Maximizing Minimum Wage Momentum
June 15, 2021
Much has happened since July 24, 2009. Osama bin Laden was killed by U.S. Navy SEALs; America elected its first Black president to a second term; same-sex marriage became legal in all 50 states; 195 nations signed the Paris Agreement and recognized the threat of climate change; and the U.S. economy entered its longest-ever expansion.
After over a decade of changes to our culture, political environment and economy, what could possibly be the same? The answer to that question is alarming: July 24, 2009, marked the most recent federal minimum wage increase– to just $7.25 an hour.
Since the 1970s, the hourly compensation rate has plummeted despite the growing economy. While net productivity has risen almost 70% in the past four decades, data from the Bureau of Labor Statistics revealed that wages have been stagnating. This rising inequality has destroyed workers’ momentum, preventing a substantial increase in pay and prosperity for the working class.
In order to reverse this trend, America must commit to policies that provide living wages and empower organized labor. Raising the federal minimum wage to $15 an hour and passing the Protecting the Right to Organize (PRO) Act are necessary first steps toward that goal.
Raising the minimum wage would increase pay for at least 17 million people and lift at least 900,000 out of poverty, according to a study by the Congressional Budget Office. This change would help revitalize a nation that has faced a year of slowed economic activity and devastating losses due to the COVID-19 pandemic.
A minimum wage increase will be a crucial first step in closing the gap between productivity and wages: it will provide relief for workers in states that do not have minimum wages higher than $7.25. However, it is only a first step, and committing to comprehensive labor legislation is needed to combat the decades-old trend of rising productivity and low wages.
The PRO Act will give a much-needed update to the process by which workers can collectively bargain by strengthening the hand of unions and enabling workers to organize more easily. It would also apply the 1935 National Labor Relations Act, which guarantees the right of workers to unionize, to more sectors of the workforce.
Along with providing new mechanisms to protect labor rights, the PRO Act would reverse harmful provisions of the 1947 Taft-Hartley Act, which created incentives for workers not to join a union and limited solidarity actions.
These changes could not come at a better time for California, which has the highest poverty rate in the country when accounting for the cost of living, according to a commission appointed by Governor Gavin Newsom. The report revealed that less than half of Californians are in “quality jobs,” which are defined as those that provide a living wage and a safe work environment.
Biden has every incentive to push legislation like the PRO Act and a $15 minimum wage. Not only would it be good for workers and the economy, but it would also be smart politics. In conservative Florida, where Trump beat Biden by 3%, a ballot measure to raise the minimum wage to $15 by 2026 passed by a large margin, winning over 60% of the vote. Appealing to the economic interests of Floridians by emphasizing labor legislation could help Biden overcome deficits among socially conservative voters.
The fight to provide living wages and pass major labor legislation like the PRO act will not be easy. Democrats face roadblocks like weak Senate support, with only 47 cosponsors for the PRO Act, a number well short of the 60 votes needed to overcome the filibuster.
While passing the PRO Act might not be immediately possible, Democrats must demonstrate they are doing everything they can to pass legislation that has become a litmus test for organized labor. Losing unions’ support before the 2022 midterm elections would strike a major blow to a party that needs to build on thin majorities in the House and Senate.
Providing a $15 minimum wage and passing the PRO Act would give Democrats the opportunity to improve low-wage workers’ quality of life, boost post-pandemic recovery and reverse a harmful decrease in the power of labor that has plagued the economy for decades. It is high time to seize that opportunity.