July 23, 2014
Next Task Force Meeting
Economic Justice Task Force Meeting
To Be Announced
Vision for Children at Risk,
St Louis Children's Agenda Office
2401 N. Grand Avenue
St. Louis, MO 63106
Please join us to get information you can trust and to add your voice and action.
The Fair Minimum Wage Act (FMWA) of 2013 is expected to reach the Senate floor the week of December 9th. This bill would raise the minimum wage, in three steps, to $10.10 per hour and index it to inflation on a yearly basis after the final increase. It would also gradually raise the tipped minimum wage to 70% of the full minimum wage and index that to inflation. This bill is enthusiastically supported by a wide array of groups representing organized labor, business leaders, the civil rights community, workers, low-income individuals, and communities of faith.
Support the Motion to Proceed without any amendments or poison pills that would weaken the bill. We want a clean bill.
It’s the right policy (see talking points below) and it’s the right politics. A national poll conducted in July 2013 revealed that 80% of all Americans, including 62% of Republicans, favored raising the MW to $10.10. www.nelpaction.org.
- The Fair Minimum Wage Act of 2013 would help restore the minimum wage to its historic level, making up for decades of erosion. The federal minimum wage has lost more than 30% of its value and would be more than $10.70 per hour today if it had kept pace with the cost of living over the past forty years
- More than 30 million workers would receive a raise from the FMWA of 2013. This includes those working at or near the minimum wage.
- The stereotype of minimum wages being for teenagers or entry level workers is demonstrably false:
- 88% of workers who would benefit from raising the minimum wage are adults over the age of twenty,
- 43% have some college education
- 48% of college graduates work in jobs requiring just a high school diploma
- The median age of a low-wage worker has risen to 34.9
- More than 17 million children have a parent who would get a raise under the Fair Minimum Wage Act of 2013
- The low-minimum wage perpetuates income inequity between women and men, and between white workers and workers of color.
- 56% of workers who would benefit from raising the minimum wage are women
- Nearly half are workers of color
- 57% of the pay gap between workers at the bottom of the wage scale and those in the middle is due to the eroding purchasing power of the minimum wage over the past thirty years, according to a recent study by the Economic Policy Institute.
- The federal tipped minimum wage has been frozen at $2.13 since 1991. We must stand together and call for the restoration of the tipped minimum wage to 70% of the full minimum wage.
- Two-thirds of tipped workers are women – a key step for women’s pay equity.
- Waitresses and waiters are three times more likely to be paid below the poverty line than the general workforce and nearly twice as likely to need food stamps.
Tips are notoriously erratic, varying from shift to shift and from season to season. A higher tipped minimum wage would help cushion the impact of these fluctuations and ensure a guaranteed basic income for tipped workers.
- The Fair Minimum Wage Act of 2013 would generate more than $32 billion in new economic activity, translating to 140,000 new full-time jobs as higher sales lead businesses to hire more employees, according to estimates by the Economic Policy Institute.
- More working adults than ever are depending on low-wage jobs.
- Since the recession, 58% of new jobs have been in low-wage occupations like cashiers and food preparation where the minimum wage sets pay scales.
- Most big low-wage employers –including retail and fast food chains like Walmart and McDonalds –are enjoying strong profits and can readily afford a higher minimum wage
- 78% have been profitable every year for the past three years, and 63% of these companies are earning higher profits now than before the recession
- The economic evidence shows a higher minimum wage does not cost jobs.
- The most rigorous studies of minimum wage increases over the past twenty years show no discernible reduction in employment or slowing of job growth when the minimum wage has increased.
- The panel of roughly 40 economic experts that the University of Chicago's Booth School of Business surveys regularly on public policy issues agrees that the benefits of a higher minimum wage outweigh the costs. When weighted by the confidence with which the experts hold their opinions, 62 percent of the leading economists surveyed agree that the benefits of raising and indexing the minimum wage outweigh the costs, while only 16 percent disagree.
