Will the minimum go up?

November 18, 2013

Trish Kahle, an activist in the Fight for 15 struggle in Chicago, looks at the motives behind a new federal initiative, supported by Democrats, to raise the minimum wage.

FOLLOWING A summer of walkouts by low-wage workers organized in the Fight for 15 campaign; a successful ballot initiative to raise the minimum wage to $15 an hour for 6,500 workers in Sea-Tac, the Seattle suburb where the region's international airport is located; and the success of socialist candidate Kshama Sawant's campaign for the Seattle City Council with a call for a $15 an hour minimum wage at the heart of its platform, President Barack Obama has supported legislation that will raise the federal minimum wage from $7.25 an hour to $10.10.

The proposal, sponsored in Congress by Sen. Tom Harkin and Rep. George Miller, is more than $1 an hour more than Obama proposed in his State of the Union address earlier this year. In 2008, as president-elect, Obama proposed raising the minimum to $9.50 an hour and indexing it to inflation, but his administration never pursued this measure in Congress.

On November 13, Labor Secretary Thomas Perez met with low-wage workers from across their country and promised to bring their concerns to Obama's attention. "Here's the bottom line," Perez said, "No one who works a full-time job should have to live in poverty."

President Barack Obama during a speech to members of the U.S. Coast Guard

The protests of low-wage workers and radical activists have pressured Obama and the Democrats to once again return to this theme and put forward a proposal that represents a significant increase. But there are reasons to be skeptical about the exaggerated statements of liberal media outlets that "Obama's $10.10 minimum wage would fundamentally transform America," as a Huffington Post article was headlined.

FIRST OF all, even though the $10.10 an hour proposal would be an increase of almost 40 percent, the final wage, reached in increments over several years, would still not be enough to lift minimum-wage workers with families out of poverty.

As a Huffington Post article pointed out about Obama's State of the Union pledge on the minimum wage, that level "won't do the trick"--especially with the ever-increasing cuts to social programs and the public school budget, as well as the impact of Obama's health care law forcing millions of people into the private health care market.

The value federal minimum wage has been whittled away by the rate of inflation for years. Even a raise to $10.10 an hour wouldn't return the minimum wage to its 1968 value, which works out to $10.55 in 2013 dollars, once inflation is accounted for.

The problem is clearest of all in major cities. In Chicago, for example, a single parent with one child needs an annual income of $48,840 to make ends meet, according to an Economic Policy Institute report titled "What Families Need to Get By." A full-time job at the current minimum wage earns workers $15,080 a year. Raising the minimum to $10.10 would only begin to close the gap, raising a full-time minimum wage income to about $20,000.

Second, Obama is hardly taking a bold, "transformative" step in supporting the Harkin-Miller proposal. According to a Gallup poll from earlier this month, 76 percent of people would support raising the minimum wage to $9 an hour. Over 90 percent of those who identify as Democrats were in favor--even a majority of Republicans, at 58 percent, agree.

Lastly, and perhaps most importantly, Obama is putting his support behind a measure that is unlikely to become law anytime soon. Despite 58 percent of Republicans saying they support an increased minimum wage, most GOP politicians oppose any increase in workers' living standard, particularly in the form of a mandate from the federal government.

Obama and the Democrats have a record of putting forward proposals like this that will be popular with the party base--but not lifting a finger to prevent Republicans from blocking them.

THE RIGHT wing, it seems, never misses an opportunity to attack low-wage workers and their demands--in the name of cutting the deficit and protecting business interests. At just the mention of raising the minimum wage, they pull out the "job-killer" scarecrow. Republicans even have the audacity to say that they are looking out for low-wage workers with their opposition--because raising the minimum wage would supposedly make it harder to find employment.

House Speaker John Boehner, for example, was typical with his claims that the Democratic proposal for raising the minimum wage would make it impossible for small businesses to grow.

But most low-wage workers don't work for small businesses anyway. According to a National Employment Law Project (NELP) report from 2012, most low-wage workers--about two-thirds--work for companies with more than 100 employees. Of the 50 largest low-wage employers, more than 90 percent were profitable last year, and over 75 percent of them were more profitable than before the economic crisis began five years ago. McDonald's, for example, raked in $27 billion in revenue last year. If it were a country, it would have the 90th largest economy in the world.

As the NELP report concluded, "Contrary to what critics sometimes suggest, the majority of the impact of any increases in the minimum wage will therefore be felt by large companies and corporations rather than small mom-and-pop establishments."

These corporations pay out millions in executive salaries and bonuses, with CEOs making more in a few hours than a full-time minimum-wage worker makes in a year. The companies are making more than enough money to pay their workers a living wage, but they continue to fight tooth and nail against even the smallest increases in compensation for employees.

Why? As capitalists, their chief interest is in increasing their profits. As long as workers are unable to force concessions from them, there is no incentive to increase wages, especially while unemployment remains relatively high.

Now, though, the Fight for 15 has frightened these employers with the possibility of an emerging fast-food labor movement--one that could challenge them not just about wages, but other issues: benefits, working conditions, the quality of the products sold, and community accountability, to name a few.

As low-wage workers, we welcome any increase in pay--even a few extra dollars each month can mean the difference between eating and going hungry, between turning up the heat in winter so we can sleep comfortably and taking the dangerous risk of leaving it low, or even off.

But while the Democratic proposal for a $10.10 an hour minimum would be a substantial increase, we have to recognize how we got to this point--it wasn't by thanking politicians for meeting us (less than) halfway.

Here in Chicago, low-wage workers have a motto in responding to the concessions we do win from employers: "Thank you, strike again." This is the same approach we must use when we here promises from politicians about the demands we raise.

A $10.10 an hour minimum wage wouldn't lift many low-wage workers out of poverty, and simply having Obama declare his support is not the same as actually getting it implemented. What this does show us, however, is that our movement is gaining momentum. Politicians who line up to support a minimum wage increases haven't suddenly seen the light. They're feeling the heat.

Any increases we do win in our wages--whether they come directly from employers or in the form of a higher minimum wage mandated by the government--won't be because of the benevolence of the Obama administration or corporate CEOs. They will be the result of continued organizing, strikes and demonstrations.

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