Your Neighbor's Paycheck Is Your Paycheck

Here's the deal: how much money you get paid is based on how much other people get paid. This is a fact of life. Your paycheck is based on what other people get in other jobs like yours, and what other people in your area make, and what other people with your qualifications make. The price of those people's work sets the price of replacing you if you quit your job. If you make less than they make, it can only be so much less. If you make more than they make, it's only realistically going to be so much more. If you're making too much less than similar workers, it will be cheaper to give you a raise than to replace you. If you're making too much more, it will be cheaper to hire someone else. You may feel like your paycheck is just between you and your boss. But you will always, always be in an important economic relationship with other workers who have other bosses. This basic truth about the world is called "the labor market."

If other people make more money than you do for more or less equivalent jobs, or if they get some benefits that you don't get, you have two ways of thinking about it. You can think of their pay as a reflection on you, and make everything of a question of self-esteem, or you can think of their pay as a market indicator and make it about money.

People who look at it as a comparison end up resenting the other workers and wanting to see them lose their jobs, or have their pay and benefits cut. That way the person doing the comparison can feel good because they're making more, or not as much less, than other people, so they can feel like winners. From this viewpoint, it's not about making more money than you're making now, but making more than other people. If you make five hundred dollars a week and other people make five hundred fifty, and they get two paid sick days a month, this mindset says that the someone else should have their pay cut seventy-five dollars and lose the sick days, because they shouldn't be treated better than you.

People who look at other people's pay as a market indicator, on the other hand, want the people who are making more money to be paid even more. If you are making five hundred dollars a week and get no sick days, but someone down the street with basically the same job makes five-fifty and gets to call in sick two days a month, you should want that person to get another raise, so they make five-seventy-five or even six hundred dollars a week. If they get that much, your boss will eventually have to give you five fifty, and maybe one paid sick day a month, to keep you from quitting and getting a job at the other place. If your boss won't give you a raise, but other bosses keep giving raises to their workers, eventually you will be able to quit and make more money at another job. The point isn't to make more money than someone else. The point is to make more money than you're getting.

If people at some other company get their pay cut, you get to feel better about yourself. If people at that company get a raise, sooner or later you get more money. In fact, the way it generally works in the second case is that you get more money and that makes you feel a little better about yourself.

The Republican position is that you should want other people to lose what they have. Why should they get health care? Why should they have a union? Why should they get a pension someday if you don't? The Republican position is that they will take things away from other people, to show those people that they are not better than you. Then, later, they will take things away from you, because they can. What are you going to do about it? Get another job? All the other jobs you qualify for are worse than yours ... wasn't that what you wanted?

The liberal position is that you should want other people to have good jobs, and for their job to get better, so that yours will get better. If someone gets health benefits and you don't, you should hope that everyone gets health benefits, so that your boss will have to give them to you. If someone else is in a union and you are not, you should hope their union get them a really good deal, because that will raise the market price for your work, too.

This is a basic fact of life. Workers are in it together, like it or not. Bosses are in it together, even if they never hold a meeting. If someone else's boss cuts their pay, your boss will be able to pay you less. If some else's boss gives them raises, yours will eventually have to give you one, too. This is called "the free market."

One of the many freakish oddities of our current political life is that most of the people shrieking about the evils of socialism take an essentially socialist position to questions of wages and benefits. The Tea Party doesn't want workers, and especially public workers, to make what the market demands. They want them to make what they deserve, in the particular Tea Partier's opinion, which is always less than the free market price. The Tea Party may worship "capitalism" when "capitalism" means a very small group of people getting obscenely wealthy, but when it comes to everybody else, everybody who works for a living, the Tea Party is just a pack of raging pinkos.

Remember, any time you hear someone complaining about this or that group being "overpaid," they mean you.

cross-posted at Dagblog