Sunday, April 6, 2014

The Union Push Behind the Calls for Increasing the Minimum Wage

It has become obvious in the People's Republic of San Francisco. The San Francisco Chronicle reports:
Labor activists will file papers Monday to give San Francisco voters a chance to raise the minimum wage to $15 an hour - the highest in the nation.

While Congress balks over raising the federal minimum wage to $10.10 an hour, the city's November ballot will probably include the "Minimum Wage Act of 2014," which is designed to lift base pay roughly 40 percent from its current $10.74.

The ballot measure, designed by SEIU Local 1021 and groups including the Alliance of Californians for Community Empowerment, gives businesses with fewer than 100 employees until 2017 to lift wages to $15 an hour. But they must raise wages to $13 an hour by 2015 and $14 by 2016, according to the proposal.

Mark Berman,  the executive director of the Center for Union Facts, explained, in WSJ, the obvious desire of unions for a higher minimum wage:
Organized labor's instantaneous support for President Obama's recent proposal to hike the minimum wage doesn't make much sense at first glance. The average private-sector union member—at least one who still has a job—earns $22 an hour according to the Bureau of Labor Statistics. That's a far cry from the current $7.25 per hour federal minimum wage, or the $9 per hour the president has proposed. Altruistic solidarity with lower-paid workers isn't the reason for organized labor's cheerleading, either.

The real reason is that some unions and their members directly benefit from minimum wage increases—even when nary a union member actually makes the minimum wage... The increases restrict the ability of businesses to hire low-skill workers who might gladly work for lower wages in order to gain experience. Union members thus face less competition from workers who might threaten union jobs.

This view is not speculation. A 2004 study in the Journal of Human Resources by economists William Wascher, Mark Schweitzer and David Neumark determined that lower-wage union workers typically see a boost in employment and earned income following a mandated wage hike. Never mind the corresponding drop in jobs and earned income for nonunion minimum-wage workers. They may have been priced out of the jobs they need, but that is not the union's concern—its members have landed higher wages and reduced competition for jobs.


  1. How about a column exposing the Chamber of Commerce/Big Business/Wall Street crowd opposing an increase in the min wage, and supporting more forced integration and amnesty, bailouts, the Fed....?

    At some point, you have to figure out we have no dog in this dog and pony show.

    1. Definitely agree and wish more would be written about why all the same evil eltists who Austrian libertarians correctly trash on most other issues are all lining up to push amnesty. Rand Paul is using their language and embracing their nonsense now, too.

  2. Raising the minimum wage is mostly a transfer from those who eat at McDonalds to those who work at McDonalds. It would have no effect on inequality. The minimum wage law should only be used as an enforcement mechanism, meaning that if an employer claims that someone agreed to work for $1 per hour or some amount that it would be unreasonable that someone would agree to, then there would be a violation if the worker was being paid only $1.
    How could you not expect vast inequality to occur when you make the tax rate on income received by the rich such as: dividends, capital gains and corporate profits much less than the tax rate on wages and eliminate the tax on inheritance tax for 99.9% of all estates.
    “..Equally unhelpful in terms of addressing the income and wealth inequality which results in the overinvestment cycle that caused the depression are those who emphasize various non-tax factors. Issues such as globalization, minimum wage laws, outsourcing, free trade, unionization, the increase in single-parent families, problems with our education system and infrastructure can increase the income and wealth inequality. However, these are extremely minor when compared to the shift of the tax burden from the rich to the middle class. It is the compounding year after year of the effect of the shift away from taxes on capital income such as dividends over time as the rich get proverbially richer which is the prime generator of inequality…”

    1. So the people who eat at McDonalds are the ones financing this anti minimum wage campaign? Interesting. Thought it was financed by the large shareholders who see a higher minimum wage coming out of their profits.

  3. A $15min wage should make San Francisco a mecca for the wealthy as most of the businesses that pay minimum wage serve middle and lower class people should slowly disappear. This reminds me of our local government's boat ramp fee. I have a 34' boat on a trailer and if I didn't get my boat in the water by 8am on a weekend there was no parking for by truck and trailer which meant I'd have to drive south or north and take a chance that those ramps were not full. The local government seeing this as an opportunity to make money imposed a $30 parking fee. At first I was outraged and then I discovered something great about it. For the average boater $30 was just too much for parking. and I guess they decided to traveled further to the free ramps. So now thanks to the higher fee the government has unwittingly created a boat ramp exclusively for those that can afford the fee. I can launch my boat at anytime on a beautiful weekend morning and have no worries about parking. If they try to lower the fee I'll be there fighting it and if more people become willing to pay the fee, I'll argue that it should be higher. LOL

  4. I am fully support for minimum wage for a labor $15.00 per hour of the San Fransisco state. us minimum wage is the main aim to create awareness about the law labor act. Beside this site makes a common sense all of the employees/workers of his own regarding the rights, duties and responsibilities. So if you want more valuable informations then read the website attentively.