Tonight, after many hours of floor maneuvering, the House passed (by a vote of 123-24) a bill that would raise the minimum wage in Massachusetts to $10.50 by 2016. That’s the good news.
The bad news is that the House bill, as reported out of committee, would raise the minimum wage for tipped workers (which has been a paltry $2.63 an hour since 1999) to only $3.75 an hour. This is not nearly high enough. Massachusetts has the lowest tipped minimum wage of the six New England states. Tipped workers in America are twice as likely to live below the poverty line as the average worker. Experience in other states shows that, far from killing job growth as opponents have argued, a higher tipped minimum wage can lead to better employment numbers in tipped industries. Indeed, California and other western states do not allow for payment of a sub-minimum wage to tipped workers at all, but have thriving restaurant sectors nonetheless. And it makes sense, because restaurant workers with a little cash to spare like to go out to eat themselves, and let someone else do the serving. If they’re bringing home only $9 an hour, including tips, eating out is not going to be on the menu very often.
Rep. Farley-Bouvier sponsored an amendment (# 88) to increase the tipped minimum wage to $5.25 rather than $3.75. Last week, thanks to a strong campaign by the Raise Up MA coalition, the amendment received 40 additional co-sponsors. Yet today it was withdrawn due to inadequate support. Something is wrong when, in a body with a 129-28 Democratic advantage, such a modest amendment cannot pass. It means that there are at least 50 members of the House calling themselves Democrats who were unwilling to vote for it.
The House bill also failed to index the minimum wage to inflation going forward. Between legislative increases in the minimum wage, its purchasing power is virtually always eroded by inflation. Indeed, over the past 45 years, the increases that have passed have failed to recapture all of that erosion: the minimum wage today is, in real terms, almost a quarter less than it was in 1968 even though productivity has soared during that time. 70 percent of the American economy is consumer spending. The key economic problem of our time is inadequate consumer demand, precisely because so many workers are being paid substandard wages that leave them with virtually no disposable income.
Failure to index the minimum wage to inflation does not mean only that the value of low-income workers’ pay will continue to erode, robbing the economy of their consuming power, although that would be bad enough. It also means that the legislature will be forced to revisit this issue, and expend great time and energy on it, time and time again. A common complaint of business lobbies about this bill is that it is too much of a minimum wage increase all at once. Indexing the wage to inflation would eliminate this problem, providing the “certainty” business claim to want. Because it would not allow them to pay artificially lower wages for several years, however, most business groups oppose it. That leaves only the “raise-it-every-few-years approach” they claim to deplore. Heads they win, tails their workers lose.
Apparently a sizeable contingent of the House Democratic caucus finds that sort of calculus acceptable. As with the tipped minimum wage amendment, an amendment to include indexing to inflation in the final House bill, sponsored by Rep. Holmes (# 50), was withdrawn without a vote. Personally, I’m sorry. I would have liked to have seen a roll call on these two issues. Voters deserve to know where Representatives stand on them.
(UPDATE here — to reflect Hester Prynne’s point in the comments that things remain uncertain procedurally.)
Now – pending resolution of the procedural shenanigans you may recall from two weeks ago – the bill passed by the House ultimately may go to conference committee to resolve differences between it and the bill passed by the Senate all the way back in November (the other options apparently being that the House adopts the Senate bill, which I would love but don’t see happening, or that no bill will become law despite each house of the General Court having passed one, which would just be incredibly stupid). The Senate bill, worthy of our Commonwealth, increases the minimum wage to $11 rather than $10.50. And, unlike the House bill, it indexes the minimum wage to inflation and raises the tipped minimum to half of the regular minimum, meaning $5.50 to start and rising with inflation each year.
My thanks to all those members of the House who were prepared to support indexing the minimum wage to inflation and providing a higher tipped minimum wage than $3.75. But the job is only half done. I urge all readers to contact their Representatives while the bill is in conference committee, if the bill does in fact go to conference committee. Tell them to include these two important provisions in the final bill that is sent to the governor. Otherwise the people of Massachusetts will have do in November, at the ballot, what too many House Democrats failed to do today.
Our representatives need to jettison this bill — and the “leadership” that jammed it through.
The UI provisions should be struck, as well. Massachusetts needs more, not fewer, unemployment benefits. Those benefits must be funded. Employers who fire workers are precisely the correct sources for that increased funding.
We’ll see what emerges and people will be doing what they can to move it. If the final bill is not sufficient the option of going to the ballot remains.
You’re absolutely correct that 50+ Democrats refusing to vote for the amendments I described is due to leadership signaling its opposition. Far too much fealty to one or two people at the top of the House pyramid.
The UI changes were quite minor and innocuous compared to what they were rumored to be at the outset. That tells me activists’ efforts had a positive impact. I’m hopeful they will continue to have an impact in the conference committee phase.
me that the UI changes wouldn’t cause harm to the unemployed. I tend to believe him, but I don’t know the details of how it works.
A few weeks ago it seemed the house bill would, but it didn’t. There were a number of clever amendments designed to do it stealthily, which generally failed.
