The phrase “income inequality” has now become a part of our political lexicon, thanks in part to Occupy Wall Street. The growing disparity between the rich and poor has grown so significantly since the 1970s that even conservatives who generally eschew a government response to “market forces”— such as Marco Rubio and Paul Ryan — are now committing major speeches to the topic.
But there is certainly no consensus among lawmakers on how to close that growing and disturbing gap.
While Republicans generally say the best way to address poverty is a job, progressive activists have been organizing in Florida and across the country over the past year to build momentum around raising the minimum wage.
Earlier this month in Tallahassee, Representative Cynthia Stafford (D-Opa Locka) and state Senator Dwight Bullard (D-Cutler Bay) introduced a bill that would raise the minimum wage in Florida from the current $7.93 an hour (up 14 cents this year as indexed to inflation) to $10.10. Their proposal would include tipped employees, raising their hourly rate of pay dramatically from $4.91 to $10.10 as well.
[jump]“I think it’s an opportunity for working-class families to raise their quality of life,” says Tampa Democratic state Representative Janet Cruz. “We’re talking about folks who are working full-time and still eligible for federal benefits because they just don’t make enough money.”
In the past, the minimum wage worker was usually somebody in high school or college trying to make a few bucks to put gas in the car and/or have some money to go out on a Friday night. But that stereotype has been turned upside down in recent decades, when there are more and more people like Fred Richard Davis Jr., adults who, because of their circumstances are now able only to earn a living at a fast-food restaurant or other minimum-wage establishment.
Davis, 33, has been working since mid-December at a Wendy’s restaurant in North Tampa where he serves as a jack-of-all-trades and makes the minimum wage of $7.93 an hour. Last week he made $225 working a 28-hour week. He’s lucky in that he has a sister who has been able to take him in, because the $900 in take-home pay he’s collected in the last month barely allows him to pay for necessities like food and transportation.
He’d like to move into his own apartment, but that may be months from now as he saves up enough money for first and last month’s rent (and possibly a security deposit). He’s been pre-approved for a car loan (he uses HART to get to work), but can’t act on that offer since he doesn’t have enough for an initial downpayment.
Davis also receives food stamps — as do many others in the fast-food industry. A study conducted by economists at UC-Berkeley found that over half (52 percent) of all fast-food workers are on some form of government assistance.
“Taxpayers are subsidizing the low-wage model of these employers, who are making record profits in some cases,” Columbia University professor Dorian Wallen told NPR last month.
The National Restaurant Association reported that sales in 2014 among all restaurant types are projected to exceed $683 billion, up 3.6 percent from last year.
The minimum wage was last raised in Florida after the 2004 election. The people, not the politicians, made it happen via a constitutional amendment (led in part by the now dismantled ACORN organization). Their vote moved the minimum wage rate a full dollar up to $6.15 an hour and indexed it to inflation, which is why it’s now risen to $7.93. That’s 68 cents more per hour than the federal minimum wage, last raised in 2009.
For Dwight Bullard, the light dawned when he personally experienced what it’s like to work for minimum wage. Last summer he and Broward County Commissioner Marty Kier took up a challenge offered by the group 1Miami to live for a week subsisting on a minimum wage, which broke down to a little over $52 a week, an experience he describes as “eye-opening.”
“It’s not until you experience something like that … that you really, really get a sense of the everyday creature comforts that you think are proper spending or good economics that you can easily take for granted,” he says.
But the odds are formidable against passage of Bullard’s bill in the Republican-controlled Legislature. One of its leading critics is the Florida Retail Association. Spokesperson John Fleming says that there should be an asterisk attached to any proposed legislation, because, he asserts, such an increase means ultimately fewer such jobs. And his organization is wholeheartedly against the way that the minimum wage is currently indexed to inflation in Florida, saying it’s calculated too early in the calendar year.
“It always goes up and it never, ever goes down. Even when the economy is down,” he laments.
Both supporters and critics of raising the minimum wage point to economists to support their point of view.
In their 2009 book Minimum Wages, UC-Irvine Economic professor David Neumark and William Wascher reported that minimum wage increases “reduce employment opportunities for less-skilled workers and tend to reduce their earnings; they are not an effective means of reducing poverty; and they appear to have adverse longer-term effects on wages and earnings, in part by reducing the acquisition of human capital.”
