February 4, 2014

The Fight for $15 (Part II)

Originally posted at GuerillaPress

A server at DiMillo's Floating Restaurant in Portland's Old Port. Wait staff there make a base salary of $3.75 an hour--half the state's $7.50 minimum wage.

It's official: Portland Mayor Michael Brennan reads this blog.

How else to explain the mayor's call in his recent "State of the City" address to establish a higher minimum wage in Portland, just weeks after Guerrilla Press took on that very topic? Hey, Mike--while you are listening, I have some ideas on other issues I'd like you to consider.

OK, so I have no idea if Brennan reads this blog. In all likelihood he is following the lead of his Democratic leadership, which has made raising the federal minimum wage a top priority this (election) year, according to a recent story in the New York Times. While President Obama's proposed $10.10 an hour would still not constitute a living wage, and falls short of the $15 per hour many fast-food and retail strikers have called for in recent months, the fact that the topic has been thrust back into mainstream debate is nonetheless encouraging.

If city officials were to approve an increased minimum wage, it would make Portland the only community in Maine to have a higher wage than the statewide $7.50. (The federal minimum wage is $7.25.) Such a move is not unprecedented, however. Nationally, eight cities or municipalities in the U.S. currently have a minimum wage that is higher than their state level.

As governor, Angus King twice vetoed modest increases to the state's minimum wage, claiming it would scare off potential businesses.

Of course, with this renewed focus on the minimum wage comes the inevitable Big Business backlash. Though Brennan did not state a specific dollar amount in his generic address, local business owners are already getting nervous that this prospective wage increase might--gasp!--cost them more money.

Steve DiMillo, owner of the upscale DiMillo's Restaurant and prominent local businessman griped to the Portland Press Herald's Randy Billings (1/24/2014) that any increase in the minimum wage would force him to "give raises to some of [his] highest-paid employees."

DiMillo's wait staff, because they are tipped workers, only receive a base salary of $3.75--half the state minimum wage. But, DiMillo points out, "they earn upwards of $20 an hour when tips are included..."

That is assuming, of course, the waiter is tipped at all. Last time I checked, tipping is completely optional. Sure, most of us tip regularly and tip well, but DiMillo makes it out to be a guaranteed part of a waiter's income. Besides which, servers whose tip is included in a credit or debit card payment do not always receive the money right away--if they receive it at all. Wage theft in the restaurant industry is far more pervasive than many people realize.

Later, in the same article, Coffee By Design co-owner Mary Allen Lindemann, also bemoans the possibility of having to pay her workers more. She shifts the blame to the city's lack of affordable housing, which, while certainly an equally important concern for minimum-wage workers, strikes me as something of an apples-vs.-oranges comparison. In other words, it is not Lindemann's fault that her employees can barely afford to stay in their apartments. It is the city's.

And how do CBD workers feel about their meager salary...? We do not know. Billings does not quote any of them--though he does offer a picture of CBD barista, Elliot Conrad, hard at work for little pay, to accompany his story.

This is actually a recurring trend in media stories concerning the minimum wage. Employers and business owners (aka, the "job-creators") are quoted at length, but rarely do reporters bother to interview the workers themselves--the very people who stand to benefit from a higher wage. And here I thought the whole point of journalistic "objectivity" was to present, "both sides."

Incidentally, can I just note how disappointing it is to hear this corporate, anti-worker attitude from two of Portland's popular small businesses? I always thought part of the appeal of small businesses over the Big Box stores was that they are run by halfway decent human beings who actually appreciate and acknowledge their workers' contributions. Guess it just goes to show that, while capitalism may come in many sizes, the end result is always the same: Enrich the owners while exploiting the labor potential of the workers.

The argument that a higher minimum wage would cost jobs is simply not true.

This conservative talking-point has been thoroughly discredited by a wide range of economists and academic studies, all of which find that a hike in the minimum wage has little to no discernible effect on employment. In fact, a Chicago Federal Reserve study in 2011 found that every one dollar increase in the hourly pay of minimum wage workers results, on average, in $2,800 in new spending from those workers' households. This means more in the economy overall which, in turn, leads to more jobs. Or, as NYTeconomist, Paul Krugman, puts it, "Your spending is my income and my spending is your income."

Now, I know what you are thinking:

"DiMillo's and Coffee By Design are small businesses. They do not earn the mega-millions that Fortune 500 corporations like Walmart and McDonald's do. They simply cannot afford to pay their workers more."

But even if we accept this as true (and I for one don't; DiMillo's and CBD are both highly successful businesses, the latter with multiple locations throughout Portland), the fact is these companies employ a very small portion of the city's overall workforce. In 21st century, post-globalization, post-NAFTA America, the majority of us work--whether we like it or not--for Corporate America. Here in Maine, that means we work at Hannaford, Walmart, and L.L. Bean--the state's three largest employers.

Frankly, it makes no sense to involve small business owners in the minimum wage debate given that the percentage of the workforce they employ is so statistically small. That being said, DiMillo and Lindemann are actually in the minority of the small business community on this issue. According to a recent report by Small Business Majority, 67 percent of small business owners wholeheartedly support not only raising the minimum wage, but also annually adjusting it for inflation. Yet, the Press Herald story makes no mention of this survey.

The fact is, these two penny-pinchers are not representative of the overall small business community.

Finally, can we please retire this elitist notion that low-skilled, minimum wage jobs are basically "starter jobs," that were designed merely to give teenagers work experience?

This may have been true 30 years ago, when we had a robust, thriving economy with plenty of work opportunity. But today the majority of jobs with any expected growth are almost exclusively in retail or the service sector. These crappy, demeaning jobs are the only ones available even to college educated workers. To claim that individuals today "choose" to work at McDonald's or Wendy's demonstrates an astounding lack of understanding about the current state of the U.S. economy.

Additionally, the stereotype of the average McDonald's worker as a teenager or college student is equally outdated. The average age of a fast-food worker, according to a recent report by the National Employment Law Project, is 29. More than 26 percent of them, according to the report, have children and subsist on poverty wages. To claim that minimum-wage jobs are not "real jobs," or are only meant to be "transitional," smacks of classist arrogance.

No matter how you look at it, there is simply no compelling argument against raising the minimum wage--in Portland and nationwide.

Now, whether Brennan can actually get any sort of minimum wage ordinance through the current business-worshipping City Council(which is primarily made up of Democrats; just sayin'...), is another question entirely.


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