From the outbox of Meyer’s inbox:
Most of us have an experience with minimum wage. It was either our first pay rate or the pay rate of the fast food clerk where you picked up lunch. Nobody is going to get rich working for the minimum wage for their entire life. But it is a decent start that can open the door for many individuals. That same fry cook could some day grow up to become manager. In fact, that’s exactly what happens. This being an election year means the minimum wage discussion will be bubbling up in the coming debate cycle. The opening salvo could be in New York City as explained in the article below.
MINIMUM WAGE DEBATE PITS BUSINESS AGAINST LABOR, BUT DOES LITTLE FOR MOST NEW YORKERS
By Colby Hamilton
The debate over a proposed state minimum wage increase is heating up as Assembly Speaker Shelly Silver introduced legislation Monday to raise the base from $7.25 to $8.50 per hour.
“Last year we began the process to instill fairness in New York’s tax code, and now we are addressing the inequities at the lower end of the pay scale,” Silver said in a statement about the legislation. “It is absurd to expect anyone to afford the cost of living today and be able to invest in their future on a pay rate of $7.25 an hour. That is why it is my top priority this legislative session to repair the ladder to success, to make an investment in our working families and ensure that they can continue to do so as the cost of living continues to rise.”
Labor is predictably lining up opposite business groups, with allied think tanks providing policy arguments sure to be used by their respective sides. (Mayor Michael Bloomberg is coming in somewhere in between.)
Labor vs. Business
“The legislation being introduced today is a small but important step that will help forge a path out of poverty toward the middle class,” said Retail, Wholesale and Department Store Union President Stuart Appelbaum in a statement. “Raising the minimum wage in New York is morally right and economically smart: when workers earn more, they spend more, generating demand for new goods and services that will create more jobs and strengthen our economy.”
Applebaum noted a coalition of labor unions, as well as the labor-backed Working Families Party, support the increase.
“The minimum wage proposal put forth by Assembly Speaker Sheldon Silver is ill-timed and shows a complete disregard for the private sector and the challenges Upstate New York faces in promoting private sector job creation,” said Brian Sampson of Unshackle Upstate, who went on to say the legislation would increase unemployment among young and low skilled workers.
“Raising the minimum wage would only hurt New York’s small businesses, farms and not-for-profits that are struggling to make their current payrolls, and reduce job opportunities, in this difficult economy,” said Heather Briccetti, president and CEO of the Business Council of New York State, in a statement.
Dueling Think Tanks Explore Side Issues
The Fiscal Policy Institute, a labor-connected economic think tank, released a report that says that state actually needs to raise its minimum wage to $10 an hour by 2014—$1.50 more than what Speaker Silver is proposing. Doing so, the argument goes, would directly benefit folks in industries like retail, where a third of workers make less than $10 an hour. The report says 88 percent of these are full-time adult workers.
“It’s certainly a big step in the right direction, and it’s very positive in that it acknowledges that the current minimum wage is far from adequate,” said FPI’s deputy director and chief economist, James Parrott, in a phone interview.
On the other side of the argument was a piece up this morning on the Empire Center of New York State Policy, a business-friendly conservative think tank, blog The Torch. The piece, by EJ McMahon, doubled-down on the points made by Empire Center senior fellow Rus Sykes that the state is in a better position to help lower-income earners through the current earned-income tax credit system than a minimum wage hike. The EITC system, they say, pumps $4.5 billion into the state’s economy, and proved minimum wage earners with an effective equivalent income of $10.44 per hour.
“The minimum wage increase being proposed by Speaker Silver…is not targeted to low-income workers. Only about 20 percent of the benefits of that increase will go to low-income households,” Sykes said over the phone. According to his analysis, most of the money will be going to teenage workers, or multi-earner households.
“We think a mini wage increase is job killing, a really bad idea and is trying to solve a problem that really doesn’t exist in New York,” Sykes said.
Read the rest about this issue here.
