Politics & Prejudices
The latest twist in Michigan's battle over the minimum wage.
Published: May 20, 2014
When I first heard the news, I couldn’t believe it. The Republicans who control the Michigan Senate had just voted to raise the minimum wage by nearly two dollars an hour!
But, yessiree, sho’ nuff, there was Mark Schauer, the soon-to-be Democratic nominee for governor, grinning happily and standing with his arm around Randy Richardville, the Republican Senate Majority Leader from Monroe.
My first thought was that I was wrong about everything, that Jesus must have shown up after all, and I was about to be burnt toast. Then I started studying what actually happened … and soon realized, alas, that this apparent Great Victory for the Poor Working People was way less than it seemed.
Here’s the scoop. … (Bear with me now; understanding what’s going on requires a little historical perspective.)
Before making your mind up as to how you feel about the minimum wage, consider this: For the last five years, Michigan has had a minimum wage of $7.40 an hour. If you were to work a full-time job making that, you’d score the non-princely sum of $15,392 a year, which is barely enough to support a goldfish.
But that probably sounds princely to anyone who works as a server in a restaurant, where our minimum wage is $2.65 an hour. Imagine working at a Coney Island in Roseville, say, and trying to live on that and tips.
Not surprisingly, a coalition of organizations called Raise Michigan has been collecting signatures to get a proposal on this November’s ballot that would raise the minimum wage to $10.10.
Merely the idea of that was enough to elicit sneering disapproval from most legislative Republicans. The true minimum wage, one said, is zero. Meaning, that’s what the lower classes will be earning if they raise the minimum.
Why, they said, restaurants and businesses won’t be able to pay their workers, they’ll close down, and everyone will be laid off. These are familiar arguments to anyone who knows history. Chamber of Commerce types said precisely the same things, using almost identical words … back in 1938.
That’s when Congress first enacted a minimum wage — of 25 cents an hour. None of the bad predictions came true. Gradually, the minimum wage was increased.
Interestingly, if the proposal to raise it to $10.10 gets on the ballot and becomes law, that won’t be — when you adjust for inflation — the highest the minimum has ever been. That happened back in 1968, when it was $10.79 in today’s dollars.
Unemployment was a minuscule 3.7 percent back in ’68, when the minimum wage reached its highest level. So did boosting it cost jobs?
A year later, the jobless rate was 3.4 percent.
Forget the facts; businesses these days don’t want to pay their workers more, and the legislative Republicans are their willing servants. Two weeks ago, Richardville said he was against any minimum-wage hike, period.
But then reality began to sink in. Soon, it became clear that the minimum-wage proposal was easily going to get enough signatures to get on the ballot, and polls showed a good chance it might pass. What especially worried them is that the ballot proposal also extended the regular minimum to restaurant servers and others who are supposed to depend on tips to survive. True, the GOP and their business buddies might still be able to defeat it by spending millions on negative ads.
That wasn’t a given, however. And they had another big worry regardless of whether the ballot proposal passed or failed:
Putting minimum wage on the ballot could easily bring out hundreds of thousands of Democratic voters who normally don’t show up in non-presidential election years.
Democratic state chair Lon Johnson is a master at studying turnout. He knows that if 3.3 million voters show up in November, Rick Snyder will be re-elected and the GOP will hang on to hefty majorities in both houses of Congress.
But boost the number of voters to the 3.8 million who showed up eight years ago, and the Nerd goes back to Gun Lake, and Democrats will gain control the legislature’s lower house.
Republicans know that too. So the Senate Majority Leader slyly appeared to reverse course. He began by offering a bill that would have raised the minimum to $8.15 an hour.
But this bill was mainly cover for a poison pill. It wouldn’t just change the rate; instead, it was designed to repeal and replace the old minimum-wage law.
That, they thought, would make the ballot proposal null and void. As in, Sorry, folks; you collected signatures to repeal a law that no longer exists. Sucks to be you.
However, Richardville’s bill got no support from Senate Democrats. Plus, it seems a fair number of his fellow Republicans wouldn’t vote to raise the minimum at all, no matter what. Let the workers eat sawdust.
So they negotiated, and a deal was struck. The Senate passed a new minimum, which will reach $9.20 an hour by 2017.
What’s more, they gave tipped workers a paltry increase to $3.50 an hour, and indexed both wages to the inflation rate, as long as inflation stays under 4 percent.
Naturally, they left in the poison pill. But this is by no means a done deal. The agreement still has to be passed by the Michigan House of Representatives, where there are slightly more Democrats, and a considerably higher number of Tea Party nuts. There’s also Speaker of the House Jase Bolger.
> Email Jack Lessenberry