5 Things that Have Changed Since the Federal Minimum Wage Was Last Increased


The federal minimum wage was last increased on July 24, 2009, and since then, a lot has changed (don’t forget tipped workers haven’t seen a raise since 1991). There have been so many attacks on working families since that time that it would be difficult to catalog them all. But workers and their allies haven’t taken the attacks sitting down, and many are finding new ways to organize and stand up for their rights. Here are five things that have changed since the last time the federal minimum wage was increased:

1. Republicans Took Control of the House and Promptly Did…Nothing: In the 2010 midterm elections, Republicans took control of the House of Representatives in Washington, D.C., and then proceeded to engage in historical levels of obstructionism, and this 113th Congress is on pace to go down as one of the least productive Congresses in history. Congressional Democrats have tried to raise the minimum wage, butRepublicans blocked the legislation. Not to mention Republicans also shut down the government in 2013.

2. Working Families Turned to State and Local Governments: Not content to wait for Republicans in Congress to act, working family advocates turned their attention to state and local governments. On June 1, 2014, Delaware became the 22nd state (as well as the District of Columbia) to raise its minimum wage above the 2009 level. Four more states are set to increase on Jan. 1, 2015, while at least four more will consider ballot measures to increase their minimum wage in November 2014. At least a dozen cities or counties also have passed minimum wage increases in the past five years as well. Much of the state and local action has been in the last year or so, showing a growing momentum across the country for raising the wage despite Republican opposition.

3. Worker Productivity Has Risen, While Wages Have Stagnated: One place you can’t lay the blame for the economic crisis, stagnant wages and other economic problems is on workers. Between 1973 and 2013, worker productivity had risen nearly 65%. Meanwhile, wages for those same workers had only increased 8.2%.

4. CEOs, on the Other Hand, Have Gotten Much Richer: While workers are much more productive and not being fairly compensated for it, CEOs are making out like bandits. The average S&P 500 company CEO received $11.7 million in 2013, or 774 times a full-time worker earning the federal minimum wage. The ratio of CEO pay to production and non-supervisory worker pay has gone from 46–1 in 1983 to 331–1 in 2013.

5. The Value of the Minimum Wage Keeps Getting Eaten Away by Inflation: Stagnant wages are a real problem for working families and they are barely keeping up with inflation. A few examples make this problem clear. In January 2009, the average price of gas was $1.84 a gallon, now it’s $3.59 a gallon. The price of beef has risen 74% since 2009 to a record level. In 2009, a gallon of milk could easily be purchased for under $3, now the price is more than $4 in many places. Overall, food prices have risen 9% since 2009, with many individual staples rising much faster.

Reposted from AFL-CIO NOW

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These Two Studies Turn Wall Street’s Economic Argument On Its Head

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Two studies released in the past few weeks are busting long-held myths about what makes our economy grow.

The first came in June from three professors: Michael J. Cooper of the University of Utah, Huseyin Gulen of Purdue, and P. Raghavendra Rau of the University of Cambridge. They looked at the long-term performance of 1,500 businesses and found that higher CEO pay has a negative effect on a company’s performance.

Using data from 1994 to 2013, the professors saw that companies in the top 10 percent of CEO pay produced “negative abnormal returns” (lower shareholder returns than other firms in their industry) or around -8 percent over three years. The higher the pay got, the more pronounced the effect: the top 5 percent of highest paid CEOs steered their companies to a 15 percent worse performance.

Why were these companies doing worse?

In a word, overconfidenceCEOs who get paid huge amounts tend to think less critically about their decisions. “They ignore dis-confirming information and just think that they’re right,” says Cooper. That tends to result in over-investing—investing too much and investing in bad projects that don’t yield positive returns for investors.”

The second came this week from the Center for Economic and Policy Research, which compared employment growth between states and found that those states that raised their minimum wage levels experienced higher growth than those that didn’t.

Of the 13 states where the minimum wage went up on January 1, 2014 (either because of legislative action, referendum, or cost-of-living adjustments), all but one had positive employment growth, and nine of them had growth higher than the median. “The average change in employment for the 13 states that increased their minimum wage is +0.99% while the remaining states have an average employment change of +0.68%,” wrote CEPR.

“While this kind of simple exercise can’t establish causality, it does provide evidence against theoretical negative employment effects of minimum-wage increases,” writes Ben Wolcott of CEPR.

In other words, it doesn’t prove raising the minimum wage always creates a certain number of jobs within 6 months, but it does add to the pile of evidence showing that raising the minimum wage doesn’t negatively affect employment.

And CEPR isn’t the only group that reached these conclusions. An analysis by banking giant Goldman Sachs (!) also found the states that raised their minimum wages doing better than those that didn’t.

