Minimum wage workers teach economics to the economists

MILWAUKEE – “He should be a Ph. D in economics,” said Seth Harris after listening to Marvin, the Milwaukee minimum wage worker he met at a roundtable this spring explaining how his family struggles along every month on take-home pay of $1,000.

A professor of law and labor economics before rising in public service to become acting U.S. Secretary of Labor, Harris has reason to know a financial wizard when he meets one – and he was impressed by Marvin’s worn notebook itemizing how he stretches his money — $200 in FoodShares (the Wisconsin name for the food stamp program), family rent of $500, repairing things himself, clothing, basics, ending each month with a final week without grocery subsistence and by walking to work at McDonalds rather than riding a bus.

A working father with a high school education, Marvin was one of 18 minimum wage workers gathered at a South Side job center to discuss the need for higher pay. It was part of city by city confabs hosted by Harris and such labor department leaders as Jay Williams of the Office of Recovery, continuing throughout the summer and into the fall with these stories transported up the line into federal department newsletters and to White House staffers and speechwriters.

Beyond availability for midday meetings, participants are hardly cherry-picked for political views. As an amused Jennifer Epps-Addison of the Milwaukee Job Search coalition and Wisconsin Citizen Action noted, “You don’t find a lot of Tea Party believers supporting their families at $7.25 an hour with no paid sick days or health benefits.”

The local media dutifully turns up, though in Milwaukee they devoted only a few seconds of air time or 10 inches in print to the issue. To be honest, even important topics presented in staged federal events are ho-hum to the press. What woke them up was how these quiet spring and summer roundtables morphed into one-day strikes spreading to major U.S. cities strikes organized around the demands for better treatment and pay for low-income workers.

There is more in the works July and August, including tweets and rallies around the nation by House and Senate members pushing for a higher minimum wage. The feeling in D.C. is that the dam of resistance to a higher minimum was weakened by these forums with low-wage workers, then cracked further by national one-day strikes and may now be finally bursting in D.C.

Aiming for media attention

Harris has run most of these sessions around the nation to push media attention and partly because the new Secretary of Labor, Thomas E. Perez, had become a GOP political football in the nomination process over his Latino heritage and past leadership of the Justice Department’s civil rights division. The delay was finally broken July 16 by a major Senate deal to approve all of Obama’s cabinet appointments, but the memory of obstructionism will linger. Republican behavior against Perez had as much to do with his Latino roots and civil rights work as it does his labor seat, so it is unlikely to endear the right wing to the minority community or the low-wage workers.

But there’s another emerging benefit to these roundtables. They go up the line. Look for stories like Marvin’s and hundreds of others from these roundtables woven into President Obama’s anecdotal thread as he prepares speeches to push his effort to raise the minimum wage.

Obama is a political realist looking for opportunity to achieve change, even if its not the total change he would like. But these interviewed workers are desperate to survive and thus are beginning to sound more like an extension of the Occupy movement. They say the president’s $9 goal in his State of the Union speech is a pittance. So they are not waiting. They are engaging in the sort of actions that wake the media up – walkouts, pickets, and strikes, not roundtables. In small doses they are getting wages higher, as recently reported in St. Louis at Little Caesar’s pizza and Jimmy John’s subs.

In New York City, Chicago, Detroit, St. Louis, Seattle, and Milwaukee, fast food workers, and sympathetic retail workers went on one-day strikes to make their case. In Milwaukee some of the activity grew out of attention to that Harris roundtable, with Epps-Addison and her Milwaukee Jobs and Wisconsin Citizen Action group robustly working to publicize walkouts by more than 200 workers at fast food chains and mall retail outlets such as Foot Action and Simply Fashion.

In Milwaukee, other McDonald’s workers have higher-regarded jobs than Marvin – who described himself to a reporter as “the best damn toilet cleaner you’ll ever find” – but reported the same $7.25 pay. One grandmother at the roundtable worked three jobs a week at different homes, some involving elderly care and cleaning, so she could earn as much as $8.50 an hour at some of those. But she still runs from job to job grabbing the cheapest meal on the way, which often, she sheepishly admitted, means McDonald’s.

