Seattle Approves $15 Per Hour Minimum Wage 1040
An anonymous reader writes "The Seattle City Council announced on Monday that it has unanimously approved a $15 per hour minimum wage mandate. The new rate will go into effect starting April 1, 2015 in a tiered, gradual manner that depends on employer size. In the first year of implementation, hourly minimum wage will be raised to either $10 or $11 according to the employer size category. By 2021, hourly minimum wage across the board should be at or above $15. Seattle is the first city to implement a living wage for its lowest earners."
Minimum wages create unemployment (Score:2, Interesting)
Re:Even higher! (Score:5, Interesting)
When you're selling hot dogs at the side of the street, if you set the price at $0, you'll lose money, and if you set the price at $100000, you'll lose money, but if you set the price at $3, you might make money?
You can't reductio ad absurdum a minimum wage like that.
As a difficult-to-implement experiment, I'd love to see what actually happens (I know what people of various political stripes will predict happens; I want to see reality tried and I want to see it tried a few times in different cultures so we aren't extrapolating from a single datapoint) when you combine Mincome [wikipedia.org] that met the "living wage" criteria, with abolishing the minimum wage.
Since everybody now makes Mincome, the living wage is no longer a factor and that knocks out the key motivation behind a minimum wage. Therefore, in principle, you can hire your fast food vendors at 50 cents an hour. Provided you can find them, of course, since if they have a livable wage, they don't have "sheer desperation" as a motivator to get a low-paying job -- but so long as the entire economy doesn't collapse to the point that the mincome is unsustainable, I'd view that as a positive change, not a negative. Job experience might be a motivator, though, and anyway a living wage isn't exactly a luxury wage -- somebody who made $10 an hour might be perfectly willing to work the same job at $2 an hour to effectively push their income up and save up for that xbox or whatever. Maybe shit job wages go down, maybe they go up, maybe it depends on the industry -- there are factors pushing in both directions.
Meanwhile, the mincome wouldn't be completely irrelevant to the lives of the relatively high-paid tech workers (obviously this varies with geography), but it wouldn't be an overriding concern either. It gives a bit more power to the worker in that they can be confident that their family won't starve if they quit in outrage or if a prospective employer calls the employee's bluff in a salary negotiation.
I know the mincome concept makes a lot of people grind their teeth just on the face of it (COMMUNISM LEADS TO DEAD BABIEZ!), but among other things it's about the only practical way to realize the theory of having truly no minimum wage at all. Bluntly, even slaves cost money to keep alive -- that expense combined with the limited hours in a day generates an effective wage floor even without the law, in the absence of some other income source like a parent or spouse or independent wealth or rampant theft.
Re:Sweden (Score:4, Interesting)
"I must stress that I am not a socialist or communist by a long shot, but there is something wrong with a society that can't pay their workers a proper wage."
That's the nature of capitalist society, capitalism naturally breeds inequality. Marx's analysis of capitalism still holds true.
Dealing with the effects of capital accumulation on the working class, Marx states:
"They mutilate the labourer into a fragment of a man, degrade him to the level of the appendage of a machines destroy every remnant of charm in his work and turn it into a hateful toil; they estrange him from the intellectual potentialities of the labour-process in the same proportion as science is incorporated in it as an independent power. ... It follows therefore in proportion as capital accumulates the lot of labourer, be his wages high or low, must grow worse. It establishes an accumulation of misery corresponding with the accumulation of capital. Accumulation of wealth at one pole is, therefore, accumulation of misery, agony, toil, slavery, ignorance, brutality, mental degradation at the opposite pole."
Re:Behind the curve (Score:2, Interesting)
This exactly.
There are ways of finding a solution to having a sustainable living wage without the drawbacks of inflation, but that largely comes back to having jobs and living spaces be in the same building. None of this driving/transiting an hour in each direction every day.
