Council Member Kshama Sawant Replies to Small-Business Owner Mike Klotz

A Debate Over Wages and Rhetoric

Comments

1
The high road. Well played. One of the best articles on the issue I've read. Thanks Councilmember!
2
We done.
3
"It seems you have missed my recent proposal. . ."

Very diplomatic; Friedman and Meinert would have used the f-word.
4
Best councilperson ever
5
"My position has always been that we should tax big business and the super-wealthy to subsidize those small businesses"

OK, where's that proposal? Where's the law, the tax, collection and enforcement system? Lost in committee? Hiding up your backside? Put a real proposal out there, write the bill and campaign the council to pass it.

Or is that too much like real work?
6
"I have aggressively advocated for tax credits and subsidies for small business"

Talking does not = legislating. Write the bill.
7
She is being trained well by her Union Boss . Note her talking points have moved away from Workers converting Boeing Airplanes to Buses and taking eminent domain over Capitol Hill Mansions to being a supporter of Small business by raising your costs 67% over 3 years instead of One..Yay!!

FYI: Note her Compromise is the same as 15now's Ballot initiative. So she basically said Fuck you to Mike Klotz and Small business owners. Join forces with me and go "Bankrupt" in our efforts to oust BIG Business cause that will show them..LOL

So if our local cafe's raise prices & SBUCKs doesnt thats great for small business how? If the local Deli shutters their doors that is Bad for Subway why?

At least be honest that this is an attempt to get all workers above $15 and you dont give a fuck about Small business. Big Business Operations can scale labor, change suppliers & automate. How are you going to hurt them exactly with our help.

I visualize a charicature picture of Amazon and Walmart Ceo's laughing at Sawant as she gives poison to Small business owners telling them it will cure what ails them.
8
I feel that if the minimum wage were already $15, @7's employers would have been able to hire someone to post who had a decent command of the English language.
9
@7 you really can't read, can you? You write at the sixth grade level, which probably means your reading comprehension is pretty bad, too. You can't be trusted to actually think critically with any accuracy.

@troll. What a profound ignorance of irony you have. Why don't you shut the fuck up, get elected and pass the bill yourself? But you won't. You'll just make anonymous comments on Slog. That'll fucking compel Sawant to follow your agenda. We applaud you for your civic participation. You'll sure show us with your initiative, connections and diplomacy.
10
@8:

Um, maybe this change in the focus of Council Member Sawant's response is because the person to whom she's responding ISN'T James McNerney, Jr.?

And if you ARE "a real live employer" why aren't you, oh I don't know, supervising your employees right now instead of bloviating on a blog?
11
@9

Of course if she did spend her time proposing dead-on-arrival bills that have zero support from any of the other eight council members or the mayor, then the haters would be fuming that she's wasting time tilting at windmills and not serving her constituents working on things that are actually possible.

Concern troll is concerned.
12
Here's a question I have that I haven't gotten a decent answer to. I'm pro-$15 wage and also pro-phase-in, with one big question/caveat on the phase-in portion.

If, as Sawant proposes, we phase in the $15 wage for small businesses and service organizations but make it immediate for big businesses, doesn't that mean that the more talented low-wage workers will gravitate to the big-business jobs? Who is going to make less money for three years working for a small business when they can be making up to 36% more by working for a larger business?

Naturally, this will mean that the more skilled workers move away from the small businesses. The problem is that a small business with <10 employees often needs those employees to be more agile and able to wear multiple hats (i.e., they need the more-skilled low-wage workers).

Outside of the reply, "Well, then, pay them more!" which completely ignores the reality that the phase-in is designed to address, how are small businesses expected to deal with that migration of skilled workers to the larger companies? Wouldn't a phase-in for ALL businesses make more sense for small businesses?
13
@10

He just told Billy to mow a little closer to the rhododendron, so his employee has been supervised enough until his mom call him to dinner.
14
Hmm.
Stilettov you apparently do not see the irony in this whole article. Somehow Small business owners will benefit from a m.w hike while Big Business will not?

