The current President of Delaware’s Chamber of Commerce took to the Opinion Page of the News Journal to try out this argument against raising the minimum wage — that we should leave minimum wages be since they were not meant to support a family, but re-train workers for high wage work.
I’m here for worker training and re-training. There’s no reason why anyone working should not have the opportunities to up their skills or gain additional ones to better their employment prospects. But I’m not here for the Chamber of Commerce (or the Government for that matter) make an argument that you need a high-level of work skills before you even deserve a livable wage.
“For years, people have advocated for a higher minimum wage for workers in entry-level or low-skilled jobs. They argue that those low wages are not enough to sustain a family and, in 2020, they’re not wrong. These jobs and their minimum wages were never intended to do that; these were entry-level, part-time positions that were a supplement to your other income or a way to develop a work history as a new entrant in the job market. “
Except that FDR *did* intend for a minimum wage to be a livable wage — this is what he said in 1933 in his Statement on the National Industrial Recovery Act: “By living wages, I mean more than a bare subsistence level — I mean the wages of a decent living.”
That seems clear — a decent living.
FDR also has words for the business executives who spin up a ton of reasons why the people who work for them should not get paid fairly:
“Do not let any calamity-howling executive with an income of $1,000 a day, who has been turning his employees over to the Government relief rolls in order to preserve his company’s undistributed reserves, tell you – using his stockholders’ money to pay the postage for his personal opinions — tell you that a wage of $11.00 a week is going to have a disastrous effect on all American industry.” (1938, Fireside Chat, the night before signing the Fair Labor Standards Act that instituted the federal minimum wage)
Let’s inform ourselves about a couple of things:
- Less than livable wages invoke government supports for people who work but don’t make enough to sustain themselves. Most of the people who receive TANF benefits work and the Trump administration is trying to cut these benefits. These low wage workers are also eligible for Medicaid, possible housing supports and other government benefits to supplement the non-sustainable wages the DE Chamber wants to argue for. Ask yourself why a taxpayer should be subsidizing the low wages sanctioned by the government?
- In 2019, the highest growth in wages came in the low wage sector, largely reflecting an upward push in wages from higher state minimums. And yet — inflation only rose from 2.1% in 2018 to 2.3% in 2019. Wage growth with relatively stable inflation is not a sign of impending economic disaster.
- Seattle has the highest minimum wage in the US and when it was passed, restaurant owners sounded the death knell for restaurants in Seattle. Data from the St. Louis Fed would show you that the Seattle area restaurant scene is booming:
There’s no doubt that a change in minimum wage will cause business owners who rely on minimum wage workers to make some adjustments to their business model. But it will make sure that these owners are accounting fully for their costs to do business rather than relying on a taxpayer to make up the difference. And increasing the minimum wages won’t stop the need to train workers in higher-skilled jobs. But while a worker is trying to become an electrician, that worker should be paid livable wages at their job at McDonald’s to keep a roof over their head, gas in the tank and food in the fridge.
A livable wage tells business owners that Delaware refuses to provide a “serf” class of workers just because it is convenient for these businesses. A livable wage also tells workers that what they do is worthy of the dignity of fair compensation and helps lift them out of the intentional poverty that the current minimum wage leaves them in. We’ll let FDR have the last word for the Chamber:
“No business which depends for existence on paying less than living wages to its workers has any right to continue in this country.” (1933, Statement on National Industrial Recovery Act)