A political divide on hiking the minimum wage
On January 28 President Barack Obama gave his 2014 State of the Union (SOTU) calling on both Chambers of Congress to either work with him to move the country forward or forcing him to use his presidential powers to enact policy.
Congress to Debate Merits of Minimum Wage
In a little over an hour, Obama rattled off dozens of domestic and foreign policy initiatives for Congress to consider this session. But the President also called for an increase in the nation’s minimum wage to provide America’s worker’s a living wage.
While Obama’s push to raise the minimum wage was derailed last year by the GOP House and its Tea Party Faction, the Democratic president noted that five states have already passed laws to raise theirs (including Rhode Island).
With corporate profits and stock prices climbing, average wages “have barely budged,” observed the President. “Inequality has deepened. Upward mobility has stalled. The cold, hard fact is that even in the midst of recovery, too many Americans are working more than ever just to get by – let alone get ahead. And too many still aren’t working at all,” he said.
Through an executive order the President announced in his SOTU address last Tuesday evening that he would ratchet up the minimum wage of federal contractors to $10.10 per hour, “because if you cook for our troops’ meals or wash their dishes, you shouldn’t have to live in poverty.”
“Today, the federal minimum wage is worth about twenty percent less than it was when Ronald Reagan first stood here,” the President quipped, noting that legislation to increase the nation’s minimum wage to $10.10 has been introduced by Senator Tom Harkin, a Iowa Democrat who is retiring after serving almost 40 years in Congress, and Democratic Congressman George Miller, from California, also leaving office after 20 terms.
Two Sides of the Coin
Although creating jobs will be one of the top campaign issues that must be addressed by the State’s gubernatorial candidates, look for the minimum wage issue to pop up for heated political discussion with the Democratic and Republican views being like two sides of a coin.
When he announced his bid for governor, Mayor Taveras he told his supporters that increasing the minimum wage is a step in building an economy that supports higher paying jobs, puts people back to work and gives Rhode Island families the opportunity for a better life. There was a time when his mother worked at the minimum wage to support three children so he knows firsthand how much raising it can help a family, he stated. He is also pushing for statewide universal pre-kindergarten.
Taveras quoted from a recent study by the Economic Policy Institute that indicated that increasing the minimum wage to $10.10 an hour would increase the wages of 65,000 Rhode Island workers and indirectly benefit an additional 26,000 more, totaling nearly 20 percent of the work force. He cited another study that found that moving to a higher wage would boost the national economy by as much as $22.1 billion, creating as many as 85,000 new jobs.”
According to Eric Hyer’s, Gina Raimondo’s Campaign Manager, “Gina strongly believes that we need to increase the minimum wage and she was pleased to see President Obama call for increasing the minimum wage to $10.10 an hour during the State of the Union this week. No one who works full time should live in poverty. As the President said, it is time to give America a raise.”
“Gina is calling for us to take action on this now and raise the minimum wage to $10.10 by 2015 and then index it to the cost of living so that politicians can’t play games with people’s lives.
Two-thirds of minimum wage earners are women so a raise would immediately help women across Rhode Island and their families, adds Hyer, noting that “Clay [Pell] is in favor of increasing the minimum wage to $10.10 per hour and does not see a reason to delay this matter until 2018 or 2015. He would be in favor of the General Assembly passing legislation this year. Too many Rhode Islanders are working in jobs at wages that are simply insufficient and no individual who works a full time job should have to raise their family in poverty. There’s an economic development aspect to this as well, by raising the minimum wage we’re putting more purchasing power out there, which will help spur the economy,” said Bill Fischer, Pell’s spokesperson.
General Contractor Todd Giroux, a Bristol resident who seeks the Democratic nomination for Governor, sees the national conversation of increasing the minimum wage as shifting towards that of providing America’s workers with living wage. According to Giroux, President Obama’s call for a national minimum wage increase for federal contractors increases the “momentum for main street people to call upon elected leaders to represent their needs in jobs and wage security.”
Beginning May 2014, Giroux proposes the $ 8.00 minimum wage to be called a provisional starting wage for new hires for the first two weeks of employment. This hourly rate would increase to $ 9.11 after their second week. On January 2015, the provisional starting wage would be $ 8.75 for the first two weeks of employment, increasing to $10 per hour after their second week. Full-time, part-time and seasonal workers would be eligible for this salary increase.
GOP Candidates Say No Way
But, the Rhode Island’s GOP candidates, Cranston Mayor Allan Fung and Businessman Ken Block, are not buying the Democratic candidate’s solution that minimum wage is the way to go.
“Democrats continue to recycle bad ideas. It’s time we consider some new ones so people have the opportunity to succeed and thrive, and not rely on government coercion to dictate wages. Increasing the minimum wage will result in higher unemployment, reduced job opportunities, reduced customer spending, and will reduce net job growth because of the effect on expanding companies,” says Mayor Fung
“The real issue in Rhode Island is unemployment and getting our workforce prepared with the necessary skill set for the ever changing workforce. It is quite evident that raising the minimum wage would not solve these problems,” adds Fung.
Ken Block adds, “President Obama seems to believe that government can just order the economy to improve. Republicans and Independents know that government has a critically important, but limited role in the growth of jobs. Government’s role is to regulate fairly and only where necessary, and to control its spending so people and businesses are not taxed to death. President Obama continues on the wrong track to fix lagging employment, just as the Democratic leaders of our General Assembly continue on the wrong track to fix Rhode Island.”
With the Rhode Island General Assembly geared up to pass legislation to make the Ocean State an easier place to do business, lawmakers should not forget their constituents who cannot pay their mortgage, utility bills, or even put food on their tables. Until the State’s tax and regulatory system primes the economic pump to create more jobs, giving a little bit more money, say $10.10 per hour, will go a long way for tens of thousands of poor or working poor Rhode Islanders who struggle to survive.
How can Rhode Islanders currently making a weekly paycheck of $320 (minus taxes), receiving a minimum wage, support their families? This is not the American Dream they were brought up to believe in.
Herb Weiss, LRI’12 is a Pawtucket-based writer who covers, aging, health care, medical and business issues. He can be reached at hweissri@