A living wage would lift the poor

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By Tom Broderick

President Lyndon Johnson declared the federal War on Poverty in 1964. It foundered on the shores of Vietnam when we opted to fund guns over butter. Fifty years later, there is renewed interest in eliminating poverty.

Even at the local level, government can, and should, play a role in eliminating poverty, for example — by passing a Living Wage Ordinance (LWO).

For 10 years, a group of Oak Park citizens have worked, without success, to have the village board pass such an ordinance. We originally proposed that those covered receive $13.85/hour, inclusive of employee benefits. We now think it should be at least $15/hour.

We focused on three groups of workers: 1) village employees; 2) employees of contractors and sub-contractors hired by the village; and 3) employees of businesses or organizations receiving a significant financial grant from the village (eventually pegged at $50K/year). 

In 2008, 60% of Oak Park voters (94% of precincts) supported a living wage in an advisory referendum. The village board referred the proposed LWO to the Community Relations Commission (CRC). After 13 months of study, the commission recommended passage by a vote of 7-2. The board accepted the report but stripped the supportive recommendation. 

Among current board members, Colette Lueck, Glenn Brewer Adam Salzman and Robert Tucker have expressed a willingness to support putting the LWO on the board agenda. Despite numerous reminders and requests over the past two years, none has acted.

Poverty exists in Oak Park. The Oak Park-River Forest Food Pantry records show that in 2013, they provided food to 2,484 unique individuals residing in Oak Park zip codes. This is 18% of their client base. On average, they figure that each pantry visitor made 3.4 trips per year. This means our food pantry supplied a week's worth of groceries to approximately 8,000 food-insecure people from Oak Park last year.

The Illinois Department of Education reports that 627 students in Oak Park District 97 elementary schools are eligible for free meals, with another 129 eligible for reduced-cost meals. The report shows 383 students in our two public junior high schools eligible for free meals, with another 88 eligible for reduced-cost meals. Oak Park and River Forest High School has 480 students eligible for free meals and another 101 eligible for reduced-cost meals. 

West Suburban PADS also keeps records of who they serve by residential zip code. In 2013 they provided relief to 123 individuals from Oak Park. This is 14% of their client base. 

In the new 2014 Report on Illinois Poverty issued by the Social IMPACT Research Center of the Heartland Alliance, 1.9 million Illinois residents (14.7% of our population) currently live below the poverty line. That matches the percentage from 1960, before President Johnson declared our War on Poverty. The rate for Illinois children living below the poverty line went from 16.5% in 1960 to 20.7% in 2012. 

This is a disgrace and remedies are available.

Poverty is destructive to individuals and communities. Business opportunities and commercial development are not the only issues that demand attention. It's past time for our village board to deal with the Living Wage Ordinance — a tool proven to lift people out of poverty. 

Tom Broderick

Co-chair

Sandra Shimon

Co-chair

Dr. William Barclay, Gail Hafner, Ruth Kovacs, Paul Sakol, Bruce Samuels, Jan Sansone, Gary Schwab, Peg Strobel

For the Greater Oak Park chapter of the Chicago Democratic Socialists of America

Reader Comments

38 Comments - Add Your Comment

Comment Policy

Truth  

Posted: July 1st, 2014 9:05 AM

http://www.businessinsider.com/rich-people-dont-create-jobs-2014-6

OP  

Posted: July 1st, 2014 5:15 AM

There is a systemic change that has occured over the last ten years - wage growth is flat/declining for workers at the lower end of pay scale while non wage economic profits (rent, dividend etc) has risen quickly. Falsely propoing up wages will not change that ... The issue will take as much time to fix as it did to create - we are attacking symptom of problem - not the core issue. We need improved education, affordable colleges, address quality of schools and more jobs.