- An April 2013 poll released by Small Business Majority found that two-thirds of small business owners in the U.S. support raising and indexing the federal minimum wage.
- More of the business press than ever has endorsed raising the minimum wage, including Bloomberg News, Crain’s New York Business, and The Economist citing the evidence that a higher minimum wage does not cost jobs.
Please bring the following documents with you on lobby visits – whoever set up the meeting is responsible for bringing the documents.
Fact Sheet: The Fair Minimum Wage Act of 2013: http://www.nelp.org/page/-/rtmw/NELP-FMWA-2013-Fact-Sheet-030413.pdf?nocdn=1.
NELP Action Fund, July 24, 2013 “New Poll: Overwhelming Majority of Americans View Minimum Wage Increase as Important Priority for Congress Over Next Year,” www.nelpaction.org.
Small Business Majority, “Small Businesses Support Increasing the Minimum Wage,” April 2013, http://www.smallbusinessmajority.org/small-business-research/minimum-wage/
EPI, “A $10.10 Minimum Wage Would Give Economy (And More Low-Wage Workers) A Bigger Boost,” http://s1.epi.org/files/2013/EPI-10-10-minimum-wage-economy-boost.pdf. (5 pager)
EPI’s State-by-State breakdowns of how the FMWA would help workers in each state (just bring the one-pager for the Senator’s state): http://www.epi.org/files/2013/EPI-federal-minimum-wage-state-impact.pdf.
Fair Pay for Women Requires Increasing the Minimum Wage and Tipped Minimum Wage (main federal minimum wage fact sheet)
ROC Tipped Minimum Wage One-Pager which was sent as an attachment to an email.
Business friendly op-eds:
Holly Sklar, "Minimum wage back to 1950 level on 75th anniversary," distributed by McClatchy Tribune News Service, http://www.businessforafairminimumwage.org/news/00375/mcclatchy-tribune-holly-sklar-minimum-wage-back-1950-level-75th-anniversary
Lew Prince, "The American Dream is built on fair wages," US News & World Report, http://www.usnews.com/opinion/blogs/economic-intelligence/2013/08/09/a-fair-minimum-wage-helps-workers-and-businesses
NELP, October 2013, “The Public Cost of Poverty Wages,” http://www.nelp.org/page/-/rtmw/uploads/NELP-Super-Sizing-Public-Costs-Fast-Food-Report.pdf?nocdn=1.
NELP/Cry Wolf Project, March, 2013, “Consider the Source: 100 Years of Broken-Record Opposition to the Minimum Wage,” http://nelp.3cdn.net/fb518f3647002218a7_a6m6ilt1w.pdf.
EPI, “Raising the Federal Minimum Wage to $10.10 Would Give Working Families, and the Overall Economy, A Much-Needed Boost,”http://www.epi.org/files/2013/IB354-Minimum-wage.pdf (28 pager)
Restaurant Opportunities Center United, “Tipped Over the Edge: Gender Inequity in the Restaurant Industry,” http://rocunited.org/wp-content/uploads/2012/02/ROC_GenderInequity_F1-1.pdf.
Restaurant Opportunities Centers United, “Realizing The Dream: How the Minimum Wage Impacts Racial Equity in the Restaurant Industry and In America,” June 2013, http://rocunited.org/realizing-the-dream/Women and the Minimum Wage, State by State (clickable map shows each state’s minimum wage and tipped minimum wage, along with the share of minimum wage workers who are women, the next scheduled increase in the minimum wage, and any 2013 action on the minimum wage in the state legislature; .pdf chart summarizing the same information is attached)
Fair Pay for Women Requires Increasing the Minimum Wage and Tipped Minimum Wage (main federal minimum wage fact sheet)
Higher State Minimum Wages Promote Fair Pay for Women (uses state-level data to provide more support for our argument that a federal minimum wage increase could help close the wage gap)
Beware The Mythical $10.96 An Hour Welfare Claim
Another welfare myth is making the talk show circuit: Cato Institute says MO welfare mom gets $10.96 per hour in benefits. Malarkey! Find the truth here!