That is a tough selling point to make & disingenuous. As for having any influence i would say that if there is any merit to this article it would be Business owners are at the "Table" and have already pushed Sawant toward 3 years.

By my own admonition that is a concession. But its basically moving the gun from being pointed at my head to my knee. So yes..progress is being made!!But not enough and the voters will agree.

As for you socialist trolls.Perhaps you can tell me how this MW increase does not actually promote labor force rotation ie; Discrimination against low skilled workers and minorities. Thats just what we need more white males in Seattle.

15
Councilmember Sawant, while you are a member of the Mayor's Advisory Committee, you are our elected representative FIRST. Your duty is to find resolve within the City Council. The fact that you are already disregarding the process of the Council Committee before work has even started shows that you have no regard for the voters or the institution.
16
@12 "Who is going to make less money for three years working for a small business when they can be making up to 36% more by working for a larger business?"

Lot's of people! Big businesses have been able to offer more to their employees since the dawn of capitalism, and yet small businesses are often harder to get a job with because the culture and environment is often so much more rewarding.
17
Hey PhngWTFname..
Your a winner & real bright shining light of democracy. Gotta hand it to you, you keep taking abuse over and over and over again and come back for more. Its good to see your position is evolving with Kshama's over the past few weeks.
18
@15

Pretty sure disregard for the Seattle Process was quite explicitly part of her platform. Voters who were satisfied with the venerable Process all went for Conlin, not Sawant. Turning into Richard Conlin after taking office would be a slap in the face to her supporters. You dance with the one that brung ya.
19
@17

Another reading comprehension failure. They have free classes you can sign up for, you know. Reading is fundamental, don't you know?
20
Once again, you state that in the history of minimum wage increases, that the economy has thrived, but what's being proposed has NEVER been done before. No one has ever taken the market with the highest minimum wage in the country and tried to increase it by 67%. It's for this reason why this cannot be a simple procedure.

I'm for a minimum wage increase, but people should also know that this movement has NOTHING to do with Seattle, it's the basis for a national campaign. This is great, but it cannot be a simple and flat increase. Without Total Compensation, this minimum wage increase is a threat to our entire restaurant and bar industry, which is one of the leading markets in the country.
21
@20

You don't even have the Mayor's support for total compensation. I think it's dead, Jim.
22
Shorter @20 circa sometime last century:

"My God people, can you imagine how horrible a Minimum Wage/8 hour work day/5 day work week/Social Security/child labor/workplace safety/mandatory overtime/(add your own - it's fun!) plan will be? Such a thing has NEVER been done before!"
23
So the Sawantantistas are concern trolling when she says she'll raise taxes on the wealthy to help small businesses and non-profits?

Well, it's good to know she's lying about that proposal then.
24
@22 I'm referring to the fact that references to minimum wage increases of the past do not hold a lot of weight in this instance because it's a situation that has never been proposed before. All previous large increases to minimum wage in the past have been to bring a low minimum wage up to around the national standard, not to increase the largest minimum wage to twice the national standard.

Again, I'm for an increase, but not without total compensation
25
@24

Washington raised the rate for tipped workers by over 85% in 1989, after I-518. Restaurants showed no sign of distress from this increase in wages. None.

So if you want to go on forever denying that there is any precedent for this increase, you can, but that's not true.

It's a free country. You can say the trickle down economics was a huge success and the middle class isn't disappearing. You can say things that people can see with their own eyes are false. Go ahead and keep saying it.

But when you ask again and again and again why rational people disagree, there's your answer. Your answer is that the tipped wage once jumped by over 85% and no harm was done. Ask again, and you'll get the same answer.

The other thing that's unprecedented: letting real wages fall so low for so long. That experiment failed and it's time to end it.
26
Im still waiting for her to explain how she wants to take over Boeing and start building mass transit vehicles at the Everett plant.

stupid communist should be run out the country.
27
cthulhu proves once again why people making under $40k a year have no business talking about economics.

