Today’s News & Commentary — August 29, 2017

An embattled St. Louis ordinance raised the city’s minimum wage to $10 an hour on May 5, 2017.  Yesterday, the minimum wage dropped back down to $7.70 because a state law took effect prohibiting local minimum wages above the state minimum.  Though many states have prevented local increases, few have rolled back increases that were already in place.  Some St. Louis workers saw their wages fall immediately.  Other businesses have publicly committed to keeping wages at or above $10, perhaps due in part to urging from the Save the Raise campaign.  Raise Up Missouri, an allied campaign, is building support for a ballot initiative that would raise the statewide minimum wage to $12 per hour by 2023.

Apple CEO Tim Cook just finished a mini-tour of middle America, and the New York Times notes a strong resemblance between his trip and conventional political campaigning.  Cook toured a tech company in Ohio and announced a major investment in Iowa.  In Texas, Cook announced that Austin Community College will become one of 30 community colleges offering an Apple-authored curriculum on app development.  Critical of governmental gridlock and of President Trump’s response to Charlottesville, Cook has demonstrated a commitment to using renewable energy, and reaping the tax benefits of doing so.

Unemployment has been unnaturally low for four straight months, where ‘natural’ refers to a balance between the risk of recession and the risk of inflation.  This might mean that another recession is imminent.  It also might mean that structural changes—an aging workforce, globalization, and technology—are creating a new ‘natural’ for the American economy.  The Wall Street Journal observes that inflation is falling rather than rising, and this supports the second explanation.