Flagstaff Council To Join Minimum Wage Lawsuit?


Flagstaff Council To Join Minimum Wage Lawsuit?

     By Councilman Jeff Oravits

On May 5th, the Flagstaff City Council will hear a request to join in a lawsuit against the state of Arizona to allow Flagstaff, and any Arizona town or city, to set its own minimum wage.  The suit was brought forward by the Flagstaff Living Wage Coalition, a group headed by Eva Putzova, a member of the Flagstaff City Council.
If Flagstaff is allowed to raise its minimum wage, what do proponents propose as Flagstaff’s new minimum wage?   Some groups, like Fight For 15, are pushing to “increase base salaries to $15 per hour.” Arizona’s current minimum wage is $8.05 per hour. What effect would nearly doubling the minimum wage have on our economy? 
This isn’t just a Flagstaff issue. As the attorney for this cause stated recently, this push is statewide. 

“There are voters and advocates who want to see this in Phoenix, Tempe, Tucson and all around the state,” said attorney Shawn Aiken, who, along with attorney Mik Jordahl of Flagstaff, is representing the Flagstaff Living Wage Coalition. “We want to get it on ballots as soon as we can get this lawsuit resolved.”  (AZ Central, April 14, 2015)

Ms. Putzova ran her campaign for council on a platform of “shared prosperity” and “living wages”. If the City joins the lawsuit, who will determine what is a “livable wage” and how high will that minimum be?  What will be the impact on businesses and ultimately on the cost of goods and services as new higher wages inflate through the economy?  Will the long term impact of higher wages backfire and just create higher costs for everyone, especially the very people proponents claim they are seeking to help?  Will new businesses avoid places like Flagstaff in favor of lower wage areas causing further employment pressures?
I want to hear from the community and residents of Arizona on this issue. What are your thoughts?  
You can also email the entire Flagstaff City Council at council@flagstaffaz.gov
Respectfully,
Councilman Jeff Oravits
joravits@flagstaffaz.gov
928-213-2015
The meeting discussing the lawsuit is open to all. 
May 5th, 6:00PM.
Flagstaff City Hall
211 West Aspen Ave.
It will also be streamed live 

19 thoughts on “Flagstaff Council To Join Minimum Wage Lawsuit?

  1. As a business owner who already pays higher than minimum wage–$12.00 is our lowest starting pay–I would naturally benefit from an increase in minimum wage. It would create higher barriers to entry for young entrepreneurs that are tough competition. It would eliminate local smaller competitors who provide the same services cheaper by using laborers paid minimum wage but who typically aren’t employable at larger companies for various reasons. It also provides a valid argument for raising prices.

    I’m against increasing minimum wage for all the reasons listed above but it won’t hurt me, or any of the crony capitalist corporations, if ultimately passed. A dramatic increase in minimum wage hurts the very same people it’s advocates portend they want to help. Maybe my 12.00/hr. employee will see three more dollars an hour in pay but that will immediately be wiped out by the 10% increase in prices they’ll pay everywhere else.

    But I’ve grown tired of arguing with the advocates of increasing minimum wage and their ignorant adherents. How stupid am I to argue for the greater good when the ideas of the insincere give me better competitive advantage and I don’t suffer the derision of the community by being in opposition. I should be thanking Eva and her accomplices.

    1. I’m not sure the discussion is raising the minimum to $15 but just raising it. I compliment you on paying $12/hr. Does paying $12/hr mean you charge more than your competitors?

      1. Doctor, did you have to raise your fees over time to compensate for some increase of costs of doing business?

      2. A compliment isn’t deserved. The rate we pay is based on our business model. It’s simple supply and demand–there is a small supply of excellent workers which increases their value. A valuable employee is always in play and is often solicited by our competitors which means it’s in our best interest to provide good pay and a good work environment. Anyone who takes credit for market realities is disingenuous.

        Increasing your value in the marketplace is the most important ingredient for fulfilling the American Dream. In my +38 years of working I’ve noticed that the most successful in their careers increased and leveraged their own skills rather then relying on intervention by govt. or a union to increase their lot. Eva and her ilk are just pandering to curry favor and appealing to the worst part of our character, not the best.