There is a reason you dont make shit for a salary cthulhu - its because you are stupid fool.
28
The pointed, repeated tossing around of the "67%" figure is meaningless, because it's only one piece of a much larger equation. This does not translate to a 67% increase in operating costs for a business. A business has many costs in addition to labor which will remain unchanged by an increase in minimum wage. Payroll is only a fraction of those costs.

In addition, the 67% is an increase ONLY if you are paying your workers minimum wage. If you are already paying 15.00, there will be no change. If you pay a variety of wages in that scale, you'll be somewhat affected.

If you pay your entire crew minimum wage, then you're going to see the most significant increase, and that's GOOD, because if you are running a business and paying all of your workers minimum wage, your business deserves to fail.

It only hurts if you're currently treating your workers like shit.
29
@17, please for the love of god learn the difference between 'your' and 'you're.' It's not that hard.

30
@27

The reason you're heading straight into a buzzsaw when the voters go to the polls is your undisguised contempt for low wage workers. The real fun starts when the business owners in the anti-15Now campaign have their Mitt-Romney-47-percent-moment and they get caught on tape saying what they really think of minimum wage workers.

In short, thanks for the raise.
31
I'll repeat myself, the previous 85% increase in minimum wage brought a poverty wage up around the national average. What's being proposed is a 67% increase to the highest minimum wage in the country for tipped employees. So no, this is not remotely the same situation.
32
We're all just talking in cycles, lets just pass the fucker and see how it turns out.
33
Blahblahblah Romney ..next comes the ivars poll and then the union poll. Again you are using the same rhetoric over and over again. FYI the mayor is for total compensation so that is a lie. Your not in the negotiation process..so don't act like your a player here. Your way off also on your conclusion about what the council will recommend as well.

Honestly neither side knows how seattle voters will react. I will take my chances with the ballot. And the only contempt for low wage workers is coming from the white guy like you who has never employed or helped be in their life.
34
Sure would be nice if she backed up her assertions with some actual facts or data by citing the examples she is talking about. Just because she says it won't cost jobs or cause inflation doesn't make it so.

State Treasurer, PHD Economist & Democrat who is in favor of raising the minimum wage, Jim McIntire did a study on the effects of the last time Seattle had a large minimum wage increase back in 88/89 when I-518 passed. Of the 100000 who received wages, 11,700 jobs were eliminated because of the increase. Of the almost 12k jobs that were lost almost half were refilled in a couple years, but by older more experienced workers, meaning less opportunity for minority & unskilled workers. Again this study was done by someone who is in favor of raising the minimum wage, they are just being honest about the cost of it, unlike Sawant.

Also during the 3 years after the passage of I-518 Seattle experienced an 3 yr inflation rate of 17.9%, this is 4.6% higher than the national rate over the same period of time. Not to say that raising the minimum wage is the only reason for inflation, but there is a correlation between I-518 & the highest inflation rates Seattle has seen in 35 yrs.

I support raising the minimum wage, but if you look at recent Seattle history it will cost some jobs & cause some inflation.

http://blogs.seattletimes.com/opinionnw/…

http://www.seattle.gov/financedepartment…
35
@33, how can you possibly know which commenter is white or not white? Your (note the usage there) stereotyping is showing. I guess you're (note the usage there) just assuming that anyone who disagrees with you is the wrong race.
36
@33

Having the neighbor's boy mow your lawn two days a week does not make you an employer, and certainly not a "player". You fell for John McCain's "We're all Joe the Plumber" line.
37
@31

It brought the tipped wage up to the national average non-tipped wage. Most the rest of the country kept a tipped wage, which today is still only $2.13/hr.

The reason it is the same situation is that it makes no difference to a Washington restaurant how much employees make in Waterloo, Iowa. All that matters to them is that their 1988 tipped employee payroll added up to X, and after 1991 it added up to 85% more than X. Today the same X is being increased by only 67%, not 85%.