John Butch Murtagh from Oak Park, Illinois  

Posted: June 30th, 2014 11:51 PM

Hi Optimist, The OP economy is being ripped apart by shortages and excesses. On the shortage size, they have high debt, stagnant income, and high operating expense. On the excess side, it stagnant property tax revenue and declining wealth requires an increase in revenue that can't be increases in property or retail tax! Development is seen as the answer. Unfortunately, there are many communities in Chicago Metro in the same financial fix and all are using the same strategy ?" attract developers, and the same tactics ?" offer trinkets. With all governments facing the same shortage/excess problem the price of victory climbs, while the return on investment tank. How do you get out of the trap? Step one is "Recognize the Mess." Step two is "Do a Priority List." The problem right now is that while the board is pushing hard to get developments passed as quickly as possible, the track record has been for promised dates to be missed. It is also evident that the board has not given up small, carryover, projects that are wasteful of the board and staff's time. The village needs better focus. As far as the poverty and the working poor, I agree with you that OP should be active in finding solutions and supporting state and federal efforts. A 2014 OP Living Wage Ordinance has no potential to help resolve the national poverty and working poor problem.

John Butch Murtagh from Oak Park, Illinois  

Posted: June 28th, 2014 10:49 PM

JOEL SCHOENMEYER, i came across your Living Wage post of April 3. It was posted by Tom Broderick, one of the lead organizers in the effort to pass LW ordinances. I am not sure how I missed your post as I have been involved in the LW for the last six years. As you question are very pertinent and on the mark, I am writing a consolidated reply to your questions. I preface my comments with a quote from Bernard Baruch. He said: "If you get all the facts, your judgment can be right; if you don't get all the facts, it can't be right." Baruch's quote captures exactly where the Oak Park Living Wage stands. I was the Community Relations Commission Chairperson in 2009-2010 when the commission was charged with studying the LW Ordinance's feasibility. We studied for a year and were unable to come to a fact based recommendation to guide the board decision. The reason the facts based criterion could not be met was the village government's lack of information for analysis, or its choice to not provide the facts and data the commission requested and needed. Based on input from the commission, the board chose not to pursue an ordinance. Since that decision in 2010, there have been no further studies in the village. Additionally, there have been no additional ordinances approved by municipal governments in the United States. In twenty five years, less than 100 ordinances have been passed. The absence of additional ordinances is largely the result of federal and state governments agreeing to address the high number of working poor in the country. There was not enough facts/data in 2009 to make a facts and analysis based decision. Conditions and facts are worse in 2014 than they were in 2009.

Uncommon Sense  

Posted: April 9th, 2014 11:55 AM

I could support something like that if ALL govt aid were ended and left to local communities. That way when someone stupidly blows their $34k, they have to answer to their neighbors and local communities, churches, etc. I doubt kids would starve, but you'd no longer have people getting a pass for being irresponsible.

OP Transplant  

Posted: April 9th, 2014 10:35 AM

Unlikely to work, even in a small homogeneous country like Switzerland. Will those who spend their 34 grand unwisely then be allowed to starve in the streets, or will additional aid be offered? My guess is the latter.

Anybody else see this?  

Posted: April 9th, 2014 10:25 AM

Switzerland is proposing an unconditional minimum $34,000 income. Essentially, you eliminate all govt aid, give everybody the money to start, then let them spend it on what they want/need. http://www.pbs.org/newshour/making-sense/will-guaranteed-income-ever-come-america/

Uncommon Sense  

Posted: April 9th, 2014 10:19 AM

As a side note, I'd like to thank Tom for admitting that liberalism has failed. His third to last paragraph basically states that there has been no change in poverty since LBJ's war on poverty. So in other words, despite spending TRILLIONS, we have made ZERO progress on preventing poverty. Of course, liberal logic maintains we didn't spend enough, so we need to spend even more money.

Uncommon Sense  

Posted: April 9th, 2014 10:15 AM

If we can cure poverty by simply raising the minimum wage, why stop at $10 or $15/hr? Just bump it to $50. That way we all can be part of the 1%!

Ray Simpson from Oak Park, Illinois  

Posted: April 9th, 2014 7:12 AM

@ Dwyer - I am not sure who I have accused of what. My argument here has been the boosting minimum wage might make people "feel good" but has cascading effects that can doom a company. Think about the worker, who has done a good job over the last couple of years and had received annual raises of a dollar an hour. All of a sudden that effort is wasted and his value has diminished to zero. Since our valued worker has proven himself worthy, he should get a bump to keep everything fair. Now we have laborers who are getting wages close to their supervisors and that opens a whole new can of worms. Where does this end?

