Archives for April 2014

It’s dark days for trying to do local political metacommentary. The election isn’t in enough swing to really make fun of campaign stuff, and the legislature is out of session. So all I get from the GOP caucuses is press releases like this about how people are holding town halls. So instead of making fun of the Republicans, I’m just going to use this Republican press release to air one of my pet peeves about Washington politics. Emphasis mine.

Reps. J.T. Wilcox, R-Yelm, and Graham Hunt, R-Orting, will hold an hour-long telephone town hall for 2nd District residents Wednesday, April 23, at 6:30 p.m.

We have to come up with a more uniform system of labeling where people represent. Seriously, you look at that, and you think, oh, the person who represents Yelm and the person who represents Orting are going to get together and discuss stuff, cool. But in fact, they both represent Yelm and they both represent Orting. I see this all the time, and I assume this is based on where they live, or possibly where their district office is located?

And it seems like the solution is simple enough: Just name the districts after the geography. Then everyone can be from the same place. Also, when people are talking about districts, there will be a name instead of a number, so I won’t have to look at a damn map to have a conversation.

Seriously, the next redistricting commission should get on that.

@GoodJobsSeattle @ @GoldyHA Coalition may reject the idea of health benefits as a part of wage. Larger Seattle nonprof community does not.

— CapitolHillChamber (@caphillchamber) April 17, 2014

Back in Stupidland I sarcastically tweeted back “like that’s believable” to the Capitol Hill Chamber of Commerce’s suggestion that it somehow represents the non-profit community better than the Seattle Human Services Coalition (SHSC). Which apparently offended the chamber’s Michael Wells. You can read the whole stupid, stupid exchange here.

For the record, SHSC—a coalition of hundreds of human services providers, agencies, programs, and individuals—fully supports a $15 an hour base minimum wage “that does not include other forms of compensation.” I later asked Michael if his non-profit championing chamber would accept a straight up $15 minimum wage that allowed a health care deduction only for non-profits?

“Nope.”

Fair or not, the chamber’s claim to be championing the interests of non-profits is simply stupid messaging. It fails the sniff test. It makes them sound arrogant and disingenuous. The chamber should really consider taking my constructive criticism to heart.

Also on Twitter, hipster oligarch David Meinert helpfully suggests that folks might take me more seriously “if you could make a point without all the negativity.”   I suppose he’s talking about posts like this. Huh.

The thing is, politics is an adversarial process. It’s a contact sport. So if you can’t take a few bruises, then get out of the game. I didn’t make these rules—I don’t even necessarily like them. But fuck if I’m going to play with one hand tied behind my back for the sake of not offending people who would congratulate themselves for passing a $15 minimum wage that doesn’t pay $15 an hour.

– Vigil planned for 17 year-old student struck by car, killed in NE Seattle

– There’s your liberal media for you.

– How Football Culture Can Change Rape Culture

– Link’s ridership has increased enough by February to meet it’s yearly projected growth.

– This is an unjust and morally bankrupt system that can be fought by western citizens and governments demanding accountability, including the application of a broad set of international laws that companies must follow regardless of where they site their work or who they contract it out to. Without this, the race to the bottom around the globe will continue.

– It’s time to get worried about the Collectivists

I honestly have no idea what this editorial is trying to say:

THE Legislature already faces the difficult job writing a balanced, education-focused budget when it reconvenes in January. That job got harder two weeks ago with an $80 million bill sent, as if in a time machine, from 2003.

According to a state Supreme Court ruling, the bill is owed to about 22,000 contracted in-home care providers for the state Department of Social and Health Services’ clients with disabilities.

[…] In this case, the state Supreme Court adds to an already hefty bill it imposed in the education-funding McCleary decision, which is coming due. While the court’s job is not to budget, it also does not operate in a vacuum.

Feel free to read all the in-between parts, but it’s not going to help. The Seattle Times editorial board is arguing what…? That the Supreme Court shouldn’t enforce an $80 million judgment against the state? That the Supreme Court shouldn’t enforce McCleary? I presume there’s an opinion in here somewhere.

No, it’s not the court’s job to write the budget. But if the state lacks the financial resources necessary to meet its legal obligations—as determined by the highest court in the state—shouldn’t our editorialists be urging the legislature to write a budget that raises the revenue necessary to obey the law, rather than chastising the court for, um, something?

