Can the nation afford a $12 minimum wage in 2020? The answer is obviously yes on the face of it. But the always useful Economic Policy Institute released a report showing that the answer is in fact yes.
A federal minimum wage of $12.00 in 2020 would return the wage floor to about the same position in the overall wage distribution that it had in 1968.
In 1968, the minimum wage stood at 52.1 percent of the median wage.5 By 2014, this ratio had fallen to 37.1 percent.
Raising the federal minimum wage to $12.00 by 2020, under the conservative assumption of no real wage growth at the median, would leave the ratio at 54.1 percent, just above where it was in 1968.
If we assume just 0.5 percent annual real wage growth for the median worker between now and 2020, the ratio would fall to 49.9 percent.
A broadly similar story emerges when using the average hourly earnings of nonsupervisory production workers, instead of the median wage, as a benchmark.
The federal minimum wage was equal to 53.0 percent of the average production worker wage in 1968. By 2014, this ratio had fallen to 35.2 percent.
Raising the federal minimum wage to $12.00 by 2020 would restore the ratio to 51.4 percent (under the conservative assumption of no real wage growth for production workers), just below its 1968 value.
The strong rise in average worker productivity and the increase in the age and educational attainment of low-wage workers in the last five decades suggest that the 1968 benchmark may understate the economy’s capacity to support a higher national wage floor in 2020.
The compression of median wages across the U.S. states over the last five decades, especially the catching up of lower-wage states, means that the federal minimum wage has less impact on low-wage states today than was the case in 1968.
What I want to know is whether we can have a $20 minimum wage by 2020.
The latest Rheeist attack on unions is quite special. Her organization Students First is helping a woman named April Bain, featured above, in a lawsuit against the California Federation of Teachers. Bain admits that the union does good things. But she doesn’t want to pay the dues the union uses for political activities. I’ll let Moshe Marvit explain the details of how this incredibly ludicrous but very dangerous case is being argued.
At issue in Bain is not that teachers may choose to opt out of membership with their union and pay a reduced dues rate while still receiving all the benefits of the contract. Those fair share fee cases, such as the seminal Beck v. Communication Workers of America, focus on the process of opting out of membership and the types of fees that would be refundable. At issue are those teachers who choose not to be members of the union and do not receive the members’ benefits from the union, such as being able to vote in union elections and access to any union-sponsored insurance programs. Bain and other teachers in the suit argue that it is unfair and unconstitutional for them to be denied any benefits of membership as a result of their decision to opt out of membership and pay a reduced amount in union dues.
They want to be able to both opt out of membership in the union and a significant portion of union dues, but to still be able to vote for union officers and direct the union (which they’ve chosen not to join). In other words, they want the full benefits of a union without having to pay for them. And they are asking the federal courts to intercede and say that the First Amendment guarantees them that right.
“The complaint equates joining the union with ‘giving up’ First Amendment rights.” Seattle University School of Law professor Charlotte Garden explained to In These Times. “But joining or not joining are both exercises of the right of free association. It seems that the plaintiffs wish their choices were different—and that they could join the union on their own terms—but I can’t think of any other circumstance in which an individual would attempt to bring a First Amendment claim to force a private association to change its terms of membership.”
In other words, Bain not only wants to have access to what the union wins in contract negotiations, which she of course receives, but she also wants all the privately held benefits unions offer to their own members as well. This takes non-union members leeching off their fellow workers to a whole new level. To say that it’s a violation of the 1st Amendment to not receive union disability insurance because you are not a member of the union is completely absurd. The legal case also revolves around admitting that unions provide real benefits for workers, but saying that the unions should force employers to grant those provisions and that they violate non-members rights by granting the benefits themselves. Thus, unions do a great job and destroying unions is part and parcel of the same argument.
But of course Michelle Rhee will do anything to destroy teachers’ unions. And as for the Supreme Court, well, I’m not sure there is any argument too ridiculous for the 5 Republican justices if it serves their agenda of destroying workers’ rights. If the case goes there, I get scared.
I’ve been completely overwhelmed this week with end of the semester work. Good thing nothing has happened in the news the last couple of days that might require some historical comment… Anyway, I’m starting to dig out. So let me at least take the time I’m glad that John Oliver dedicated his show this week to sweatshop labor. Basically, if you were to film a comedic take on Out of Sight, this is what it would look like.