A report published by the Washington-based Cato Institute claims that a Missouri mom with two very young kids “earns” $10.96 an hour by being on ‘welfare.’
This claim is becoming gospel among some of those who want to slash benefits to struggling families.
That $10.96 ‘wage’ puts Missouri in 30th place on the report’s list, way behind Hawaii and Massachusetts but above Alabama and Mississippi.
The report – The Work Versus Welfare Trade-Off: 2013, An Analysis of the Total level of Welfare Benefits by State – came out earlier this month. It made a small splash in the media ocean. The St. Louis Business Journal, for example, posted a very uncritical item and link to the report on their website on August 21st. Across the nation, other media outlets gave the report a bit of coverage.
A couple of weeks later, alas, the Cato Institute’s creative math is popping-up in a second level of stories. The report is now being cited as proof that America is too generous with struggling families and, therefore, able-bodied adults are staying at home rather than take honest jobs. This is the 2013 version of Johnny Cash’s 1970 “Welfare Cadillac” myth.
Let’s start with a quick reminder. The Cato Institute was founded in the mid-1970’s by Charles Koch and friends to promote smaller government, liberty and other values in a conservative way. The current board includes David Koch of Koch Industries and Ethelmae Humphreys of Tamko Products. The institute is considered a charitable group by IRS because its stated purpose is to educate the public and policy makers. In the Fiscal Year covered in their 2011 IRS form 990 they took in close to $40 million: their top dog had total annual compensation of $500,000+. Many of their employees have compensation above $100,000 a year. Cato hosts seminars, publish papers, provides talking heads for cable TV and behaves like most other Washington think tanks. This August’s report is a follow-up to a publication series begun in September 1995.
From this year’s Executive Summary:
The current welfare system provides such a high level of benefits that it acts as a disincentive for work. Welfare currently pays more than a minimum-wage job in 35 states, even after accounting for the Earned Income Tax Credit, and in 13 states it pays more than $15.00 per hour…states should consider ways to shrink the gap between the value of welfare and work by reducing current benefit levels and tightening eligibility requirements.
From the Introduction:
There is no evidence that people on welfare are lazy or do not wish to work. At the same time, however, the evidence suggests that many are reluctant to accept available employment opportunities.
The report calculates the maximum benefits available to a mom with two very young children who qualifies for and receives help from seven basic programs. While it acknowledges that many people do not receive all these benefits, they claim it fair to assume that some do because every program on their list is utilized by at least 10% of the eligible population.
The report’s annual amounts for our mom and kids in Missouri…
$3,504 TANF 12 months at the $292 maximum
$6,312 SNAP The absolute maximum Food Stamp benefit of $526 a month for a family of three
$8,295 Housing A monthly rent stipend of $691.25
$7,092 Medicaid An average coverage cost of $591 per month
$ 935 WIC Vouchers covering mom and both kids
$ 400 LiHEAP Energy Assistance
$ 300 TEFAP Commodity Food, valued at $25 per month
Now, the report does note that in Missouri just 13.3% of TANF households receive housing assistance. It doesn’t say that in St. Louis County, the state’s most populous, the list to apply for housing assistance is closed because they have so many more applicants than available housing units. Still, Cato ‘credits’ our hypothetical mom with being that lucky one in seven and a half who gets a housing stipend.
In a head scratcher, in their summary they give mom $400 in LiHEAP while back in Table 12 they note that the average annual utility benefit in Missouri is $167 per year.
Most people lucky enough to have employer-supplied health insurance have part (or most) of their premium paid by their company. If forced to admit what you make, do you include the premiums your boss paid in your behalf? Here the total value of the cost of Medicaid is attributed as direct income to mom.
Many years ago severe cuts in The Emergency Food Assistance Program caused the St. Louis Area Foodbank and their colleagues to reduce the number of pantries carrying government commodities. As a result, a family visiting Circle Of Concern’s pantry in Valley Park is offered a form to take to Feed My People in High Ridge for that month’s available commodities. Similar arrangements abound about the state. Of course, many families do not ask for the forms and not everyone who gets a form journeys to the second pantry.