There are a lot of moving pieces here but the main one is they voted to change the formula for employers to pay in, to make those who lay off workers more regularly pay more than they do now and those who do it rarely pay less.
have enjoyed their own automatic pay increases and yet can’t see the importance of minimum wage earners having the same security.
Perhaps instead of indexing legislative salaries to the average household income, it is indexed to the minimum wage?
Let them find out first hand what it’s like to try living on poverty wages!
For what it’s worth Legislators have received two (relatively small) pay cuts over the last 2 Legislative Sessions
As the article states
Not weighting in on the pros and cons of the House bill, but just to set the record straight on Sue’s point on automatic Legislators pay raises.
http://www.bostonglobe.com/metro/2013/01/03/mass-lawmakers-constitutional-officers-face-percent-pay-cut/AcewKGL7a3Xb150idyZLTL/story.html
they have still had an overall increase of close to 30% with increases usually ranging between 4.5% and 8%.
All without thousands of people having to collect tens of thousands of signatures.
But again since 2010 there has been decreases of between 2% and 4% and given that a majority of the Legislature was not in office for the last ten years it is an unfair argument to make.
when they are paid at the increased rate, without regard to whether they began getting paid at the time of the increase or yesterday.
the drastic decreases were between .5% and 1.6% . Perhaps it felt like 2% and 4%.
people who work long hours to make our laws a decent salary. But I agree with you that it’s beyond frustrating when they – and particularly the ones who claim to be Democrats – won’t allow a million other people even a subsistence wage.
me that the UI changes wouldn’t cause harm to the unemployed. I tend to believe him, but I don’t know the details of how it works.
It is still entirely unclear what will happen now that the House has passed its bill. Even though both the House and Senate will have acted on both the minimum wage and unemployment insurance, their bills will be like “ships passing in the night,” because the House (citing the integrity of the legislative committee process) declined to use either the minimum wage or unemployment insurance bills passed by the Senate and instead started at square one with an entirely new bill. No House-Senate conference committee will be appointed to work out the differences until this standoff is resolved.
More of this way-inside-baseball stuff here.
I was under the impression, apparently incorrect, that the House had found a procedural way around that issue by substituting this bill for another that had emerged from committee on time.
Now we’re looking at what? Either the House blinks and passes the Senate bill, or the Senate blinks and appoints people to a conference committee? I have to imagine that a final bill will emerge, and I’d venture there will be a conference committee in the end. It just seems DeLeo’d rather pass no bill, and blame the Senate, than agree to the Senate bill as is.
to reflect this sorry state of affairs
is running for state treasurer. Is there anyone running for higher office from the state senate?
Barry Finegold is also running for Treasurer
by the way, gave a good speech at the outset making all the points I would have wanted to make. Then he sent a fundraising email touting this bill a couple of hours after the vote was held.
Finegold voted for the Senate bill but I’m not sure what role he played in other than that.
that their candidacies have something to do with the pissing contest between our august legislative bodies.
will probably increase your popularity with House members more than Convention delegates, but it should be a considerable help with fundraising.
business interests and fundraising?
(Bear in mind, everything I know is at least second-hand).
Thanks for the excellent roundup, fenway.
I was not surprised the indexing amendment was withdrawn because I understand that was the plan all along, especially since the sponsor of that amendment is hardly a progressive. Legislative symbolism all the way.
I was however surprised the tipped wage amendment was withdrawn.
I can understand the desire to have a recorded vote on indexing and tipped, but I don’t know if it would have told us much or could have hurt our prospects in conference committee with either of those proposals. I’m no expert at that point and defer to Hester P 🙂
All of this craziness in the Legislature strengthens my view that the ballot may be the only way to enact an indexed fair wage for all workers including tipped workers. If you look at the history in the other states that have an indexed minimum wage almost all of them were enacted not via legislative action but via voter referendum.
http://en.wikipedia.org/wiki/Minimum_wage_in_the_United_States
http://ballotpedia.org/Minimum_wage_ballot_measures
http://www.dol.gov/whd/minwage/america.htm
AZ — 2006 voter ref 65/34
CO — 2006 voter ref 53/46, to Const amend
FL — 2004 voter ref 71/28
MO — 2006 voter ref 76/24
MT — 2006 voter ref 72/27
NV — 2006 voter ref 68/31, to Const amend
OH — 2006 voter ref 56/43
OR — 2002 voter ref 51/48
VT — 2006 (?) law passed reg way?
WA — 1998 voter ref 66/33
WDC — 2014 law passed reg way?
Also 7 (really 6) other states plus MA are looking at MW ballot refs for 2014, and the majority of them include indexing:
http://ballotpedia.org/Minimum_wage_ballot_measures#tab=By_year
AK — indexing
AR — no indexing
CA — MW supp for home health care workers, no indexing
ID — no indexing
MA — indexing
MI — indexing
MO — indexing to CPI and tipped 60%, some other changes
SD — indexing
Key factor to note: Almost half of these 2014 MW initiatives are in states with very contested US Senate seats for this cycle ie Alaska, Arkansas, and Michigan — which, not coincidentally, are the three most threatened but likely prospects for Dems to retain per this chart at least:
http://www.washingtonpost.com/blogs/monkey-cage/wp/2014/04/01/the-8-senate-seats-most-likely-to-flip-to-the-gop/
I’ve been a big supporter of going to the ballot here in MA with both MW and earned sick time, for a whole host of reasons. But one of the sobering factors that the RaiseUp MA coalition is going to have to confront in terms of deciding whether to take both initiatives to the ballot is cost and ability to marshall volunteers.