Of course, conservatives are angry about it. And there’s nothing as smug and condescending as a British wealthy conservative.
We also know how to fix this problem. We should buy more from them. It’s worked absolutely beautifully in China. 15 years ago manufacturing wages there were $1,000 a year. Today they’re $6,500 a year. They’ve risen because we’ve been buying all our electronic bling from poor Chinese people working in Chinese factories. And our buying that bling has meant that jobs have become more productive (heck, electronics assembly is going to be more productive that staring at the south end of a north moving water buffalo however you do it) and the economy has taken off. And China started with those “start an economy” kits we call schmutter factories too. And in only 15 years China has grown rich enough that it no longer does that work. Even Chinese people don’t wear clothes made in China now, now that China’s got rich (which it has by any global or historical standard) that work is not done by poorer people in Vietnam and Indonesia. And guess what? They’re getting rich too.
Because that’s just how economics works. Trade makes everyone better off. That’s why the more trade we have then the more people will be made even better off.
And as at the top, I feel like as a Briton I should apologize. For surely anyone who manages, like Oliver, to get through one of our top universities would have learned that somewhere along the way? But apparently not, for which I do apologize.
Here’s the thing about this kind of argument, outside of the smugness,–people who make it conceive of labor exploitation as a gift the western world has granted to the poor of Asia and Latin America. This argument is much like colonialist arguments about giving Christianity and civilization to the natives. There is just enough of a kernel of truth here–people do need jobs!–to make a lot of people believe this basic narrative. There are of course several problems with it. First, the argument that China has become wealthy because it became the world’s sweatshop is vastly and overly simplistic, with state investments in the economy and centralized control over that economy being at least as important as people putting together plastic widgets for Walmart.
Second, it offers a religious faith in the market as a god that rivals any extremist Christian or Muslim for the damage it can do to the world. That diehard devotion to their ideal of free market capitalism means that conservatives aren’t going to ask any questions about the limitations of the current trade system, assuming that the gods will take care of it if we sacrifice enough
lambs on the altar children in the factories. The increasingly rapid mobility of global sourcing means that if workers protest or win higher wages or make any improvements in their lives, the companies can simply move to another country. The ability to create a global middle class out of these jobs is impossible. Bangaldeshis and Indonesians are not getting rich. An elite class is making bank. But workers are not recreating the U.S. in 1955 in Dhaka. At best, you might create a China with vast poverty and an incredibly wealthy elite. While the U.S. is also moving in that direction in no small part because all the good jobs for working class people have left, it’s not ideal for any nation’s long-term stability, as we are discovering in Baltimore.
Such religious devotion to capitalism also allows believers to completely ignore the voices of the actual workers. Again, when capitalist gurus and their devotees talk of sending low-paying jobs around the world, they treat it as a gift from the god of the market. So when workers complain of the treatment–bad wages, beatings, sexual harassment, forced pregnancy tests, long hours, poor housing, terrible food, etc., etc.–they are seen as ungrateful and not voices to which we need to pay attention. We can go along in our developed world believing that far away out their in Bangladesh and Vietnam, workers are happily toiling to make their lives better. But when they do actually try to make their lives better, to tell employers what they want and need, what happens? This is what happens:
For those who don’t want to watch it, a quick summary:
Just look what happens in the below clip from new documentary The True Cost. In the clip we meet 23-year-old Bangladeshi woman Shima Akhter, who is one of almost 4 million garment workers in the country and earns less than $3 a day making clothes in dangerous conditions. Akhter formed a union at her job, and along with other workers, submitted a list of demands to her managers. Instead of looking at the demands or even ignoring them, the managers had Akhter and the other workers viciously beaten by 30 – 40 staffers with chairs, sticks, and even scissors. Akhter was hit in the chest and abdomen and had her head banged against a wall.
Obviously John Oliver is an embarrassment to the British elite educational system–not to mention the University of Aberdeen for moving away from buying sweatshop made electronics–for caring about a woman like Shima Akhter. Because the market is after all a god and gods need sacrifices. So long as it is someone else and I can buy clothes for cheap, go for it. If 1100 people die in a Bangladeshi factory for this system, it’s far and what do I care. Ooh, those jeans are only $20!!!
