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roosevelt institute
California's $20 Fast Food Worker Minimum Wage Kicks In
"Fast food companies can afford to pay $20/hour without raising prices or cutting hours," said the California Fast Food Workers Union. "Doing either is a choice. Don't let them tell you otherwise."
Apr 01, 2024
A new California law raising the minimum wage for most fast food workers from $16 to $20 an hour took effect Monday, a move cheered by labor advocates who dismissed—and debunked—claims by an industry reaping record profits that the pay hike would force restaurant chains to raise prices and cut jobs.
The law applies to restaurants at national fast food chains with at least 60 locations and that have limited or no table service. Restaurants inside supermarkets and establishments that bake and sell bread are exempt. Twenty dollars is just a starting point, as a state law also established a Fast Food Council that can raise wages by up to 3.5% annually through 2029.
"The vast majority of fast food locations in California operate under the most profitable brands in the world," Joseph Bryant, executive vice president of the Service Employees International Union, said in a statement. "Those corporations need to pay their fair share and provide their operators with the resources they need to pay their workers a living wage without cutting jobs or passing the cost to consumers."
As the California Fast Food Workers Union noted:
- From 2015 to 2023, California raised the minimum wage by 72%, from $9 an hour to $15.50 an hour;
- While the minimum wage was rising, fast food restaurants in California added 142,000 jobs; and
- The minimum wage has increased every year in California since 2015, and so has the number of fast food jobs in California, except for 2020, when the Covid pandemic hit.
California Fast Food Worker Union also pointed out that "numerous academic studies confirm: When states and cities pass big minimum wage increases, employers either add jobs or there is no or minimal effect on employment."
BREAKING: Today hundreds of fast food workers from across California are in LA to officially launch the California Fast Food Workers Union
We've won a Fast Food Council
We've won $20/hr
Now we're doing whatever it takes to win annual raises, just cause, and more#UnionsForAll pic.twitter.com/pykRKZF0PV
— California Fast Food Workers Union (@CAFastFoodUnion) February 9, 2024
The union highlighted various studies, including one in 2024 that found no fast food jobs were lost when California and New York increased their minimum wage to $15; another in 2018 that showed a slight increase in restaurant and food service employment in six cities that raised their minimum wage; and yet another in 2021 revealing hikes in state and local minimum wages had no effect on McDonald's opening or closing restaurants.
"According to the data, there's no reason why the new fast food minimum wage of $20 per hour in California should mean layoffs or increased prices," Alí Bustamante,deputy director for the Worker Power and Economic Security program at the Roosevelt Institute, said last week. "Profits in the fast food industry are sufficiently high to absorb the greater operating costs and ensure industry workers are paid fairly."
As More Perfect Union noted, McDonald's made $8.5 billion in profit last year, while Burger King's parent company raked in $1.2 billion, and Starbucks enjoyed $4.1 billion in profits.
Additionally, a new Roosevelt Institute analysis co-authored by Bustamante found that the 10 largest publicly traded fast food companies spent $6.1 billion on stock buybacks last year alone. This, while fast food prices soared by 46.8% over the past decade compared with 28.7% for the average of all prices. In 2023, fast food companies charged their customers 27% above their production costs. Critics have accused these and other corporations of "greedflation."
"In 2022, fast food industry employment in California had increased to approximately 553,000 workers—a 20.1% increase since 2014," the analysis notes. "Trends in the California fast food labor market have mirrored the national averages. Yet between 2014 and 2023, the federal minimum wage remained stagnant at $7.25 per hour, while California's minimum wage increased from $9 to $15.50 an hour—further evidence that California fast food firms can readily adjust to minimum wage increases."
The U.S. federal minimum wage of $7.25 an hour has not been raised since 2009, and that amount is worth far less now than it was then due to inflation.
"This is an insult to American workers and bad for our economy," former U.S. Labor Secretary Robert Reich said in a video published Monday by the Gravel Institute.
"It's simply a myth that raising the wage automatically means lost jobs," Reich asserted. "Here's the bottom line: If your business depends on paying your workers starvation wages, you should not be in business."
