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GOP proposal to raise minimum wage
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| MisterOpus1 |
Long, long overdue, and way below inflation and standards of living. So it was a nice surprise to initially read Sen. Rick Homosexual-Marriage-Will-Lead-To-ing-Animals Santorum (R-PA) lead the charge in raising the minimum wage $1.10 to $6.25/hour. This will all be added to that lovely bankruptcy bill (which is in another thread):
http://www.kansascity.com/mld/kansa...cs/11061008.htm
(Knight Ridder free subscription req'd)
But those darn GOPers always have catches don't they? Welp, here ya go!:
| quote: | Licensing Sweatshops: While a $1.10 per hour minimum wage increase by itself would help 1.8 million workers, Santorum includes a poison bill exempting any business with revenues of $1 million or less from regulation -- raising the exemption from the current $500,000 level.
The upshot: while 1.2 million workers could qualify for a minimum wage increase, another 6.8 million workers, who work in companies with revenues between $500,000 and $1,000,000 per year, would lose their current minimum wage protection.
And an even larger number of businesses, those with revenues under $7 million, would be exempt from fines under a range of other safety, health, pension and other labor laws. Essentially, the realm of unregulated sweatshops would be expanded and legalized under Santorum's bill.
Killing Overtime: It gets worse-- the 40-hour work week would be abolished and companies would not have to pay overtime if they cut hours the next week. The proposal is called "flex time", but workers would have no say in the matter. Their hours could be rearranged, upsetting child care and other weekly routines, and companies would no longer have the deterrent of having to pay overtime as a way to encourage giving workers a regular weekly schedule.
Banning State Minimum Wage Laws: But here's a kicker from a GOP supposedly dedicated to states rights. Santorum's bill would ban states from requiring employers to pay tipped workers with a guaranteed wage. Employers could pay tipped workers nothing and force them to live off tips, while states would be preempted from creating a higher wage standard for tipped workers.
The federal Fair Labor Standards Act specifically guarantees states the right to impose higher wage standards than the federal law. One area where many states have a higher standard than federal law is for tipped workers, who are guaranteed only $2.13 per hour in wages under federal law and can be forced to credit their tips against the required federal wage level. Many states have a higher minimum wage for tipped workers or have abolished the so-called "tip credit" altogether and let workers keep their tips, without allowing employers to reduce their salary below the regular minimum wage level.
With Santorum's bill as law, you would end up with a situation where small and even medium size restaurants and other businesses with tipped employees would be exempt from the federal minimum wage, and state governments would be barred from requiring employers to pay actual wages to tipped workers. Essentially, those workers could be hired for zero dollars and told they had to live only off tips, however little those were.
The attack on the tip credit is bad enough, but the precedent of the federal government creating a MAXIMUM standard for wage regulation and restricting the right of states to create a higher standard is even more dangerous. Because of federal inaction, states across the country have raised their minimum wages -- Red State Florida raised theirs just last fall and indexed it to inflation -- and many more are thinking about it. (See the chart below)
If Santorum and the GOP can push through a restriction on states' ability to raise standards for tipped workers, the next step could easily be a restriction on states being allowed to have ANY minimum wage higher than the federal level at all.
The City Minimum Wage Precedent: Sound too far-fetched even for rightwing politicians? Well, after a number of cities began enacting city minimum wage laws, about a dozen southern and western states, including Florida, Louisiana and Georgia, passed legislation banning local governments from enforcing local minimum wages higher than the federal minimum wage level. Backed by the conservative American Legislative Exchange Council, these "minimum wage repeal acts" are the model for the national GOP going further and preempting state minimum wage laws, just as they recently preempted state class action laws and just as they have preemped state health care and environmental regulation. (See this post today on the full range of conservative's preempting progressive state laws).
http://www.nathannewman.org/laborbl...ve/002263.shtml |
Economic Policy Institute's analysis can be found here:
http://www.epinet.org/newsroom/rele...inimum_Wage.pdf
Corporate welfare anyone? Class warfare anyone? |
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| George Smiley |
| $6.25 is a pretty crap wage!!! |
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| St_Andrew |
| quote: | Originally posted by George Smiley
$6.25 is a pretty crap wage!!! |
indeed! so many ppl that are on it too! :nervous: :nervous:
anyway, that proposal seemed pretty crap. |
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| CyberneticAngel |
| I am always against minimum wage, I feel that the market is the best regulator for how much a job is worth. |
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| St_Andrew |
| quote: | Originally posted by CyberneticAngel
I am always against minimum wage, I feel that the market is the best regulator for how much a job is worth. |
well, when the minimum wage is that low and a lot of companies still uses it then there is something wrong. but yeah, i agree with your idea. |
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| MisterOpus1 |
| quote: | Originally posted by CyberneticAngel
I am always against minimum wage, I feel that the market is the best regulator for how much a job is worth. |
In principle I tend to agree with your statement as well. But unfortunately, the realities of our market is that it's not as good of a regulator as we'd all like it to be. |
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| CyberneticAngel |
| ^^^ thats true, between government regulation and corporate colusion it is easy to see why a little regulation is nessesary. On the other hand the only time that i have actually worked for minimum wage I also recieved tips, I don't think that there are actually that many jobs filled by legal workers who this affects. |
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| George Smiley |
Companies dont pay anyone what that job is worth!! Companies pay the lowest they can get away with and with no regulation, they wouldn't even pay the paltry $5 they pay now!