There aren’t a lot of steel jobs in the U.S. anymore but the ones that remain are about the disappear as U.S. Steel announces more layoffs. At the core of layoffs is unrestricted free trade that undermines the ability of American corporations to sell its own steel because it has to pay workers decent union wages and abide by environmental standards. The Trans Pacific Partnership will just continue to undermine the ability of Americans to work industrial jobs. And before we argue this is a good thing, note that for all the workers, like the rest of the American working class, they face unemployment, decreased earnings, and increased instability in their lives. Every United Steel Workers job lost means less ability for unions to influence American economic and social policy, giving more power to corporations and moving the New Gilded Age another step forward. Those who continue to say that these free trade agreements like the TPP need to reckon with these realities, especially liberals who do not trust corporations at home but want to empower them overseas. Everything that is wrong with this nation in the New Gilded Age can be traced back to the decline of union jobs and the disappearance of working class voices from politics.
Oh Walmart. You are so evil.
Wal-Mart suddenly closed five stores in four states on Monday for alleged plumbing problems.
The closures could last up to six months and affect roughly 2,200 workers in Texas, California, Oklahoma, and Florida, CNN Money reports.
Wal-Mart employees say they were completely blindsided by the news, having been notified only a couple hours before the stores closed at 7 p.m. Monday.
“Everybody just panicked and started crying,” Venanzi Luna, a manager at a store in Pico Rivera, California, told CNN Money.
All workers will receive paid leave for two months. After that, full-time workers could become eligible for severance, according to CNN Money. But part-time workers will be on their own.
Local officials and employees have questioned Wal-Mart’s reasoning for the closures.
Why were these stores closed? Because they had activist employees.
The United Food and Commercial Workers International Union (UFCW) said it planned to seek an injunction from the National Labor Relations Board on Monday compelling retailer Wal-Mart to rehire 2,200 employees at five recently closed stores.
The UFCW claims that Wal-Mart Stores closed its Pico Rivera location — one of the five stores — in the Los Angeles area in retaliation for protests by workers there in recent years seeking higher pay and benefits.
“This is a new low, even for Walmart,” said Venanzi Luna, an eight-year Walmart worker and long-time OUR Walmart member. “It’s just so heartless to put thousands of your employees out of a job with no clear explanation on just a few hours’ notice. We know that Walmart is scared of all we have accomplished as members of OUR Walmart so they’re targeting us. Through OUR Walmart, we’re going to keep fighting back until the company gives us our jobs back. It’s unfortunate that Walmart has chosen to hurt the lives of so many people, just to try to conceal their real motives of silencing workers just like they’ve always done.”
I suspect there will be more details about these Walmart closings coming out in subsequent days.
In a nation that places many injustices and indignities on the poor, it’s good to see at least one of those be alleviated in one place:
But the city where first impressions count for everything is about to make the job market a little less judgmental. New York’s City Council just voted overwhelmingly to outlaw the common practice of letting employers prejudge people based on their credit history—passing an unprecedented ban against employers use of workers’ credit background data.
The legislation, which passed last Thursday following an extensive grassroots campaign by local and national labor and community groups, restricts a boss, prospective employer or agency from “us[ing] an individual’s consumer credit history in making employment decisions.”
The final version incorporates some compromises pushed by the business lobby, such as carve-outs for positions that could involve handling “financial agreements valued at $10,000 or more,” police and national-security related jobs, or workers with access to “trade secrets.” While business groups cited these provisions as wins in a bill they otherwise chafed at, economic justice advocates have nonetheless hailed the law as a promising boost for an emerging nationwide movement.
Sarah Ludwig of the New Economy Project says, “It’s a strong law…and it’s going to cover most New Yorkers [and] most jobs by far and away. It’s a real civil rights victory.”
Enforcement of the law will be driven by a complaint process, which makes it a tricky game for the city authorities relying on workers to come forward. But Ludwig adds, advocates hope the system provides a platform for the city’s Human Rights Commission to gain new prominence under the de Blasio administration’s leadership, since the city has “this unbelievably strong human rights law” on paper but not necessarily in practice.
Not perfect, but a significant improvement. Of course, this should be a nationwide law, for what possible valid reason is there to allow employers to access job applicants’ credit histories, unless the goal is to create a permanent underclass.