But a letter to President Obama and members of Congress signed last week by 75 liberal-leaning economists (including Larry Summers) strongly urged support of federal legislation proposed by Representative George Miller (D-California) and Senator Tom Harkin (D-Iowa) that would raise the minimum wage to $10.10 an hour.
The economists wrote that recent academic studies show that such an increase has little to no negative effect on the employment of such workers, and in fact “could have a small stimulative effect on the economy as low-wage workers spend their additional earnings, raising demand and job growth, and providing some help on the jobs front.”
David Scott is owner of the Bad Monkey Bar in Ybor City. Like many establishments on Seventh Avenue, the bar sees its revenues ebb and flow depending on tourism and special events that bring visitors to the historic district. Scott says he can handle the modest increases that come from indexing, but a bump up to $10.10 would be a “pretty significant jump” for him to handle.
“What it means to guys like me is, we’re probably going to reduce the number of staff,” he says. Currently he employs between 12-15 people each week.
Senator Bullard acknowledges that his bill did not originally include the subminimum wage for servers, but he altered it after he was approached by members of the Restaurant Opportunities Center of Miami (ROC-Miami), who campaign to improve workplace policies for restaurant employees.
“Your average customer does not know he’s helping to pay the wage of restaurant workers,” says Yaneth Lomaba, lead coordinator with ROC-Miami, which has a website called livingofftips.com that allows servers to tell their own horror stories about living off such a low wage — although the $4.91 rate for tipped employees established in Florida by the 2004 amendment puts the state ahead of many others.
Nationally that rate has been $2.13 an hour since 1991. The National Restaurant Association (known as “the other NRA” in Washington) was considered a key player in keeping the rate for tipped employees exempt from President Clinton’s minimum wage increase in 1997. The $2.13-an-hour rate is also preferred by the Florida restaurant lobby, which tried unsuccessfully to reduce the subminimum wage two years ago.
One of the main groups behind that effort was the Florida Restaurant and Lodging Association. Its president & CEO, Carol Dover, says the group is in the process of reviewing the Bullard-Stafford bill. But the rest of her response to CL via email was boilerplate. “The restaurant industry provides valuable jobs that not only fill critical gaps in our workforce, but also pays a fair wage to employees. Part-time, entry-level work is important and provides a starting point for new entrants in the workforce, additional income and flexibility for workers trying to balance their careers with family responsibilities, and as a way to remain involved in their communities.”
Jean Souffrant of ROC Miami laments the fact that the restaurant industry is the only business that “gets away with not paying workers a regular wage.” ROC’s Lomaba blames the lobbying power of industry giants like Darden Restaurants, the Orlando-based corporation that bills itself as “the world’s largest full-service restaurant company,” which includes hundreds of Olive Gardens, Red Lobsters, Capital Grilles and Seasons 52s all across the country (Darden officials did not return CL’s calls by our deadline).
The momentum for low-wage restaurant and fast food workers kicked into full gear last year, when organized labor and other progressive groups created a national campaign of fast-food strikes by employees across the country to bring attention to their low wages.
On the first Thursday of last December, demonstrations were held in the morning and afternoon in front of two fast food establishments along East Busch Boulevard in Tampa, calling for their employees to earn a living wage of $15 an hour.
That may be too big a leap for mainstream America.
Polls consistently do find majorities (including Republicans) supporting a raise in the minimum wage to $10.10 an hour. An NBC News/Wall Street Journal survey released this month found that more than six in 10 voting age adults approve of such a measure. Support for $12.50 an hour fell to about 40 percent, whiled fewer than 30 percent support the $15-an-hour claim. A CBS News poll conducted in November found just a quarter of the population believes the wage should remain at $7.25.
A year ago during his State of the Union address, President Obama called on Congress to raise the minimum wage to $9 an hour, a rate he’s now upgraded to the $10.10 figure that has become the go-to level in 2014.
But that raise remains very much in doubt. House Speaker John Boehner pooh-poohed the idea last year after the State of the Union, and Tallahassee is, well, Tallahassee.
Senate President Don Gaetz has not taken a public position on the issue, while House Speaker Will Weatherford has referred it to three separate committees.
And Governor Rick Scott’s take? When hearing politicians’ vows that such a raise would help low-income workers and working families, Scott says, “I cringe.”