You might say the chieftains of America’s largest restaurant corporations want it every which way and then some.
Having read the polls supporting a minimum wage hike, they’re skittish about trashing the idea personally. So they pay their DC lobby machine to do their dirty work. And it’s not enough for them to shove the costs of their low-wage model onto Joe Schmo taxpayer. These CEOs are also making the rest of us pay for their own fat paychecks.
How’s that again? Yes, ordinary taxpayers are not only covering the cost of billions of dollars in public assistance for restaurant workers who earn poverty wages. We’re also subsidizing the pay of our nation’s notoriously overpaid CEOs.
Here’s how it works: Under the current tax code, corporations can deduct no more than $1 million for executive pay from their federal income taxes. But there’s a giant loophole that allows unlimited deductions for “performance pay.” So, no surprise, what the big corporations tend to do is put about $1 million of their executive pay packages toward salary and call the rest “performance pay.” That way the more they shovel into their CEO’s pockets, the less they pay Uncle Sam. And the rest of us foot the bill.
A new report I co-authored at the Institute for Policy Studies explains how the 20 largest corporate members of the National Restaurant Association have benefited from this loophole. These corporations aren’t necessarily bigger exploiters than those in other sectors. But they deserve extra scrutiny because of the high social costs of their low-wage model—and because they’re fighting so hard to preserve it.
Nearly all of the big restaurant corporations are members of the National Restaurant Association, which is leading the charge against minimum wage increases.
… Polls have confirmed that Americans from across the political and ideological spectrum are overwhelmingly in favor of a substantial increase in the minimum wage. And election results are now confirming the sentiment.
Now comes a powerful signal from Chicago.
When voters in the city went to the polls to cast ballots in Tuesday’s statewide and local primary elections, thousands of them faced an economic question: Would they support a $15-an-hour minimum wage for large employers in the city?
The results were overwhelming. With 100 of the 103 precincts where the issue was on the ballot reporting, 87 percent of voters were backing the $15-an-hour wage. Just 13 percent voted against the advisory referendum. That huge level of support will strengthen the hand of activists who are encouraging the city council to consider a major wage hike.
The Chicago vote illustrates a phenomenon that is being seen in many of the nation’s largest—and most expensive—urban areas.
“With inequality at record levels, more workers relying on public assistance just to afford the basics, and the federal minimum wage stalled at just $7.25, more and more cities are responding with higher minimum wages at the local level,” says Paul Sonn, general counsel for the National Employment Law Project. “We’re seeing this especially in high cost regions where the state-wide minimum wage just isn’t enough.”
reports on how Fight for 15 activists in Chicago celebrated International Women’s Day—by demonstrating for the rights of low-wage workers.
"Unlike nations which have rational labor policies like sick leave, paid parental leave, affordable child care, vacation time, generous retirement and which protect the right to organize a union, the USA has chosen the opposite course. This has led to some of the worst inequality in the developed world, which because of our rampant gender and racial discrimination, falls heaviest on women, particularly women of color."
INTERNATIONAL WOMEN’S Day (IWD), March 8, was originally inspired by the historic 1909 “Uprising of the 20,000,” a garment workers strike of women in New York City, many of them immigrants. They demanded better pay, better working conditions and the right to join a union.
So it made sense that the Workers Organizing Committee of Chicago (WOCC), which leads the Fight for 15 campaign in the city, should celebrate International Women’s Day by standing up for the rights of women workers in 2014.
A Chicago McDonald’s worker named Carmen Navarrette had been told that she “should put a bullet through her head,” because she had requested permission to go home after becoming very ill at work. She is a diabetic and had just been released from the hospital.
As a result, dozens of WOCC members and supporters marched into a North Side McDonald’s on International Women’s Day to demand an end to this kind of discrimination and verbal abuse.
On the morning of March 8, a smaller group of WOCC members and allies picketed a North Side Chicago Whole Foods and demanded the reinstatement of Rhiannon Brochat. She was fired after she stayed home with her special needs child when Chicago schools were closed on the worst day of the Polar Vortex.
McDonald’s and Whole Foods may seem like very different companies, but their attitude toward women workers is remarkably similar.