    2. So if a person is more productive, they should NOT be paid more for their higher productivity? If you think so then you are against what most see as part of the American Dream of working hard and being paid for your hard work based on your productivity (merit). Raising the minimum wage is all about paying workers for the increased productivity they have been doing since the 80’s but were not being paid for. The wealthy .01% took the higher profits their more productive workers made for them and redistributed these to themselves instead of paying their workers for their increased productivity. That’s wrong and since the companies won’t do it in their own, workers feel they have to look to their government to make them do it. That’s all this is. It is that simple.

      1. Your talking points do not support reality, only an ideology. If merit is to be properly compensated, then advocate for hard work, excellence in behaviour and work ethics on an individual basis: this is how one can rise above the average, and advance without limits. The blanket assumption that everyone works hard and everyone deserves equal outcome has resulted in a few pulling the cart, and many taking a ride – where, you say? In socialism.
        Results? As Winston Churchill put it, the equal sharing of misery.
        (Might be helpful to check out the authors I suggested).
        When wages are determined by government edict, it is statism, it is socialism. If you think I’m protesting too loudly against that (I guess only the left may do so), you ain’t seen nothin’ yet.
        You don’t have to agree with me, but may kindly allow that I can smell socialism and its various evil manifestations from afar.

      2. Actually, Gabor, my talking points are based on statistics you can find easily online. Productivity overall in this country has gone up but wages are flat.

        http://www.motherjones.com/politics/2011/06/speedup-americans-working-harder-charts

        http://www.epi.org/publication/ib330-productivity-vs-compensation/

        What you are missing is this: these statistics are all about individuals who have been working their butts off. A huge majority of people are working harder and producing more but they are NOT getting paid for their higher productivity. This is not socialism; these statistics represent ALL working people in this country so the freeloaders you think are there are fewer than you can imagine. The myth of the lazy American worker is not born out by the numbers. But don’t let those pesky facts dissuade you from your belief that I am espousing socialism. Even though I am not; I can see you have your mind made up.

        What I know (because I am old enough to remember) is that before 1980’s, government had regulations on companies preventing them from offshoring their profits or cutting out worker’s pensions or keeping wages flat when productivity went up. Somehow our country managed to prosper and there were lots of jobs and OH MY, families could live WELL on ONE income! Imagine that! And it was not under socialism; it was under regulated capitalism. De-regulation allowed companies to rob workers of their fair share of the profits they made for their employers; how is it socialism to want people to get fairly paid for their increase ACROSS THE BOARD, of productivity? It isn’t. If companies would be fair to their workers government regulations wouldn’t be necessary but greed has a way of making people do the wrong thing unless laws prevent it.

        Socialism is about government owning business; that’s not the same as government regulating minimum wage, not even close.

  2. The one thing more despicable than a Marxist is a Marxist agent provocateur in a free society.
    Mik Jordahl is another radical leftist, an ACLU co-conspirator, who has sued the state before.
    Putzova, whose group is suing now, must recuse herself from this matter; indeed, not even allowed to propose this action – how shameless (and how Marxist) is it to blatantly use your office for your personal political agenda.
    Maybe the Attorney General should be informed of this.
    BTW: there is zero pro argument for this stupid agenda, and plenty of cons. Primarily, because it is a CON job.

  3. For those who say raising the minimum wage will hurt businesses, the following research articles say otherwise.

    Lawrence F. Katz and Alan B. Krueger, “The Effect of the Minimum Wage on the Fast Food Industry,” Industrial Relations Section, Princeton University, February 1992.

    David Card, “Using Regional Variation in Wages to Measure the Effects of the Federal Minimum Wage,” Industrial and Labor Relations Review, October 1992.

    David Card and Alan Krueger, Myth and Measurement: The New Economics of the Minimum Wage (Princeton, NJ: Princeton University Press, 1995).

    David Card and Alan B. Krueger, “Minimum Wages and Employment: A Case Study of the Fast-Food Industry in New Jersey and Pennsylvania: Reply,” American Economic Review, December 2000 (in this reply, Card and Krueger update earlier findings and refute critics).

    Jared Bernstein and John Schmitt, Economic Policy Institute, Making Work Pay: The Impact of the 1996-97 Minimum Wage Increase, 1998.

    Jerold Waltman, Allan McBride and Nicole Camhout, “Minimum Wage Increases and the Business Failure Rate,” Journal of Economic Issues, March 1998.

    A Report by the National Economic Council, The Minimum Wage: Increasing the Reward for Work, March 2000.