Don’t forget that only TANF puts cash in a recipient’s pocket. All other assistance gets paid to third parties – grocery stores, doctors, landlords, utilities and such. And, TANF has a 60 month limit. After five years the benefit becomes $0 per month for most recipients. (By the way, just over 36,000 Missouri families currently get TANF.)
As I mentioned, the report’s authors (Michael Tanner and Charles Hughes at Cato) purposely credit the maximum amount potentially available to a mom with two very young kids. They also torture reality in their assumptions. Within their Note 10 back on page 43, for example,
One factor that increases the amount of SNAP benefits received by our profile family in many states relative to some other calculations is the assumption that our family receives LIHEAP benefit. As explained by the Congressional Research Service, “a SNAP household can use the Low Income Home Energy Assistance Program (LIHEAP) payment (regardless of the amount of that payment) to document that the household has incurred heating and cooling costs. This documentation triggers a standard utility allowance (SUA), a figure that enters into the SNAP benefit calculation equation.” These Standard Utility Allowances are generally higher than the actual utility expense occurred and have the effect of increasing SNAP payments.
Now, in my experience crossing four decades of reviewing information on a few thousand St. Louis area families receiving pantry help and Food Stamps, I seldom found a family with utility bills lower than the standard allowance. In Missouri it gets hot and it gets cold. That SUA is based on, well, a national standard calculation and not Missouri reality.
So, if you are confronted by a believer in the $10.96 an hour myth, point out that the number comes from a Washington think tank and not what’s real here in Missouri.
A Missouri mom only gets $292 to spend where she feels it’s needed. That’s equal to about 40 hours per month at Missouri’s minimum wage of $7.35 an hour. (Feel free to point out that the maximum TANF grant hasn’t been increased since John Ashcroft was governor.) If you add the maximum Food Stamp and TANF benefit amounts ($818 a month for a family of three), mom “earns” about $4.72 an hour equivalent in fulltime wages. The other benefits are more miss than hit.
Or, you could ask the obvious question: if anyone really could get $26,837 in benefits by staying at home and collecting welfare, how do the fast food restaurants stay open when the teenagers are in school?
The kicker: tell that doubter that Missouri’s most utilized benefit program, Food Stamps, today helps a tremendous number of “working poor” families where the adults do have jobs – they just don’t earn enough to escape poverty. Maybe they should apply for jobs at the Cato Institute.
Hunger & Poverty Related Missouri Legislation
May 6, 2013
HB = House Bill
SB = Senate Bill
HCS = House Committee Substitute
SCS = Senate Committee Substitute
SJR = Senate Joint Resolution
SS= Senate Floor Substitute
FOOD STAMPS FOR ALL
SB 346 Shalonn “Kiki” Curls (D- Kansas City) – Not a majority party bill, but the Senate Government Accountability and Fiscal Oversight Committee voted Do Pass on SB 346 thanks to our advocacy! The House version, HB 838 (from Paul Wieland, R-Imperial, a majority party sponsor) has also passed out of committee. This proposal – favored by MASW – would allow those convicted of drug offenses, who have complied with treatment and other provisions, to receive food stamps.
Please contact senators asking them to Perfect and pass this bill on to the House. Both sponsors are also looking for additional legislative vehicles on which these bills could be amended.
FOOD STAMP & TEMPORARY ASSISTANCE RESTRICTIONS
HCS HB 455 & HB 297 Andrew Koenig (R – Manchester) [HB 297 by Keith English (D – Florissant)]
This proposal would force the Department of Social Services to seek a waiver from the federal government to put photos on EBT cards for food stamp accounts. The state would have to provide a card with photo to each member in a household age 16 or older. Rep. English told KMOV-TV this move would only cost $100,000 the first year and $20,000 per year thereafter but would save “hundreds of thousands of dollars.” We disagree. When the cost of staff time, postage and other direct and indirect expenses are attributed to the photo cards, that price is substantially higher. The value of the ‘prevented fraud’ is hard to calculate – many actions described by legislators as “fraud” are actually legal and reasonable (like driving across a state line to buy a product if it will save your family money). We doubt that true savings will be as great as the photo card expense.
