The Lobbyists Behind Senate Failure to Advance Minimum Wage Increase

The Lobbyists Behind Senate Failure to Advance Minimum Wage Increase

Twenty low-wage dependent trade groups band together to shut down the Senate's minimum wage hike, although the majority of Americans support raising the federal minimum wage -   May 1, 2014
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Jessica Desvarieux is a multimedia journalist who serves as the Capitol Hill correspondent for the Real News Network. Most recently, Jessica worked as a producer for the ABC Sunday morning program, This Week with Christianne Amanpour. Before moving to Washington DC, Jessica served as the Haiti corespondent for TIME Magazine and Previously, she was as an on-air reporter for New York tri-state cable outlet Regional News Network, where she worked before the 2010 earthquake struck her native country of Haiti. From March 2008 - September 2009, she lived in Egypt, where her work appeared in various media outlets like the Associated Press, Voice of America, and the International Herald Tribune - Daily News Egypt. She graduated from Northwestern University's Medill School of Journalism with a Master of Science degree in journalism. She is proficient in French, Spanish, Haitian Creole, and has a working knowledge of Egyptian Colloquial Arabic. Follow her @Jessica_Reports.


The Lobbyists Behind Senate Failure to Advance Minimum Wage IncreaseJESSICA DESVARIEUX, TRNN PRODUCER: On Wednesday, the Harkin-Miller $10.10 minimum wage increase met its day on the Senate floor. In a 54 to 42 vote, the bill failed to advance--with the vote being split mostly along party lines.

JOHN CORNYN, U.S. SENATOR (R-TX): We all want to see hardworking American families work their way toward the American dream. But we're not going to be able to do that by the federal government setting wages for restaurants, small businesses, and other people across the country.

TOM HARKIN, U.S. SENATOR (D-IA): So the American people are calling for us to pass this bill desperately. Desperately. The time has come--in fact, it's past time--to do the right thing, the morally correct thing, to raise the minimum wage. The time has come to give realistic hope--realistic, not false hope, but realistic hope--to people like Alicia McCrary and so many people in our country who work hard every day, millions of working Americans, to give them a realistic hope that our economic system is not going to continue to leave them further and further behind.

DESVARIEUX: Although independents voted with Democrats, Democrats would still need six Republican votes in order to reach the 60 votes required to advance the bill. Only one Republican voted in favor of the bill, Tennessee Senator Bob Corker.

But not all Democrats are in favor of a minimum wage increase. Home of retail giant Walmart--Arkansas Senator Mark Pryor voiced his opposition to the bill. Although he wasn't present for the vote due to recovery efforts in his home state, he wrote in an op-ed in an Arkansas newspaper that said he supports a state ballot initiative that would raise the minimum wage to $8.50 an hour over three years. That's a sharp contrast to his fellow Democrats' proposal to raise the minimum wage to $10 an hour over the next two years. Pryor was in the minority, since the rest of the senators against the bill were all Republicans.

But with poll after poll showing that most Americans support increasing the minimum wage, why would any Democrat or Republican senator take on such an unpopular position? Institute for Policy Studies economic policy associate Betsy Wood says if you follow the money, you understand how strong lobbying forces outweigh the voice of the American people.

BETSY WOOD, ECONOMIC POLICY ASSOCIATE, INSTITUTE FOR POLICY STUDIES: About 76 percent of Americans in a recent poll said that they support an increase in the minimum wage. So the polls show an overwhelming majority thinks that an increase in the minimum wage is a good idea and something that would be good for workers and for their families. But a small contingent of very wealthy Americans are controlling our process through these large corporate lobbies that spend millions of dollars to defeat commonsense legislation that would help millions of families and workers.

DESVARIEUX: In a letter to senators, 20 trade associations urged members of congress to reject an increase to the federal minimum wage. These associations representing industries like hotels and restaurants wrote about the minimum wage, quote:

"The more expensive something is, the less of it one can afford. This is exactly what will happen if the minimum wage is increased--there will be fewer low-skilled workers hired, other workers will lose hours, and employers will have more incentive to find other ways to be productive, such as using technology or automation where they would previously have hired someone."

Some big names a part of this group include the U.S. Chamber of Commerce, the National Restaurants Association, and the National Retail Federation. These groups have put large sums in the pockets of lawmakers in the form of campaign contributions.

According to the non-partisan Center for Responsive Politics, this group has spent more than $91 million on lobbying just last year. At the very top of the list is the U.S. Chamber of Commerce, which spent about $74.5 million on lobbying in just one year.

Republicans do get the vast majority of donations, with nearly 83 percent of the group's contributions going to the GOP in the 2012 and 2014 election cycles.

One of the most powerful corporate lobbies against raising the minimum wage is the National Restaurants Association. It held its annual public affairs conference this week in Washington. The membership includes big names like Domino's, McDonald's, Chipotle, and 7-Eleven. Protestors confronted the attendees of the conference, demanding for higher wages.


OFF-SCREEN: We will terrorize you like you terrorize your employees.

OFF-SCREEN: You're not worth $10,000 an hour, you punks.


DESVARIEUX: Protestors pointed to a recent study released by the Institute of Policy Studies which found that the top 25 largest corporate members of the National Restaurants Association received more than $200 million in taxpayer subsidies in 2012-2013 through what is known as a tax loophole.

WOOD: We looked at the 25 largest corporate members of the National Restaurant Association and how they're benefiting from both a tax loophole at the top that allows CEOs who are paid in so-called performance pay above $1 million, for that to be an unlimited deducted amount from their taxes for the company. [sic] So companies are getting huge deductions off of their taxes at the very top for performance pay. But these are the same companies that are also lobbying against an increase in the minimum wage for their workers.

DESVARIEUX: At the top of that list was CEO of Starbucks Howard Schultz, who took home $236 million in exercised stock options and other "performance pay" from 2012 to 2013. That translated into $82 million of lost tax revenue from the coffee giant Starbucks.

Schultz says he supports a minimum wage increase. But Starbucks is still a member of the National Restaurant Association, which lobbying against it.

HOWARD SCHULTZ, CEO, STARBUCKS: I applaud the president for taking a stance on raising minimum wage. I'm not sure that the rhetoric around $10 at the federal level or $15 at the state level in Washington is the right number.

DESVARIEUX: These protestors says that $10.10 is not the right number for a living wage and that the Senate should be discussing how to really lift people out of poverty with a $15 an hour wage, and they see the proposed vote by Senate Democrats as a political maneuver.

LARRY HOLMES, ACTIVIST: --maneuver on the part of the Democrats who want to use people's anger over low wages as an election issue in the midterm elections. That's fine, but my interests--and I think that some of the other people here and some of the other low-wage activists around the country--our interest is not just in the elections. We want a real increase. The $10.10 that the president's talking about is not enough, especially over a period of two or three years. Some of us feel that they're proposing that to sort of take the steam out of the low-wage workers movement. We are demanding $15 an hour.

DESVARIEUX: Fifteen dollars may seem like a long shot with Congress dragging its feet for a $10 increase, but protestors say they will continue to expose the hundreds of lobbying interests who are looking to block the minimum wage hike.

For The Real News Network, Jessica Desvarieux, Washington.


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