One Walmart worker who makes $7.75 an hour and still can’t support her family of three joked after the event about a fellow African American, Michelle Obama, eliciting that pledge from Walmart to hire 100,000 veterans over five years. “I wonder how soon they’ll turn militant at $8.63 an hour,” said Elise referring to the reported “sales associate” minimum for the vets.

Walmart’s claim — that it would hire the vets without adding new jobs — brought this interpretation from Ball State economist Mike Hicks: “Job turnover should make it easy to accommodate any vet looking for work. They probably won’t see a huge uptick in vet applications, but it is smart public relations.”

Key elements neglected

Note that the mainstream reporters dutifully covering the roundtables tended to neglect one of the most persuasive elements of these discussions, a reality counteracting those inflammatory comments that dominate conservative blogs and columns. Those speaking out to Harris turned out not to be working for local mom and pop stores – the small businesses critics say will be hurt by enforced slightly higher wages. Such mom-and-pop entrepreneurs often retain employees by paying above minimum or (to the anger of some traditional unionists) offering points in the company or shared time plans.

No, most of the participants work for the giant retailers that report record profits for their national execs or local franchisees -such as Wendy’s, Taco Bell, Arby’s, and Popeye’s. Or take Tim, paid $8 an hour to run a Domino’s outlet in Milwaukee. Domino’s top five executives made $18.25 million in 2012. Tim has gotten $8 an hour for years. The commentators who oppose a raise in the minimum wage or who attack the few states that have taken the initiative to legislate above the federal rate ignore those factors.

One anonymous critic, claiming to be a “researcher” working with rich businessmen and well-heeled political action committees, demeaned the effort this way: “The worst thing you can do for a poor person is give them money. It’s like giving a gun to a monkey. Most have no prayer of ever working for Starbucks or Costco (known for paying better wages and supporting a federal increase). They only hire fit, good looking productive employees who are worth their wage.”

Asked about the comments, it was described as “an insult” to hardworking low wage workers by executives of the Costco warehouse enterprise who insisted they couldn’t speak on record for the company. But they pointed out that Costco is actively looking at the vast worker pool in Milwaukee to join nearby outlets in Grafton and Pewaukee and applauded how hard the minimum wage hires in Milwaukee struggle for their employers.

Then there’s influential Republican House member from Tennessee, Marsha Blackburn, the aggressive blonde matron trying to inherit the Michelle Bachman slot on the talk show circuit. She regularly proclaims that women don’t need equal pay as in the Lily Ledbetter law she opposed and recalls how back when she was a teenager (around 1970) she was proud to earn $2.15 an hour after school in Mississippi. Economists immediately pointed out that this minimum pay she was so proud of translates in today’s money to $12 or more an hour, way above what President Obama is trying to impose.

Inflamed rhetoric aside, there are harsh numbers that explain the biggest problem facing the nation’s economy, according to respected labor reporter Steven Greenhouse in the New York Times. D.C. politicians, he noted, are “unlikely to do much to alter the one major factor contributing to income inequality: stagnant wages. For millions of workers, wages have flatlined.”

It’s one reason college students are now organizing on campuses and joining community coalitions to support low-paid and often lower-educated workers in their demands for a much higher minimum wage. Under federal law (though forced higher in some states) that actually falls to $2.13 an hour for waiters and waitresses, on the assumption even in hard economic times that tips will fill the gap.

Forced into occupations

Many college graduates are forced into these occupations and many others into the general $7.25 fast food industry, noted University of Wisconsin-Milwaukee professor and researcher Marc Levine. So they realize more than most “the promised American ideal of better education leading to better wages will no longer be there for them,” he said, unless the minimum wage is raised and better balance is achieved for those entering the middle class and those looking down on them from on high.

It’s also a central point made by New Yorker writer George Packer in his recent praised nonfiction best-seller, “The Unwinding.” He also believes that the central promise of better education leading to good financial rewards has vanished. This works out for Walmart, he ironically writes, because “the hollowing out of the heartland was good for the company’s bottom line.”

Jared Bernstein, an economist who worked as executive director of the White House Task Force on the Middle Class, is actually challenging the administration in his frequent online analytic blogs to do even more for the minimum wage, for college students and for job creation. He even suggested that “the federal government, in spending hundreds of billions on health care, might insist that providers pay home-care aides or lab technicians $20 an hour rather than $10. There’s no reason why a lab technician with a few years of community college shouldn’t be able to find her way into some segment of the middle class.”