This bill passed with 120 votes. It has been referred to the Senate Government Accountability and Fiscal Oversight Committee.
HCS HB 343 Casey Guernsey (R-Bethany)
This collection of punitive and unenforceable rules passed the House with 112 votes – three votes more than needed for a veto override. The bill is now in the Senate: friendly senators do not think they can stop it. The Fiscal Note on this bill warns that it could cost Missouri more than $3.5 billion per year in federal funds for the Medicaid program. The director of the Department of Social Services has told the legislature that the federal government will not approve the numerous waivers to allow this bill to take effect.
The bill is now before the Senate Government Accountability and Fiscal Oversight Committee. It could get a Senate hearing this week. Advocates will be needed to contact state Senators to educate them on the potential cost of this bill.
HB 1040 Steven Cookson (R – Poplar Bluff)
“School age children of welfare recipients must attend public school, unless physically disabled, at least ninety percent of the time in order to receive benefits.” The Kansas City Star and other media have called this proposal ‘mean.’ This approach has not proven to improve school attendance in other states. Anything that makes a desperately poor family more poor actually works against school attendance (by causing evictions, utility disconnection, etc.).
HB 801 Jay Barnes (R – Jefferson City)
Every person covered by MO HealthNet who is convicted of a drug related crime must go to drug treatment if they want to still have medical coverage. This would require a federal waiver.
This bill has been assigned to the Government Oversight Committee chaired by Rep. Barnes.
SB 128 David Sater (R – Barry Co.)
This bill would restrict food stamp use to a list of ‘healthy’ foods, similar to the WIC program: it conflicts with federal regulations. It is opposed by the grocers and other retail associations.
This bill was heard by the Senate Government Accountability & Fiscal Oversight Committee on 3/27.
SB 251 Will Kraus (R – Jackson Co) [Co-sponsor Maria Chappelle-Nadal (D – St Louis Co)]
This bill requires DSS to staff a hotline to take anonymous reports of “suspected public assistance fraud.” Those convicted of fraud would serve 120 days or more in jail unless they make full restitution to the state. This bill caused a stir because of a sensational and erroneous headline and AP article – stating that food stamp benefits could be converted to cash by using an EBT card at an ATM machine.
The Senate amended and passed this bill. It will be heard in the House Government Oversight and Accountability Committee on April 29.
HB 700 Jay Barnes (R – Jefferson City)
The bill to ‘transform’ Medicaid would limit coverage to those with incomes at or below 100% of the poverty level. While some additional families would gain coverage, the net effect could be to have fewer families (and children) covered than are currently enrolled. The proposal would require federal waivers. The revised Medicaid system would not qualify for additional funding from Washington. The Senate leadership said they do not see the bill passing this year. MASW members should continue to push for Medicaid expansion! If we do not win it by May 17, we must demand a Special Session and passage of this win-win-win opportunity for our state.
The House Rules Committee is reviewing the bill.
HB 926 Sue Allen (R – Manchester)
This pair of bills would shift many elderly and disabled patients on MO HealthNet into private prepaid pharmacy and private Managed Care programs. This could cost as much as $26 million in General Revenue.
The Special Standing Committee on Emerging Issues in Health Care heard this bill on 4/17.
HCS HB 536 Burlison
This bill radically reduces the Missouri income tax paid by many business owners. The adjusted gross income subject to Missouri income tax would be reduced by up to 50% (by January 2017). Corporate tax burdens would also be reduced.
The Ways and Means Committee voted “Do Pass” on 3/12.
HB 895 Jeremy LaFaver (D – Kansas City) Not A Majority Bill
This bill would create a Missouri Earned Income Credit equal to 20% of a taxpayer’s federal EIC.