Start with the obvious: 15$/hr, and all jobs must be hired full time, only at the discretion of the hiree can an employer reduce the hours (eg voluntary unpaid time off) an employee shall agree not to work for any other company full or part time except at hobbiest/training levels (eg I could work 38/hrs/wk at a coffee shop, but could train for a better job/position by having the hours not overlap with each other.) No unpaid internships. Any internship must be paid the prevailing wage for the position they are doing work as.
Get the employees to the places they need to be: For "office" environments, the office must supply living space for any employee that does not wish to transit/commute, or they must provide the telecommuting resources. I can't tell you how much telecommuting is useful, and how redundant office buildings are. Maybe new buildings can be constructed so that they are literately partitioned as "living space | workspace" with entire companies renting out floors so they can use the meeting spaces and network resources of those floors.
But I think the real source of the problem (the one that Seattle, Vancouver BC, NYC, and San Francisco) are all stuck with is the lack of available land because of the geography. It's not cost effective to build single-family homes, in fact very few exist anymore. The average "home" is really an illegal duplex. Single family homes are routinely replaced with 8-unit townhouse/rowhomes if not replaced with condo buildings. Nobody is building affordable housing at all.
Re:Sweden (Score:4, Interesting)
-- Leszek Kolakowski (a man who grew up much like you, as an ardent Marxist and atheist, only to get hit on the head with a cold bucket of reality from the system that you love)
I like how they conflate "minimum" and "living". (Score:5, Interesting)
I like how they conflate "minimum" and "living". The quoted councilman is doing it for effect, obviously, but it's not the same thing, and it won't be.
Jobs which currently exist, and are not worth paying for under the new wage will either go away, or become "sidework". This is how "sidework" started in the food service industries in the first place, after the minimum wage bumped to the point that it was no longer profitable enough to employ full time bus boys. It's why your tables don't get bussed by someone other than the waiter/waitress at even mid scale restaurants these days, and why in the higher end restaurants with bus staff, they tend to be paid out of shared tips from the wait staff at the lower end of high end places, or make minimum wage at the higher end.
Other jobs which are nice-but-not-strictly-necessary just won't get done. This is why your typical store owner doesn't have a kid washing down the sidewalk at the start of the day, and why the parking lot at the strip mall near your house looks like the inside of a dumpster, until the minimal cleaning work by local ordinance can be carried out by a street sweeper service that hits the parking lots of the local businesses as little as legally possible to get away with.
There will be jobs going away over this for sure. It will be interesting to watch how this plays out over time; I don't expect most other cities to be following this model, and I don't expect state adoption any time soon in Washington.
Re:Even higher! (Score:2, Interesting)
Communism leads to dead retirees if not babies, dear. They are on a fixed income. Seattle has just doubled what it will cost them to go out for a dinner or a coffee. If all they get is social security you've just constrained them to their homes. Oh wait, they can't even live there because the prices of the food they eat are going to go up. The prices of the gasoline they use to get out of the city to saner purchasing climes goes up. All prices go up. How about making sure those on a Social Security income have their income go up accordingly?
If the current minimum wage is not worth working to receive why do people work? They have welfare to fall back upon? It sets a very effective and practical minimum wage? Oh, you say these are young people of school age trying to build up work resumes of any kind possible so they can move on to better paying jobs? Hm, will they be able to get the resume job (hey, he actually is willing to work) with the higher cost for their unproven (or proven barely adequate) labor?
Minimum wage has a lot of "feel good" associated with it. Now sit down and build the logic tree for what happens next, with real people involved not fantasy idealized people.
It will be interesting to see how this plays out.
{^_^}
Re:Behind the curve (Score:4, Interesting)
What happens when the manufacturing cost increases by 50% to 100%? Remember, if someone is making $14.00/hr and you give the janitor a $5.00/hr wage to $15.00, your worker is going to want $19.00/hr or more.
Most restaurants have a very small profit margin, so what will happen when employee costs increase by 50%? Does the owner try to sell? Just shut it down and leave? Increase prices by 50% to 100%? If the cooks are making 1/3 more than the dishwasher and the dishwasher suddenly starts making $15.00/hr, how much will the cooks wants $18,00/hr or $20.00/hr?