My personal opinion is that if the politicians who decry a raise in the minimum wage were really concerned about small businesses, they would set up a way to offer subsidies to these companies that truly could not financially afford to pay their workers above poverty-level wages.
Barring that, I frankly think if there is a small company that cannot afford to pay its workers a living wage, then that company either needs to change its practices, or face the fact that it should not be in business at all.
I’m reminded of the old “small” plantation owners who complained that they would “go out of business” if not for the slave labor which they depended upon. The response by abolitionists? Too bad.
If it is absolutely necessary for you to employ slave labor, or only pay poverty wages to employees, in order to run a business, then you frankly should not be in business. If your success as a “small business” is directly predicated upon the impoverishment of American workers, then you are part of the problem.
For the truth of the matter is that the crushing poverty faced by millions of low-income American workers is far more of a national crisis than the potential inability of various small-to-mid-level capitalists to run their tiny little niche-market operation.
Opponents of the Fight for 15 in Seattle are counter-attacking with the claim that small businesses would suffer.debunk their arguments.
Scary statistics on unemployment, inequality, climate change and more.
January 28, 2014 11:15 AM ET
In tonight’s State of the Union speech, we’re likely to hear a lot about the nation’s continuing recovery from the Great Recession, and about President Obama’s determination to run an executive end-run around obstructionist Republicans in order to kick the economy into a higher gear.
But as the nation pauses for this annual moment of reflection on our fiscal and social health, too many leading indicators get short shrift. Here are 27 statistics – on unemployment, inequality, the drug war, defense spending, climate change and more – that underscore the troubled reality of America in 2014:
1. New income generated since 2009 that has gone to the top 1 percent: 95 percent
2. Financial wealth controlled by the bottom 60 percent of all Americans: 2.3 percent
3. Record combined wealth of the top 400 richest Americans: $2,000,000,000,000
4. Real decline in median middle-class incomes since 1999: $5,000
5. Percentage of Hispanic and African-American children living in poverty, respectively: 33.8 percent; 36.7 percent
6. Amount that food stamps will be cut in 2014: $5 billion
7. Federal minimum wage: $7.25
8. What the minimum wage would be if it had kept pace with gains in worker productivity since 1968: $21.72
9. Number of U.S. workers laboring at or below minimum wage: 3.6 million – the near equivalent of the population of Los Angeles.
10.Stealth taxpayer subsidy to the fast-food industry, paid out as safety-net benefits to McWorkers earning poverty wages: $7 billion
11. Global carbon dioxide levels measured in parts per million: 397
12. Maximum concentration of the greenhouse gas that scientists deem sustainable: 350
13. Years since the turn of this century that have ranked among the warmest 15 on record: All 13
14. Rank of 2013 on that list of the warmest years on record: Number Four
15. U.S. defense spending as of 2012: $682 billion
16. Dollar amount by which that surpassed our nearest plausible military rival, China: $516 billion
17. Federal deficit last year: $680 billion
18. Number of Americans disenfranchised from voting for felony convictions: 5.9 million
19. Share of those disenfranchised voters who are African-American: 37 percent
20. Number of Americans arrested annually for marijuana possession: 658,000
21. Total incarcerated U.S. population: 2.3 million
22. Total population on probation/parole: 4.8 million
23. States that could be entirely filled by all of the Americans under correctional supervision: Nevada and Kentucky
24. Official unemployment rate: 6.7 percent
25. Alternate rate including Americans who’ve given up looking for work, or have only been able to secure part-time employment: 13.1 percent
26. Number of jobs the United States is still down from 2008 employment peak: 1.69 million
27. Number of Americans who were cut off from long-term unemployment benefits at the turn of the year: 1.3 million
January 6, 2014: 7:10 AM ET
Millennials are starting to get restless for change.
Stuck in low-wage or part-time jobs with mountains of student loans to pay off, the generation that came of age in the new millennium finds itself in a hopeless situation. Despite being better educated than previous generations, many young people are shut out of the middle class with no road map of how to get there.
So many of them are joining protests, showing up at rallies, or forming unions to improve their situation.