I dunno, just seems to me like the responsible thing to do.

Well, boo for Governor Inslee hiring a coal lobbyist.

Gov. Jay Inslee has hired a coal lobbyist to direct his policy office, an eyebrow-raising selection for a governor who has insisted on sweeping scrutiny of coal export terminals proposed at Cherry Point, north of Bellingham, and along the Columbia River at Longview.

The new appointee is Matt Steuerwalt, who has been through the revolving door in recent years. He was a top energy/climate adviser to then-Gov. Chris Gregoire, then went to work for the Seattle-based Strategies 360 group.

Of course the policy matters more than the person putting it in place. And later in the piece, his spokespeople make the case that this hire won’t change Inslee’s decision on the coal export terminal. I hope that’s true, but let’s call this a bad sign none the less.

Here’s the part of the post where I mention that you can drop Governor Inslee a line if you’re unhappy with this hire, you can email his office.

I know I promised that yesterday’s post on a “Tip Adjusted Benefit Deduction” would be my last creative stab at proposing a minimum wage compromise that benefits both sides, but I’ve got one more wonky little provision that should be a part of any debate over a so-called “tip credit”: the size of the credit should be indexed to a fixed percentage of the effective state minimum wage for tipped employees, not Seattle’s minimum wage.

Here’s how it would work: Let’s say Seattle set it’s minimum wage to $15 an hour, indexed to inflation, with a maximum allowable “tip credit” set to 50 percent of the effective state minimum wage for tipped employees, currently $9.32 an hour (also indexed to inflation). That would make Seattle’s tip credit $4.66 an hour. Simple.

But because Seattle’s tip credit is indexed to the state minimum wage, it creates within Seattle’s powerful restaurant industry a very strong incentive to politically oppose any effort to establish a tip credit within state minimum wage law. For example, let’s say a bill were proposed in the state legislature to establish a minimum wage for tipped employees set at 50 percent of the state minimum wage. This would effectively halve the allowable tip credit in Seattle to only $2.33 an hour! I’d love to see the Washington Restaurant Association try to maintain unity over that.

It is essentially a poison pill provision aimed at addressing labor’s very legitimate concern that passing a tip credit here in progressive Seattle could set a political precedent that enables the imposition of a tip credit statewide, thus lowering the incomes of tens of thousands of tipped workers outside city lines.

Don’t get me wrong: I oppose a tip credit. I find the arguments in favor less convincing than the arguments opposed. But if we’re debating whether to impose a tip credit we should also be debating the nature of the tip credit itself. I have now proposed a number of variations that could make a Seattle tip credit a helluva lot less worse than the restaurant industry giveaway imposed at the federal level. For example, a tip credit indexed to the state minimum wage for tipped employees as described above, combined with a substantial monthly threshold and exemption, and conditional on meeting strict business and account practices designed to impede wage and tip theft, would have a very different impact than the out-of-the-box tip credit the restaurant industry is demanding.

Both sides would be asked to give a little. Both sides would get a little something in return. That is the essence of political compromise.

Trust me, these series of posts on potential compromises aren’t going over well with my friends at 15 Now, while the folks on the business side of the table continue to pretend that I ceased to exist the second I left the pages of The Stranger. But I know that city council members are still reading me, and they are the ones who will ultimately craft a minimum wage ordinance, not the arbitrarily appointed members of Mayor Ed Murray’s Income Inequality Advisory committee.

If the business community can have the gall to attempt to redefine such a common word as “wage” through their bullshit “total compensation” proposal, then it is certainly reasonable to redefine such a vague and inaccurate term as “tip credit” (which is, in fact, a “tip deduction“) in the service of promoting better economic incentives. Instead of simply opposing or supporting a tip credit, we should take this debate as an opportunity to rethink it.

My sincere advice to both sides as they head into the nitty gritty of final negotiations is to think creatively before digging into an intractable position that triggers a risky winner-take-all confrontation at the ballot box. A modified tip credit that serves to impede wage and tip theft while removing existing economic incentives to push employees into part-time non-benefit work, could actually prove a win-win for businesses and workers alike.

Or maybe not. But it’s worth exploring.

– I can’t imagine city leaders pushing for a freeway through their downtown, but I guess Olympia in the 1950’s is strange.

