Obama Promises $10.10 an Hour to Federal Contract Workers, But Details Are Fuzzy

  by Bruce Vail

President Barack Obama announced Tuesday he would order an increase in the minimum wage for some workers indirectly employed by the federal government, drawing praise from labor union supporters and scorn from one top Republican Party opponent.

“In the coming weeks I will issue an executive order requiring federal contractors to pay their federally funded employees a fair wage of at least $10.10 an hour—because if you cook our troops’ meals or wash their dishes, you should not have to live in poverty,” Obama said during his State of the Union address. The promise was accompanied by an exhortation to Congress, state and local legislators, and private companies to take their own steps to raise minimum wages. Continue reading

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Wage boost could pay Democrats dividends

by Harold Meyerson

Harold Meyerson

Harold Meyerson

American liberalism and the Democratic Party — two partially overlapping but by no means identical institutions — have set themselves an unusually clear agenda for 2014: reducing economic inequality and boosting workers’ incomes. These are causes they can fight for on multiple fronts.

Raising the minimum wage should offer the course of least resistance. Although congressional Republicans may persist in blocking an increase in the federal minimum wage, they do so at their own peril. Raising the wage is one of the few issues in U.S. politics that commands across-the-board public support. A CBS News poll in November found that even 57 percent of Republicans support such an increase. Continue reading

At $2.13 minimum wage, restaurant workers struggle to put food on their own tables

by Laura Clawson

Restaurant workers are supposed to get at least minimum wage, when tips are combined with the $2.13 an hour tipped worker minimum wage. But, as the women in this video make clear, that’s not enough. Too often, employers don’t make up the difference, or even push workers to do prep or cleaning work at $2.13, with no chance to make tips. Or customers walk out on their checks, or leave a racist note instead of a tip, or a homophobic note instead of a tip, or a religious tract instead of a tip. Continue reading

Raise the Minimum Wage

by Lawrence S. Wittner

RaiseTheMinimumWageASome 47 million Americans live in poverty, and a key reason is the decline of the minimum wage.

First established under the Fair Labor Standards Act of 1938, the nationwide minimum wage was designed to lift millions of American workers out of poverty and to stimulate the economy. Unfortunately, however, it was not indexed to inflation, and big businesses — hostile from the start — fought, often successfully, to prevent congressional action to raise it. As a result, over the past forty years, the purchasing power of the minimum wage has fallen sharply. If Congress had kept the minimum wage in pace with inflation over this period, it would today be $10.74. But, in fact, it is $7.25 — about two-thirds of its previous purchasing power.

A major consequence is that increasing numbers of workers and their families live in poverty. The annual salary of a full-time American worker employed at $7.25 per hour is $15,080 — less than the official federal government poverty level for a family of two. The poverty level for a family of four is $23,550 — considerably beyond what a minimum-wage worker earns.

At the same time, the rich have grown far richer. Between 1968 and 2012, as the minimum wage declined in value, the top 1 percent of households doubled their share of the nation’s income. The typical CEO of a big business received a 16 percent raise in 2012 — to $15.1 million. That year, the pay of Wal-Mart’s CEO, Mike Duke, rose 14 percent, to $20.7 million. By contrast, Walmart — the largest employer in the United States — pays its sales associates an average wage of $8.81 an hour. It is much the same story at McDonald’s, which employs large numbers of the nation’s low wage workers. In 2012, the CEO of McDonald’s was paid $27.7 million. Although his income roughly tripled in 2012, the income of McDonald’s fast food workers remained abysmal. Thanks to this pattern, the United States now has the most unequal distribution of income in the industrialized world.

Another consequence of keeping the minimum wage low is that, by under-paying workers, corporations are shifting the real costs of doing business to the general public. According to a study released this October by the University of California and the University of Illinois, 52 percent of America’s fast food workers receive assistance from public programs like food stamps, Temporary Assistance for Needy Families, and Medicaid thanks to their poverty-level wages. As a result, taxpayers are contributing $7 billion per year to pick up the cost of supporting these fast-food workers. The study estimates that public assistance to McDonald’s workers alone amounts to $1.2 billion a year — the equivalent of one-fifth of that corporation’s annual profits. Taxpayers are also paying enormous amounts to support the impoverished employees of Walmart and other giant companies. Continue reading

July 24 Day of Action: Raise the Minimum Wage Now!

Photo by Wisconsin Jobs Now/Flickr

The federal minimum wage has been stuck at $7.25 an hour since July 24, 2009, and tomorrow, in a national day of action in more than 30 cities across the country, a broad coalition of labor, faith, civil rights, community and policy activists will call on Congress to raise the minimum wage.

The centerpiece of the action is the Fair Minimum Wage Act of 2013, introduced by Rep. George Miller (D-Calif.) and Sen. Tom Harkin (D-Iowa), to raise the wage to $10.10 and index it to inflation so it doesn’t lose its value over the years. The bill also boosts the minimum wage for tipped workers.

Click here to sign our petition asking Congress to raise the minimum wage

Continue reading

The Wal-Mart Low-Wage Model Broke the U.S. Economy

by Gregory N. Heiris

Walmart_2_croppedWal-Mart’s nickname should be Inequality Inc.

Consider this:

• Six heirs of the company’s founder control more wealth than 41.5 percent of all American families combined—or 48.8 million families.

• From 2007 to 2010, the wealth of the six Wal-Mart heirs went up from $73.3 billion to $89.5 billion while the country’s median family wealth plummeted by 38.8 percent.

No, what’s good for Wal-Mart is not good for America.

As the Walton family accumulated its fortune over decades, our country became more economically polarized and a culture of discontent began brewing. Continue reading

Labor Department Hits the Road To Push Minimum Wage Hike

By Bruce Vail

Acting Secretary of Labor Seth Harris listens May 14 as fast food worker Laura Bailey describes the financial stresses of raising a daughter while earning $7.80 an hour. Between them is Jonathan Martin, another Baltimore worker who would benefit from a minimum wage increase. (U.S. Department of Labor)

Acting Secretary of Labor Seth Harris listens May 14 as fast food worker Laura Bailey describes the financial stresses of raising a daughter while earning $7.80 an hour. Between them is Jonathan Martin, another Baltimore worker who would benefit from a minimum wage increase. (U.S. Department of Labor)

BALTIMORE—With one minimum wage hike proposal after another languishing in Congress, some advocates may have given up hope of an increase anytime soon. But Acting Labor Secretary Seth Harris is not discouraged.Harris, who has been the interim head of the Department of Labor since Hilda Solis’s resignation in January, has taken the agency on

road in favor of a wage raise. He traveled to Baltimore this week to meet with low-wage workers and promote President Barack Obama’s State of the Union proposal to lift the federal minimum from $7.25 to $9.00 an hour. The president’s plan would also automatically link future increases to inflation, as a way of preventing the gradual erosion of purchasing power that has plagued low-wage workers since the 1980s, Harris says. Continue reading