Moral Low Ground

US Government

Los Angeles Mayor Eric Garcetti Signs $15 Minimum Wage Law

Protest for $15 minimum wage; New York City, April 15, 2015. (The All-Nite Images)

Protest for $15 minimum wage; New York City, April 15, 2015. (The All-Nite Images)

Los Angeles Mayor Eric Garcetti signed a law on Saturday raising the city’s minimum wage from $9 per hour to $15 by 2020, a historic move that will affect hundreds of thousands of workers.

The raise makes Los Angeles, the nation’s second-largest city, the biggest city to enact a $15 minimum wage to date. The City Council approved the wage hike in May by a vote of 14-1, requiring businesses that employ more than 25 workers to pay them at least $15 by 2020. The council had previously voted for a $15.37 minimum wage for city hotel workers, a move that was strongly opposed by the hotel industry and its highly-paid lobbyists.

The Los Angeles Times reports Garcetti signed the law in South Los Angeles, where about 500 people gathered for the historic event. The mayor predicted that about 600,000 Angelenos would be affected by the wage hike, which won’t begin until July 2016, when the citywide hourly minimum wage rises to $10.50. A separate statewide minimum wage hike to $10 takes effect in January 2016.

The legislation also allocates a $500,000 budget to establish an Office of Labor Standards, which will ensure that businesses are in compliance with the law and are paying workers fairly.

“This is about the idea, that American ideal, that when someone works hard, they should be able to support themselves, and they should be able to support their families,” Garcetti, who spoke in both English and Spanish, told the crowd at Saturday’s ceremony. “Too many Angelenos have been left behind even as we’ve put the recession in the rearview mirror.”

The signing ceremony included speeches by city council members, labor leaders, immigration activists and low-wage workers.

Laphonza Butler, president of the Service Employees International Union (SEIU) chapter representing home health care workers, said Garcetti is “a champion for workers,” calling the minimum wage increase a “revolution of values.”

“For every young person that has watched your mother struggle to put food on the table… welcome to the revolution,” Butler said.

“I’ve worked at McDonald’s for a year and I make $9/hour, currently the minimum wage in California,” a grateful Anggie Godoy said in a video for Fight for $15 LA, which has long advocated what is now law in Los Angeles. “I’ve fasted, gone on strike and I’ve even talked to McDonald’s shareholders. I believed that we would win $15. I knew my family, like many of the LA families, could not afford to lose.”

CNN Money reports several groups representing restaurants, theaters owners and small businesses have opposed the minimum wage hike.

“This is a city that’s already behind, that’s already fighting an uphill battle,” researcher Christopher Thornberg, who studied the potential affects of the wage increase for the anti-$15 Los Angeles Area Chamber of Commerce, told the Los Angeles Times.

Addressing the concerns of interests opposed to the raise, Garcetti insisted that “we would not have done this if we believed this would hurt our economy.”

Los Angeles is the largest, but not the first, US city to raise its minimum wage to $15. Last June, Seattle’s city council voted unanimously for an incremental hike to $15 by 2018. Last November, San Francisco also voted for a raise to $15. Nearby Emeryville then made headlines by approving the world’s highest minimum wage—$16/hour. Other cities, including Chicago ($13), Oakland ($12.15) and San Diego ($11.50), have also approved raises for their lowest-paid workers.

Meanwhile, the federal minimum wage remains at $7.25, which ranks near the bottom among most-developed nations with minimum wages. Living wage advocates, including prominent US Senator Elizabeth Warren (D-MA), have cited studies showing that the minimum wage would currently be around $22 per hour if pay increases had kept pace with increased rates of worker productivity over the past half century.

Economic inequality and the yawning—and growing—gap between the top income earners and everyone else is one of the most pressing problems facing the United States today. The average US CEO earns more than 350 times as much as the average worker, by far the largest disparity in the world.

US wealth inequality has reached levels unseen since the Great Depression. According to a 2014 study by Emmanuel Saez of the University of California at Berkeley and Gabriel Zucman of the London School of Economics, the richest 0.1 percent of Americans have as much wealth as the poorest 90 percent. According to 2012 figures from the non-partisan Congressional Research Service, the bottom 50 percent of US households have just 1 percent of the nation’s wealth, while the top 1 percent have 34.5 percent of the nation’s net worth.

One in six Americans is living in poverty, with even greater impoverishment among racial minorities and children—according to the Census Bureau, nearly 40 percent of black children and one-third of Hispanic children were living in poverty in 2010.

Economic mobility, long a hallmark of the ‘American Dream,’ has taken a huge hit. According to the World Bank, the odds of escaping poverty are about the same today in India as in the United States.

US income inequality, which is closely connected to wealth inequality, has also increased dramatically in recent decades, beginning with the largely discredited ‘trickle-down’ economic policies instituted by the Ronald Reagan administration, which lavished tax cuts and preferential treatment on wealthy corporations and individuals at the expense of the middle and working class and, especially, the poor. Social safety nets were shredded, even while corporate welfare reached historic levels. Successive administrations, both Republican and Democrat, have favored the rich over the poor for decades.

Today, the share of total income earned by the top 1 percent of US families has more than doubled, from 10 to 20 percent, since the late 1970s. Meanwhile, the income share of the bottom 90 percent of families has plummeted from a peak of 36 percent in the mid-1980s to 23 percent at the end of 2012.

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