Sure, it is a $5.00/hr increase for minmum wage but it is a 50% increase in wage. What if the other employees demand a 50% wage increase as well? What if the union contract demands it? Suddenly, that 14.00/hr employee is making $21.00/hr.
Re:Behind the curve (Score:5, Interesting)
Funny part is, this was in "business friendly" Texas. Can't imagine what would have happened if we had tried to open in some place like California.
Re:Behind the curve (Score:5, Interesting)
Okay, let's play the budget game and decide what you are going to cut. The discretionary side of the budget is approx. $1.020 Trillion and the non-discretionary side is approx. $2.6 Trillion. Discretionary has already been cut and you'll fail to notice any decrease in taxes. Of discretionary, military is about $570 Billion. Of that, approx. half is salaries and benefits. The personnel side has already been cut and is projected to cut more. No real appreciable saving due to those cuts are apparent. So that leaves training, procurement, etc. Procurement has already been cut. That leaves bases....except they've been cut as well and the Pentagon is floating another BRAC, which is strongly being pushed back against by your congresscritters which don't want a base cut in their district. Similar concerns occur with procurement except that congress is making it worse by demanding the Pentagon buy stuff they don't want. So let's cut all those overseas obligations. Hmmm...Europe, we can feed it back to the Russians, they'll like us for doing that and the Euroweenies cannot find the grit to defend themselves anyhow...except that isn't real expensive. Similarly with the Pacific, you won't mind being pushed around by China which already claims the entire S. China Sea owing to cultural history, blah, blah, blah...whatever excuse they are using to make their egos look bigger this year.
What about the rest of discretionary. You like clean air and water, yes? Don't touch EPA, the Republicans don't believe in it either so maybe you can get a few bill out of them. NIH? Does anyone in your family have a nasty disease? They fund research into those that the drug companies won't because not enough people will die from small ball diseases. The list there goes on.
How about the non-discretionary side. All those promises to the old folks that were made? They believed them even if the promises cannot be kept. So Grandma can come and live with you, yes? By the way, her meds are expensive so better start saving. We could start changing the promises made to younger generation so they'll not have a nasty surprise when they get blue hair. But those won't buy the next election and they won't save current taxes.
How about welfare? We could squeeze all the corruption out of that...except, if we knew how to do that effectively, we'd have already done it.
BTW: Don't forget about global warming and sea level rise. Norfolk, VA. and Miami, FL. won't. They want federal aid to stop the sea from eating their towns. So we could make changes now to mitigate that disaster...except that coal state pols claim that would be bad because it will suck jobs from their states...better to screw the world than they get dis-elected by disgruntled unemployed.
So, what's yer plan?
Re:Behind the curve (Score:5, Interesting)
What else can you really compete on when you're selling basics like toilet paper and laundry detergent.
The last one: image. Wal-mart has picked up such a negative image that a lot of people will pay extra just to make sure they don't have to shop there. Heck I personally buy a lot of store-brand generics for lots of products, but I won't buy those at Walmart because I don't want anyone who might come in my home to see a Wal-mart store brand product in my house.
One thing stores can compete in too is in non-imported goods. I try to buy "Made in the USA" goods when I can - particularly for things like tools. The local hardware store runs about 15-20% more than Walmart but a LOT of what they carry is domestically produced, and even for the stuff that isn't, they generally filter out the "junk" that Walmart sells. If something is of low/poor quality, that store generally won't stock it. They also have knowledgeable people working there, which helps. You're not going to find a person with actual plumbing or electrical experience working the hardware section at Wal-mart.
Re:Behind the curve (Score:3, Interesting)
Really? Is "I quit" so hard to say?
Of course, if you lack skills that make you employable, you will have a hard time to find another job. But why should individual employers be burdened with paying for your lack of skills? If hard-to-employ people need financial help, it should be provided as welfare, and people should vote for it explicitly.
What raises in minimum wage really are is an attempt to sneak in tax increases without anybody noticing. And, ironically, minimum wage increases are regressive: high income people don't notice them because they generally don't do business with businesses employing minimum wage workers anyway.