A campaign for MW and earned sick leave on the Fall ballot will cost a lot of money — and we will be competing for $ and volunteers with all the US Senate races, Governor’s race, and MW initiatives in AK, AR, and MI which are obviously much higher priority for the national Dem party and TPTB in the union movement, etc.
The national Dem party is thankfully pushing hard and putting a lot of $ into GOTV for our base in the Fall to help hold the US Senate, and the minimum wage is a big part of that strategy. That’s the good news, imo.
http://www.washingtonpost.com/blogs/plum-line/wp/2014/04/03/inside-the-dems-minimum-wage-strategy-for-2014/
The bad or sobering news, imo, is that we in MA may find ourselves on the short end of the stick for $ and volunteers in our potential MW ballot effort as a result. This isn’t in my opinion a reason to dismiss going to the ballot on MW — far from it. But it is a sobering fact that we need to consider and I think we’ll need to prepare and strategize to overcome some serious obstacles that have nothing to do with the MA Legislature…
As I’ve said before, I’m not sure how much more difficult it would be to take the MW and sick leave to the ballot when we’re already doing sick leave anyway. For all I know it might be a lot more costly, but I figure the volunteers we have can do both issues at the same time. (That was the plan all along – I never had a ton of confidence the Leg would act. We’re actually doing better than I expected on that front. The historic record you presented just confirms that legislatures tend to lag on this issue.) Having Dem candidates for statewide office who pound the issue this fall won’t hurt either.
Agree with you on how it helps GOTV and I’m confident we’d win on MW. The big risk seems to be that it would overshadow the harder-to-grasp sick leave question.
Re the tipped wage: you’re almost certainly right that they thought having an adverse vote would weaken their hand in conference committee. But doesn’t withdrawing it send the same message as a loss – it didn’t have the votes to pass the House? So I find it disappointing, after thinking it had a chance with 41 sponsors.
…that minimum wage legislation always seems to have such a delay or slow ramp-up built in? I can see as of January 1st the new wages taking effect, but why another year. Every time I see this I think great, and by the time its implemented it should already probably be another couple of dollars.
n/m
The bills passed in the Senate and the ballot initiative all raise the minimum wage almost immediately. For example, the ballot initiative goes from $8 to $9.25 on Jan. 1, 2015, then to $10.50 on Jan. 1, 2016. The Senate bill goes up a dollar each year between now and 2017. People tend to talk about it in shorthand – raising it to $10.50 by 2016 – but it does go up sooner than that.
Since an increase from $8 even to $10.50 would be a 31% jump (which is totally justified given the erosion since 1968), it probably won’t be totally eroded by inflation between now and then, though it will be partly eaten up by inflation.
At least I hope prices won’t be 31% higher by 2016!
The House bill also raises the MW in steps over two years. I didn’t mean to imply, by omission, that it doesn’t.
spread it out over a few years makes it easier to pass by preempting the other side from decrying too much, too fast.
Given that this is the normal means of minimum wage increases passing, I don’t think we should run away from the formula. It’s more important to pass it over a couple years than risk losing the entire bill or ballot campaign.
…but this is one of those areas where we could use a bit of “too much, too fast” IMO. Sure it’s better than nothing, but I’ve thought for years the minimum wage should be $10 so I’m in not much mood to wait some more. This is long overdue and we need to catch up.
As great an abstract slogan as “change” is, people often have trouble supporting it when it’s something concrete.
Create a mechanism in which the change comes over time and a lot of that reticence can often disappear.
I’m right there with you in thinking we could have used more of “too much,” but “too fast” is not something worth fighting for if the change is going to come over the course of a few years instead of 1 or 2, especially when that change is meaningful.
Were I Raise Up, I’d have kept the transitional periods, but have fought for $12 an hour. Hell, I think $15 an hour could win a popular vote, especially since so many damn people would be effected by it.
Just about every retail worker, fast food worker, supermarket cashier, secretary, security guard, busboy, cook, landscaper, janitor and so on and so forth would have had a very, very strong reason to get out and vote if $15 an hour were on the ballot, even if it getting there were spread over 4-5 years.
So I’m all for fighting for more, but fighting for getting it faster when it’s already coming fairly soon is only worth it if it doesn’t put the whole thing in jeopardy.
From previous exchanges we have had on a variety of issues you probably know better than anyone that I tend not to be the demanding I-want-it-now type. It’s just on this particular issue I feel like I support MORE change in practice, but when I see what’s offered my enthusiasm goes down and I have to fall back on well I guess it’s OK in theory.