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How the Dems’ “Raise the Wage Act” Would Work

Workers rally for a $15-an-hour minimum wage outside a McDonald’s on Chicago’s South Side in 2014. (AP Photo/M. Spencer Green)

The “Fight for 15” got a federal air kiss today. Senator Bernie Sanders (I-Vt.) and Senator Patty Murray (D-Wash.) introduced the Raise the Wage Act of 2017, which would bring up the hourly minimum wage in the U.S. to $9.25 immediately, and hike it to $15 by 2024, and bring up pay for tipped workers.

As The Washington Post is quick to note, Republicans control Congress and so the bill is “largely a messaging vehicle, with no chance of passage.” But its support among Democrats highlights an interesting shift.

The last version of the Sanders bill, 2015’s Pay Workers a Living Wage Act, had just five co-sponsors. The new bill counts 22 co-sponsors, including Senate Democratic leader Chuck Schumer. Just two years ago, Schumer resisted the $15 minimum wage proposal, instead co-sponsoring Murray’s legislation for a $12 wage — “a winner issue for us,” according to Schumer.

The Post categorizes that support as the “latest example of the Democratic Party’s leftward shift” since Hillary Clinton was defeated in the 2016 presidential election.

Think tank Economic Policy Institute offered its breakdown of the benefits of Sanders and Murray’s bill. The EPI dubs itself nonpartisan, but it is affiliated with (and has received funding from) the labor movement.

According to an EPI fact sheet, the bill is a response to ground-up advocacy taken on by cities and states in the wake of the fast-food workers strike in 2012. So far, California, New York and D.C. have approved raising their minimum wages to $15 an hour and Washington, Oregon, Colorado, Arizona and Maine have approved minimums in the range of $12 to $14.75. Some of the cities on the front line of the fight (even before 2012) have included Seattle, Phoenix, Los Angeles and San Diego.

The EPI sees the bill as all sweetness and light, stating that it would “lift pay for 41 million workers — nearly 30 percent of the U.S. workforce,” “begin to reverse decades of growing pay inequality between the lowest-paid workers and the middle class,” and “generate $144 billion in higher wages for workers and would also benefit their communities.” It would also be a boon for women and people of color, in the EPI’s eyes.

Quantifying the economic impacts of raising the minimum can be a tricky business, of course, as Johnny Magdaleno wrote for Next City last year.

Amid any debate about raising the minimum wage — whether at the city or state or federal level — there are typically two camps. Proponents say higher wages lead to improved standards of living that come back full circle to support local economies. Opponents say delivering bigger paychecks forces employers to cut costs and services and can damage a small business’s bottom line.

Different studies seem to support both of those theories. And researchers have tried to measure the truth of each by separating the federal minimum wage hike from the Great Recession to measure its impact, a formula that is “enticing to researchers because it’s like a perfect petri dish for two economic theories,” Magdaleno wrote. But one possible problem is that they’re working with data on the national level, looking at a “huge economic collapse” while hundreds of state and city policies were also being enacted — any one of which could potentially skew results.

Still, the Fight for 15 obviously has momentum. Clinton offered support for the fast-food workers strike on the campaign trail. However, she ended up backing a $12 minimum wage — a move that drove (yet another) wedge between her and Sanders, who supported $15.

“History has outpaced Secretary Clinton because all over this country people are standing up and saying $12 is not good enough,” Sanders said during a debate with Clinton last year, The Post reports.

Apparently, he’s not backing down from that statement — and Democrats seem to be backing him.