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Reports Expose Deep Harms of Corporate Tax Cuts and 'Trickle Down' Ideology
"Failing to reimagine a more ambitious and comprehensive use of corporate tax policy prevents us from achieving a more equitable, sustainable, and democratic economy."
Jan 23, 2024
Two new reports published Tuesday by the Roosevelt Institute argue that robust corporate taxation is key to creating a strong economy and improving the well-being of families and children—objectives that have been undermined in the decades since the Reagan era by regressive tax cuts enacted on the false premise that benefits would "trickle down" to the rest of society.
The first report, A Mapping of the Full Potential of U.S. Corporate Taxation to Enhance Child and Family Well-Being, examines what the authors describe as the understudied notion that "increasing corporate taxation will necessarily help children and families by providing additional revenue for essential public services."
That perspective runs counter to what the Roosevelt Institute's second report calls "a 'cut-to-grow' mentality" that rose to prominence in the 1970s and was enthusiastically embraced by the administration of President Ronald Reagan.
"Under this view, the thinking went, it was necessary to reduce the corporate tax rate to grow the economy—and that this growth would allow gains to eventually 'trickle down' from the rich shareholders to the middle class," the report states. "During this time, the corporate tax rate was gradually reduced to 35% before it was dramatically cut to 21% in 2017. These cuts resulted in corporate tax revenues falling to less than 10% of total federal revenues."
"Perhaps more than any other, President Ronald Reagan leveraged mounting backlash to taxation and government spending to dramatically reduce both, regardless of the consequences to American families," the report observes.
"Corporate tax policy since Reagan has been driven by the trickle-down economics narrative that cutting the taxes on 'job creators' will benefit less wealthy U.S. taxpayers."
The decades-long decline in corporate tax rates has severely undermined the federal government's ability to finance critical public goods, from education to childcare.
"Since regressive corporate tax cuts don't significantly increase earnings for working families (through either wage or employment increases), but they do reduce the government's ability to fund family income and care supports, childcare costs—which are already rising—can become a relatively more expensive line item in working parents' household budgets," reads the Roosevelt Institute's first report, authored by Emily DiVito and Niko Lusiani.
"When they can't afford childcare," they added, "parents face the difficult choice of having to cut costs in other places—often on the basic necessities that allow children to thrive, like food, clothing, and enrichment activities—or taking on additional caregiving duties themselves."
At the state and local levels, DiVito and Lusiani noted, "corporations' successful efforts to avoid their full property tax liability devastate public school budgets."
DiVito, deputy director for the corporate power program at the Roosevelt Institute, said Tuesday that "we have a false idea in the U.S. that corporate tax policy is unrelated to equitable social reforms."
"However, strong corporate tax policy is vital to all aspects of a thriving economy," she argued. "And the failing to reimagine a more ambitious and comprehensive use of corporate tax policy prevents us from achieving a more equitable, sustainable, and democratic economy and society for all families."
The new reports come a week after a bipartisan pair of House and Senate negotiators announced a deal to expand the child tax credit (CTC) for three years in exchange for a series of corporate tax cuts. The American Prospect's David Dayen estimated that "in the time period when all the tax credits are actually in place, the business tax changes are five times more costly than the CTC changes."
"Who knows if this deal can pass in time to take effect in the upcoming 2023 tax season, if ever. Sen. Mike Crapo (R-Idaho), the ranking Republican on the Senate Finance Committee, is already asking for changes to make it even more generous to businesses. That's in part a function of the dissembling that there is 'parity' in the deal. The truth is that this is not an equal trade. And it may extend that inequity well into the future."
That warning is in line with the Roosevelt Institute's new research, which argues that a corporate tax code generous to big business fuels inequality by "benefiting capital interests (i.e., business owners, partners, and shareholders) at the expense of workers and their families."
"When corporations enjoy low taxes on their profits, they face a trade-off for how to otherwise disperse them: make investments in the workforce and productive capacity (e.g., raise wages, hire more workers, and/or upgrade buildings, equipment, or technology) or distribute them to shareholders (i.e., pay out dividends and buy back stock to inflate prices). Data shows that executives typically choose the latter."