In the past year, millennials turned up the heat against low wages at Victoria’s Secret, Wal-Mart (Fortune 500), , McDonald’s (Fortune 500), , Wendy’s (, )KFC (Fortune 500) and others like , Kaplan (, which runs tutoring centers. )
Overturning a decades-old exemption, the U.S. Department of Labor has extended minimum wage and overtime benefits to the mostly female and minority workforce of nearly 2 million home health-care workers.
The Fair Labor Standards Act will be extended to direct care workers, U.S. Secretary of Labor Thomas Perez said Tuesday on a conference call with reporters. Those affected by the rule will receive the same protections as people providing similar services in hospitals and nursing homes, effective Jan. 1, 2015.
“Home-care workers are no longer treated like teenage babysitters providing casual services under this rule,” Perez said. “A fair wage will further stabilize and professionalize this critical line of work.”
The move was opposed by the Washington-based U.S. Chamber of Commerce, which said it would make home-health care too expensive for some. The cost of the rule will average $6.8 million a year over a 10-year period, the department said. It was backed by a broad coalition of groups that advocate for low-wage workers, according to Sarah Leberstein, a staff attorney with National Employment Law Project in New York.
Congress extended benefits to domestic workers when it amended the Fair Labor Standards Act in 1974. The measure included a narrow exemption for babysitters and workers who provide “companionship” services that the Labor Department later interpreted to include direct-care workers, Leberstein said.
Kyle King made $8 an hour when he started working as a cashier at the Burger King across from Boston Common. Nine years later, he is up to $8.15, logging fewer hours and living with his brother in Roxbury because he can’t afford a place of his own.
King’s worsening economic condition has prompted him to make a bold decision that could cost him even more money: He plans to skip his scheduled Thursday afternoon shift at the chain’s Tremont Street restaurant.
But King isn’t quitting. Instead, he is taking part in a nationwide demonstration of fast-food employees demanding $15-an-hour wages and the right to unionize. Thousands of workers in 50 cities are expected to take part in the one-day strike. In Boston, as many as 200 fast-food employees are expected to form rolling picket lines outside nine chain restaurants — including Burger King, McDonald’s, and Dunkin’ Donuts — culminating in a rally on Boston Common.
King, 45, said he realizes low-skilled workers like him are easily replaceable and that he could be fired over Thursday’s act of defiance. But he is more worried that nothing will change for those who work behind fast-food counters unless more attention is called to their cause.
John Oliver raked Fox News over the coals on Thursday’s episode of “The Daily Show,” mocking the network’s parade of conservative commentators for their opposition to striking fast food workers who are demanding higher wages.
After running a clip of Greg Gutfeld suggesting that raising wages for low-income workers will make things a little too cushy, Oliver mockingly elaborated on the argument.
"If you raise the minimum wage, people will never stop working in the fast food industry," Oliver said. "They’ll get so comfortable in those hot kitchens and in their acrylic uniforms, relaxing in that grease fog, smelling like processed meat no matter how many showers they take."
Next up for Oliver’s wrath was Gutfeld’s co-host of “The Five,” Andrea Tantaros, who said that if the “Obama economy” was stronger, the striking fast food workers would surely already be receiving higher wages.
"Yes, because that’s how capitalism works," Oliver observed. "Companies always pass on higher profits to their lower-level workers. That’s a fact."
But the interim host saved his most stinging blow for Wall Street cheerleader Neil Cavuto, a Fox News financial analyst who waxed nostalgic about his days earning $2 an hour as a 16-year-old fast food worker. Oliver pointed out that the current median age of fast workers is 28, much different than “a 16-year-old Neil Cavuto getting his first job to earn money for beer and porn.” Moreover, Oliver highlighted the fact that when the $2 wage Cavuto earned in 1974 is adjusted for inflation, it comes out to $9.47 per hour — $2.22 more than the current federal minimum wage.
"It’s incredible that he had the incentive to leave that for his high-paying job on television right now," Oliver said. "He really pulled himself up by his bootstraps."