I suppose I should say something about Gawker’s decision to unionize and the CEO’s seeming decision to let it happen. I don’t have all that much real insight to have. The site has been excellent on labor issues for some time. It should be said though that the limits of the bargaining unit may be pretty tight–full-time employees in a heavily contingent world. Is there some generational shift happening here? Who knows. I think it’s significant if it means that young, relatively well-educated people are going to be seeking to create unions in newer forms of business. In any case, it’s at least an interesting data point that needs further monitoring.
By the way, the above image is from a 1948 strike in New York. Mostly, I was looking for an excuse to put it up here.
The plague of unpredictable work schedules, with employers changing workers’ weekly schedules as their whim, must end. It causes all sorts of problems for those workers. A few examples from Gillian White:
According to a recent study from the Economic Policy Institute, this is life for about 17 percent of the labor force. So called “just-in-time scheduling” is far more common for those who work for hourly wages or are part-time employees, or both. Part-time workers—more than six million Americans—are more than twice as likely to have unpredictable hours than full-time employees.
Many workers had one week or less of advanced notice about their upcoming work hours, the study found. Such haphazard scheduling has been linked to not only lower levels of job satisfaction, but also to greater levels of work-family conflict, according to the Lonnie Golden, the study’s author. Another study, published in the Journal of Occupational and Environmental Medicine, had similar findings, linking irregular shift schedules to diminished cognition and physical health, with workers who were exposed to such schedules for extended periods showing decreases in their ability to reason, think, and recall information.
In some cases, the differentiation in weekly work hours or varying start times may reflect a move toward increasingly flexible work places, but that’s not likely the case for low-income, part-time workers, who make up such a large portion of those working with unpredictable schedules, says Golden.
Additionally, the phenomenon may be contributing to the growing economic inequality in the country, according to Golden. For example, a lack of predictable hours can lead to difficulty obtaining or keeping government benefits for some workers. A 2014 study from researchers at the University of Chicago noted that in some states, qualification for child-care subsidies are tied to the number of hours worked. That can mean that decreased hours lead to a loss of child-care benefits, which then leaves parents unavailable to work, even when shifts become available. “Work-hour requirements are based on the assumption that workers decide how many hours they work, yet because hours are a key component of labor costs, corporate policies often restrict their availability,” write Susan Lambert, Peter J. Fugiel, and Julia R. Henly, the study’s authors.
There’s no actual reason for this sort of scheduling to exist. It should not be that hard for employers to give workers a consistent schedule that can be set weeks or even months in advance. It’s just that employers don’t want to do it.
The Ohio legislative decided to stick a measure in a funding bill that would redefine all faculty as supervisors since they play some role in university governance. This would make them ineligible to have a union. I’m not at all confident that John Kasich won’t sign this.
On April 17, 1905, the Supreme Court, led by Chief Justice Melville Fuller, decided the Lochner v. New York case, overturning a New York law limiting the hours bakers could work to sixty a week. This landmark case gave official SCOTUS sanction to the idea of free contract between employer and employee. Calling such laws, “unreasonable, unnecessary and arbitrary interference with the right and liberty of the individual to contract,” the Court effectively ruled that corporations have full rights to set any conditions of employment they chose. This classic statement of the Gilded Age has inspired conservatives and outraged liberals ever since.
By 1900, the rise of the Progressive movement and an increasingly aggressive American working class that ranged from conservative organizations like the American Federation to Labor to radicals like the Industrial Workers of the World led to a growing amount of state and local laws to regulate labor. The rank exploitation of Gilded Age capitalism had increasingly moved large swaths of Americans, including a growing number in the middle and upper classes, to understand that basic protections must be granted if the nation was to remain socially stable and if future generations would grow up to be good moral Americans.
And this attitude, while often paternalistic toward workers, had its benefits as workers really struggled to live lives of basic dignity in the Gilded Age. The combination of extremely low wages, very dangerous work, strikes met with state violence, and an economy constantly in turmoil thanks to the corruption of politicians and illegal machinations of capitalists meant that the American workforce had few options to improve their lives. They tried but usually failed because of the combination of overwhelming combined state and corporate resistance, something Lochner would reinforce. Accessing middle-class support for basic rights was necessary in order to achieve even the most rudimentary improvements in workers’ lives.