HB 917 Burlison
This bill would allow Missouri taxpayers to exclude 50% of capital gains income from their state taxable income: it would dramatically favor the richest of the rich taxpayers and cause a loss of up to $104 million in revenue.
This bill had a hearing in the House Ways and Means Committee on 4/16. It is expected to be considered in executive session this week.
HCS SS#2 SCS SBs 26, 11 & 31 Will Kraus (R – Jackson Co.)
This bill would reduce the state income tax, replacing some of the lost revenue with an increase in the general state sales tax. The corporate tax rate would also go down, and, business owners would be able to deduct up to 50% of their income from their Missouri income tax calculations. Taxpaying families with an income of less than $20,000 per year would get a new $2,000 income deduction. The House made changes, most notably only allowing some provisions for tax cuts to apply if the state’s revenue increases by $100 million a year. (This bill is seen by many legislators as a necessary reaction to tax cutting efforts in Kansas.) This bill would shift more of the tax burden to working families, especially working poor families. According to the Missouri Budget Project, it is expected to result in a net loss of up to $900 million a year for Missouri.
The House sent the bill, with new amendments, back to the Senate. It could be considered by the Senate this week, so ask your Senate members to vote no. If the bill is Truly Agreed and Finally Passed and goes to the governor’s desk, Gov. Nixon should be encouraged to veto this bill. Watch for updates from MASW in these final days of Legislative Session.
SJR 16 Mike Kehoe (R – Cole Co)
This bill would – upon a public vote – create a new 1% sales tax for 10 years for transportation projects.
This bill has been passed by the Senate. The House Rules Committee voted “Do Pass” on 4/16. The proposal may appear on the ballot in 2014, but there is still internal majority party controversy about this bill, so it’s outcome is uncertain. (The Governor does not get to sign or veto Joint Resolutions.)
UTILITY COST RECOVERY
HCS HB 398 Jeanie Riddle (R – Mokane)
This bill would allow electric utilities to raise their rates, with less Public Service Commission review, to cover infrastructure improvements. MASW is among the groups warning that this proposal could result in significant annual increases in charges to ratepayers without traditional Public Service Commission review.
The Rules Committee voted “Do Pass” on the bill on 4/4. It may come to the House floor for Perfection at any time. Encourage your House member to vote no.
SCS SB 207 Mike Kehoe (R – Cole Co)
As seen on TV (and the Senate companion piece to HB 398 above): This bill would allow electric utilities to add surcharges to customer bills for infrastructure costs without going through the traditional rate change process before the Public Service Commission. There is great concern that this approach could cause bills to rise without adequate oversight. Supporters still have television commercials on this issue running on mid-Missouri stations. MASW has testified about its concerns with this bill and HB 398 and co-sponsored a forum on this topic with the Consumers Council of MO and AARP on 3/29.
The Public Service Commission stated that this bill “would remove a large component of cost analysis in the determination of just and reasonable rates. This is not to suggest the Commission would be unable to review these costs at all…Instead, the ISRS-related [infrastructure] costs would largely be subject to a mathematical review for accuracy.”
This bill is scheduled for Perfection in the Senate this week: Please contact your Senator urging a no vote.
The Economic Justice Task Force is committed to reducing economic injustice and inequality through advocacy and public education.
Goals for 2013
- Support progressive legislation on economic justice issues including (but not limited to) tax justice, predatory lending, Earned Income Tax Credit, subprime mortgage problems, utility rates, tax credits, living wage, and consumer protections.
- Work with MASW chapters and partner organizations to plan public forums on above identified economic justice issues, especially issues of economic injustice related to racial or gender discrimination.
- Co-sponsor conferences and major meetings whenever possible.
- Work with other organizations in support of efforts to reduce poverty and unemployment in Missouri.
Interested in participating in the Economic Justice Task Force? Contact Task Force Chair Angela Roffle.
A list of upcoming meetings is available on the MASW Calendar page.
A list of related web sites is available on the MASW Links page.
Looking for older Economic Justice links and/or documents?