How Seattle got sick of waiting for someone else to fight income inequality and took charge
by Paul Constant
Like a lot of people in Seattle, I generally think of Canada as the brainy little sister who’s got it all figured out. While the U.S. staggers home from the bar at three in the morning with a gun shoved in her bra and a nasty infection blossoming underneath that unfortunate new tribal tattoo on her neck, Canada is nestled safely in bed with a loving partner and happy dreams of nationalized health care running through her head. But something strange has happened in the last couple years. Seattle has gotten the jump on Canada in two very important ways: Our state, Washington, legalized marijuana in 2012 and our city passed a $15-an-hour minimum wage this past June. Legal pot is important for many reasons, most meaningfully that it will save an entire generation of Americans from many years of imprisonment for what really ought to be, at worst, a ticketable offense.
But as a Seattleite, I’m proudest of the minimum wage increase because it addresses what I consider to be the single biggest problem of our time — rampant income inequality. One of my favorite thinkers on this subject is Robert Reich, a former Secretary of Labor under President Bill Clinton. In his books Aftershock and Beyond Outrage (and, in a more simplistic way, in the documentary Inequality for All), Reich explains that the American economy is stagnating because more and more money rises to the top one per cent of all earners and simply stays there. The wealthiest of us all now make more money than they can ever possibly spend, Reich explains, and that top one per cent is now in possession of a larger percentage of money than at any time since the 1920s. The Mitt Romneys of the nation instead invest their wealth in tax-free offshore accounts and nations like China, where pesky regulations don’t get in the way of sky-high profits. A capitalist society requires a free flow of cash, but the middle and lower classes in America now have less money to spend than they’ve had in a century, and this could lead us to another Great Recession. Reich’s prescription for this problem is heavily increased taxes on the top wage earners in America, which would then be funneled back to the middle and lower classes.
That idea was not popular, because as John Steinbeck once famously said, “socialism never took root in America because the poor see themselves not as an exposed proletariat but as temporarily embarrassed millionaires.” Even people below the poverty line hate the idea of raising taxes on the top one per cent of all earners because they suspect they are one lottery ticket away from joining the one per cent; here in Washington state, a vast majority of voters — 64 percent of us! — shot down a proposed state income tax on individuals earning more than $200,000 a year. Because that could be us one day, right? Rags to riches is the American dream, even if it never, ever happens in real life.
Even the Occupy movement couldn’t inspire enough Americans to end income inequality on a national (or even statewide) level. So it’s up to the cities to try to fix things as best we can, and one of the easiest ways for a city to affect income inequality is to raise the minimum wage.
(Well, here anyway. Cities don’t have this option in Saskatchewan, where the minimum wage is set by the provincial government).
In Seattle, the change began the way most interesting political changes begin: with the successful election of a socialist. Kshama Sawant, an economics teacher at Seattle Central Community College, ran for our city council in 2013 on a platform to raise the minimum wage to $15 an hour, as part of a movement called $15 Now. (The minimum wage in the United States is a shameful $7.25 an hour, and Washington State’s minimum wage, at $9.32 an hour, is the highest in the union.) Sawant ran against a particularly smug tool of downtown developers and unimaginative centrist Democrats, and so through the allure of novelty and a refreshing candor, she seized the zeitgeist. The mayoral election happened to be the same year as Sawant’s campaign, and both mayoral candidates endorsed a $15 minimum wage, presumably because they had no choice. Thanks to her political savviness and the support of labor, Sawant basically won the election before the votes were mailed in.