The good news in the ACA for low-wage workers who work for small employers (those with fewer than 50 full-time workers) is that many will have access to affordable health coverage for the first time through the new health insurance marketplaces. They will be able to sign up for subsidies that limit how much they pay in premiums to a percentage of their income and get plans with good benefits and moderate out-of-pocket costs. Those with incomes below 133 percent of the federal poverty level (about $15,000 for an individual) will be eligible for Medicaid in states that agree to expand coverage.
But for those who work for bigger employers – and some two-thirds of minimum wage jobs are at employers of 100 or more – it is not clear whether the ACA will deliver on its promise of affordable coverage.
… That is because the big business lobby exercised its muscle in shaping the ACA in the Senate Finance Committee. All the law requires is that employers offer individual employee health coverage that does not cost more than 9.5 percent of an employee’s income in order for the business to escape paying a $2,000-to-$3,000 penalty. In addition, the ACA allows employers to offer plans with very high out-of-pocket costs.
And here’s the kicker: as long as a worker is offered the less-than-9.5-percent-of-income coverage at work, that worker is not eligible for the much better coverage in the marketplace. And if the worker decides that she can’t afford the premiums, she will be have to pay a penalty for not being insured.
Seen in this light, Obamacare is one more step toward both improving and exacerbating the low-wage work crisis in the nation. The movement away from employer-provided health coverage is a huge step forward in creating a more just health care coverage system. But justice for low-wage workers at big businesses will mean confronting the power of companies like WalMart, McDonald’s, and Bank of America (with its low-wage tellers). This is the same challenge we face in taking the other steps needed to modernize labor standards for the 21st Century: a higher minimum wage indexed to inflation, paid sick days and family leave, and overhauling labor laws so that workers’ rights to form unions is restored. It is fast becoming central to the fight for a new economy that works for all Americans.
Fast-food workers around Seattle began their 24-hour strike on May 29 when workers at a Taco Bell in the Ballard neighborhood walked out at 10 p.m., shutting the store down. The next day, workers from Burger King, Taco del Mar, Subway, Chipotle and Qdoba walked out in a series of actions beginning in the morning and ending that evening. In total, job actions shut down 11 fast-food restaurants throughout Seattle.
About 300 fast-food workers and supporters gathered at 4 p.m. on May 30 for a rally in Denny Park. Organizers pointed out that two thirds of fast-food workers are women. Speaking to the crowd, Caroline Durocher from the Ballard Taco Bell said, “I’m on strike today to make a living wage, to make enough to eat, to afford bus fare, to live. When I went on strike and my store shut down, I felt like a person again.”
IN A matter of few months, strikes and protests by low-wage workers have rolled through more than a half-dozen U.S. cities—with the promise of more to come, as fast-food and retail workers, from McDonald’s to Macy’s, give voice to the frustrations of millions of workers who endure low wages, poor working conditions and disrespect on the job.
These are workers—in retail, fast-food and other branches of the service sector—that many unions considered “too hard to organize” in the past. Now, workers themselves are challenging that idea—and in the process, they may play a central role in helping to revitalize the labor movement.
From city to city and workplace to workplace, the solidarity has been almost contagious. In New York City, workers walked out at McDonald’s, Wendy’s and other fast-food restaurants in late November of last year. Many said they were inspired by the Black Friday walkout by Wal-Mart workers in over 100 cities.
New York saw another strike on April 4—the 45th anniversary of the assassination of Martin Luther King. On April 24, it was Chicago’s turn—retail and fast-food workers took part in a one-day walkout that rolled from one low-wage workplace to another and another. And there’s more—Milwaukee, St. Louis, Detroit and Washington, D.C.
… While the strikes and walkouts seemed to come out of nowhere, every worker inside each workplace can play a key role every day in making this fight stronger. As Matthew Camp said:
These are people from a wide range of backgrounds. Most of us are working poor, but some of us are young, and some of us are old. We work in different places across the city, but to see everybody come forward and display this kind of solidarity and pick up each other’s cause is profound.
That’s the great thing about Fight for 15—it’s not really a question about what I can do in my workplace, but the idea that we won’t do well until we all do well together. There are people in Fight for 15 who have worked at McDonald’s for decades and still make less than $10 an hour. To have Whole Foods workers, who start at $10, pick up that person’s struggle as their own is incredible to me.