New York was one of these states with a strong Progressive movement. In 1895, the state passed the Bakeshop Act. This law regulated the sanitary conditions of bakeries (a prelude to the national Pure Food and Drug Act that would become law in 1906) and read “no employee shall be … permitted to work in a biscuit, bread, or cake bakery or confectionery establishment more than sixty hours in any one week,” as well as more than ten hours in a day. In 1899, Joseph Lochner, a baker in Utica, was indicted for violating the act by requiring employees to labor for more than 60 hours. He drew a $25 fine. Not learning his lesson, he was charged again in 1901; this time the state fined him $50 ($1400 in 2014 dollars) and sentenced him to up to fifty days in jail if he did not pay the fine.
Joseph Lochner, standing on right
Lochner appealed this second fine, attempting to overturn the law. The Appellate Division of the New York Supreme Court upheld the law by a 3-2 vote and then the New York Court of Appeals, where he lost 4-3. The Supreme Court was divided on this law. But by a 5-4 decision, the Court ruled in favor of Lochner and overturned the Bakeshop Act.
John Marshall Harlan, the best justice of the era and often the only one with the welfare of the average citizen in mind, wrote one of his classic dissensions. He wrote that it was “plain that this statute was enacted to protect the physical well-being of those who work in bakery and confectionery establishments.” He went on, “If the end which the legislature seeks to accomplish be one to which its power extends, and if the means employed to that end, although not the wisest or best, are yet not plainly and palpably unauthorized by law, then the court cannot interfere.” Oliver Wendell Holmes also dissented, using his ideology of limited court activism to accuse the majority of asserting their own economic preferences into the Constitution where they did not belong.
The majority in fact did that, but didn’t care. Rufus Peckham wrote the majority opinion. He countered the argument of New York that “has a right to safeguard a citizen against his own lack of knowledge” by stating that citizens “are … able to assert their rights and care for themselves without the protecting arm of the State, interfering with their independence of judgment and of action.” And this really sums up the doctrine of free contract. Theoretically this sounds like the language of freedom because it places control over one’s life in his or her own hands. But of course such an analysis, which libertarians love today, completely ignores power relations. No baker could assert his own rights because it was the employers who constricted those rights. When the option is a) work 65 hours or b) don’t eat, that’s not a freedom of choice.
Moreover, Peckham went into the health of working in a bakery, writing the law was unnecessary because “To the common understanding, the trade of a baker has never been regarded as an unhealthy one.” Of course, such a judgment from a judge should not matter when deciding the constitutionality of the law–the question is whether it is constitutional, not whether the judge personally agrees on the merits of the law. But of course the Supreme Court has long operated as little more than the assertion of personal political position as constitutional principle, a problem which plagues the Court today. Moreover, the question of health and work in the Gilded Age was one of huge importance because work was so starkly unhealthy. It’s entirely possible that compared to paint workers having their brains disintegrated through unbelievable levels of lead poisoning and radium workers dying from horrendous cancers that bakers didn’t have it so bad, but that doesn’t mean that working in unsanitary conditions for long hours did not have an effect on their health. Even when employers and states decided to something about workers dying or suffering grievous injuries on the job, it would take until the establishment of OSHA in 1970 before workplace health per se was really taken that seriously in the United States.
However, Lochner was also the peak of corporate rights superseding that of workers and the public. The Muller v. Oregon decision three years later carved out room in the freedom of contract ideology for hours limitations on women workers, which began to slowly build toward the principle of government regulating the workforce. From 1905 on, Lochner became the case that progressive labor activists such as Louis Brandeis sought to overturn. Yet this would be a long fight lasting until the New Deal, with the Court reviving the Lochner doctrine in the 1923 case Adkins v. Children’s Hospital, declaring a Washington DC law setting minimum wages for women and children unconstitutional.
Conservatives would like to return to a Lochner-era America today and are working hard to make sure that happens.
This is the 142nd post in this series. Previous posts are archived here.
It’s long been known that better working conditions and higher pay lead to happier and more productive workers. Yet short-sighted greed and corporate resentment over treating workers like human beings has contributed to a global production system that strips workers of basic dignity. But even in Vietnamese sweatshops producing clothing for western markets, the evidence suggests that better conditions create happier workers which creates higher profits.