Taken together, these studies back up what working people already know:  higher wages add to a virtuous cycle that benefits both workers and businesses, and that exorbitant CEO pay does nothing for the broader economy other than line the pockets of an increasingly small and powerful group of uber-wealthy individuals.

Text RAISE to 30644 to join Working America’s fight for fair wages.

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While Many CEOs Were Scoffing At Raising The Minimum Wage, They Were Getting An 8.8 Percent Bump in Pay


For the fourth straight year, the median CEO pay package increased in 2013, crossing $10 million.

Propelled by a soaring stock market, the median pay package for a CEO rose above eight figures for the first time last year. The head of a typical large public company earned a record $10.5 million, an increase of 8.8 percent from $9.6 million in 2012, according to an Associated Press/Equilar pay study.

As the Associated Press reports, the median CEO makes 257 times as much as the average worker, up from 181 times as much in 2009.

In the 1980’s, the average CEO made roughly 42 times as much as the average worker. In the boom times of the 1950’s, they made about 21 times as much.

From 2012 to 2013, as median CEO pay rose 8.8 percent, the value of the minimum wage actually fell roughly 1.6 percent. The value of the minimum wage has fallen every year since 2009.


The Dodd-Frank Wall Street reform law passed in 2010 contained provisions requiring companies to be transparent about the ratio between CEO and average worker pay. But thanks to aggressive lobbying, the SEC has been slow to issue rules.

As of today, nearly four years after the law passed, the SEC has still not finalized the rule on CEO-to-worker pay ratio disclosure.

Photo by kentwang on Flickr

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Walmart CEO Steps Down After Embarrassing Week for Company. What’s Next?

Something had to give.

Amid one of the most turbulent periods in Walmart’s history and ahead of thousands of Black Friday protests against the company’s treatment of workers, CEO Mike Duke has stepped down.

“Walmart has been heading in the wrong direction, and it’s a testament to the pressure the company is feeling that they’re changing leadership at this moment,” said OUR Walmart member Tiffany Beroid, an associate at Walmart #1985 in Laurel, Maryland.

This move comes after an enormously embarrassing week for Walmart.

Over 400 news outlets reported on a photo of food drive bins set out for associates to donate to other associates. The revelation sparked criticism from all quarters, including actor and businessman Ashton Kutcher, who tweeted his barbs to more than 15 million followers. Late night talk shows like Stephen Colbert lampooned the store’s actions: “Anyone can afford food at Walmart, except people who work at Walmart.”

In addition, the National Labor Relations Board (NLRB), fully staffed after years of Republican-lead obstruction, announced a decision to prosecute Walmart for illegal firings and threats against striking workers. More than 117 Walmart associates were unfairly fired or disciplined after multi-city strikes last June, according to OUR Walmart.

To top it off, Walmart associates and allies are building momentum toward nationwide protests of the company’s low pay and disrespect toward workers on November 29, Black Friday. In the past month, workers have walked off the job in Chicago, Dallas, Tampa Bay, Miami, Cincinnati, and Seattle, Los Angeles, and Sacramento. Port drivers at trucking companies that are part of Walmart’s supply chain also went on strike last week.

CEO Mike Duke will be fine, however. In 2012, he was paid $23.2 million, or about 1,034 times more than the company’s average worker.

Duke’s successor will be Michael McMillon who was previously CEO of Walmart International. McMillon ran the company’s international division during a period the New York Times reported that Walmart was making illegal bribes to Mexican officials.

Tiffany Beroid issued a challenge to the incoming CEO: “We sincerely hope that Mr. McMillon will answer the country’s calls for Walmart to publicly commit to paying $25,000 a year, providing full-time work and ending its illegal retaliation against its own employees.”

Let’s keep up the pressure. Join us and stand up for Walmart workers at a Black Friday event near you.

Photo by @unitehere on Twitter

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That Time Stephen Colbert Created A Public Relations Nightmare for Walmart

On Tuesday night, Stephen Colbert helped turn Walmart’s food drive fiasco into a full-blown PR nightmare.

Earlier this week, a Walmart associate shared a photo from a Canton, Ohio store showing empty bins with a sign that read “Please donate food items so associates in need can enjoy Thanksgiving dinner.”

Not only is Walmart not taking responsibility for their low wages and unfair scheduling practices that put many of their employees “in need.” They are placing the burden on their fellow associates to help them out.

“Some critics out there are saying Walmart isn’t doing enough, but they’re wrong because Walmart isn’t doing anything,” Colbert told his audience. “These bins are for employees to donate to other employees. And where can Walmart low-wage employees find cheap food to donate? Walmart.”