Tipped employees are not their whole payroll, they weren't then and they aren't now. Yet then, they absorbed an 85% increase in that portion of their payroll that went to tipped employees.

Now you're here saying that in 2015, they can't absorb a much smaller 67% increase in the same portion of their payroll. They did it once, but now? What's changed?

And the 85% increase not only didn't drive the industry to bankruptcy, it didn't cause even a ripple. No detectable change at all. But now all of a sudden, for no known reason, a smaller increase in the same portion of their payroll will bankrupt them all.

Except big chains, who have some magic that allows them to defy gravity.

Not plausible. It would be plausible if you had data that showed getting rid of the tip penalty caused any detectable harm. Or any data that showed tip penalty state restaurants, employers, employees, customers, or any body, are better off than in Washington.

We've had no tip penalty for 26 years and everywhere you look, we appear to be better off than those states with a tip penalty.

And of course, nobody says how they're going to monitor and enforce this Seattle total compensation system. Wage theft is bad enough, but now you need a large auditing bureau to keep track of every employers compensation package. Expensive! Who will be taxed to pay for it? What city services will be cut to pay for it?
38
You can vote on it, but no one can repeal the laws of supply and demand.

There will be fewer jobs inside Seattle with a $15/hr. minimum wage. There are jobs that do not make economic sense at $15/hr. or they can be replaced with automation or moved outside the city limits.

The impact will be on the young and the less educated. Those of you who have ever argued against things with a "disparate impact" should check yourselves now. This proposal is racist in the extreme.

I imagine there will be a number of service companies (i.e. janitorial) located in Shoreline, serving clients in Seattle. The Jack-in-the-Box ordering kiosk is going to be a standard item.

I'll have to go to Mountlake Terrace to get a Dick's Deluxe and a chocolate shake. What? You think a labor intensive burger joint like Dick's is going to survive in Seattle. Think again. Their well-known, very generous non-wage compensation package won't survive with a base labor rate at $15/hr. The increase will have to come from somewhere on the non-wage side. And those Dick's employees that are making between MW and $15/hr? They get a raise and lose their non-wage benefits, so they get a small raise, but their Federal taxes go up. What? you expect an employer to raise everyone's wages by $6/hr just because the MW got raised? Not likely.
39
Ms. Sawant - How will the wage increase balance against the cost of living increase?

The absolute # of dollars per hour made by an mw worker are meaningless. What matters is the cost of living for these people.

Case 1 - an mw worker makes $300 a week, and has $20 left over as discretionary income.

Case 2 - an mw worker makes $500 a week, and has $15 left over as discretionary income.

How exactly has the mw worker benefitted?

Every single commodity and service will increase in price, unless you think that "The market charges what the market will bear." is an incorrect axiom.

Guess what, it's an axiom because it's been proven true. Rent, food, etc - all are going to increase in rate to make this 15now agenda a zero net gain for mw workers - *at very best*.

We have yet to hear how simple market dynamics are not going to apply in this case as they have in every other case.

Please, can you at some point address the fact that it isn't the # of dollars made per hour that matters, but rather the purchasing power of whatever dollars are made which matters?

Please? Pretty please, with sprinkles?
40
She still didn't address the issue: will she pursue a tax break for small, local businesses as she promised to help them offset the cost of a higher MW? Will she run that as a parallel ballot initiative?
41
@37 You are right in some of your facts, but the situation is very different. Again, you took a sub-poverty wage for tipped workers and brought it to the national level. This crippled many bars and restaurants and more than 30% of their workforce was laid off as a result.