Bill Dwyer  

Posted: April 8th, 2014 11:04 PM

Good for you, Ray. You actually can offer an argument, rather than just pointless accusation. Well done.

Ray Simpson from Oak Park, Illinois  

Posted: April 8th, 2014 9:59 PM

@ Dwyer If the question is to justify the difference between compensation of CEO and laborer - my answer is to point out that the laborer has a job and his paychecks aren't bouncing. We have pointed out that raising minimum wage will require letting marginal value employees go. It all comes down to dollars and cents and benevolence is nice but not a part of well run business. The short answer is NO CEO and laborer wage differences don't bother me. I am not wrapped up in a victim scenario.

Bill Dwyer  

Posted: April 8th, 2014 7:46 PM

How 'bout you respond coherently to whatever JAC asks of you, Ray, rather than simply engaging in juvenile speculation about JAC being Trainor? Can you even answer questions, let alone refute an argument? Let's se you give it a go.

Ray Simpson from Oak Park, Illinois  

Posted: April 8th, 2014 7:26 PM

Is "JAC" Ken Trainors nom de plume? Sure sounds like it to me.

Ray Simpson from Oak Park, Illinois  

Posted: April 7th, 2014 3:40 PM

@Uncommon - remember that the actors, jocks and musicians are mostly sympathetic to the progressive left. Not so sympathetic that they are willing to give up anything. They sure wouldn't want to be confused with the Koch brothers who donate hundreds of millions every year to charity, hospitals and public television.

Uncommon Sense  

Posted: April 7th, 2014 3:20 PM

I always find it comical folks like JAC love to point out CEO pay, but always leave out actors, musicians, and athletes when using examples of people making absurd amounts of money. Should actors be limited to making only 10x's the wage of the production assistant? Or maybe ARod should only get 15x's the hot dog vendor?

OP Transplant  

Posted: April 7th, 2014 3:09 PM

In addition to the inevitable job losses, remember that a LWO would also increase the cost of many goods and services. This increase will hit the poor harder than the middle class.

Ray Simpson from Oak Park, Illinois  

Posted: April 7th, 2014 1:51 PM

@ JAC in the real world, if you are paid more than the value of what you produce - you are a liability. When you get your living wage ordinance and you move a person from marginal to a liability and they get terminated, it would seem to me that your 'feel good' effort has done real harm. Income inequality is a fact of life and savvy people make more than the marginal ones. Heartless - no - just a simple truth.

Hey JAC  

Posted: April 6th, 2014 10:35 AM

And when employers decide to automate because it is cheaper than paying low skilled workers $15/hr plus benefits, then what? Nate Silver's 538.com recently had an entry discussing this issue. As for your point about the unfairness of CEO pay, apparently corporate boards are willing to overpay. You could always start your own company and pay yourself and your employees whatever you want. As for the point about welfare, maybe those workers should seek to improve their skills in order to make more?

JAC  

Posted: April 6th, 2014 2:17 AM

Ray S. asks if I am bothered?. Sure! When someone refuses to address an important issue like a ceo being paid more per day than a worker earns in a year and chooses instead to offer drivel as a response. It also bothers me that this same individual feels very comfortable using the phrase "general old lady meddling". Ageist and sexist and offensive. Safe to figure he got no problem with the Koch brothers and Sheldon Adelson meddling and all of those fellows are in their golden years.

