Americans for Tax Reform has a handy list of all the companies that are hiking wages, handing out millions in bonuses, and making charitable donations. And it is lengthy. In a very short time frame, tax reform has made good on what the Fight for $15 movement promised—provide a direct, positive impact on the well-being of thousands of workers.
Who would have guessed that lessening the tax burden on employers would have positive impact on wages and economic growth?
In contrast, the Fight for $15 has failed to deliver, despite the millions of dues dollars that the Service Employee International Union, along with other unions, have spent on the effort.
Part of the organizations’ failure stems from the fact that artificially raising wages to $15 per hour is a bad idea. Even the liberal-leaning Washington Post editorial board recently published an editorial imploring Montgomery County, Maryland, to not raise the minimum wage to $15.
Further, in real world test cases, the outcome of $15 minimum wage has not been pretty. A National Bureau of Economic Research study found that in Seattle, which recently raised the minimum wage to $15, “some employers have not been able to afford the increased minimums. They’ve cut their payrolls, putting off new hiring, reducing hours or letting their workers go.”
Additionally, a study commissioned by the City of Seattle to monitor the impact of the $15, found the wage increase cost jobs and hours for workers.
While raising minimum wages to $15 is not economically wise, the Fight for $15, a thinly veiled union front group, has had to deal with other setbacks. Despite organizing protests and lobbying efforts, Michael Saltsman, managing director at the Employment Policies Institute, documents the Fight for $15’s losses in trying to raise the minimum wage:
New Mexico Gov. Susanna Martinez vetoed a state wage hike, pointing to its consequences for small businesses. And in Maine, legislators — at the urging of restaurant servers — are poised to roll-back harmful minimum wage provisions passed by ballot measure on Election Day.
Last month, Baltimore Democratic Mayor Catherine Pugh vetoed a $15 minimum wage. She justified her decision by pointing to the impact it would have on city finances and city businesses. City analyses predicted the wage hike would have raised city payroll costs by $115 million over four years. Employers in the city told her they would be forced to reduce job opportunities and move outside city limits if the law took effect.
Also last month, the City of Flagstaff voted to roll back its forthcoming $12 minimum wage after numerous municipal small businesses like Cultured Yogurt dessert shop and Country Host restaurant were forced to close as a result.
In Iowa, state legislators recently voted to set one minimum wage at the state level and eliminate the patchwork of local minimum wage increases around the state. Missouri legislators are working to do the same. Last summer, Cleveland’s Democratic City Council voted against a $15 minimum wage then worked with state legislators to set state preemption on this issue.
Numerous Chicago suburbs, including Barrington, Oak Forest, Rosemont, and Tinley Park, have opted out of Cook County’s $13 minimum wage. Some cities in Santa Clara County in California have also chosen to do the same.
Ultimately, a strong economy is the best path to higher wages. Unions should recognize this and stop wasting member dues on the Fight for $15 movement, which even if it succeeds in raising minimum wage laws is bad news for workers at-large.