Letters to the editor

By Northwest Arkansas Times

Posted: July 30, 2009 at 6:48 a.m.

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A bigger slice of the pie

WASHINGTON COUNTY — The July 24 raise in the federal minimum wage to $7.25 per hour, the last of three such increases enacted by Congress in 2007, will help millions of workers cope with the rising price of food, housing and other basic items. Extra earnings of up to $28 per week could help pay for health care or school supplies, but it won't get many people out of poverty.

It is a blight on our society that people who work hard (many times even two or more jobs) cannot have a standard of living that enables them to live above the poverty level and to be able to pay their bills.

In this time of economic turmoil, the increase in the minimum wage is part of the solution, not the problem, since the extra weekly pay of up to $28 for low-income workers will be spent at neighborhood businesses on basic needs like food, fuel, housing and health care. Numerous studies cited by Let Justice Roll, a nonpartisan coalition of faith, labor and business organizations, demonstrate clearly that increasing the minimum wage is sound business practice and provides a stimulus to local economies.

The minimum wage was enacted during the Great Depression. President Roosevelt called it "an essential part of economic recovery," putting a needed floor under workers' wages and stimulating the economy and job creation by increasing consumer purchasing power. However, the new income floor of $15,080 a year is less than what a corporate CEO at a Standard & Poor's 500 company earns before lunch on any given day.

An economy built on rising greed and debt rather than living wages is a house of cards. While the increase in minimum wage will help many workers, it's just a small crumb of the larger pie that workers are being denied.

Bradford Bowen / Fayetteville

An unfair deal unfolds

I guess we know what motivates people to move from South Carolina to Arkansas, and it ain't altruism. The hogs are lining up at the trough. I voted for the lottery assuming that it would be run in a competent fashion. Now Arkansas is looking like a bunch of rubes at a carnival show. How easily Passailaigue has charmed our legislators and taken their money.

Any good con man knows that the keys to success are to play greed against common sense and to force the marks to make decisions rapidly with little time for reflection. Passailaigue starts by telling our legislators to "ignore criticism from your constituents" because the average person "just really will not understand it." This is really interesting. Aren't we going to sell tickets, collect the revenue and then distribute it to winners, the scholarship fund and our new employees? Where is the rocket science?

This brings to mind an image of Enron's Jeff Skilling informing a young reporter that she is just not smart enough to understand the revenue model.

Yes, it is true that increased profits can come from increased revenue and that tradeoffs are difficult to evaluate. However, we start out by paying $785,000 for the director and two vice president positions instead of a competitive combined $450,000. At 25 percent payout to the scholarship fund, we need to collect an extra $1.34 million annually in revenue that would not be collected with less-experienced persons running the lottery. Do we really believe this will happen? How does the lost revenue due to backlash against exorbitant salaries figure in? What is the effect of losing the support of 50 percent of the constituents at the outset? It is a complex equation, but I don't buy the return on investment for multi-year salary commitments.

The next thing we will see is that Passailaigue writes the compensation packages for his buddies, and that these include some nice bonus and severance packages. What is the cost of that over five years?

I also don't buy that we have immediately saved $700,000 in consulting fees by placing all of our trust in a single individual that is obviously motivated to line his pockets. With any investment there is value in listening to several advisors, and especially to advisors that will not gain personally based on their advice.

My mother taught me that two wrongs don't make a right. Don't compare these salaries to already outrageous football coach salaries, but rather to really important positions such as state education commissioner or university chancellor. Passailaigue is simply a CPA that has learned how to sell tickets and manage an 80-employee operation. There is no comparison on level of responsibility and potential influence to the state education commissioner.

The only good thing about accelerating the sale of lottery tickets is that it will hasten the day that we open our eyes and see what kind of deal we have made.

Ron Foster / Fayetteville

Opinion, Pages 4 on 07/30/2009

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