Re:Behind the curve (Score:4, Interesting)
Minimum wage, a bigger picture (Score:5, Interesting)
(Wow, this got long...)
When minimum wage became the big issue, with all the protests, I thought back when I made minimum wage. I flipped burgers and live in a house with 4 friends. Sure I couldn't afford rent and food at minimum wage, but I could afford 1/5th rent and food and have plenty left over. My friends (who also worked the same McJob) saved money, a couple bough used cars. We had every game system, a great stereo, I had a top of the line computer. We had enough and some luxury items. I thought back then and how much I made. I adjusted my wage with inflation and it came to...... $6.52/hr. WHAT? wait a sec, all those protesters with signs said if I adjusted for minimum wage, it would be 10.75/hr! What gives???
So I grabbed every minimum wage since it's start and adjusted each one for minimum wage. Here it is (Note: I did this 3-4 months ago, there could be more inflation now):
Year: Wage then -> Adjusted to 'today' (3-4 months ago)
1955: $0.75 -> $6.55
1956: $1.00 -> $8.60
1957: $1.00 -> $8.32
1958: $1.00 -> $8.09
1959: $1.00 -> $8.04
1960: $1.00 -> $7.90
1961: $1.15 -> $9.00
1962: $1.15 -> $8.91
1963: $1.25 -> $9.56
1964: $1.25 -> $9.43
1965: $1.25 -> $9.28
1966: $1.25 -> $9.02
1967: $1.40 -> $9.80
1968: $1.60 -> $10.75 $10.20
1970: $1.60 -> $9.65
1971: $1.60 -> $9.24
1972: $1.60 -> $8.95
1973: $1.60 -> $8.43
1974: $2.00 -> $9.49
1975: $2.10 -> $9.13
1976: $2.30 -> $9.46
1977: $2.30 -> $8.88
1978: $2.65 -> $9.51
1979: $2.90 -> $9.34
1980: $3.10 -> $8.80
1981: $3.35 -> $8.62
1982: $3.35 -> $8.12
1983: $3.35 -> $7.87
1984: $3.35 -> $7.54
1985: $3.35 -> $7.28
1986: $3.35 -> $7.15
1987: $3.35 -> $6.90
1988: $3.35 -> $6.62
1989: $3.35 -> $6.32
1990: $3.80 -> $6.80
1991: $4.25 -> $7.30
1992: $4.25 -> $7.09
1993: $4.25 -> $6.88
1994: $4.25 -> $6.71
1995: $4.25 -> $6.52
1996: $4.75 -> $7.08
1997: $5.15 -> $7.51
1998: $5.15 -> $7.39
1999: $5.15 -> $7.23
2000: $5.15 -> $7.00
2001: $5.15 -> $6.80
2002: $5.15 -> $6.70
2003: $5.15 -> $6.55
2004: $5.15 -> $6.38
2005: $5.15 -> $6.17
2006: $5.15 -> $5.98 $6.60
2008: $6.55 -> $7.12
2009: $7.25 -> $7.90
2010: $7.25 -> $7.78
2011: $7.25 -> $7.54
2012: $7.25 -> $7.39
2013: $7.25 -> $7.28
2014: $7.25 -> $7.25
Now you see, the 10.75 is the highest value, in 1968. Claiming that should be the standard is as intellectually dishonest as claiming the lowest value ($5.98/hr) should be the standard. The median would be $7.78, and the average would be $7.94. A fair minimum wage increase would be in that rage. Last time we raised minimum wage in 2009, there was no issue... because it was with in that median-average rage. It was fair.
Minimum wage jobs are not meant to careers. They are entry level jobs for teens and young adults. Majority of minimum wage workers are just starting out. As you gain experience you become worth more to an employer and you should make more. If you aren't, look for a new job. Early in my adult life, I switched jobs every 1-2 years. Each job paid better than the previous.