“Anyone can afford food there,” he continued, “except people who work at Walmart.”

This is just another way Walmart, despite huge profits and exorbitant executive pay, places its financial burdens on others. Because of Walmart’s low wages, erratic scheduling, and lack of health benefits for more employees, each Walmart Supercenter costs taxpayers approximately $900,000 in Medicaid, SNAP, and other public assistance.

Walmart claims they pay an average hourly wage of $12.78, but independent analyses peg that number closer to $9 an hour. A Walmart executive boasted at a Goldman Sachs conference in September that 475,000 of the company’s U.S. associates make more than $25,000 a year, implying that the vast majority of Walmart’s 1.4 million American employees make less than that.

This business model is a choice, not a necessity. A Demos report showed how Walmart could double hourly wages just by not repurchasing billions of dollars its own stock. An analysis from Fortune magazine’s senior editor Stephen Gandel — hardly a left-winger — demonstrates that Walmart could give its employees a 50 percent raise and still deliver on its promises to shareholders.

Thus far, Walmart is refusing to listen to shareholders, independent business analysts, or its own workers. That’s why we’re standing up on Black Friday – stand with us by finding an event near you.

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Janet Sparks, a Walmart Associate, Wants to Talk to You About CEO Pay

The following is a guest post from Janet Sparks, a Walmart associate and shareholder.

I’ve worked at Walmart in Baker, La., for eight years, and I’ve been a Walmart shareholder since I started. Times are tough for Walmart customers, but I want you to know that times are tough for many Walmart associates, too. We are stretching our paychecks to pay our bills and support our families. Many of us are not getting as many hours as we used to and that makes it even harder. Now the new associates in my store are not even hired as permanent employees. They are hired as temps with no benefits—not even a discount card.

So when I think about the fact that our CEO Mike Duke made more than $20 million last year—more than 1,000 times the average Walmart associate—with all due respect, I have to say, I don’t think that’s right. Most of his pay came from bonuses. At the store where I work, associates have received only two quarterly bonuses in the past five years. And the last one was just $26.17. As hard as we work, I think we deserve better, so do our customers and so do our shareholders.

That’s why I am asking you to join me and send a letter to the the U.S. Securities and Exchange Commission (SEC) supporting a law that would require companies to disclose CEO-to-worker pay ratios. Investors deserve to know what workers are earning compared to CEOs at the companies they invest in.

If you’ve got a pension, retirement plan or even college savings for your kids, then you’re a stakeholder—and it’s time for corporations to be held accountable to you when it comes to their executive pay scales. The SEC’s comment process is the first step.

Send a letter to the SEC supporting this law today.

Reposted from AFL-CIO NOW

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While Worker Wages Stayed Flat This Past Year, You Won’t Believe What Happened to CEO Pay

The top ten highest paid chief executives in the country all took home more than $100 million last year, with two of them earning billion-dollar paychecks.

“I have never seen anything like that,” said Greg Ruel, who authored a report on executive compensation released Tuesday by GMI Ratings. “Usually we have a few CEOs at the $100 million-plus level but never the entire top ten.”

Facebook’s Mark Zuckerberg took home more than $2.2 billion, and Richard D. Kinder of Kinder Morgan, Inc. took home more than $1.1 billion.

The case of Kinder is deceptive. In 2012, his base salary was $1, but he made a billion dollars selling restricted stock. That followed a nearly $60 million profit from stock in 2011.

GMI’s poll of 2,259 American companies — accounting for salary, stock options, bonuses, and the like — found an average increase in executive compensation of 8.47 percent. For the top 1,000 companies, however, that number jumps to 15.47 percent.

Meanwhile, median household income has remained flat at $51,017. Adjusted for inflation, there was almost no measurable increase between 2011 and 2012.

Worker wages haven’t only remained flat over the same period, they have “fallen about 9 percent from an inflation-adjusted peak of $56,080 in 1999,” writes The Guardian’s Dominic Rushe.

So why are CEOs getting rewarded? Stock option packages are supposed to “align the interests of senior executives with shareholders,” writes GMI, but “the unintended consequences of these grants is often windfall profits that come from small share price increases.”

In other words, these huge stock options are supposed to give CEOs the incentive to make sure their company does well, but mostly it incentivizes them to seek small, sometimes short-term stock jumps. Put another way, it’s not in the immediate self-interest of these immensely powerful people that the economy as a whole does well, or even that their own companies do well in the long run.

