Another stellar hearing in which our senior senator cuts to the truth on a topic we’ve heard so much crap about. This info is profound and the difference a fair minimum wage would make in millions of lives is hard to fathom. (I’m also convinced that the minimum wages discussed at this hearing would have boosted our economy beyond our imagination.) Shame on anyone who tries to keep it where it is. (Again, though, empty chairs reveal the county’s hard-working lawmakers. What’s their hourly wage?)
Happy Weekend.
Discuss
31 Comments . Leave a comment below.Not if they are never in their seats I suspect and I’ve noticed the same on the Banking Committee.
As for minimum wage, as a substitute teacher I already get paid a little more than the proposed increase, but I’d be tempted to stop looking for other work if I got 22 or 33 dollars per hour as suggested in this clip.
There is nothing more impressive than the intelligence and integrity that Senator Warren is bringing to the Senate.
a better response to Senator Warren might have been:
McDonalds sells 70 hamburgers per employee per hour — so that four cents per burger is $2.80, and they’ve covered the increase. I sell 7 entrees per employee per hour, so I’d have to raise my prices $0.40, not $0.04.
Could his customers absorb forty cents? That’s a different question altogether.
Here’s what the restaurant owner should have said: McDonalds is a giant corporation with a sophisticated business model. I just run a restaurant and I don’t do fancy pricing calculations. I try to keep my prices low while also watching expenses carefully. An increase to the minimum wage makes me nervous, because I don’t know how much I would need to increase prices, and I don’t know whether an increase will impact my business. I work very hard; I don’t make a lot of money, and I try my best for my employees and my customers. It isn’t easy running a restaurant, especially when you have to compete with corporations like McDonald’s. The playing field is already uneven, as McDonalds has an army of lobbyists to protect themselves, and I am here at this Senate hearing by myself.
The data presented by Dr. Dube destroyed the argument of the restaurant owner:
He might as well argue that the time goes backwards or objects fall upwards — the data simply doesn’t fit his argument.
the restaurant owner lives in the 9-9-9 world of Herman Cain, former CEO of the National Restaurant Association, and Richard Berman, purveyor of slick fictions as fact.
A Michael Saltzman wrote a hit piece on the minimum wage for Politico (Tiger Beat of the Potomac) last week. It is total malarkey.
http://www.politico.com/story/2013/03/statistical-problem-of-minimum-wage-and-poverty-88824.html
Saltzman claims to be Research Director for the Employment Policies Institute, one of many right wing fronts set up by Berman.
to figure out their pricing, maybe even something proprietary, the level of math involved to figure out how much you need to charge per meal to cover a minimum wage hike like this is not that difficult.
I appreciate not every Mom and Pop store does this or would even want to do this, but we do live in a “capitalistic” society and they need to learn how to do the things that keeps them competitive.
Nothing involved here would require anything beyond a 6th grade understanding of math, and preferably a basic understanding of excel. Even Mom and Pop stores should be able to handle that, and if they can’t, well… there are other Mom and Pop stores that do.
if you can’t figure out roughly what the impact on your profit margin is if your labor costs go up by X, how can you run a business? How can you possibly set the wages of all your other workers who aren’t on minimum wage? Or know how many workers you can afford to hire?
Certainly the basic equations to calculate the change in prices required to cover increased labor costs would be simple in a world where such changes had no effect on demand. But add to those calculations the elasticity of demand, and substitution effects of price increases and other common economic effects. If I raise the price of my hamburgers how many customers will eat my chicken sandwiches instead? How many customers will simply go elsewhere for lesser quality food or stay home and make their own hamburgers?
Yes, corporations like McDonald’s have economists and pricing models based on empirical evidence but Mom and Pop’s… I doubt it. It’s not always as simple as you make it sound.
That is not to say I am against a certain level for the minimum wage, but just slight changes in a complex economic model can have widespread effects.
Do McDonald’s franchisees even set prices?
Go to McDonald’s on Boston Street in Lynn and prepare to spend about 10% more on a lot of things than the one on the Lynnway, sometimes even more.
Davios can’t compete with Mickey D’s.
Hmmm. And bicycles can’t compete with Ferraris
you’re right about the question, but yes… the restaurant can raise their prices by $0.40, too.
Two people at the 99 going out for a bite aren’t going to notice if their meal costs 40 cents more, particularly if that extra 40 cents is likely to ensure the cook and prep people are making a better living and a bit happier on the job. The food just may taste a bit better, after all.
I think the highlight of the clip is the exchange between Senator Warren and Dr. Dube from 0:20 to 1:43:
Bingo, cigars all around.
The increasing wealth concentration, and the increasing rate of wealth concentration, since the 1970s (and especially since the 1980s) is the central problem facing us today.
Senator Warren is the only elected official willing to confront this reality. Barack Obama is ducking it, the rest of the Senate is ducking it, the GOP denies it, and the mainstream media don’t report it.
For example, I’d like to point out that Boston Globe somehow missed the riveting exchange about a crucial issue that we’re discussing here. They did, however, manage to publish a very informative piece describing the “spartan and utilitarian” temporary office assigned to Senator Warren. Now that’s what I call real hard-hitting journalism.
Absolutely amazing on these issues. The lies that are taken as axioms are being exposed!