– TRAP Laws and the Emptying of ‘Roe’

– I’ve probably walked past that bike shop 10000 times. Who could have predicted they’d be a chop shop? Other than I sort of assume that about all bike shops.

– Shoe truthers, sure.

– Why is there a different standard between McAllister and Vitter? Shut up, that’s why.

– Today in “just because you can do something doesn’t mean you should,” it’s the Rattlesnake Rodeo—or, more accurately, the Rattlesnake Pile of Snakes Just Kind of Lying There—in Opp, Alabama. The annual event includes snake races, snake handling, snake milking, and snake touching.

Because voters are stoopid:

Washington state voters support both expanding background checks for gun sales and restricting background checks for gun sales, according to an Elway Poll released Tuesday.

The poll, the first public survey of voters to gauge support for the initiatives simultaneously, shows the pro-background check Initiative 594 is starting the campaign in better shape. But the anti-background check measure Initiative 591 also has support.

… Asked about the initiatives, 72 percent of voters said they would support I-594, while 55 percent said they would support I-591 and 40 percent said they would support both.

I know, I know. Initiatives almost always lose support as the election nears. So this far out from  November, 72 percent support is where the pro-background check initiative wants to be to have a shot at winning, whereas only 55 percent support suggests the anti-background check measure is headed toward defeat.

But still… a majority of voters support contradictory positions. This is just an incredibly stupid way to legislate.

 

It’s also, ironically, my birthday. So celebrate by watching Robert Reich explain why our tax system sucks (for everybody but the One Percent).

When I offered last week my “Five Proposals for Making a ‘Tip Credit’ Less Worse,” I got exactly the sort of response from the business community that I expected: crickets. The restaurant industry really isn’t interested in discussing the pros and cons of the traditional tip credit; they just want it, period. So there wasn’t much risk in proposing compromises that the other side would refuse to consider.

Which is why I have one more tip credit compromise to propose—one which borrows from the arguments made in support of the bullshit “total compensation” proposal—that offers cost savings to employers while removing their incentive to push workers to part-time employment. For want of a better term I dub it: a “Tip Adjusted Benefit Deduction (or TAB Deduction).”

A TAB Deduction is a variation on the traditional tip credit that further limits the credit to an amount not to exceed the cost of providing certain defined benefits. A TAB Deduction would assure that all Seattle workers take home a minimum of $15 an hour in cash compensation, while incentivizing employers to shift involuntary part-time tipped workers to full-time jobs. A TAB Deduction would also be conditional on meeting strict business and accounting practices intended to impede wage and tip theft, while facilitating the investigation and prosecution of claims thereof.

How does the TAB Deduction work?
A qualified employer would be permitted to deduct from its minimum wage obligation an amount equal to the smaller of A) the cost of providing permissible benefits, B) the amount of tips actually received by the employee, or C) the difference between Seattle’s minimum wage and the effective minimum wage for tipped employees under city, state, and federal law.

For example, assume the minimum wage for tipped employees is WA state’s current minimum wage of $9.32/hr, while Seattle’s minimum wage is $15/hr—that makes the maximum TAB Deduction $5.68/hr. Now assume that an employee earns $4/hr in tips and $3/hr in benefits. The employer may deduct the smaller of the three figures—$3/hr—from its minimum wage obligation, with the employee ultimately receiving $12/hr in wages plus $4/hr in tips for a total of $16/hr plus benefits.

Only those benefits defined in ordinance, and in maximum amounts approved by regulators, may be applied to the TAB Deduction. Further, the TAB Deduction would only be made available to employers who follow strict business and accounting practices.

How does a TAB Deduction benefit workers?
While it would guarantee all workers a minimum cash compensation of $15/hr, a TAB Deduction would also modestly reduce take-home pay below what a straight up $15/hr minimum wage might otherwise provide to tipped employees who receive benefits. But the TAB Deduction does broadly benefit labor in two distinct ways:

First, a TAB Deduction removes from employers existing economic incentives to eliminate benefits, or to force workers into part-time work in an effort to cut costs by denying them benefits. In any workplace where average tips routinely exceed the cost of benefits, the labor-cost differential between part-time and full-time work is all but eliminated.