Many of those workers were hired back over the next few years, but this is still not remotely close to the proposal we're facing today. No matter what the position, raising the minimum wage up to the national standard is a lot different than taking the highest minimum wage and attempting to increase it by 67%
42
Cthulu-you keel touting I-518 saying it didn't cause even "a ripple" in the restaurant industry. Do you have any facts or data to back this up? Because according to State Treasurer, and PHD Economist Jim McIntire did a study showing I-518 caused 11.7% job loss by those affected by the raise & it also coincided with local inflation much higher than the national average. (I already posted the link to the study in comment #34). Just because you and Sawant say no one will suffer in your magic world devoid of basic economic principles doesn't make it so. And I-518 that you keep daying didn't cause a ripple is either a lie or ignorant of the facts that it cost almost 12,000 their jobs and caused inflation.
43
@41:

Citation, please.
44
@41

Citation please, indeed. Thirty percent! That would be a bombshell. If only there were proof of these mass layoffs, you'd have something to make a case with. Maybe just hoping everyone will believe you without any fact-checking?
45
@JimR: San Francisco has the highest minimum wage in the country today anyhow, so nobody is proposing to 'take the highest minimum wage in the country and increase it'.
46
In the background of all of this talk of labor costs for restaurants is the fact that cost of commodities such as beef, pork, eggs are rising due to various factors:

http://www.usatoday.com/story/money/busi…
47
BTW: I'd like to see this $15 an hour happen as fast as possible. We need more jobs in the areas outside of Seattle...Tacoma, Everett, Kent, etc...

Maybe Seattle will stop sucking the air out of the room when it comes to jobs if Seattle widens the lead over the MW in the rest of the state and other areas of the US.
48
Ugh. Can we have a rule that if you don't know the difference between their and they're you aren't allowed to comment?
49
Kshama Sawant- How can you sit here and speak against big corporations while you enjoy all the benefits of being MARRIED to a $100,000.00 + per year MICROSOFT employee?
50
@49

Sshhhh! Stop that now.... we're not supposed to talk about that uncomfortable little fact.
51
This has nothing to do with the topic. Keep your eye on the ball dorimonsonfan! Hey wait. . . this is a Dori "change the subject" trick.
52
@51 Kshama Sawant enjoys a very comfortable lifestyle on the backs of 16 year olds making 47 cents an hour working 15 hour shifts assembling controllers for the Microsoft XBOX in China. You dont see any hypocrisy there? You think she is a good spokesperson for social justice?
53
@52 come on man. They've been separated for years and she receives no compensation from him. She was making a living as a part time econ professor at a community college. Go away troll.
54
@53

The reason nobody gets the satire is that so few Seattleites have ever heard of Dori Monson.
55
Just want to add, from the perspective of a Portlander who appreciates what Seattle is doing here … that Kshama Sawant is proving to be a forceful advocate for the kind of ideas that could bring large numbers of disenfranchised people back to the polls. It's been a while since I've seen an elected leader speak so eloquently and persuasively about what a more democratic economy would look like, and how to use democracy to achieve equity.
56
@53 How do you know she receives no compensation from him? Do you gave aaccess to her bank accounts? They are not divorced so anything he is currently making from big evil Microsoft is going to be 50% hers at some point.
57
@56 feeling scared there? Your slime needs a little more stretch in it if you want it to reach, but honestly, a good hard look in the mirror and some deep breathing exercises will probably do more to ease your anxieties.
58
@28 You are a moron with zero sense about business , what does the employer who has people making from Minimum wage to 20$ an hr do after all the minim wage people are moved to 15$ All his people making 15$ to 20$ will have to be moved up as well. Duh!
59
Well written, intelligent, non-inflammatory article addressing facts. Not poorly written rhetoric from a multiple dive diner owner with an agenda...yes, Dave Meinert. His daily rants on Facebook and in The Stranger about Ms. Sawant and 15 Now are soley to keep his profit margin up. Meinert makes a lot of money, but he fails to discuss this issue. It's great to read an article that is well reasoned and believable. People like Meinert are twisting this campaign to make it about themselves. Sawant is looking at the big picture: companies profit off the low wages of their workers. Thank you Stranger for running this article.
60
For someone who claims to hate the 1% she sure is doing a lot to ensure they will be the only ones who will be able to hire anyone in Seattle.
61
"Fortunately, a vast body of evidence from past minimum wage increases, in Seattle and Washington State and elsewhere, demonstrate this isn’t what happens."

