NEW YORK, Jan 31, 2021 (BSS/AFP) – When President Joe Biden unveiled a $1.9
trillion stimulus proposal earlier this month, few were surprised by the
plan’s hefty price tag or sweeping scope.
More striking was Biden’s inclusion of a measure to more than double the
federal minimum wage to $15.
The move, backed by leading Democrats including left-wing Senator Bernie
Sanders, establishes the fight for higher wages as a top priority for the new
administration, potentially leading to one of Washington’s boldest
adjustments in US social and labor policy in decades.
The fate of the initiative — which so far lacks support from Republicans
— will help determine whether Biden delivers on a core pocketbook issue as
US income inequality widens during the Covid-19 pandemic.
Sanders, a former presidential candidate, called the current federal
minimum wage of $7.25 an hour a “starvation wage” as he unveiled the proposal
for an increase in Congress.
The senator said he hopes Republicans “will understand the severity of the
crisis,” but added that Democrats should be prepared to enact the policy on a
narrow party-line vote.
Such an increase would boost wages for more than 32 million US workers,
according to the Economic Policy Institute, a progressive think tank.
The Sanders bill proposes “a significant increase in the minimum wage,”
Ben Zipperer, an economist at the institute, told AFP. “Unfortunately, we
have quite a big hole to dig out of in terms of providing what low-income
workers need.”
– Popular support –
The bill would put the United States on par with a growing number of
states and cities that have already enacted the hike at the urging of the
“Fight for $15” movement launched by fast-food workers in the early 2010s.
“The bump up made it a little bit easier,” said Maggie Breshears, who
works at grocery store and retailer Fred Meyer in Seattle and has gone from
making about $10 per hour in 2013 to $17.59 after Seattle lifted its minimum
wage in 2014.
The US minimum wage was first enacted in 1938 as part of President
Franklin Delano Roosevelt’s New Deal reforms.
The measure has been periodically increased since then, most recently in
2007, when Congress lifted it gradually from $5.15 to $7.25 an hour, which
would equal a $15,000 annual salary.
Barack Obama was unable to win a boost during his eight-year presidency
from 2009 to 2017. In 2019, the House of Representatives approved an
increase, but the bill died in the Republican-led Senate.
– Compromise ahead? –
Supporters of an increase draw hope from rising public support apparent in
2020, when Florida voters backed a hike to $15 per hour at the same time the
state voted for Republican President Donald Trump, who ended up losing re-
election.
In Arkansas, another Republican state, 68 percent of voters in 2018 backed
gradually increasing the wage to $11 an hour.
“If we had left it to the legislature, it would have stayed at $6.25,”
where it was before the most recent federal increase, said Kristin Foster, an
Arkansas political consultant who directed the 2018 campaign. “The only way
it was able to pass was through the ballot.”
Several large companies, including Amazon, Target and Starbucks, have set
$15 as their minimum wage for US workers.
Others that once fought the measure have given ground. These include
McDonald’s, which said the discussion on the minimum wage represents an
“important one that McDonald’s looks to advance, not impede.”
Supporters of the wage increase welcome large companies’ endorsements, but
say it is too soon to know whether they will shift the politics of the issue.
The Business Roundtable, which represents the biggest US companies, said
the Sanders bill was a starting point.
“We agree that the current federal minimum wage of $7.25 is too low, and
we are in favor of an increase at the federal level,” said a spokeswoman.
– Small business skepticism –
But the Sanders bill drew criticism from other groups, including those
representing small businesses and restaurants, which say they have suffered
more than large firms during Covid-19.
Howard Wright, the chief executive of Seattle Hospitality Group and the
co-author of Seattle’s 2014 wage hike, said companies should be able to raise
the wage as long as it is done gradually.
“What we are averse to is surprise and having things we can’t control,”
said Wright, who favors correlating the wage level to the local cost of
living, given the diversity of the US.
In response to written questions on whether to index local costs, Treasury
Secretary Janet Yellen emphasized the need for a “nationwide” wage hike
“phased in over time.”
Holly Sklar, the founder of activist network Business for a Fair Minimum
Wage, rejected indexing the wage to regional costs.
“The minimum wage is supposed to be something that helps everyone rise,”
she said. “Any state can go higher.”