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Maryland NOW Says, “Raise the Wage”

NOW leaders rally for minimum wage increase in Montgomery CountyNOW leaders rally for minimum wage increase in Montgomery County

By Mike Hersh, Co-President Montgomery County Chapter
March 6, 2014

The federal minimum wage is $7.25–less than $15,000 a year for a full-time worker. This is a great concern to women for several reasons. Nearly two-thirds of minimum wage workers are women. Therefore, the National Organization for Women, Maryland State Chapter calls upon elected officials in our state to raise the minimum wage to a living wage level–including for tipped workers. As we move toward that goal, we see raising the minimum wage in Maryland to $10.10 as a worthwhile step forward.

National and Maryland NOW–and our chapters across Maryland–are working hard to make sure hard-working women and men earn enough to support themselves and their family. We joined with allies including the Montgomery County Government Employees Organization (MCGEO) / United Food and Commercial Workers (UFCW) Local 1994, Progressive Maryland, Progressive Democrats of America, Young Democrats, Progressive Neighbors, Jews United for Justice, and many other organizations and individuals as we hosted a rally and press conference late last November in Rockville, Maryland.

National NOW President Terry O’Neill, Maryland NOW President Sara Wilkinson, and all three Montgomery County NOW co-presidents–Holly Joseph, Jeannette Feldner, and Mike Hersh–worked with Bob Stewart of MCGEO and other allies to organize the rally supporting Council Member Marc Elrich’s legislation. This public event and other efforts–including a phone call and email campaign to persuade undecided Council Members–helped push the Council to enact a strong minimum wage increase for Montgomery County. We celebrate this hard-won success, and continue to support an increase at both the state and federal level.

The UFCW local 1994 website reported on our shared effort that helped push the Montgomery County Council to pass “legislation that raises the minimum wage in the County to $11.50 by 2017, indexed to the consumer price index. The bill, sponsored by Marc Elrich, sets a precedent followed by Prince George’s County, which passed an increase to $11.50 by 2017, and the District of Columbia, which also passed an increase to $11.50 by 2016.”

Speaking at the rally, Terry O’Neill said, “Women, who are now 40 percent of the primary breadwinners in their homes, are disproportionately working these minimum wage jobs.” She added, “They can’t save for retirement, they can barely make ends meet, if they can at all. We should pay a living wage, but this increase is a good start.

“This was about poverty level jobs,” said Gino Renne, President of UFCW Local 1994 MCGEO, “We have huge corporations like Wal-Mart coming in and paying well below the cost of living in our area. Workers are forced to seek government assistance like SNAP [food stamps] benefits and Medicaid. Essentially, taxpayers are subsidizing these jobs. It’s time this stopped and this [raising the minimum wage] is one way we can combat this problem.”

WTOP Radio reported, “The minimum wage increase would be phased in so that workers would see an increase to $8.40 an hour by Oct. 1, 2014. The rate would increase again to $9.55 an hour by October 2015, then $10.75 an hour by October 2016 and finally hit the new $11.50 an hour mark by 2017.”

MCGEO explained, “The Montgomery County bill passed overwhelmingly with only Councilmember Phil Andrews voting against. But prior to the vote, the success of the bill was not guaranteed. Councilmember Craig Rice (now Council President) urged the council to leave the increase up to the state or even federal government.”

Maryland NOW appreciates the leadership demonstrated by lawmakers in Montgomery and Prince Georges Counties, as well as the District of Columbia. We agree with Montgomery County Council President Rice that the state and federal government should act, but not that it made sense to wait before taking needed action. We’re encouraged by these local actions, but remain concerned because women and families in the rest of Maryland and the US simply can’t afford to wait for their long-overdue raise.

Despite stereotypes to the contrary, most people earning the minimum wage are adults trying to support themselves and their family–not teenagers as some believe. While pro-business interests, right wing think tanks, and conservative academics warn that a minimum wage increase would kill jobs and hurt the economy, history and experience refute their dire predictions.

The Economic Policy Institute (EPI) has collected and developed studies indicating that if the federal minimum wage were gradually increased to $10.10 per hour by 2016, nearly 28 million workers would get a raise. This would provide a serious increase in spending power for 15.3 million women–including almost 4.8 million working mothers. This is critical because nearly a quarter of the parents who’d benefit are the sole income earners for their families. Simply put, a minimum wage increase would directly help millions of American breadwinners and their families.