    Holly Sklar, Laryssa Mykyta and Susan Wefald, Raise The Floor: Wages and Policies That Work For All Of Us (Boston: South End Press, 2001/2002), Ch. 4 and pp. 102-08.

    Marilyn P. Watkins, Economic Opportunity Institute, “Still Working Well: Washington’s Minimum Wage and the Beginnings of Economic Recovery,” January 21, 2004.

    Amy Chasanov, Economic Policy Institute, No Longer Getting By: An Increase in the Minimum Wage is Long Overdue, May 2004.

    Fiscal Policy Institute, States with Minimum Wages above the Federal Level Have Had Faster Small Business and Retail Job Growth, March 2006 (update of 2004 report).

    John Burton and Amy Hanauer, Center for American Progress and Policy Matters Ohio, Good for Business: Small Business Growth and State Minimum Wages, May 2006.

    Paul K. Sonn, Citywide Minimum Wage Laws: A New Policy Tool for Local Governments, (originally published by Brennan Center for Justice) National Employment Law Project, May 2006, includes a good summary of impact research.

    Liana Fox, Economic Policy Institute, Minimum Wage Trends: Understanding past and contemporary research, November 8, 2006.

    Paul Wolfson, Economic Policy Institute, State Minimum Wages: A Policy That Works, November 27, 2006.

    Arindrajit Dube, Suresh Naidu and Michael Reich, “The Economic Effects of a Citywide Minimum Wage,” Industrial & Labor Relations Review, July 2007.

    Jerold L. Waltman, Minimum Wage Policy in Great Britain and the United States (New York: Algora, 2008), pp. 17-19, 132-136, 151-162, 178-180.

    Sylvia Allegretto, Arindrajit Dube and Michael Reich, Do Minimum Wages Really Reduce Teen Employment?, Institute for Research on Labor and Employment, Univ. of CA, Berkeley, June 28, 2008.

    Michael F. Thompson, Indiana Business Research Center, “Minimum Wage Impacts on Employment: A Look at Indiana, Illinois and Surrounding Midwestern States,” Indiana Business Review, Fall 2008.

    Hristos Doucouliagos and T. D. Stanley, “Publication Selection Bias in Minimum-Wage Research? A Meta-Regression Analysis,” British Journal of Industrial Relations, vol. 47, no. 2, 2009.

    Sylvia Allegretto, Arindrajit Dube and Michael Reich, Spacial Heterogeneity and Minimum Wages: Employment Estimates for Teens Using Cross-State Commuting Zones, Institute for Research on Labor and Employment, Univ. of CA, Berkeley, June 25, 2009.

    Arindrajit Dube, T. William Lester and Michael Reich, Minimum Wage Effects Across State Borders: Estimates Using Contiguous Counties, Institute for Research on Labor and Employment, Univ. of CA, Berkeley, August 2008.
    Published by The Review of Economics and Statistics, November 2010.

    John Schmitt and David Rosnick, The Wage and Employment Impact of Minimum‐Wage Laws in Three Cities, Center for Economic and Policy Research, March 2011.

    Sylvia Allegretto, Arindrajit Dube and Michael Reich, Do Minimum Wages Really Reduce Teen Employment? Accounting for Heterogeneity and Selectivity in State Panel Data, Institute for Research on Labor and Employment, Univ. of CA, Berkeley, June 21, 2010.
    Published by Industrial Relations, April 2011.

    Anne Thompson, What Is Causing Record-High Teen Unemployment? Range of Economic Factors Drives High Teen Unemployment, But Minimum Wage Not One of Them, National Employment Law Project, October 2011.

    John Schmidt, Why Does the Minimum Wage Have No Discernible Effect on Employment?, Center for Economic and Policy Research, Febuary 2013.

    1. Try Milton Friedman (Nobel Prize in economics). Also try Drs. Thomas Sowell and Walther Williams, arguably the brightest economic minds today. These two are black Americans, whose perspective in general, and their views on the impact of misguided policies such as this on minorities in particular, are invaluable, and absolutely unbiased. Which cannot be said of a couple of authors I recognize in your citation.

      Let’s cut to the chase: this is all about income redistribution. Which is socialism, of which 26 years was more than enough for me. And I say this as a not-so-well-to-do man.

