Looney: Get Corporations Off Welfare ...

Thomas MacMillan File PhotoWelfare programs for the working poor are actually government subsidies to corporations, New Haven’s state Sen. Martin Looney argued. To get corporations off of welfare, raise the state minimum wage to $10.10 per hour.

Looney made that argument to the the Labor and Public Employees Committee at the Capitol on Tuesday.

Looney spoke in favor of a proposed bill that would raise the minimum wage—now at $8.70 per hour—to $10.10 by Jan. 1. 2017. The change would come in three increments, over three years. The governor proposed the hike earlier this month.

“People working full-time jobs should receive a wage that allows them to care for their families,” Looney said.

Keeping wages low is a “hidden government subsidy to corporations,” Looney argued. Companies can pay full-time workers so little that the workers are forced to turn to government assistance. The government then pays for workers to live, which keeps salary costs low for companies.

Currently, 70,000 to 90,000 workers in Connecticut earn the minimum wage, according to a Senate Democrats press release. If the minimum wage was $10.10, someone working a 40-hour week would ear $21,008 per year. That’s still below the the federal poverty level for a family of four. which stands at $23,850.

Looney’s full testimony follows:

Good afternoon Senator Osten, Representative Tercyak and members of the Labor and Public Employees Committee. I am here to testify in support of SB 32 AN ACT CONCERNING WORKING FAMILIES’ WAGES, H.B. 5069 AN ACT CONCERNING LOW WAGE EMPLOYERS and S.B. No. 56 AN ACT CONCERNING SEVERE MENTAL OR EMOTIONAL IMPAIRMENT AND WORKERS’ COMPENSATION COVERAGE

The cost of living is high in Connecticut and workers who earn minimum wage should not be asked to bear a disproportionate share of the burden in our sluggish (although improving) economy. There is a broad consensus that people who work full time should be compensated with a living wage. Minimum wage workers should earn enough to cover the necessities of life without depending on government subsidies and charity. In fact, conservative activist Ron Unz has started a campaign in California to raise the minimum wage to $12 per hour. His view is that allowing corporations to pay such low wages is in fact a hidden government subsidy to corporations. The corporations compensate their workforce with such low wages that the workers receive government benefits such as food stamps, the Earned Income Tax Credit, and Medicaid. If the corporations were required to compensate the workers more fairly, government spending would decrease and the workers independence would increase.

The proposal in this bill would build on the act we passed last year, and increase the minimum wage to $10.10 by January 1, 2017. Workers who earn minimum wage are the least able to survive without increases to assist them in offsetting the increases in the cost of living and even this proposed increase does not raise the minimum wage to the relative value of the minimum wage in 1968. HB 5069 similarly would assist low wage earners achieve a sustainable lifestyle. Although the current drafting appears somewhat confusing, the intent of this bill is to require highly profitable big box stores to pay a higher minimum wage than local small businesses.  This legislation is similar in intent to the Washington DC Large Retailer Accountability Act which would have set the minimum wage for these businesses at about $12. According to a Study at the Univesity of California at Berkeley if Walmart increased its average wage from $9 to $ 12 it would only need to increase the price of its merchandise to customers by 1.1% which would cost the customers, on average, $12.50 per year. This does not seem to be an undue hardship on either the retailer or the customer. (http://laborcenter.berkeley.edu/retail/bigbox_livingwage_policies11.pdf)

SB 56 would ameliorate some of the changes made to the workers’ compensation law in 1993. Specifically, it would expand workers’ compensation coverage to individuals suffering from post-traumatic stress disorder as a direct result of witnessing the death or maiming of another human being whose death or maiming was caused by an intentional act of violence of another person. I would support expanding this coverage further and not requiring that the act be intentional. It is reasonable to think that a person could suffer from PTSD from witnessing the death or maiming of a coworker whose death was not intentional.
Thank you for considering these highly important issues.

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posted by: HewNaven on February 19, 2014  10:03am

Looney’s on the right track but he’s not pushing hard enough.

Why don’t legislators ask for automatic increases to the minimum wage? We all know the cost of inflation. What will $10.10 be worth in 2017 when the law finally becomes reality?

If I paid $10.10 to purchase something in 2010, the same purchase would cost $10.79 in 2013.


posted by: Noteworthy on February 19, 2014  11:37am

False Advertising Notes:

1. I hope to live long enough to hear Martin Looney tell the whole truth and nothing but the truth instead of the half baked truth patching over clear, demonstrable and large potholes in his public policy.

2. The Congressional Budget Office just issued a report that says raising the minimum wage as proposed will have clear winners and losers - those who keep their jobs will see larger paychecks; but 500K to 1,000,000 other people will also completely lose their jobs.

3. Any decision to raise the minimum wage should be made with a clear and unclouded accounting of the winners and losers - to pretend there are only winners is dishonest and misleading.

4. If Mr. Looney was really concerned with cutting corporate welfare, he should curtail the use of tax credits, end the governor’s blank check policy to hedge funds, ESPN, FODs (Friends of Danell)and insurance companies who have gotten copious amounts of taxpayer’s money to “preserve or grow” jobs in Connecticut.

5. Side Note: The high cost of living in CT is directly attributable to the failures of this state’s current and former political leadership - from spending, to debt, to taxes, fees and fines. When will Mr. Looney address those issues so that the lives of the middle class and working poor improves without the need to mandate a hike in the minimum wage? Very soon, Mr. Looney may face the need to mandate wage increases for the middle class since those wages have stagnated while our tax bite has not. Ironically, a large chunk of that money is going to the welfare state - corporate and individual.

posted by: Jones Gore on February 19, 2014  12:00pm

Very interesting spin, which in fact is a true. I personally never looked at it that way.

I feel that as long as Wall Street is able to make a profit although we have a high unemployment rate, people should get paid more for the work they do. But we all should be prepared to pay more because corporation will increase wages.

posted by: Dwightstreeter on February 19, 2014  3:11pm

No politician ever mentions the biggest freeloader in New Haven - the Yale Corporation.
A multi-billion dollar multi-national corporation can’t pay taxes like other property owners and business owners why?????

posted by: Tom Burns on February 20, 2014  2:37am

Way too slow and way too little—Those of means (super unusual disgusting means) can hire all those unemployed and pay them $15/hr minimum in CT (costed out based on where you live)—then there will be no welfare, no food stamps no programs that the Repubs hate and taxes would go down—all the rich have to do is get creative—keep the money they spend on campaigns and hire someone instead—most of you never worked a day yourself—without the worker to make you successful you got nothing—cold day in hell before these selfish non-working rich boys give up a dime—it’s sickening-it took Teddy Roosevelt to take them down a notch and then Eisenhower to tax them as they should be taxed—-90% boys—and if that is too much leave the country that you usurp—you will not be missed for a minute but YOU will miss the land of the free—pay up and make a difference or hit the road—Tom