Has there ever been such a quick and concise defense of a minimum wage hike? Going to $10.10 would have a dramatically positive impact on our economy, and it *won’t* hurt businesses at all.
It’s a shame, really, because it would help most businesses that complain loudest about it… if they could ever see things at the macro level, instead of just their bottom line.
Giving poor people a live-able salary will just mean that all that money is going to go right back into the economy anyway, and whatever small price increases businesses would need to offset a minimum wage hike would be so small that most people wouldn’t even notice the difference even if they bought the same item a week before the new price went into effect.
Truly, this is one of those instances where doing the decent thing to do is also the smart one.
Living Wage Calculation for Boston city, Suffolk County, Massachusetts
because we can’t understand the gravity of the situation without realizing what it actually cost to live a modest and basic life. Personally, I think the numbers are little low in the calculations, but a least it’s a start.
and fantasize a bit. What we really need is a maximum wage law, not a minimum wage law. In businesses over a certain size, no employer or boss should make more than 20 times the average income of their company. Maybe it might turn a few heads towards the real origins of the owner’s wealth, the productivity of their labor force and the foresightedness to pay them accordingly. What was not answered in the clip above is if the minimum wage did rise to $33/hour, would the 1% be richer, the same, or less. Would the GDP pie expand because of better worker morale and loyalty? My answer is yes.
and worker morale and loyalty but improved health. And better health would save individuals, business and government gazillions.
And wait, there’s more!
If parents aren’t forced to work multiple jobs they can take better care of their kids, get better food, time to play and talk and read to them. Imagine the contributions of a country of kids growing up like this.
There we have it, BMGers, the solution to soooo many things. Triple the minimum wage. And that would lead to the solution to everything else.
Yikes Stripes!
There was a great profile on the average life of a 1950s CEO. He made the equivalent of $500k in today’s dollars, owned one nicely appointed but modest home, maybe a summer or winter home, drove a nice American car to and from the office, worked 60 hours a week, and interacted with the workers in his company a whole lot more and felt responsible to them. If the President makes that same salary I don’t see why we can’t cap it.
It was, effectively, a cap on income.
As Rachel Maddow as pointed out, “I’m a big liberal, which makes me agree 100% with the Republican Party platform in the 1950s”.
Under Ike we had unprecedented spending on world class roads, public universities, expansion of Social Security to cover disability insurance, and cuts to defense spending. Oh how I’d take that Republican over most of today’s Democrats.
In 1955 we spent 17.8% of our GDP on government
In 2010 we spent 23.9%
I would gladly go back to the spending and tax polices of 1955 – BUT not the social values. Gee it was a great time – especially the part my parents couldn’t get married in a church because they were divorced.
Or lets put up the same trade barriers that existed in the 1950′s (granted the result of a 1920 trade war) – so it was cheaper for the Canadians to buy from Europe ?
Hey lets bring back the Cabaret tax excise tax, a tax on all receipts at any venue that served food or drink and allowed dancing. That will help our economy.
Is not as large as most people expect, nor is the Kennedy place in Hyannisport. Even the richest people back then didn’t need places like this and this.
We truly live in an era in America when a tiny sliver of people have opulence and the vast majority struggle to make ends meet. It smacks of feudal Europe. The sad thing is that we’ve been here before and we came out of it, just to put ourselves back in. Last time I was in Newport, I heard some lady saying how sad it was the Astors, etc., couldn’t stay in those “cottages” after WWII. I thought it was the best thing that ever happened to our economy.
If ever a “revolution” needed to be undone, it’s this Reagan-Thatcher one.
Our economy sputtered along for 50 years, inequality grew, we fell behind our international competitors, and our infrastructure crumbled…oh wait, I’m confusing post ww2 with post Reagan revolution.
to have Elizabeth Warren as my Senator.
we are so far away from the where we need to be. If it has to start at $10, that’s fine, but then the minimum wage needs to continue to rise steadily until it reaches a true living wage.
Keep in mind that the minimum wage is a state issue too. Since 1968, the value of the Massachusetts minimum wage has fallen by 24%. Our own analysis has found that over 200,000 children in Massachusetts live in households that would be affected by a minimum wage increase and that raising the minimum wage does not impede job growth (during an economic downturn, it can even provide some economic stimulus.)
When are we going to significantly raise the minimum wage for tipped professions? Many west coast states pay wait staff actual minimum wage ($7.25 federal, or higher if their state has higher minimum wage) instead of the $2.13 an hour.
* Waitresses in MA make a minimum $2.63/hr, plus tips. Raise it.
* Agricultural workers in MA make a minimum $1.60 according to MGL chapter 151 section 2A; I’m not sure if federal minimum wage applies. Raise it to the statewide minimum wage.
Want to make a real difference in people’s lives? Want to make a real difference in the lives of single parents, those who need to work a second part-time job, those who are trying to work and pay their way through school, those who’ve been laid off and are scrapping by to make ends meet? Raise the minimum wage for sub-minimum-wage jobs. And don’t cite chapter and verse about how if an employee makes less than $7.25 with tips that employee can go to the boss and ask for the difference. It [almost] never happens. The employee just has to suck it up. Hell, I know more than a few Boston bartenders who aren’t even on the books — the only way they can get a job is to work for tips only, with no taxes and no paycheck.
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