Really? VAST body of evidence demonstrates?

San Jose, fast food stats after a 30% increase?
WA mincrease for tipped employees '89?

I am not reassured by her words here.

62
@61

Just because you didn't look for evidence doesn't mean there isn't any evidence. Here you go:

Study - Why Does the Minimum Wage Have No Discernible Effect on Employment?:

http://www.cepr.net/documents/publicatio…

"Economists have conducted hundreds of studies of the employment impact of the minimum wage. Summarizing those studies is a daunting task, but two recent meta-studies analyzing the research conducted since the early 1990s concludes that the minimum wage has little or no discernible effect on the employment prospects of low-wage workers."

Study - Earnings and Employment: The Effects of the Living Wage Ordinance in Santa Fe, New Mexico:

https://bber.unm.edu/pubs/SantaFeEarning…

"The most controversial and hence interesting conclusion suggested by the analysis is that large businesses in the retail and accommodations and food services sectors increased both employee earnings and employment relative to large Albuquerque and small Santa Fe businesses after the LWO. This increase was somewhat lower for female and youth workers, though still an increase relative to large Albuquerque and small Santa Fe businesses. Certainly the data do not suggest that the increase in the minimum wage had any negative effect on these two industries or on earnings and the number of jobs as a whole."

Study - Minimum Wage Shocks, Employment Flows and Labor Market Frictions:

http://www.irle.berkeley.edu/workingpape…

"Clearly, minimum wage policies substantially reduce turnover and increase job stability, even without affecting overall employment levels for highly affected groups, such as teens. An important proportion of this reduced turnover seems to occur by reducing job-to-job transitions, indicating the presence of frictional wage dispersion. The likely reduction in flows to unemployment suggests the minimum wage also affects firm decisions to lay off workers and search anew, versus retain an existing match."

Study - Minimum Wage Channels of Adjustment:

http://www2.gsu.edu/~ecobth/IZA_HKZ_MinW…

"Further, our study does not find evidence of clear-cut employment losses – even over three years and a 41% increase in the MW."

If you're truly concerned about increasing the minimum, please read these studies.
64
The takeaways from the trolls and haters here about increasing the minimum wage is:

* People deserve to work and be in poverty because business owners have unsustainable business models.

* If you wave your hands, studies can be ignored.

* Washington State's multi-year experiment in having the highest or among the highest minimum wage in the country in the face of a terrible economy counts for nothing.

* People keep citing a 67% raise when even the complaining business owners note that many of their employees make well above Washington minimum wage, and thus the disparity will be much smaller or very small.

And nobody seems to mention the health-care subsidies which boost the real take-home wages of many workers and could allow businesses to drop healthcare coverage in some cases while still allowing their employees to come out far ahead (with portable health insurance instead of the expensive COBRA post-employment coverage), thus freeing cash for increasing wages.

65
@62

I've totally read all of those.
66
Has there ever been a psychological evaluation of those who employ?(and those who wish to employ?):If so,then I wouldn't be surprised if they discovered all employers are sociopaths! ;D --- http://www.psychologytoday.com
67
@65

Cool. So you forgot to list them, then?

Don't forget about these:

http://www.raisetheminimumwage.com/pages…

Or this:

http://www.epi.org/publication/bp178/

"Over 650 economists, including five Nobel Prize winners and six past presidents of the American Economics Association, recently signed a statement stating that federal and state minimum wage increases 'can significantly improve the lives of low-income workers and their families, without the adverse effects that critics have claimed.'"

It's disingenuous to claim that there isn't significant evidence showing minimal negative effects in employment when raising the minimum wage. I hope this information can finally reassure you.