Also according to the EPI, increasing the minimum wage to $10.10 would add to–not decrease–employment: “Based on the economic multiplier effect that results from putting additional income in the hands of lower-income workers, raising the minimum wage will likely have a modest but positive impact on job creation, leading to an additional 85,000 net new jobs when fully phased in.” EPI compiled “the most recent, highly rigorous, peer-reviewed economic literature based on an analysis of real-world minimum wage increases across counties on state borders that shows essentially no disemployment effect resulting from raising the minimum wage. See more here.

Conclusive studies refute dire “job killing” warnings from opponents of a minimum wage increase. EPI cites “The best report providing a comprehensive analytical overview of the literature, ‘Why Does the Minimum Wage Have No Discernible Effect on Employment’ [from the Center on Economic and Policy Research’s John Schmitt that] illustrates the folly of ‘doom and gloom’ job-loss arguments, which fail to account for the several ‘avenues of adjustment’ available to employers that can and do prevent employment loss, including improved productivity and efficiency, reduced turnover and training costs, modest price increases, increases in demand (resulting from the stimulative impact of increasing lower-income wages), and reduced profits.” See more here.

EPI explains, “Lower-income earners spend their income more immediately, more completely, and more locally, than do higher income earners, and therefore generate more economic activity. Increasing the wages of 27.8 million workers by $35 billion over the phase-in period generates an additional GDP impact of $22 billion. See more at here.

The National Women’s Law Center (NWLC) confirms EPI’s findings about proposed legislation in Congress, and points out another positive impact of raising the minimum wage: that is, it would help close the gender-based income gap: “Millions of workers–mostly women–struggle to make ends meet on minimum wage earnings,” adding “The Fair Minimum Wage Act (H.R. 1010/S. 460) and the Minimum Wage Fairness Act (S.1737) would gradually raise the federal minimum wage from $7.25 to $10.10 per hour, increase the tipped minimum cash wage from $2.13 per hour to 70 percent of the minimum wage, and index these wages to keep pace with inflation.

NWLC further explained, “Increasing the minimum wage and tipped minimum wage are key steps toward fair pay for women,” and added: “A woman working full time, year round at the federal minimum wage of $7.25 per hour earns just $14,500–more than $4,000 below the poverty line for a family of three.” It’s even worse for “tipped workers [for whom the minimum wage is] $2.13 per hour.  Women are nearly two-thirds of workers in tipped occupations.” The NWLC concludes, “Raising the minimum wage to $10.10 per hour would boost earnings for nearly 28 million workers, 55 percent of them women, and help close the wage gap.”

Unfortunately, federal action in the near term seems uncertain. Currently, House Democrats are championing a special procedure to force a vote on H.R. 1010. They need 218 Representatives to sign onto their discharge petition. Then, if the House passes the legislation, the Senate must act as well. Unsurprisingly, Senate Minority. Leader Mitch McConnell (R-KY) has repeated canards about the minimum wage, and signaled his opposition.

On the January 26, 2014 edition of Fox News Sunday, host Chris Wallace asked McConnell, “Isn’t it reasonable that somebody who’s working full time, 40 hours a week, should be able to live above the poverty line?” McConnell replied, “Yeah. But of course, the minimum wage is mostly an entry-level wage for young people,” and claimed that raising the minimum wage will hurt employment.

Regardless of what Sen. McConnell and other critics consider “young” or “entry-level,” facts–not prejudice–should determine important economic policies. Here are the facts. According to the Bureau of Labor Statistics (BLS), of the 3.55 million workers earning at or below the minimum wage, 854 thousand–only 24%–are younger than 19.

As the EPI has shown, raising the wage will pump more purchasing power into the economy and help employment. So the critics are just plain wrong about the impact of an increase. Unfortunately, minimum wage increase opponents are as powerful they are inaccurate. In lieu of Congressional action, localities and states are stepping up.

The National Organization for Women’s local, state, and national leadership are building on our successful local efforts by working for a Maryland-wide increase. On February 24th, Maryland NOW officers including Sara Wilkinson (President), Sandy Bell (Action Vice President), Holly Joseph (Treasurer), and Susan Martin (Secretary), joined Maryland NOW PAC Treasurer Barbara Hays, and Montgomery County NOW Treasurer Edith Miller meeting with State Legislators to discuss the minimum wage and other issues vital to women in Maryland.

At the November Rockville rally NOW hosted, Kate Planco Waybright (Executive Director of Progressive Maryland), disputed claims that raising the minimum wage would be a “job killer.” She cited EPI research showing that a statewide increase would add jobs to the state because additional earnings would be poured back into the local economy.