Reuven S. Avi-Yonah, a professor of law at the University of Michigan and the lead author of the new report on "cut to grow" ideology, said in a statement that "corporate tax policy since Reagan has been driven by the trickle-down economics narrative that cutting the taxes on 'job creators' will benefit less wealthy U.S. taxpayers."
"Such an idea is often offered in tandem with the notion that this is the only way tax policy can help American families," said Avi-Yonah. "But this just isn't true. In fact, this false 'cut-to-grow' narrative has made it very difficult to argue for a more expansive, progressive vision of corporate tax reform—contributing to a decades-long stalemate in efforts toward real comprehensive corporate tax reform."
"Now is the time," he added, "to reverse this trend with a more historically grounded support of the corporate tax."
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Progressives Rip Effort to Insert Dirty Deal Into Debt Ceiling Hostage Agreement
"These dangerous and dirty permitting deals are a matter of life and death for millions of people across our country who are already overburdened by decades of fossil fuel pollution," warned one campaigner.
May 25, 2023
Climate action advocates responded with outraged alarm Thursday to reporting that U.S. President Joe Biden and congressional Republicans may try to strike a "dirty deal" on permitting reforms as part of an agreement to raise the debt ceiling.
The deliberations continue as fears of an economically catastrophic default are growing, with just a week until the U.S. government could run out of money to pay its bills if Congress doesn't increase the debt limit, according to Treasury Secretary Janet Yellen.
"We should not be throwing people and the planet under a gas-guzzling bus just so that polluters can more easily build destructive projects."
Citing two unnamed sources close to the talks, The Washington Post reported:
The emerging deal would ease the process of building the interstate transmission lines needed to carry clean electricity across the country—a top priority for Democrats and a boon for President Biden's climate agenda, said the two individuals, who spoke on the condition of anonymity to describe the private negotiations.
To sweeten the deal for Republicans, the agreement would make modest changes to the National Environmental Policy Act, a 1970 law that requires the federal government to analyze the environmental impact of its proposed actions. GOP lawmakers have long blamed the bedrock environmental law for the yearslong delays that plague new highways, pipelines, and other infrastructure projects nationwide.
The transmission policy would be based on the forthcoming Building Integrated Grids With Inter-Regional Energy Supply (BIG WIRES) Act from Rep. Scott Peters (D-Calif.) and Sen. John Hickenlooper (D-Colo.), the newspaper noted, adding that the agreement "would include only incremental changes" sought by House Speaker Kevin McCarthy (R-Calif.) and fellow Republicans.
House Republicans notably included H.R. 1—their fossil fuel-friendly energy package—in the so-called Limit, Save, Grow Act, the "debt ceiling scam" the GOP passed last month and which established the party's priorities for the ongoing negotiations.
In response to the Post's reporting, Friends of the Earth government and political affairs director Ariel Moger said that "once again, lawmakers are expected to make the unconscionable decision to tack unpopular and environmentally harmful policies onto a must-pass bill. This deal will put communities already suffering from environmental racism at further risk by gutting essential laws."
"We should not be throwing people and the planet under a gas-guzzling bus just so that polluters can more easily build destructive projects," Moger argued. "Biden and congressional Democrats should stand up for environmental justice, reject this dirty deal, and pass a clean debt limit increase."
\u201cWe all know that we need to make the transition to clean energy as quickly as possible, but @POTUS is reportedly considering a #DirtyDeal that would lock in more fossil fuels. Keep fossil fuel handouts out of the debt ceiling deal! https://t.co/vCr7JgmqKW\u201d— Sierra Club (@Sierra Club) 1685042165
Oil Change International U.S. program co-manager Allie Rosenbluth stressed that "these dangerous and dirty permitting deals are a matter of life and death for millions of people across our country who are already overburdened by decades of fossil fuel pollution, the impacts of climate change, and compromised public health."
"The increased exposure to oil spills, gas leaks, air pollution, and water contamination would exacerbate existing environmental injustices and the climate crisis," Rosenbluth continued. "We must draw a red line and say no to Republicans taking our economy hostage to line the pockets of the fossil fuel industry."
