Wednesday, April 23, 2014

SEATTLE - Battle Over the Minimum Wage

"How much does it really cost to live in a city like Seattle?" PBS NewsHour 4/22/2014


GWEN IFILL (NewsHour):  The battle over raising the minimum wage may be at a stalemate in Washington, D.C., right now, but, in Washington State, the fight is still under way.

Our economics reporter, Paul Solman, has the next in his series of stories on that subject, this one on just how much it really costs to live in a city like Seattle.

It’s part of his ongoing reporting Making Sense of financial news.

PAUL SOLMAN (NewsHour):  In Seattle this spring, rallies to raise the minimum wage, but not to the $10.10 being debated nationally.  Here, they’re talking about $15 an hour citywide, 62 percent higher than this year’s inflation index state minimum wage of $9.32, already highest in the nation.

PHILIP LOCKER, Socialist Alternative Party:  Wall Street and big business crashed the economy.  They got bailed out.  They’re making record profits.  But working people are faced with what?  Poverty wages, low wages, McJobs, student debt.  What’s our future?
PAUL SOLMAN:  Seattle multimillionaire investor and entrepreneur Nick Hanauer is a leader of the $15 wage movement, but he still helps run his family’s pillow company.

NICK HANAUER:  And, indeed, we have factories where we do not pay workers $15.  If my competitors pay $10 and we pay $15, we will surely go out of business.  A great challenge we face in the city of raising the minimum wage to $15 is precisely that dynamic.

PAUL SOLMAN:  But, look, says Hanauer, every economic decision involves tradeoffs.  It boils down to weighing the costs against the benefits.

And in this case:

NICK HANAUER:  The benefits overwhelm the costs.  When worker compensation goes up, everyone benefits, right, because those workers both go buy more stuff and need less services from taxpayers.

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