According to minimum-wage.org, the federal government is unlikely to raise the wage in the near-term. This despite House Democrats forcing the issue, and despite “President Barack Obama’s call[ing] on Congress to raise the minimum wage to $10.10 per hour [in the 2014 State of the Union Address].” Minimum-wage.org added, “[President] Obama previously called on Congress to raise the federal minimum wage to $9.00 per hour in his 2013 State of the Union. However, due to partisan stall in Congress, it is unlikely that the federal minimum wage will be raised from $7.25 in the near future.” Fortunately, Maryland seems poised to move forward.

The Washington Post reported, “Gov. Martin O’Malley made a personal plea to Maryland lawmakers [to] Embrace his top legislative priority of raising the minimum wage and help more than 400,000 of the state’s low-income workers.” According to the Post, the Governor “pitched his plan to increase the statewide minimum from $7.25 an hour to $10.10 by 2016, telling a House committee that doing so would not produce ‘cataclysmic repercussions,’ as some business groups and other opponents fear, and “[Governor] O’Malley’s bill calls for the statewide minimum wage to rise to $8.20 an hour in July, $9.15 an hour in July 2015, and $10.10 an hour in July 2016. Counties could set a floor higher than the state’s, as Montgomery and Prince George’s have.”

Deepcor.com reported, “Governor O’Malley faces his last term as presiding governor in Maryland and has taken up the charge for an increase of Maryland’s minimum wage to $10.10 an hour,” adding, “Behind [Gov.] O’Malley’s rhetoric resides the affirmation that a raise to the minimum wage will strengthen the middle class of Maryland and help lift those hurt most from poverty into a higher income bracket, affording them more purchasing power and financial security.” Deepcor.com quoted the Governor–who spoke at a rally outside the State House in Annapolis–saying, “We all do better when we’re all doing better.”

This change is overwhelming popular with Maryland residents all across the state. The Baltimore Sun reported, “By a wide margin, Maryland voters want to raise the state’s minimum wage to $10.10 a hour, a poll conducted for The Baltimore Sun shows.”

The Sun added, “A majority of voters in every region of the state supports that wage increase [and] Statewide, 69 percent of voters surveyed said they back a proposal now being debated in the General Assembly to increase Maryland’s minimum wage from the current federal level of $7.25 an hour to $10.10 by 2016.” The Sun’s pollster, Steve Raabe, called this depth of the support “just amazing.”

In addition to enjoying widespread public support, a minimum wage increase would provide widespread benefits. A recent EPI report concluded: “Increasing the Maryland minimum wage to $10.10 by July 2016 would raise the wages of nearly half a million (455,000) Maryland workers. These workers would receive $721 million in additional wages over the phase-in period.” The Maryland economy would benefit as “The increased wages would generate more than $456 million in new economic activity and would create or support 1,600 new jobs as businesses expand to meet increased consumer demand.”

Of especial interest to Maryland’s women and all Marylanders who care about economic justice, EPI found, “The increase would disproportionately affect women, comprising 58 percent of those who would benefit.” Debunking widely-held myths about the policy, EPI reported, “The average age of affected workers is 33 years old. Teenagers comprise only 13 percent of the workers who would see a raise.” The report added, “Nearly a quarter (23.2 percent) of affected workers are parents. In fact, there are roughly 210,000 Maryland children with at least one parent that would get a raise.”

Men, women, and children–as well as businesses–will benefit from a minimum wage increase, according to EPI: “Raising Maryland’s minimum wage to $10.10 per hour by 2016 will increase the wages of the state’s lowest-paid workers by $721 million. These higher earnings—after accounting for some change in labor costs for businesses and prices for consumers—will translate into $456 million in increased economic activity, as cash-strapped workers spend their increased pay on basic goods and services. This additional economic activity will generate or support approximately 1,600 new jobs.”

Despite the “doom and gloom” predictions from special interests and their hired advocates,  Marylanders overwhelmingly support the proposed minimum wage increase. Backed by the Governor, as well as NOW, unions, many religious leaders, and countless advocacy organizations, this popular legislation has a great chance to pass the Maryland General Assembly this session. If it does, Maryland can look forward to a stronger economy, a growing middle class, and lower poverty levels.

As President Franklin D. Roosevelt said, “No business which depends for existence on paying less than living wages to its workers has any right to continue in this country.” Or in this state, NOW advocates might add. Luckily, most businesses in our state will not suffer if the minimum wage increases. They will benefit from the stronger economy we hope to build with a necessary and long-overdue raise for the working women and men of Maryland.