Ray Simpson from Oak Park, Illinois  

Posted: April 5th, 2014 10:50 PM

JAC someone once made your same argument to Henry Ford. He took a dime out of his pocket - gave it to the man and said "Consider yourself paid off" Class warfare is not the way our country was formed or prospered. It is anger and hatred of people who succeeded that is rotting this counties soul. Have you ever worked for a poor man? Does it bother you that one of the highest income areas in our country is Washington DC where government workers earn nearly twice the wages of their private sector counterpart. I do recognize that there are people who struggle and need some assistance - problem is that dependance has become a way of life for multiple generations who know no other way

JAC  

Posted: April 5th, 2014 6:31 PM

Ray S. refuses to address to the fact that full time employees may be forced to seek government assistance in order to meet basic needs. That leaves taxpayers to pick up the tab. The sad and misguided belief that a ceo is entitled to be paid $25,000 per day does not justify the obscene wage disparity nor addresses how income inequality in the United States continues to grow at an alarming rate. Whether or not these exorbitant salaries and golden parachutes are justified is subject to debate.

OP  

Posted: April 5th, 2014 5:19 PM

As harsh as it is, there needs to be incentive for investment in education/human capital. Higher wages and standard of living are the only way to achieve that. You wages are a result of your contribution and value add. Low value add and low wages ...

Ray Simpson from Oak Park, Illinois  

Posted: April 5th, 2014 4:54 PM

@JAC CEO's get what they do because that is what the market commands. If you want their skills - you pay! If you took all of the money in the world and divided it up precisely equal - within one year those who were rich before would be rich again. That is because they are money savvy. Estimates say that they would be richer because the newly poor would have squandered everything because they are money foolish. CEO's get more attention than movie stars and sports stars who have little value beyond their limited skills yet CEO's are responsible for the survival and livelihood of tens of thousands of employees. The lower end of the pay spectrum suffers from government mandates, regulations and general old lady meddling. A responsible government would partner with business to assure the success that would make better wages available. Income redistribution has never worked anywhere it has been tried and usually results in total collapse of an economy.

JAC from Oak PArk  

Posted: April 5th, 2014 3:46 PM

Let's look at the numbers. A full time worker in a fast food restaurant earns less than $12,000 a year. The CEO is paid $25,000 daily. 35 is the average age of a minimum wage employee and 30 percent of American workers have jobs at the low end of the pay scale. They work in retail, health care and fast food. When they are forced to apply for assistance just to meet basic needs, the government benefits they receive amount to taxpayer subsidized welfare for multi-national corporations.

Ray Simpson from Oak Park, Illinois  

Posted: April 5th, 2014 11:36 AM

@ Forcing - how is it ethical to pay someone a greater amount than what they contribute? Government can get away with it since they are just blowing your tax dollars. A well run company knows where every penny is and where it goes. I have seen very few well run companies that have a great number of minimum wage people. Many use temporary labor sources and they are still paying multiples of minimum wage. Holding a significant percentage of your employees at minimum wage is an open invitation for union organization. I would like to see an exact number of Oak Park employees and vendors who are getting minimum wage. Nuclear weapons free zone boondoggle all over again.

Questions for the stupid socialists  

Posted: April 5th, 2014 11:32 AM

Like "forcing the right thing": How many businesses do you own? How many people do you employ? Probably none. Start your own business and pay $15/hr to your employees performing unskilled labor. We'll see how long you last in business. Morons.

Forcing the right thing  

Posted: April 5th, 2014 10:58 AM

Employers should be paying a fair, living wage anyway. The fact that legislation is needed to force what should be a non-issue is a sad commentary on our society. It speaks volumes about you as a horrible employer if you can't have the basic human decency to pay your workers well. The problem isn't just money. It's ethics.

Ray Simpson from Oak Park, Illinois  

Posted: April 5th, 2014 10:11 AM

Sam and Henry both start a new minimum wage job on the same day. Sam is always on time, contributes to his job and works his butt off. Henry is always late, contributes little or nothing and takes every sick day he can. After six months the boss wants to reward Sam for a job well done. You guys have decided that both guys deserve a raise. The boss has a problem - he can only afford to reward Sam. He can give both the same raise and ignore good business or he can fire Henry and reward Sam - a good business decision. If government quit meddling Sam would become Henrys boss and might convince him to put it into higher gear. Remember - no matter what you do the lowest paid employees will always be just that and you cannot change basic arithmetic. The population of that group will change. The bottom ten percent is where people learn basic skills on how to contribute to a companies success. If you pay someone a dollar to do a job that is worth fifty cents, wise business requires that that employee gains the skills to do it for 40 cents or less in a reasonable time. The Living Wage Ordinance will not do anything to promote job skills and pride of accomplishment. Henry will just wind up on welfare. Nice plan!