There will always be somebody at the bottom. The young person who just starts out doesn't have anything. Some have debts, like college loans, so they have a negative self-worth. As we gain skills and earn more, our worth goes up. People love to tout the "Wealth inequality" but the better picture is "Income Mobility". What happens to those in the bottom 20%... From 1996 to 2005, over 50% of the people in the bottom 20% moved up to a higher bracket. In just 10 years, most moved up. Now why has the bracket increased in size if everybody is moving up? The bottom is always filled with new people entering the work force. The 9 year old in 1996 is now in the work force in 2005.
Also, when peop
Re:$30,000 per year (Score:5, Interesting)
Should I find a better job? The job I have is a fantastic for when I leave school, providing an exceptional network and excellent experience. I'm doing research to reduce energy use in the construction sector, which benefits society as a whole. Leaving this job would be short sighted. Admittedly, when the minimum wage increases, not all low paying jobs will be like this, but many good jobs still are.
Should I live elsewhere? Rent in the area is high and going higher, so I live with 3 other people. My location is in the city, but in the cheaper areas, not trendy at all and less safe overall, but it works. I live in this city because this is where the jobs are. I could move to the suburbs, but that would require both car payments and gas payments, neither of which are cheap, especially given >$4 gas. Public transportation is an alternative, but it costs both money (2.50 or so a ride) and time (an hour each way, so that's 30 dollars of lost productivity per day). That may not seem like much, but on $15 an hour, it's tough. So I currently bike when I can.
Eating out here is quite expensive, with most non-fast food places providing meals that start at 12-13 dollars and quickly rising from there (and that's the going rate for a burger, the most pedestrian of foods), so I eat in. Can't waste an hours worth of work to have a meal out, after all. It's not terrible, because I can cook quite well, and I've shifted to a primarily vegetarian life style, as meat is expensive.
So at the end of the day, my paycheck goes to food and shelter, both of which are kept as cheap as possible. What little extra I have is saved and used for emergency funds, which can be wiped out pretty quickly in some unforeseen event. God help me if I'm hit by a car, or come down with the flu. Being out of commission for a week is not an option. All in all, I feel I'm doing a good job pushing my future forward. But my present is a fragile system that could be wiped out given a large enough hit.
So what am I saying? Your simplistic idea of "you're an idiot and you should move" completely ignores what life is like on a tight paycheck. There are bright people on a low paycheck, and it's quite the trap. Life on a slim budget has no room for error, and when your entire system revolves around survival, it takes extra work to plan for a future.
What should be more frightening to you is that you are surrounded by people who live like this. The people who take your cash at the starbucks, the people who clean your trash out from your desk. You rely on these people, and yet you look down on them and mock them. You're lucky you are where you are at, because what you do not have to do is pull yourself up from nothing. And if you are the person who came from the mean streets and a poor family, congratulations, you've done something amazing. But if you are, you're an amazing jerk to all those who are trying to do the same thing you did.
Re:$30,000 per year (Score:5, Interesting)
Why does it have to be easy?
Did I say it had to be? No. I was arguing against the Parent Poster's comment, which was in response to GP's comment that a minimum wage was "barely a liveable wage." The Parent responded and said people who couldn't figure out how live on that were "clueless and/or spoiled" and it was "certainly enough to get by."
I then responded to and said it probably wouldn't be that easy for everyone, and I gave examples where it might be harder, i.e., closer to GP's claim that for some people it might "barely" be "a liveable wage."
In other words, I wasn't at all arguing that it should be "easy," but rather that for some people with these situations, it simply isn't, and it's rather ignorant to suggest that it is.
If you made poor decisions in your life (no skills, children you can't afford, living in an area you can't afford) why is it my responsibility (or the government's responsibility, or a private company's responsibility) to provide for you?
Some people are actually stupid, you know. I don't mean to insult them. I mean that for some people it's really difficult to develop good skills that would be worth more than $15/hour to somebody. If you're officially "mentally retarded," you can often get government subsidies to assist you. But if you're above the arbitrary borderline, you're on your own. Many of the guys who are washing dishes in a kitchen or cleaning the bathroom or bagging your groceries would have serious difficulties developing more "skills" to be competitive in the marketplace. I'm NOT saying we should just give them a happy life for free, but not everyone in the world has the same natural talents for earning potential as anyone else.
