Tonight is gubernatorial debate night, so I’m pretty sure this blog post will fly under the radar. I myself will be live-streaming the County Executive debate, and if I’m not fed up by that point, I’ll catch the Jealous vs Boss Hoagie debate on YouTube on the way home, or on a commute (thanks, YouTube premium!)
Nevertheless, I do feel like releasing a relatively short blog on a point that will undoubtedly come up during one of tonight’s debates: the importance of acknowledging labor issues in the discussion of economic development.
First, I’ll stand consistent in my opposition to the influence of money in politics. This stance applies to both corporate money AND union money. I don’t think corporations or their lobbyists should have disproportionate financial influence on our legislation, and I would say the same about labor unions as the Right often makes that point. This if fair. That being said, I do not view a candidate’s having been endorsed by labor unions as the same as being “financially beholden” to them. This summer, The Washington Post tried to make this argument, and journalist, activist, and friend Ben Spielberg adeptly refuted it.
There are multiple misconceptions among so-called “fiscal moderates” in labor-management discourse. Some throw out the glib stereotype that advocates of pro-labor legislation “don’t understand economics,” or “just want free stuff” (easily refuted – isn’t the whole point of being “pro-labor” that we’re on the side of those who work for a living?) More cogent arguments address a local jurisdiction’s competitiveness, arguing that “business-hostile” practices would force businesses to pack up and move elsewhere (such as Virginia). I’ve argued against this point in a Progressive Maryland blog about the $15 minimum wage.
Perhaps the strongest argument fiscal conservatives make, however, is that some pro-labor proposals end up hurting those whom it intends to help.
Let’s take the minimum wage argument, which is twofold. If the minimum wage is too high, certain businesses would have to lay off workers, and $15 per hour is not enough to live on anyway. My response, however, is not that we need to scrap the idea altogether; it’s that the minimum wage is an optimization problem.
$15 is not an arbitrary number. It’s a thoroughly estimated threshold at which businesses can still thrive and while giving a significant boost to employees trying to pick themselves off the ground. It is not ideal for either side. No one is denying that smaller businesses in particular may need to look elsewhere to maintain profitability in the interim. This is why pro-labor legislators are also looking into incubators and other assistance initiatives to help local businesses grow. Personally, I’d like to see developers and property owners make more of the cuts so small business owners wouldn’t face such high rents, but that’s a whole other issue. From the labor angle, it is also true that $15 is not a livable wage, but that doesn’t mean it does not help. Anyone who is familiar with the phrase “it’s expensive to be poor” will understand the mounting costs of finding oneself behind in rent or utilities or car payments. A higher minimum wage enables a working person to fall less in the hole while they pile on the hours, seek higher-skilled professional training, and apply and interview for higher-paying jobs.
This brings me to the greater point I’d like to make: that those who prioritize the interests of management over the interests of labor, claiming that pro-labor legislation would end up hurting those it seeks to help, underestimate the intelligence of our labor force. Employees know full well there is a tipping point, and that there is a figure too high, which would cause a small business to make layoffs or shift cuts. They also don’t want to lose their jobs. Sometimes they’ll even take the more “fiscally conservative” position. As an example, the District’s Initiative 77 on tipped wages actually met mixed support among DC’s waiters, likely dependent on how much they thought their tips might be affected as a result. Last year’s testimonies by minimum wage laborers before the Montgomery County Council, however, showed overwhelming support for the Fight for $15. What I would take away from their arguments, is that labor voices should be trusted. When labor has a voice in local government, we would have a better chance at working out the optimization problem together. We already hear a fair amount from the Chambers of Commerce, and it’s only fair to bring both management and labor to the table, as both sides would have a close relationship to the issue.
This reasoning also applies to the much-demonized public employee unions. While some may concede the necessity of private sector unions, public sector unions are often equated with corruption, “big-government” spending, and inefficiency. A common criticism of giving public employee unions a seat at the table in County government is that it would be a self-serving conflict of interest – public sector employees manipulating legislation to give themselves a raise amid a budget shortfall.
The truth is, just as the minimum wage private sector employees don’t want to lose their jobs, public sector employees also have a vested interest in a sustainable County budget. The public sector unions are not dumb; they know what would be asking for too much, and they also want to minimize layoffs while maximizing efficiency. While some kneejerk anti-tax, small government-absolutist would prefer a slice-and-dice approach, a truly balanced position would be to listen to the public unions and negotiate to figure out the government employee version of the labor-management optimization problem. It is in no one’s interest to have an economic crisis brought on by unsustainable and inefficient spending – least of all the unions.