On Raising the MInimum Wage

When President Obama urged Congress in his State of the Union address to raise the federal minimum wage from $7.25 an hour to $9, he got plenty of support from his audience—well, not Republicans, of course. Still more applause, though, for linking future increases to the cost of living. He said even Mitt Romney had agreed with him on that point. But the cameras cut straight to a tight-lipped Paul Ryan, looking a bit peeved over the president’s presumptuous assertion.

The fate of this item in Congress is not clear yet, but certainly it will be vigorously opposed by conservatives in both houses. Not surprisingly, it was Herman Cain—fast food magnate and former President of the National Restaurant Association—who led the charge the next day on Fox News, tearing down the concept of paying low-rung workers something closer to a living wage.

Not surprising, because the restaurant industry deserves special scrutiny here. The way minimum wage regulations work for (actually against) workers whose pay depends on tips has come to the forefront once again. The federal minimum wage for tipped workers is $2.13 per hour, and has been frozen there for over twenty years. While employers are supposed to chip in the difference between $2.13 and $7.25 when tips don’t fill the gap, the industry is rife with abuses and excuses.

That may not be so obvious in Santa Barbara, where high-end destination eateries vastly outnumber the IHOP and Dennys sort of locations, but there are plenty of places on the South Coast and around the state (minimum wage: $8/hr.) where a waitperson or counter server can come up with under $64 in tips after a slow 8-hour shift.

A very concise introduction to this issue recently aired in a segment of Moyers & Company on PBS. The difference between that ridiculously low federal floor for tipped workers and other minimum wage earners, by the way, is the lasting legacy of a devil’s bargain that Bill Clinton struck with Herman Cain back in 1996 to get a bump in the overall minimum wage.

As customers in restaurants, though, we rarely have any idea of what those cheerful folks who bring food to our tables may earn—or what other schemes are “traditional” in the industry. Here’s a piece, originally from Salon.com that highlights other abuses faced by tipped workers.

Further background and individual stories were captured last summer in this story from the Huffington Post. And for the harsh facts of how this situation impacts women in particular, take a look at this from the Daily Kos.

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