OP Transplant  

Posted: April 4th, 2014 1:47 PM

"Poverty is an economic policy." Bob, what does that even mean? This isn't a rhetorical question. Please explain what you mean when you say this.

Big Daddy from Oak Park  

Posted: April 3rd, 2014 7:11 PM

I have two children who presently are paid the minimum wage. Given that I pay 100% of their college costs I can attest that an increase in the minimum wage would merely provide them with more money for pizza and beer.

Bob Simpson from Oak Park, Illinois  

Posted: April 3rd, 2014 5:03 PM

Poverty is an economic policy. A very bad economic policy. Why should Oak Park contribute to it? Fight for $15...

OP Transplant  

Posted: April 3rd, 2014 2:01 PM

Why don't people just contribute to society according to their ability, and take from society according to their needs. That's gotta be foolproof right?

Dan in OakPark  

Posted: April 3rd, 2014 1:51 PM

By all means we should eliminate poverty, but $15 an hour sounds to low. I propose we raise the minimum wage to $100 an hour. That way you can choose to work less than full time, but still avoid poverty. No more job lock. Beats wasting time getting a good education, learning a valuable job skill or working hard to advance in your current job.

joe from south oak park  

Posted: April 3rd, 2014 10:52 AM

I barely made it through the first sentence before giving up on this article. Lyndon Johnson's decision to get involved in Vietnam was a result of the Truman doctrine. He didn't 'fund guns over butter'. This was a long term foreign policy decision that resulted in severe economic problems for the USSR leading to the fall of Communism in the late '80's.

OP Transplant  

Posted: April 3rd, 2014 10:19 AM

Unless you can convince employers to simply make less money, a LWO would force them to relocate, hire fewer people, do business elsewhere, and/or raise prices for their products or services, a hike which would hit the poor harder than the rich. The history of artificial efforts to manipulate economic systems, like the history of socialism itself, is a testament to the destructive effects of unintended consequences.

Don't try and bring logic  

Posted: April 3rd, 2014 9:32 AM

into this Mr. Schoenmeyer. The Oak Park Chapter of the Socialists don't care about raising Oak Park taxes or lost jobs due to something like this.

Joel A. Schoenmeyer from Oak Park, Illinois  

Posted: April 3rd, 2014 9:09 AM

I think we can all agree that poverty is destructive; however, this piece sorely lacks any details connecting the problem with the proposed solution. More specifically, I think the LWO proponents need to do (at least) three things: 1. Articulate clearly how an LWO will reduce poverty. As this piece states, the LWO would apply to only three types of workers: "1) village employees; 2) employees of contractors and sub-contractors hired by the village; and 3) employees of businesses or organizations receiving a significant financial grant from the village (eventually pegged at $50K/year)." How many of the people in these three groups currently live in poverty? Put a different way, what is the overlap between the people who would benefit from an Oak Park LWO, and Oak Parkers in poverty? I assume we can all agree that - to take one example - artificially raising the wages of someone living in a household earning $50,000 or more per year would serve no anti-poverty purpose. 2. Explain why an LWO would work from an economic perspective. Simply describing an LWO as "a tool proven to lift people out of poverty" in the last line of this piece is not sufficient. Presumably there are numerous studies about the economic effects of an LWO - what do those studies say about the benefits and drawbacks of such an ordinance? 3. Explain how the costs of an LWO will be passed on to the citizens of Oak Park. I assume we are talking about either raising costs (via higher taxes and/or fees) or keeping costs as is (and reducing the number of workers). Which of these paths does the Greater Oak Park chapter of the Chicago Democratic Socialists of America favor? There's also the less tangible cost associated with requiring "contractors and sub-contractors hired by the village" to increase the hourly wages of their employees. Oak Park already has a reputation for being anti-business -- won't an LWO simply further that reputation? -Joel A. Schoenmeyer

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