Minimum wage rate likely to dominate NY 2016 session
The New York State Senate held a hearing on raising the minimum wage to $15 an hour. Governor Cuomo and Assembly Democrats support the phase-in to...
Jan 08, 2016 — The New York State Senate held a hearing on raising the minimum wage to $15 an hour. Governor Cuomo and Assembly Democrats support the phase-in to a higher wage, but many Senators remain uncommitted.
Senate Labor Committee Chair Jack Martins said he wants to broaden the discussion beyond simply phasing in a minimum wage increase to $15 an hour. He said the real issue in many regions of the state is the lack of opportunity for work that provides a middle class salary, and enables small businesses to thrive.
Martins asked EJ McMahon, President of the fiscally conservative think tank, the Empire Center, how the transition to a higher wage could adversely affect smaller employers, versus the large chain stores like a Walmart or Home Depot. “A year or two, three years down the road, my locally-owned hardware store is out of business and Home Depot is still here?” Martins asked.
McMahon believes the wage increase will lead to more closures of small stores. Local businesses currently compete by providing a higher level of personalized service. He said if the price of employment goes up, they lose their edge; the chain store conglomerates are much better equipped to pay higher wages. “They are big, fat capital intensive businesses with huge marketing budgets,” McMahon said.
McMahon said a regional minimum wage that takes into account the lagging upstate economy would be better, and that the current campaign is based on workers at a “McDonalds in midtown Manhattan.”
Senator Diane Savino proposed a regional minimum wage bill, but she also supports the phase-in to $15 an hour. She told SEIU health care workers union President George Gresham that in order to implement an increase for home care workers, who are often paid very low wages, Governor Cuomo will have to re-examine the cap on Medicaid spending. Many health-care workers’ pay is based on the Medicaid reimbursement rate. Gresham, who has a close relationship with Governor Cuomo, agreed.
The union leader talked of the dignity his father gained when he stopped being a domestic servant and became a truck driver. Gresham said before that, the household telephone line was frequently turned off for lack of money, something that humiliated him when a teacher pointed it out once in school. “She said to the whole class ‘your family doesn’t keep the phone on’, and I remember how embarrassed I was,” said Gresham. He said until his father became a teamster, phone service had to be “optional” if more pressing bills were due.
Although Gresham conceded that $15 an hour is “not a magic number,” he said it does match the rate of inflation from the original minimum wage created by Franklin Delano Roosevelt in the 1930s.
Governor Cuomo did not send any representatives to the hearing; something Labor Chair Martins said was regrettable.
Cuomo has held numerous rallies, though, and made his position clear. He frames the issue in the context of income inequality. He has already taken executive actions to phase in a $15-an-hour minimum wage for fast food workers and state workers. In the lead-up to this State of the State message he held an event with an enthusiastic crowd of union leaders. “We are done being abused as a work force so we can subsidize the richest corporations in this country!” Cuomo shouted. “That’s not going to happen.”
The harshest criticism of the $15-an-hour minimum wage proposal comes from the head of the state’s Republican Party. Ed Cox, G.O.P. chair, came to the Capitol to denounce Cuomo’s efforts. He called the plan a “job killer” that is riddled with factual errors. And Cox compared the governor’s rhetorical style to former Cuban dictator Fidel Castro. “When you stand up in front of audience telling big lies in a loud booming voice as if it was an absolute certainty and you repeat it over and over again,” Cox said, “that is exactly what Fidel Castro did in Cuba.” The G.O.P. Chair accused Cuomo of trying to “dictate” policies.
The governor has not introduced a formal bill on raising the minimum wage yet. That, and negotiations with the Senate, come after the State of the State speech on January 13.