Soon after his inauguration, new Seattle Mayor Ed Murray assembled an advisory committee of 24 labor leaders, small business owners, and academics to hammer out a plan within his first hundred days in office. Like most compromises, the proposal that the committee came up with (and that our city council, including Councilmember Sawant, then approved) didn’t make a lot of people happy. It’s an imperfect solution, a whole lot of numbers swirling around in a soup of timetables and caveats. Small businesses, which are infuriatingly defined as any employer with fewer than 500 (!?) employees, don’t have to achieve the true $15 minimum wage for seven years. Large employers like McDonald’s will have to pay $15 by 2017, although if they provide decent health insurance for their employees, they’ll have until 2018 to hit $15. This number is tied to cost of living increases, so the city estimates that by the time the $15 minimum wage truly kicks in, it’ll actually be more like an $18 an hour minimum wage.
Unless everything gets derailed. Unsurprisingly, huge corporations like McDonald’s are suing the city, charging that franchises are small businesses. Conservative groups tried and failed to gather enough signatures to bring the minimum wage to a popular vote. (Reports of sketchy signature-gathering techniques, such as misinforming voters that they should sign if they wanted to support the $15 minimum wage, were rampant in the days before their referendum shat the bed and died.) One particularly dickish gambit involved a statewide initiative called the “Fair and Uniform Minimum Wage” act, which would have barred cities in Washington State from raising their own minimum wage, putting the $15 vote in the hands of the much-more-conservative statewide electorate.
The fact is, we don’t know what’s going to happen in Seattle. This kind of a minimum wage increase has never happened before. Some small businesses claim that they’ll have to shut down if they’re forced to pay their employees a minimum wage that’s more than twice the national wage. Others reply that if your business would close because you were forced to pay your workers a living wage, you’re doing a shitty job of running a business. Many argue that giving the poorest workers in the city a six-dollar raise will allow them to spend more money than ever before, which will offer a boost to local businesses.
Conservatives warn of a nightmarish Atlas Shrugged-style future, in which businesses flee Seattle en masse for more business-friendly cities. But last year, Seattle was the fastest-growing city in the United States; it seems difficult to believe that every dry cleaner in town is going to suddenly pull up stakes and move to Dallas. I completely support the increase, although I do note with a little trepidation that it doesn’t do much of anything to dislodge that ever-growing wad of money that the wealthiest Americans are sitting on; it could just be a stopgap measure that moves some cash around in a shell game while the real problem stays unresolved.
But still, it’s a promising move. We in Seattle have decided to commit to this experiment, to be a laboratory for the decent treatment of our poorest workers.
Lately, you in Canada have been consigning some of your poorest workers to an American-style fast-food hell. On Aug. 15, CBC’s Amanda Connolly reported that the Temporary Foreign Worker Program has allowed businesses to pay temporary foreign workers anywhere from five to 15 per cent less than the average in their sector. (It was even worse in fast-food: where the Harper Conservatives were forced to step in to suspend fast-food restaurants from hiring temporary foreign workers. Before the suspension, McDonald’s Canada CEO John Betts called the CBC’s charges that his corporation was mistreating employees “bullshit,” which is coincidentally my single-word review of almost every item on McDonald’s menu.) And low-wage workers in Saskatchewan have been losing their jobs to temporary foreign workers for some time now.
It’s easy to fall prey to xenophobia, to blame the foreign workers for “stealing” those jobs, but the blame falls solely on the employers, who are trying to see how low they can go while still adhering to the letter of the law.
Seattle recently reminded ourselves that for the most part, business will mistreat its workers as much as possible in pursuit of profit; government’s job is to step in and set a decent bare minimum for business to follow. One fast-food chain recently testified to the Seattle City Council that its employees were not worth $15 an hour, which is a stomach-churning proposition when you realize that most corporations believe their CEOs are “worth” tens of millions of dollars a year.
It’s time to stop the condescending (and banally evil) consideration of wages as a tit-for-tat trade in cash for a human being’s total value. It’s time for us all to come together and agree that human beings deserve a certain amount of respect, and demand that businesses behave like good citizens when it comes to the dignity of their workers.
We’ve certainly done dumber things in America.
Paul Constant is Prairie Dog’s Official American. He’s the books editor and blog editor at Seattle’s alternative newspaper The Stranger and you can read more of his work at www.thestranger.com.