America is already one of the worst countries in the west for poverty, and if you think that the market is the best regulator for how much a wage is worth then America will become even wrose than it is now (and now, no offence, but its pretty like the UK) |
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| Dupz |
| quote: | Originally posted by MisterOpus1
In principle I tend to agree with your statement as well. But unfortunately, the realities of our market is that it's not as good of a regulator as we'd all like it to be. |
I'm against minimum wages as well, but you suggest that the market isnt as good a regulator as we'd like it to be? I'm really not sure how we can see a market failure in the labour market (and therefore justifying federal regulation). From what I know most minimum wage jobs are at your local diners and supermarkets etc etc.. correct me if i'm wrong, but these markets often produce competitive labour markets (as in you can easily leave one workplace and move to another diner joint if you so wish). If this is indeed the case then a competitive labour market does produce the most efficient wage, and setting a minimum wage is merely distorting the market and putting people out of work. |
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| St_Andrew |
Sweden for example have no minimum wage tho, and a person working at mcdonalds in sweden would earn like twice as much as for the same in north america.
Sweden have strong unions tho, so thats like a "mini guvernment" or whatever :p
but no guvernment regulations :toocool: |
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| wolverine16 |
Wow, this is just like the "clean skies" initiative. A raise in the minimum wage is badly needed, especially since it hasn't risen in years despite inflation. Those strings are ridiculous though, especially since it would ban my state from setting a living wage, meaning the minimum would almost be cut in half for many people. I say raise it with almost no restrictions and have small business incentives to help compensate.
On the idea that the market sets fair prices, I would have to disagree. Personally my employer does a good job as do many, but in the case of many others look at the restrictions that have destroyed the power and numbers of unions in this country, the astronomical CEO to employee earnings ratio that has skyrocketed since the 1980s, outsourcing and the use of cheap third world labor that has virtually replaced all production here for pennies on the dollar. |
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| CyberneticAngel |
| quote: | Originally posted by wolverine16
On the idea that the market sets fair prices, I would have to disagree. Personally my employer does a good job as do many, but in the case of many others look at the restrictions that have destroyed the power and numbers of unions in this country, the astronomical CEO to employee earnings ratio that has skyrocketed since the 1980s, outsourcing and the use of cheap third world labor that has virtually replaced all production here for pennies on the dollar. |
Labor unions are just as bad as artificial wage controls, While on the one hand they have acomplished much good in the past they are now mostly antiquated. Controls that regulate the wage a company can pay you are one of the biggest factors in so many American jobs moving overseas. If you represented the fabled "widget" makers would you rather employ workers here in the US where you are forced to pay them a minimum wage, and may soon be forced to provide them healthcare? Or would you chose to move your operation to another country that will allow you to pay whatever wage that counrties labor market supports? I suppose there is a third alternative, you could always hire illegals to work for you in the US, hiring illegals in many ways represents a segment of the US labor demands that would have a hard time being meet with the current level of government interferance. Jobs that otherwise would not be profitable can be filled by employees that cannot complain to the government about working conditions and wages. Does this mean that it is right to ship jobs overseas to the highert bidder or to hire illegal aliens here in the US? No, of course not. It is truly a shame that American companies feel that the current US labor market will not support their business, and something should probably be done about it. In the end, however, it is doubtfull that increased wage controls could do anything but hasten the flight of US jobs to weaker economies.
| quote: | Originally posted by George Smiley
Companies dont pay anyone what that job is worth!! Companies pay the lowest they can get away with and with no regulation, they wouldn't even pay the paltry $5 they pay now! |
So are you saying that these jobs are not worth five dollars? Because of the relativly low unemployment in the US there are very few segments of the US economy that are suffering a glut of excess workers. Wages only go down when business is suffering and unemployment is high. This is basic supply and demand, the foundation of the capitalist system. (Of course collusion/ monopolistic tactics could also play a role, but in the US we have done a fairly good job of limiting this sort of thing since the rise of labor unions)
| quote: | | America is already one of the worst countries in the west for poverty, and if you think that the market is the best regulator for how much a wage is worth then America will become even wrose than it is now (and now, no offence, but its pretty like the UK) |
Well lets see, the US unemployment rate was UP to 5.4% so lets see, compairing that to other Western countries we have Germany at12.6%, the world average is 6.1% and in the developed economies (which include the EU-25) there was only a slight decline from 7.4 to 7.2 per cent (these last couple of numbers are from 2003 to 2004) I hardly think America ranks as "one of the worst countries in the world" |
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