“President Biden must enforce a clean debt ceiling package that does not allow for any rollbacks to National Environmental Policy Act (NEPA) or other bedrock environmental laws," she added. "While his recent climate track record has been nothing short of disastrous, it is not too late for him to turn it around and hold true to his environmental justice campaign promises."
The Biden administration has recently come under fire for backing ConocoPhillips' Willow oil project and a liquified natural gas (LNG) proposal, both in Alaska, as well as the incomplete Mountain Valley Pipeline (MVP) in Virginia and West Virginia.
\u201cWe need to do everything we can RIGHT NOW to stop a debt ceiling deal from including dirty permitting reforms that fast track fossil fuels. \n\n@StopBigOil just released this ad targeting key decision makers. Please share and tag your member of Congress!\u201d— Jamie Henn (@Jamie Henn) 1685037069
The MVP is a longtime priority of Sen. Joe Manchin (D-W.Va.), a "coal baron" and recipient of fossil fuel industry campaign cash who only supported the Inflation Reduction Act last year in exchange for Senate Majority Leader Chuck Schumer (D-N.Y.) agreeing to push through permitting reforms friendly to the coal, gas, and oil companies.
Although opposition from frontline communities and progressives in Congress blocked versions of Manchin's "dirty deal" three times last year, he has since renewed his effort, introducing the Building American Energy Security Act—which calls for completing the MVP—earlier this month. A Biden aide said the White House backs the bill.
House Natural Resources Committee Democrats and the League of Conservation Voters highlighted Thursday that 83 lawmakers have signed a letter urging Biden, Schumer, and House Minority Leader Hakeem Jeffries (D-N.Y.) "to oppose ongoing attempts to attach H.R. 1 or any other extreme proposals that gut our bedrock environmental and public laws to must-pass legislation."
\u201c#ThrowbackThursday to yesterday when 83 Democrats sent a letter to @POTUS, @SenSchumer & @RepJeffries opposing the #DirtyDeal.\n\nAs @RepRaulGrijalva said, "Our environment and health are not the GOP\u2019s bargaining chips."\u201d— Natural Resources Democrats (@Natural Resources Democrats) 1685032817
The panel's ranking member, Rep. Raúl Grijalva (D-Ariz.), led the letter and congressional opposition to last year's dirty deals.
"The growing list of my Democratic colleagues and I couldn't be more clear: Our environment and health are not the GOP's bargaining chips," Grijalva said in a statement Wednesday. "Gutting our bedrock environmental laws isn't permitting reform—it's a polluter payout. Speaker McCarthy and his extremist faction need to end this reckless scheme to force their MAGA-manufactured, polluters-over-people agenda on the American people now."
Though Jeffries is on the receiving end of the letter, he made clear Thursday that his caucus won't automatically support a Biden-backed deal, telling reporters that "it's a miscalculation to assume that simply any agreement that House Republicans are able to reach will, by definition, trigger a sufficient number of Democratic votes—if that agreement undermines our values."
\u201c\ud83d\udca1Research should inform permitting reform!\ud83d\udca1Find out what the *data* says about NEPA reviews and causes for delay: https://t.co/3yP63ck9qY\u201d— Kristina Karlsson (@Kristina Karlsson) 1685024109
Meanwhile, the Roosevelt Institute this week published an issue brief by Jamie Pleune, associate professor of law at the University of Utah, debunking the claim that reviews required by NEPA are hampering the transition to renewable energy.
"After examining 41,000 NEPA decisions conducted by the Forest Service over 16 years, we found limited correlation between the intensity of the NEPA process in question and the existence of delays," said Pleune. "Furthermore, some projects that were eligible for expedited analyses encountered delays, while some intensely studied projects were completed quickly. This indicated that the true causes of delay were external to the regulatory requirements of NEPA."
"Reducing analytical rigor or weakening environmental standards, which are some of the permitting reforms on the table in debt ceiling talks, won't address the true blockages to the buildout of renewables," she added. "In my brief, I provide progressive permitting reform, with demonstrated effectiveness, that will strengthen and improve NEPA processes while preserving community engagement and environmental protections."
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