There are efforts to make sure, at the very least, that these compensation systems are transparent. The SEC is considering a rule that would require companies to disclose the ratio of CEO compensation and the pay of the typical worker. In 2012, CEOs of major corporations took home an average of 354 times more than the average worker (up from 42 times in 1982, 201 in 1992 and 281 in 2002) but that’s just from data that’s available.

Tell the SEC companies must disclose CEO-to-worker pay ratios.

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How Corporations Use Offshore Havens to Avoid Paying Their Taxes

Reposted from AFL-CIO NOW

Current laws in the United States allow corporations to use offshore havens to avoid paying their taxes and, if it’s up to many in Washington, the problem will only grow larger, particularly if the so-called “territorial” tax system is passed. The details of the use of such tax havens were discussed in a conference call with Campaign for America’s Future (CAF), Americans for Tax Fairness (ATF) and Citizens for Tax Justice (CTJ).

Current tax laws encourage the offshoring of America’s jobs, manufacturing and profit centers, which has led to the hollowing out of the middle class, manufacturing and much of the country, according to Dave Johnson of CAF. Changes in the tax code in recent decades have led to a series of dangerous statistics for America’s working families:

  • Corporate tax revenues as a share of GDP are at near historically low levels.
  • In 2009, the U.S. share of GDP made up of corporate tax revenues was only 1.7%.
  • The top corporate tax rate in 1970 was 52.8%, now it is 35% (although the effective rate is much lower).
  • The United States has the third-lowest effective corporate tax burden in the world.
  • Corporate taxation as a share of total tax revenue was 26.4% in 1950 and was down to 7.4% in 2010.
  • Personal income, Social Security and Medicare taxes were 51.4% of total tax revenue in 1950, now they are up to 83.4%.

Congress is now proposing lowering corporate taxes even more and even, possibly, eliminating taxes on earnings reported as having been earned outside the country.

ATF has been working to highlight the massive corporate tax loopholes big corporations exploit, says the organization’s campaign manager, Frank Clemente. Those loopholes allow some corporations, such as General Electric—who had an effective corporate tax rate of 12% in 2011—to pay less in taxes than individuals. There are currently $1.6 trillion in corporate revenues waiting offshore. The corporations who own those revenues want Congress to pass a new tax holiday (previous holidays taxed those profits at only 5%, instead of the standard corporate tax rate) or a territorial tax system, wherein U.S. corporations would pay no taxes on foreign profits. Clemente says that would create an incentive for corporations to ship more and more revenues overseas, as well as shipping manufacturing, patents and jobs to countries with no corporate taxes.

CTJ works to give ordinary people a greater voice in the development of tax laws. It focuses on exposing corporations that pay little or no taxes. CTJ argued that the tax code needs to be reformed, but in a way that ends incentives to shift profits and jobs offshore. Currently, corporations have heavy incentives to disguise U.S. profits as offshore profits to avoid paying taxes.

An example of this problem is a report from the Congressional Research Service that found in 2008 that American multinational corporations reported earning 43% of their $940 billion in foreign profits in five tiny tax-haven countries that house only 4% of their foreign workforce and 7% of their foreign investments.

The three organizations say they have three basic policies they favor to deal with tax havens and the offshoring of America’s profits and jobs.

  1. Rejecting revenue-neutral tax plans that close loopholes and lower statutory tax rates. Instead they favor revenue-positive tax proposals that would increase government revenue.
  2. Closing tax loopholes that encourage the offshoring of profits, and making sure foreign profits for U.S. corporations are taxed at the same rate as domestic profits. One example of legislation that would accomplish this is a bill by Sen. Bernie Sanders (I-Vt,), the Corporate Tax Fairness Act, that would require corporations to pay the same tax rate on domestic or foreign profits and would raise $590 billion over 10 years.
  3. Rejecting the territorial tax system, which they call “tax havens on steroids.”

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The CEOs Are All Right

The U.S. Census finds nearly half of our population is considered low-income or downright poor. From the Huffington Post:

Squeezed by rising living costs, a record number of Americans – nearly 1 in 2 – have fallen into poverty or are scraping by on earnings that classify them as low income.

The latest census data depict a middle class that’s shrinking as unemployment stays high and the government’s safety net frays. The new numbers follow years of stagnating wages for the middle class that have hurt millions of workers and families.

You gotta love this guy:

Robert Rector, a senior research fellow at the conservative Heritage Foundation, questioned whether some people classified as poor or low-income actually suffer material hardship. He said that while safety-net programs have helped many Americans, they have gone too far, citing poor people who live in decent-size homes, drive cars and own wide-screen TVs.

Apparently if you lost your job, your credit, and your savings when the economy collapsed in 2008, you were supposed to sell everything you owned, or give it away, in order to look appropriately poor. Donate those designer clothes, and don some sackcloth and ashes. Car? Who cares if you need it to look for work—get rid of that car, and your refrigerator, too. If you’re poor you have no right to a refrigerator.

