After President Obama’s call to raise the minimum wage in January, polls showed that Americans backed an increase, with even 50 percent of self-identified Republicans doing so.
Yet congressional Republicans, cribbing talking points from corporate lobbyists opposed to an increase, balked at Obama’s proposal, claiming it will harm the economy.
But these wild claims of economic destruction resulting from a minimum wage hike are not new. They are the very same sorts of scare tactics used to oppose the 2007 minimum wage hike that most Republicans also opposed. Here’s what Republicans and leading right-wing pundits said at the time:
Right-wing pundit John Stossell: A wage hike would be “sticking it to low-skilled workers” and lead to higher unemployment. [January 2007]
Republican Senator Mike Enzi (R-WY): Raising the wage will “put mom and pop businesses and their employees out of business” if not accompanied with another huge tax cut for the rich. [January 2007]
Republican President George W. Bush: Simply raising the wage would “punish the millions of small businesses that are creating most of the new jobs in our country.” [January 2007]
The Heritage Foundation: This leading right-wing think tank claimed “raising the minimum wage to $7.25 an hour would cost at least 8 percent of affected workers their jobs.” [January 2007]
Rep. Jack Kingston (R-GA): Kingston said the minimum wage is just an “arbitrary number” but that raising it would “decrease the number of jobs, thus hurting those whom we are supposed to be helping.” [January 2007]
Rep. Lee Terry (R-NE): Terry said that raising the wage would be “nothing more than a Band-Aid on a broken little toe. While their intentions may be good, and I believe they are, their philosophical approach is economically and socially flawed. In reality, this plan will create an economic hardship for the employers who provide millions of Americans the opportunity to participate in our economy.” [January 2007]
Republican Senator Tom Coburn (R-OK): Coburn said his vote against the minimum wage bill was to “protect the salaries of low-income families” who would be laid off as a result of the wage hike. [February 2007]
Senator Judd Gregg (R-NH): Gregg — who now works for Goldman Sachs — had this take: “If you start losing jobs because you raise minimum wage too quickly, too fast that small employers can’t afford it, that’s going to have an effect on peoples’ opportunity to work.” [June 2006]
And recall that at the time 28 Republican Senators, many of them still serving today, voted in favor of eliminating the federal minimum wage altogether.
Despite the scare tactics from congressional Republicans, the 2007 minimum wage hike did not harm the economy. Studyafter study has shown that raising the minimum wage has not, on net, cost workers their jobs.
Most Americans want the minimum wage to be raised — 73 percent of them, including 50 percent of self-identified Republicans. But Big Business wants to fight an increase, and has enlisted its allies in Congress to block it.
Last week, the Senate held a hearing on the minimum wage and a business owner testified that a wage hike may force businesses to fire workers. Sen. Elizabeth Warren (D-MA) deftly dismantled this talking point, pointing out that, for example, it would only cost McDonalds four cents more per meal to provide a $10.10 minimum wage to all of its workers.
WARREN: During my Senate campaign, I ate a number 11 at McDonald’s many, many times a week. I know the price on that. $7.19. According to the data on the analysis of what would happen if we raised the minimum wage to $10.10 over three years, the price increase on that item would be about four cents. So instead of being $7.19 it would be $7.23. Are you telling me that’s unsustainable?
BUSINESS OWNER DAVID RUTIGLIANO: Senator Warren, not all restaurants are created equal. I’m in a full service restaurant business. McDonalds has efficiencies and they operate completely differently than I do. I have many jobs, many jobs that pay well above minimum wage. We have a retirement plan. We offer health insurance to our salaried employees. So my business is a little different. I can’t raise a four cent price. I mean I don’t have, I don’t operate like a fast food restaurant. I would hope you appreciate the distinction.
WARREN: I do appreciate the distinction and I’m not going to be in the business of being a McDonald’s representatives but they would talk about having some higher paid jobs and some opportunities for management and advancement as well. But I get your point, maybe it’s only four cents on $7.19. But if your entrees are $14.40 we’ll see how fast I can do the math — are you telling me you can’t raise your prices by eight cents?
During his State of the Union address, President Obama unexpectedly called for a hike in the minimum wage to $9.25 an hour, and Congressional Democrats are calling for an even higher hike to $10.10.
The importance of boosting the minimum wage was highlighted earlier this week when the National Low Income Housing Coalition (NLIHC) released a report showing how difficult it is for low-income Americans to get affordable housing.
The report notes that there is no state in the country where a minimum wage worker working 40 hours a week can afford a two-bedroom apartment for their family. In the cheapest state, a worker would have to work approximately 1.4 jobs to afford such an arrangement, and in Hawaii, a worker would have to work 4.4 jobs at the minimum wage.
The report then follows up with this shocking fact:
The one-bedroom housing wage also exceeds the federal minimum wage in each state across the country. In fact, with the exception of a handful of counties in Washington and Oregon (where the state minimum wage is $9.19 and $8.95, respectively), there is no county in the U.S. where even a one-bedroom unit at the FMR is affordable to someone working full-time at the minimum wage.
As we’ve noted previously, one way to force House Republicans to support increasing the minimum wage would be to put increases on state ballots in 2014. This would increase progressive voter turnout and threaten to unseat Republicans who failed to back an increase.
One of the right-wing myths about the minimum wage is that we don’t need to raise it because it mostly benefits teenagers who work part-time and live at home with their parents.
But the data does not bear this out. Every year, the Bureau of Labor Statistics compiles data on the workforce. Their most recent demographics report is from year 2011. That year, 50.5 percent of Americans who earned minimum wage or less were 25 years or older. The year before, in 2010, it was 51 percent.
Read our earlier post about how progressives could use ballot initiatives to force congressional Republicans to stop blocking increases in the minimum wage.
What if American workers were actually paid for increases in productivity?
Activists are mobilizing around President Obama’s call to raise the minimum wage to $9.00, and polling shows that Americans across the political spectrum agree with such a policy.
But here’s an interesting fact about what the minimum wage could be instead. The Center for Economic and Policy Research’s John Dewitt looked at what the minimum wage would be if it simply rose with productivity — that is, if workers were actually paid for the increasing amount of output — since 1968, and found that it would be almost 3 times what it is now:
Since 1968, however, productivity growth has far outpaced the minimum wage. If the minimum wage had continued to move with average productivity after1968, it would have reached $21.72 per hour in 2012 – a rate well above the average production worker wage. If minimum-wage workers received only half of the productivity gains over the period, the federal minimum would be $15.34.
Even Obama’s modest plan to raise the minimum wage is expected to face intense opposition from Big Business and its lobbyists.
Last night, President Obama made the proposal to raise the minimum wage to $9 an hour and then to index it to inflation. This would be a wage increase for workers in every single state except Washington.
While Republicans have already stated their intention to obstruct this proposal, they should know that raising the minimum wage is actually wildly popular. Polling conducted by Lake Research in February 2012 found that voters actually want a proposal even more progressive than Obama’s suggestion.
Their poll found that 73 percent of voters want to see the minimum wage raised to $10 an hour by 2014. This includes 50 percent of Republicans.
Earlier this month, PCCC member and minimum-wage worker, Eva Lister, testified before the Connecticut General Assembly to share with legislators what a minimum wage increase would mean for Connecticut working families. Days later, the body’s Labor Committee passed a bill that would increase the minimum wage to $9.25/hr. Today’s polling shows that voters want legislators to pass $9.75 or higher. [more]
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