      1. “Let’s cut to the chase: this is all about income redistribution. Which is socialism, of which 26 years was more than enough for me. And I say this as a not-so-well-to-do man.”

        Oddly enough where was the outcry when the income redistribution upward to the wealthy happened between the late 70’s and now? Where is the outcry about socialism when you sign up for Medicare? Methinks you protest too loudly.

        It isn’t about income redistribution; it is about paying the now more productive workers for their higher productivity. Production is way up since the pink-slipping, downsizing that happened under de-regulation of the 80’s but workers are not being paid for their increased productivity. The wealth workers created was redistributed to the richest .01%. In a country that calls itself a meritocracy, higher productivity should be paid for with increased wages but it hasn’t been. That’s what this is all about; paying people higher wages for their now higher productivity. It is as simple as that. Not socialism; just pay based on the productivity and merit of the workers; isn’t that part of the American Dream?

  4. Perhaps those who are so anti-minimum wage increase would consider the impact on the federal level (http://laborcenter.berkeley.edu/pdf/2015/the-high-public-cost-of-low-wages.pdf) of low wage workers costing $153billion a year in public assistance. I understand that this is the CITY council; an impressive city council would consider not only local but state and federal impacts of their actions. As far as strictly local impacts, consider the recent problems of the city Police Department and the actions of contingent NAU faculty members regarding low wages. Low minimum wages and low wages overall are dramatically harming Flagstaff. Most people cannot afford to live here on the wages paid. Raising the minimum wage even a few dollars would have a profound impact on the growth and quality of living in Flagstaff.

    1. Which entity is a better arbiter of across-the-board economic prosperity: free market principle, or redistributionist government mandate? One built a prosperous nation, the other
      built a thoroughly miserable empire (Eastern Europe, e.g.). If you want to experience real income inequality, look there. I did: I lived in it.

      Policies like this are, as they have, mostly harmful for those who are supposed to be the beneficiaries of those policies. Fifty years of the war on poverty wrought but more poverty.

      1. Not “redistributionist government policies,” just government making companies do what they should have done on their own: pay their workers for the higher productivity they have been doing since the 80’s.

        Worker productivity rose since the 1980’s but wages have not risen to pay for that. Companies should have done the right thing and paid their workers higher wages for their higher productivity but they didn’t; instead companies redistributed the profits from that higher productivity to the richest .01%. That is redistribution but no one seems to be upset about that.

        The American Dream is all about working hard and being paid for your hard work; companies chose not to do that and now workers are fed up with working harder than ever, being more productive than ever, but not being paid for that. Since companies won’t do it on their own, workers are looking to their government to make them do what is right.

  5. But to answer your question Jeff…

    Since there is already a minimum wage law established by the federal government, management of the city should stay focused on immediate priorities. Therefore the consideration to join the pending lawsuit is irrelevant.

    Are the true costs and impact of a minimum wage ordinance being considered before a decision to join the lawsuit is settled? Aside form the legal costs to join the suit, has the cost of enforcement and the unintended consequence of unequal enforcement been thoroughly evaluated? If not then the implied fiduciary responsibility of city staff and the council is not being upheld.

    Will the city be auditing, randomly selecting or waiting for a complaint before pursuing enforcement? What will be the staffing needs for any of those scenarios? Not having a universally applied min. wage standard will impact locally owned businesses competing regionally with out of town competitors–again why a federally established minimum wage is better. Locally owned contractors and suppliers would be saddled with yet another competitive disadvantage when bidding on local work.

    Not only will prices increase for locally provided goods and services but many locally owned small businesses that employee min. wage earners do not have the scale sufficient to absorb the impact which will result in lay-offs or closures. Is that really what’s best for those who currently have minimum wage jobs? They are usually supplying supplemental income for dual wage earning families.

    Please do not continue to waste time and resources on issues that are already codified and would only be duplication of effort. The cost of living is already high enough in Flagstaff and will be higher just to pursue such a foolhardy endeavor that is just basically more political pandering at the citizenries’ expense.

    And why do you all even feel the need to plant our flag on that hill, so we can maintain a certain image and not be thought of poorly amongst a certain ideological set? I don’t remember seeing that in the mission statement. If the lawsuit is already more or less being funded by other communities, wouldn’t joining be mostly a PR move?

    I personally don’t mind a city council that once in a while thinks with their hearts, but in this case you need to think with your heads.

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