Giving Up on Washington
MINGO JUNCTION, Ohio - The roar is gone.
Five years after Wheeling-Pittsburgh Steel's once-thunderous mill went idle, the only sound here is that of the oldest parts of the plant being dismantled.
The demolition began about a day or so before a red carpet rolled out at the White House for a state dinner featuring a dress worn by the first lady that cost more than the salary of a police officer in this town.
The demolition still was going on last Wednesday, at the same time that Vice President Joe Biden boasted about the positive impact that the American Recovery and Reinvestment Act — the stimulus — had on America's Rust Belt, on the fifth anniversary of its signing into law.
“The closest we got to stimulus money was a grant to pay for the salary of a police officer for a year,” said Steve Maguschak, Mingo Junction's administrator and police chief.
A policeman for 30 years (and the police chief since his brother retired), Maguschak became the town administrator last year when operating funds ran too low to cover a full-time employee in the post.
You have to wonder if this career law enforcer — whose father died in the line of duty in 1970, after being shot by a fugitive — feels insulted by the $13,944 grant to pay a policeman's salary.
If ever a town needed an injection of economic stimulus to spur some sort of job growth, it would be Mingo Junction, a long-forgotten village steeped in the rich history of the founding, forging, protecting and strengthening of our country.
It was here that George Washington slept ... twice.
It was here that Andrew Carnegie built one of his largest steel plants, which went on to supply the machinery that kept our military fighting in World War II — and, when the war ended, those steel and coke plants helped to build our booming cities and highways.
It was here that Ohio State University icon Woody Hayes got his first job as an assistant football coach. And it was here that Robert DeNiro barreled down Commercial Street in a white Cadillac in one of his best films, “The Deer Hunter.”
Today, the business buildings lining Commercial Street are vacant.
When Wheeling-Pitt went bankrupt, Maguschak said, a series of new owners came and went. The town's shops closed, people left, and “now we are down to an operating budget that lost 75 percent of its revenue ... the company that owns the (steel) property and what is left of the facility does not make anything — they dismantle.”
Last week the Congressional Budget Office estimated that raising the minimum wage to $10.10 an hour would increase earnings for 16.5 million low-wage Americans but would cost the nation more than 500,000 jobs.
If all you cared about was wages paid to low-income workers, this would be a winner — and you would think, in a town like this, that would be a welcome development.
It's not. It will hurt the bottom-line running of Mingo Junction's government, Maguschak said.
“I still hire kids in the summer to work at the pool or cut grass or work in the office,” he explained. “Raise the minimum wage, and that affects whether I can staff the pool, the park and the office.” And that affects the quality of life he is trying to hold onto for the residents still left here.
“We have to get out of the discussion of raising the minimum wage as good policy and talk about job creation, about revitalizing small-town America,” he said.
Many people overlook one big question in this debate: Who pays this higher wage bill?
The answer: consumers, as the rising costs of retailing or fast food are passed on in higher prices.
So the net effect of this policy is a transfer of wealth from consumers generally (especially those in the middle to lower-middle classes who shop at Wal-Mart and eat at McDonald's) to low-end workers who still keep their jobs.
Is this good economics? No, but Democrats think it is good politics.
Steve Maguschak lives in the real world of bad policies. He hasn't given up on his town, but he has given up on Washington.