In another article, Bernstein points to more proof of wage stagnation crippling public school education, forcing parents to turn to raising “funds, and not for one-off trips to Mount Vernon, but for science curriculum, guidance counselors, smaller class sizes, music classes, etc. Of course, the affluent parents can raise hundreds of thousands; the poor parents, barely hundreds.  It’s a classic example of inequality reinforcing itself through educational opportunity.”

Organizers of these new efforts to raise the wage are not just traditional unions though the Service Workers and the Steelworkers are actively among them. It is mainly coalitions, now including campuses. In Milwaukee alone they are focusing on 60,000 low-wage food and retail workers – service areas not typically unionized but representing, according the U.S. Bureau of Labor Statistics, seven out of the 10 fastest-growing occupations considered low-wage.

In fact, the minimum wage movement is giving teeth to a new generation of labor activists moving outside traditional federations such as the AFL-CIO and Change to Win. The New York City fast food workers demanding $15 an hour are getting support and media savvy from the independent New York Communities for Change.

East Coast strikers at McDonalds, Wendy’s, Taco Bell, KFC, and Pizza Hut that grew into the hundreds, organized as Fast Food Forward to develop national stories and startling statistics about how many are hardly teenagers but over 28, many single mothers raising families.

Rise into the thousands

If you total reports from all six cities where one-day strikes took place though June, the participants rise into the thousands and spread beyond fast food into retail. Only in a few places is the demand to raise the minimum to $10. Not Obama’s floor of $9. In Milwaukee as well as New York City it’s $15 an hour minimum in the fast food industry plus the right to organize.

To this point the protesters are a drop in an enormous bucket – a few thousand against much larger and better funded opponents, as witnessed June 7 in Bentonville, Arkansas, when about 200 strikers from diverse out of state Walmarts and warehouse suppliers marched and picketed at a shareholders meeting attended by thousands of employees (euphemism “associates”) hand-picked by supervisors. (Some of these associates are internally called managers to emphasize their inability to actually hire or fire employees.)

In the state where the Walton heirs rule with their billions, the picketers from OURWalmart may have been company employees from California, Louisiana, and Texas complaining of low wages and poor working conditions, but they were ordered by court injunction to stay out of Walmart facilities in Arkansas and were prevented by managers from distributing literature in Walmart-funded museums and public institutions.

If anything that created more media waves and brought more attention, particularly as Kim Bobo and her influential Interfaith Worker Justice (IWJ) climbed aboard with stories and analysis – and sharp elbows in public comments. There is no doubt, Bobo writes and lectures bluntly, that “Walmart has a history of cheating workers, of paying them low salaries, of offering very few benefits.

OURWalmart started in 2010 organized and partly funded by United Food and Commercial Workers but now the group is on its own with UFCW mainly providing media expertise, including helping bring to Bentonville a survivor of a deadly Bangladeshi garment factory fire in Tarzeen last November where 112 died and Walmart labels were found in the rubble. Also speaking was a Bangladesh union representative from the Rana Plaza collapse that killed 1,127 on April 24.

Their presence underscored how Walmart along with Gap was among the US retailers that refused to sign a legally binding accord on fire and building safety in Bangladesh that has the support of 70 other retailers including H&M, Primark, and Tesco and major European consortiums.

All these efforts and more are gaining fire because they tap into growing concerns in the American public. It’s not just college students but those who want college, said Milwaukee’s Amere Graham, an 18-year-old high school senior who works at a Milwaukee McDonald’s and joined the strike, because he intends to go to college and can’t earn enough money.

“I’m so amped up and ready,” said another striker, McDonald’s employee Stephanie Sanders, a former retail worker in her thirties who posted a blog as JS online discussing why. It’s “basically to help my generation out, and the next generation to follow.” 

Photo: Acting U.S. Labor Secretary Seth Harris listens to Milwaukee low-wage workers at a roundtable March 30. To his left is Cerena Mills, who had to bring her three-year-old to the event because she lacked the ability to pay for day care. Dominique Paul Noth.


Dominique Paul Noth
Dominique Paul Noth

Dominique Paul Noth for the past decade was editor of the Milwaukee Labor Press and website, He now writes as an independent journalist on culture and politics.