As for children, growing up in poverty has all sorts of negative repercussions for kids, and it leads to a cycle where the kids end up living crappy lives again. I don't think there are easy answers to this problem, but simply saying "it's not my problem" will ultimately lead to a generation of more kids in poverty, committing more crimes, etc. down the road. Again, I'm NOT saying we should just throw money at the problem, but we shouldn't ignore it either. (Also, note that combined with above -- stupid people often don't make the best choices. That can include having kids they can't afford. But as a society we've decided that forced sterilization of stupid people is wrong. So... well, that leaves us with a problem of people who sometimes have kids they can't afford, and we need to address it somehow.)
As for "living in an area you can't afford," well, it depends on where you can get a job. You move out of the city, maybe you have to get a car -- a car costs money, insurance, gas, maintenance, etc. You save on rent, but spend more for your car and have a longer commute which means you can't work as many hours. Sure, in some cases you could solve things by moving, but in other cases it's not so simple. I'm not saying this one is the government's problem, but it is a rationale for trying to tailor our poverty policies to the cost of the standard of living in a particular area. Hence my reply to the original parent about $30k -- in some areas, that's plenty to live comfortably. In others, not so much. We just need to be conscious of that.
The only item I agree with on your list is health, often health problems are not under a person's control.
How about (4) on my list: other dependents? Like, for example, ailing parents. Are they under your control, too? I made my choice to care for my sick dad who can't work, so I have to "pay the piper"? Also, there are all sorts of situations where you can end up taking care of people -- for example, kids often end up living with aunts or grandparents if their parents are unable to care for them (for whatever reason). Is it still my "choice" to make if my grandkid needs a home, and I don't want him to go to
Re:Behind the curve (Score:4, Interesting)
If people can afford living on one job only, they will quit their second and third jobs, opening up a lot of new jobs for those that might lose theirs.
I don't really get the idea of people losing their job because wages rise. Why? Why would I keep someone for 5 bucks an hour but fire him for 10? The question is whether I NEED the worker or whether I DO NOT need him. If I don't need him, I won't keep him for 5 around either. It's 5 bucks an hour that I could save, so why not kick his ass out? OTOH, if I do need him, I will have to pay him. 5 or 10 bucks. It will reduce my profit, but if I NEED him to do my business, I will HAVE to pay.
The only reason why I could fire someone due to an increase in wages is when this increase actually affects my cost in such a way that due to it I can no longer be profitable and hence have to close down entirely. Because either I CAN provide a service profitably or I CAN NOT. And that in turn is independent of the number of employees.
What can happen is that I would have to cut back on services I can provide now that would become unprofitable due to increased wages. Like, say, opening my shop 24/7 when the graveyard shift was only profitable because the worker was dirt cheap. Well, then I guess that means that people don't really NEED that service anyway. No loss here. The only thing we'll lose here is a few jobs in the minimal wage sector which, as noted above in the first paragraph, will easily be caught by the jobs now opening due to people working fewer jobs to make ends meet.
What it boils down to, and this is not a "theory", it's simply what I can observe by looking around myself: A minimum wage that doesn't only mean that you can sustain yourself but also that you can still maintain at least a moderate standard of living is in the end a boost to the economy because that standard of living has to be provided by someone. Of course the economic downturn has hit us, too, but by no means as hard as it has hit other countries with a lower social standard. People here still have money to spend and they DO spend, mostly on services. That in turn means jobs. That means less pressure on the social services provided by the state. Resulting in lower cost for social services. People are certainly doing worse than they did before the crisis hit, but we're a far cry from the situation the US is in. In a nutshell, even long time unemployed people can actually enjoy a minimal living standard and are kept from engaging in criminal activities because even they have a damn lot to lose.
I can go for a walk at 3am in the worst part of my town and return home alive and with all my cash and cellphone in my pocket. Can you?