Tuesday, May 10, 2005

A Different Perspective on the Corruption Convictions: Raise the Minimum Wage!

Yesterday’s convictions are most useful in sending a message to City Hall players to do a better job not getting caught next time. The convictions will have little impact on ending the pay-to-play culture that has been a part of city life since long before John Street’s time. This is clearly a problem for city progressives, but also in many ways a red herring.

As distracting and unethical as municipal corruption is, the cost of no-bid contracts, Eagles tickets, decks and even $10,000 cash gifts are not the cause of Philadelphia’s budgetary woes. The real problems in our city have been caused by a shrinking tax base which has just as much to do with an increase in poverty over the past 30 years as it does with population loss.

These are problems that no one knows exactly how to solve. However, avoiding solving these problems because of their complexity is irresponsible, especially for thoughtful, circumspect people like the readers of this and other local blogs who have spent so much time supporting Seth Williams for DA because of his thoughtful and logical approach to a complex issue.

So, I suggest that we, progressive Philadelphians, take the corruption convictions in stride and maintain leadership on the more important issues facing Philadelphia. We must focus our energy progressive candidates, like Seth, and also on progressive legislation and policy ideas that truly move the city forward.

An example of this kind of forward thinking is the minimum wage bill that Council and the Mayor are expected to pass this week sponsored by Councilman Wilson Goode Jr. The bill would raise the minimum wage by 150% for workers employed by the City or City-funded entities.

This is great legislation that can truly improve Philadelphia's future as rising wages mean rising tax revenue which benefits all of us. Further, low-wage workers spend more of their money in their own neighborhoods then higher wage earners which means that an increase in local wages has a huge impact on neighborhoods all throughout Philadelphia.

The bill has the support to pass this week, but we must be vigilant and help guarantee its passage. The Chamber of Commerce and the Business Roundtable here in Pennsylvania and all across the country have been notoriously aggressive in quashing minimum wage increases and are likely to undermine this effort in any way they can.

The most likely strategy they will pursue is to say that increasing the minimum wage in Philadelphia will make our city less competitive with other counties in our region. While many reputable economists have generally disproved the truth of this statement, a simple way to avoid the business community’s trap is to simultaneously support the state bill to raise the minimum wage sponsored by Philadelphia’s own, State Senator Tina Tartaglione and State Representative Mark Cohen. Since New York, New Jersey, Delaware and Ohio have already raised their minimum wage, the state competitiveness argument will fall flat.

Raising the wages of the majority of Philadelphia households who currently pull in an average of $30,000 a year will not only increase our city‘s tax base, but it will also restore a faith in government for low-income people who have been disenfranchised since long before Corey Kemp came to City Hall. Our anger and sense of disillusionment with corruption must not be given more priority because of our privilege than the much more fundamental sense of failure that our city, state and federal government exudes every day to those with out any privilege at all.


At 10:57 AM, Anonymous Anonymous said...

Notwithstanding the benefits of raising the minimum wage, Philadelphia has gotten poorer over the decades because middle and upper middle class people have moved out, not because the minimum wage hasn't been raised.(Thankfully, some of those middle and upper middle class residents are coming back)

At 11:31 AM, Anonymous Chuck D said...

Can we raise some money to hire Ray to post for this blog full-time?

At 11:35 AM, Blogger DanielUA said...

Haha. I think (hope) that we will start to see a lot more of Ray in a couple of weeks.

At 11:40 AM, Blogger Pat Evans/Butcher/Wicks said...

help me win Seth's race and I am all yours. (until I run out of cash-yet another reason to support raising the minimum wage!)

At 11:56 AM, Blogger DanielUA said...


Obviously, I agree with much of what you are saying. And supporting the minimum wage will have an immediate effect on the well being of many Philadelphians. However, it strikes me that instead of attacking symptoms, at some point we need to attack the illness- which to my mind is how ourleaders are selected, and how candidates good and bad are forced to pimp themselves out for cash.

I greatly admire someone like Seth, because he has simply refused to be stopped by all the barriers that have been laid before him. But, if we want to see 100 more of the same type of candidate, we need to bring down the impediments that prevent good people from running. To that end, we need to push for good government reforms, and figure out a way to prevent money from hitting us at all turns.

At 12:32 PM, Blogger ACM said...

The bill would raise the minimum wage by 150% ...

is that correct? my understanding is that the bill would raise the wage (for those covered) *to* 150% of the state or federal minimum, not more than double the current base...

At 12:35 PM, Anonymous Anonymous said...

Yes, the Phila min wage would be $5.15 * 1.5 or $7.62/hr.

At 12:43 PM, Blogger Pat Evans/Butcher/Wicks said...

From the Daily News Editorial :

It will require companies with contracts with the city to pay employees 150 percent of the prevailing federal or state minimum wage, whichever is higher.

For now, both minimums are the same: a paltry $5.15 an hour. If Goode's bill is enacted, it would raise the minimum for certain jobs to $7.72.

At 1:47 PM, Anonymous Anonymous said...

There are many sound arguments for raising the minimum wage of city employees, but arguing that it will improve the city's budget problems strikes me as specious. The "increase" you cite in the tax base resulting from the wage increase will be negligible compared to the expense incurred by the city in paying increased wages. For every additional $2.50 paid by the city in minimum wages, the city will collect only $.10 in additional tax revenue. That's a net loss of $2.40. With respect to non-city employees working through city contracts, bid amounts on city contracts will increase commensurately to recapture all required wage increases. All in all, the wage increase will have a negative impact on the city budget. The best way to increase the tax base is to attract new private sector businesses to the city. This will create jobs, increase wage tax revenue and increase business privilge tax revenue.


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