Second, the TAB Deduction addresses our epidemic of wage and tip theft by forcing employers to adhere to strict business and accounting practices (defined in ordinance and approved by regulators) in order to qualify. The TAB Deduction thus serves as a carrot for enticing employers into imposing stricter business practices upon themselves.

How does a TAB Deduction benefit employers?

It saves them money, duh, by permitting qualified employers to deduct the cost of providing benefits from their minimum wage obligation, up to the maximum allowable tip credit.

Conclusion:
Again, my preference would be for a straight-up $15 minimum wage, no tip credit (and certainly no “total compensation,” a proposal that only achieves $15 by totally redefining the meaning of the word “wage”). But if we’re going to talk about compromise, the least we can do is talk about these compromises creatively.

There’s more at stake here than simply the wages of Seattle workers. If we pass a $15 minimum wage, the rest of the state and the nation will look to us as an example. So in a nation where a tip “credit” is already deducted from the incomes of most tipped employees, anything we do to set a precedent for a better tip credit could end up improving the lives of millions of minimum wage workers. Likewise, anything we do to undermine Washington’s position as one of only seven states without a tip credit (or even worse, to set precedent for “total compensation”) could have a dramatically negative impact far outside Seattle’s borders.

That said, I don’t believe that many on the pro-business side of the table are negotiating in good faith, and I don’t believe that they are truly interested in debating compromise. But they are welcome to prove me wrong.

Now that Rodney Tom isn’t running for office, Andrew at NPI has some speculation about the seat.

With Tom gone, the way is now clear for either Hunter or Habib to run. One of them likely will declare for state Senate, and Joan McBride will then be well positioned to run for whichever House seat then opens up. The Washington Senate Democratic Campaign (WSDC) would undoubtedly prefer to have a proven winner as its candidate, so it can direct money and resources into other districts.

I don’t know the district as well as he does, but I’d be wary of the party trying to push her out for one of the current representatives. She got in the race when it was going to be a tough election. The party recruited her, and she stuck her neck out for them. I’m not saying if one of the House Dems runs, she shouldn’t run for their seat, but I hope the party will stay out of it if there is a primary.

Also, I’m not sure that the Senate is better. There’s a good chance that it’ll still be controlled by Republicans, or whatever they call their caucus if there’s one Democrat in it. Especially for Hunter, who has quite a bit of seniority in the House, it seems like it would be a step down.

Want to talk about a $15/hour minimum wage? Want to toast Sen. Rodney Tom’s (R-D-R??-WA-48) decision to retire from the Senate? Want to talk about King County Proposition 1 and mass transit? Then please join us tonight for an evening of politics over a pint at the Seattle Chapter of Drinking Liberally.

We meet every Tuesday at the Roanoke Park Place Tavern, 2409 10th Ave E, Seattle. The starting time is 8:00 pm, but some folks show up earlier for dinner.

Can’t make it to Seattle? Check out another Washington state DL over the next week. The Tri-Cities and Shelton chapters also meet this Tuesday. The Lakewood and South Seattle chapters meet this Wednesday. For Thursday, the Tacoma chapter meets. And next Monday, the Aberdeen, Yakima and Olympia chapters meet.

With 213 chapters of Living Liberally, including nineteen in Washington state, four in Oregon, and three more in Idaho, chances are excellent there’s a chapter meeting somewhere near you.

If there’s one thing I dread about the income inequality debate in general, and the minimum wage debate in particular, it’s those occasional uncomfortable moments when the anti-union, anti-immigrant, anti-semitic Henry Ford is brought up as an icon of demand-side economics. In 1914 Ford famously implemented the $5 Day (about $117 in 2014 dollars), more than twice the $2.25 prevailing wage at the time for a 9-hour auto factory shift. The story goes—and it’s a story perpetuated by Ford himself—that the goal was to pay his workers enough to transform them into car buyers themselves, thus increasing sales.

It’s a great story, and one that neatly illustrates the demand-side arguments. But unfortunately, it’s bullshit. No, the real reason Ford more than doubled his workers’ compensation was that he came to believe that paying higher wages would conversely lower his labor costs. And he was ultimately proven right.

An early 20th century assembly line job was brutal and brutally monotonous work—hour after hour of performing relentlessly quick, repetitive, and often dangerous tasks. For example, in 1916, nearly 200 severed fingers and more than 75,000 cuts, burns, and puncture wounds were recorded at Ford’s Highland Park plant alone.

