the already-comfortable is inviting and providing justification for tinkering with the market system to over-ride its distributive consequences. The second is that Obama’s pen-led populism, a result of political calculation and sincere belief in “fairness” as he defines it, has done nothing to shore up his Obamacare-battered ratings: only four-in-ten Americans approve of the way he is doing his job.
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