Paychecks for low-income families are shrinking. The inflation-adjusted average earnings for the bottom 20 percent of families have fallen from $16,788 in 1979 to just under $15,000, and earnings for the next 20 percent have remained flat at $37,000. In contrast, higher-income brackets had significant wage growth since 1979, with earnings for the top 5 percent of families climbing 64 percent to more than $313,000.

Housing costs have accelerated hugely in the wake of the foreclosure crisis. Families are paying more than a third of their income for housing; then there are utilities, energy costs, transportation, child care, and health care. Divide all of that into $15,000 a year, and see what’s left over.

What is truly shocking here, is the complete lack of concern about this on the part of most of our elected officials, and the mainstream media.

However, there is one group of Americans whose income does not appear to be shrinking or stagnant. From The Guardian:

Chief executive pay has roared back after two years of stagnation and decline. America’s top bosses enjoyed pay hikes of between 27 and 40% last year, according to the largest survey of US CEO pay. The dramatic bounceback comes as the latest government figures show wages for the majority of Americans are failing to keep up with inflation.

America’s highest paid executive took home more than $145.2m, and as stock prices recovered across the board, the median value of bosses’ profits on stock options rose 70% in 2010, from $950,400 to $1.3m. The news comes against the backdrop of an Occupy Wall Street movement that has focused Washington’s attention on the pay packages of America’s highest paid.

No sackcloth and ashes for this crowd. No shame, or sense of propriety, either. The “job creators” are delivering record profits without adding jobs.

Time for some new solutions?

Photo by Manu_H on Flickr, via Creative Commons.

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Massey CEO Set to Open More Coal Mines

by Tula Connell – Reposted from the AFL-CIO NOW Blog

Don Blankenship was head of Massey Energy when 29 coal miners lost their lives in a massive explosion. Forced to resign, he has been largely invisible since.

Now he’s filed papers to start another coal mine venture. According to Business Week:

Public records show that Blankenship has incorporated a new venture in Kentucky. Paperwork for McCoy Coal Group Inc. of Belfry, Ky., has been on file since January, though, and it has yet to seek a single mining permit, says Kentucky Energy and Environment spokesman Dick Brown.

Following the April 2010 the explosian at Massey Energy’s Upper Big Branch (W.Va.) mine, a Mine Workers (UMWA) report on the disaster summed up the tragedy in its title: Industrial Homicide. An independent report on the disaster commissioned by former W.Va. Gov. Joe Manchin (D) concluded the responsibility for the explosion “lies with the management of Massey Energy…[B]y frequently and knowingly violating the law and blatantly disregarding known safety practices…Massey exhibited a corporate mentality that placed the drive to produce coal above worker safety.” And an investigation by the Mine Safety and Health Administration (MSHA) found the company kept two sets of books to hide safety problems.

Prior to the disaster, MSHA had filed more than 450 safety citations at Upper Big Branch, which wasn’t the only Massey mine with safety problems. MSHA records show that in at least six of the 10 years prior to the explosion, Massey mine’s injury rate has been worse than the national average for similar operations. In 2009, Massey and subsidiary Aracoma Coal Co. agreed to pay $4.2 million in criminal fines and civil penalties related to a January 2006 fire that killed two miners at the Alma No. 1 mine.

But far from taking responsibility, Blankenship has implied the deadly blast was God’s fault and told the government to keep its hands off patriotic business like Massey. A business so patriotic that the Mine Workers’ report described it as

A rogue corporation, acting without real regard for mine safety and health law and regulations, that established a physical working environment that can only be described as a bomb waiting to go off.

Blankenship has made a career of busting unions, violating mine safety laws, attacking environmentalists and shilling for the far right and corporate America. The workers at Upper Big Branch were not in a union. A report following the tragedy found that unionized coal mines are far safer.

Alpha Natural Resources, which bought Massey Energy for $8.5 billion, last week reached an agreement with the federal government to pay $210 million, which does not bar any future criminal prosecutions of individuals connected to the deadly explosion.

Let’s hope not. Because as UMWA spokesman Phil Smith puts it, at least 18 Massey managers should be prosecuted, including its former CEO.

Don Blankenship belongs in jail, not in a position to put yet more miners’ lives at risk.

(Blankenship is among 30 of the worst 1 percent–bankers, politicians, and corporate big wigs–highlighted by Brave New Films. You can vote for the worst of the worst here.)

Photo of the Upper Big Branch Mine by TV19 – DD Meighen on Flickr, via Creative Commons.

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