So as you can expect, morale was low at Ford’s factories, and the turnover rate high. Absurdly high. As much as 300 percent annually. Throughout the year of 1913, Ford hired 52,000 workers in order to maintain an average workforce of only 14,000. Every new worker required weeks of costly training and break-in. Assembly lines sometimes screeched to a halt for want of enough qualified workers. Absenteeism and turnover made it impossible for Ford to keep up production and produce cars at the low prices his business model demanded.

And so when Ford introduced the $5 Day the next year, it was with an eye toward reducing turnover, thus lowering labor costs and ramping up production. And it worked! Turnover plummeted and productivity soared. The rest of the auto industry initially dismissed Ford as crazy, but they all soon followed his example.

And here’s the thing: once the other auto makers matched Ford’s wages, taking away his competitive advantage in the labor market, turnover didn’t revert to the bad old $2.25 days. Better paid workers do a better job. They’re more loyal. More productive. Less likely to call in sick. And less likely to constantly be on the lookout for a better deal someplace else.

Yes, Ford’s $5 Day did help kickstart the trend toward higher wages that ultimately primed the demand side pump on which our modern consumer-driven economy was built. So that part of the story is true, at least in effect, if not intent. But the benefits to Ford were more direct and immediate. Higher wages delivered better workers, and lower labor costs.

And those are the same sort of financial benefits employers bemoaning the cost of a $15 minimum wage have refused to factor into their equations.

Well, it looks like we won’t have Rodney Tom to kick around anymore:

Senate Majority Leader Rodney Tom, a titular Democrat who leads a Republican-dominated coalition, announced Monday that he is leaving the Legislature for reasons of health and family.

Yeah, either that or he has some polling that shows how widely hated he is in his own district. Fucking turncoat.

Republicans have thus far failed to field a viable challenger to Tom, because, you know, he’s basically a Republican. So his Eastside seat sure does look like a strong pickup opportunity for the Democrats and former Kirkland mayor Joan McBride. That said, unless Tim Sheldon can be persuaded to caucus with Democrats next session it’s hard to see senate Dems regaining control in November.

UPDATE: I guess it would be remiss of me to let Tom’s retirement pass without mentioning that one of my greatest regrets as a blogger is that perhaps my favorite post of all time was written in the service of supporting his election to the state senate. My bad.

I suppose because a 15.6 percent cut in Metro bus service would be totally all right:

THE campaign for King County Proposition 1 says 600,000 hours of Metro bus service would be cut if voters don’t approve the measure.

At best, that’s disingenuous. The facts matter when asking voters to increase car tabs from $20 to $60 and to raise the sales tax 0.1 percent on the April 22 ballot.

In fact, Metro has known since at least March 13 that better-than-expected tax collections would reduce the expected cut down to 550,000 hours. That’s because King County’s trampoline rebound from the Great Recession netted Metro $5.4 million more last year than had been projected. Metro is now forecast to receive $13.7 million more in 2014 and $15.9 million more in 2015.

First of all, the editors at the Seattle Times are the last people who can straight-facedly critique the math of others. But Jesus… talk about nitpicking. Are they seriously making the case that voters should reject Proposition 1 because Metro only faces a 550,000-hour 15.6 percent cut in bus service as opposed to the 600,000-hour 17 percent cut threatened? Accept their math and the region is still facing a devastating cut in bus service at a time there is demand to expand it (not to mention our region’s growing backlog of deteriorating roads—40 percent of Prop 1’s revenue goes to road repairs). If this is the strongest case the editors can make against Prop 1, it only emphasizes the need to pass it.

As to modestly rising sales tax forecasts, yeah, that’s true. But sales tax revenue is notoriously volatile. Indeed, this recent uptick in revenue comes on the heels of a 10-year $1.2 billion sales tax revenue shortfall from previous forecasts. So much for forecasting sales tax revenue. And with reserve funds now standing near nil, Metro has little margin of error before a couple bad quarters forces additional cuts.

Look, time has run out. Prop 1 isn’t perfect, but after two years of waiting for Olympia to stop dicking around with our transit funding, this is the only option we have left. Pass Prop 1 or cut 600,000 hours of Metro bus service—give or take a 100,000 hours.