The Restaurant Industry Will Spend Millions to Tell You They Can’t Afford to Pay Workers
What a secret conservative memo teaches us about the desperate fight against a $15 minimum wage
Lee Fang at The Intercept published a secret memo that was circulating among lobbyists and conservative donors. The memo, written by corporate super-lobbyist Rick Berman, is built on the premise that Republican politicians are facing tremendous losses (or “significant erosion,” to use Berman’s euphemism) on the state level in the 2018 midterm elections. Berman believes that Democrats will use the elections as leverage to promote a $15 minimum wage in states around the union.
Berman is probably right about that. Republicans are polling at or near record lows, and unless Democrats really screw up—never outside the realm of possibility, mind you—the GOP could be facing huge losses next year. And as Berman points out, the $15 minimum wage is a tremendously popular issue for Democrats; Americans are in favor of raising the wage. None of this seems particularly controversial.
So what does Berman want to do about this? If you guessed the logical solution—that Republicans should promote the popular minimum-wage increase—you’d be wrong.
No, in fact, Berman is trying to promote a way to fight the $15 minimum wage after Republicans are defeated. His potential campaign is two-pronged:
- First, Berman says conservatives should promote the $15 minimum wage as bad for teenagers.
- Second, he argues that the food service industry should claim that they simply can’t pay the higher wages.
One of the facts that Berman points out in this memo—that “more than 1,000 young adults drop…out of school every day with declining work opportunities”—is a genuine crisis and it must be addressed. However, this is a crisis in our public education system—not an argument against raising the wage. Those young adults who drop out of school have to be able to earn a living wage somehow, and the easiest way to do that is by raising the minimum wage. Keeping their wages at an artificially low $7.25 an hour won’t help them at all.
And not everyone who earns the minimum wage is a young adult. Nearly 90 percent of all American minimum-wage earners are over the age of 20, and one-third are over 40. So why all the concern for young workers?
Berman wants to fracture minimum-wage workers into different sub-groups, using special lower wages for minors and for “apprenticeships,” as part of an obfuscational, divide-and-conquer strategy. Really, it’s better for us all to stick together on a higher wage and fight carveouts whenever they appear. We all do better when we all do better, and we don’t want to give unscrupulous employers more loopholes to exploit.
That second point of Berman’s has been argued for years, and it’s basically already settled in favor of a higher wage. We have plenty of data from Seattle’s minimum-wage increase: restaurants just keep opening, costs have stayed low, and unemployment is about as low as it possibly can be. In reality, many restaurants have to pay much higher than $15 because there’s such a shortage of workers in the region.
Restaurants in Seattle have figured out that when you pay more for workers, you get a higher quality of service. Investing in labor is one of the smartest things any business can do, in terms of costs.
And if you need an illustration of the fact that restaurants could manage their existing costs better, Berman’s report contains a particularly damning example. Berman argues that the restaurant industry should “greatly improve our education” by paying to print “table top coasters, tray liners, coffee sleeves, etc” arguing for a lower minimum wage because costs are too high. The memo comes with a “communication budget,” and by far the single largest expense line on the budget is for “Coaster Printing and Distribution (3 Versions).”
Can you guess how much Berman and the restaurant industry are projecting to spend on coasters that complain about high costs in the restaurant industry?
The answer is $2,200,000. Yes, that’s right: two point two MILLION dollars.
This is a farce. It’s an obscene waste of money that disproves its own point. If you can afford over two million dollars to print how how poor you are on tens of millions of little cardboard circles that you’ll then distribute around the country, you’re not poor.
Setting aside the hypocrisy, this memo is, on the whole, a very good sign. It shows that conservative activists understand that their trickle-down message—the fallacious claim that raising the minimum wage will result in fewer jobs—doesn’t gain traction with voters anymore. So now they’re flailing about, looking for fresh new ways to argue the same tired case that they’ve always been making. As Berman’s memo proves, those arguments desperately need some work.
