civics, Dr. Linwood Tauheed, Dr. Tauheed, heterodox economics, transcript, UMKC, University of Missouri-Kansas City
LUMPENPROLETARIAT—Who says you can’t fight city hall? Community activists and organised labour were out in force at a morning rally outside of Kansas City, Missouri’s 26-story City Hall building at 11:00 CDT. At noon, people crowded the Kansas City Council Chambers to bear public witness to the hearing and the arguments for, and against, raising the minimum wage in Kansas City. The University of Missouri-Kansas City’s heterodox economics department reprazented today at the Fight for $15 protest rally and hearing on the 26th floor of Kansas City, Missouri’s stately City Hall.
UMKC Professor of Economics Dr. Linwood Tauheed delivered a presentation in collaboration with fellow UMKC Economics Department colleague, Dr. Mathew Forstater. Dr. Tauheed said Dr. Forstater wasn’t able to attend, so Dr. Tauheed delivered the presentation, entitled “The Social and Economic Impacts of Race and Minimum Wage in Kansas City, Missouri“, and then fielded questions from the City Council. Dr. Tauheed’s presentation emphasised sundry positive benefits from raising workers’ wages. (Full transcript of Dr. Tauheed’s presentation and additional photographs pending.)
DR. LINWOOD TAUHEED, Professor of Economics, UMKC, expert testimony, City Council Chambers Hearing on the Fight for $15, 26th Floor, City Hall Building:
DR. TAUHEED: “Mayor Pro-Tem, Members of the Kansas City Council, my name is Linwood Tauheed. I am an Associate Professor of Economics at the University of Missouri-Kansas City. The presentation, which I am going to give—of which I have a small slide show; you can bring it up in a minute [inaudible—is based on a report done by a colleague of mine, Mathew Forstater, who was not able to attend today. So, I am.
“I think that you have a copy of his report.
“And this idea of raising the minimum wage is, obviously, catching on around the country. And we have lots of evidence. We have lots of empirical evidence, that we can point to now, that, ten years ago, we didn’t have, in terms of the economic and social effects of raising the minimum wage. And, so, this particular slide show is on the social and economic benefits of raising the minimum wage in Kansas City, Missouri.
“Missouri has seen a steady, ongoing decline in the real wage since 1975.
[This is a rush transcript. This transcript is currently under construction.]
DR. TAUHEED: “I think this is all I have. So, what the slide show was, essentially, is a summary of the [inaudible]. And I know the Council is looking for, and will be looking for data, for studies. And, so, let me give you, perhaps, what I think is some guidance.
“I’m a methodologist. I teach methodology. And studies have to be done in a certain way. And some ways of doing things or arriving at conclusions are better than others. And the first study of a minimum wage, that was done in this country, that was substantial, was done by David Card and Alan Krueger in 1995. And that was a study between the State of Pennsylvania and the State of New Jersey. The State of New Jersey had increased its minimum wage, while the State of Pennsylvania did not yet increase its minimum wage.
“And, so, there was a study to see if there was job loss in New Jersey to Pennsylvania, as a result of the increase in minimum wage. And what that study showed was that there is no job loss. Now, I’m from Philadelphia. I’m right from the border between Pennsylvania and New Jersey. And lots of people go from Philadelphia to Camden, or Camden to Philadelphia to work. In this study, it was very easy to go across the bridge. This study shows no effect [in terms of job loss of] increasing the minimum wage.
“Now, this is called a natural experiment. As economists, we don’t get to experiment. We don’t get to put people in poverty and see how they’re going to act.”
AUDIENCE MEMBER: “My, my!”
DR. TAUHEED: “So, this is a natural experiment. Right? [scant audience laughter] And this is as close as you can get to the cream of the crop in methodology. And that’s a natural experiment.
“And, so, to have natural experiments is to have things happening in one place and not something happening in another place, that was very similar. You can study that and see what the effects are.
“And, so, there was testimony about an experiment at the county level with counties to see if there was a minimum wage effect. There are other methodologies, which are generally used.
“One of them is to try to estimate within a particular geography how much the minimum wage might affect employment. Okay? This is the CBO methodology; because the CBO didn’t get to conduct a natural experiment to see what the minimum wage benefits would be between the U.S. and Mexico. They didn’t have that. They estimated for all the U.S. And they could only do that estimate, as a guess, not as an empirical investigation of an experiment.”
CINDY CIRCO (KCMO MAYOR, PRO-TEM): “Okay, but if I may interrupt for just one second. There’s so much [inaudible]. I think that an understanding of methodology would be very helpful for the City Council, if you could send that to us.”
DR. TAUHEED: “I will.”
CINDY CIRCO, KCMO MAYOR PRO-TEM: “I am very interested in it. But I think that, in the interest of time, that we already got that.”
DR. TAUHEED: “Okay.”
CINDY CIRCO, KCMO MAYOR PRO-TEM: “Also,  you find that your slides are based off of a study that—”
DR. TAUHEED: “Yes, I believe this has been forwarded to you. This is called “The Social and Economic Impacts of Race and Minimum Wage in Kansas City, Missouri.”
CINDY CIRCO, KCMO MAYOR PRO-TEM: “Okay. Was that forwarded to all the Council? Or do we know?  If you could let us know.”
DR. TAUHEED: “[turning ’round] Who was that forwarded to?”
CINDY CIRCO, KCMO MAYOR PRO-TEM: “If you could let us know—”
DR. TAUHEED: “It has been, I understood.”
CINDY CIRCO, KCMO MAYOR PRO-TEM: “Alright. Thank you so much.”
DR. TAUHEED: “Okay.”
CINDY CIRCO, KCMO MAYOR PRO-TEM: “I appreciate it. Thank you.”
Then a “Michael Saltsman,” a young man, a lobbyist, apparently, stepped up to the microphone and began, like the lobbyist for the restaurant industry before Dr. Tauheed’s presentation, to argue against raising the minimum wage. He would go on to cite several major cities as examples.
“My name is Michael Saltsman, I’m the Research Director at the Employment Policies Institute, which is a think-tank in Washington, D.C.
“I did grow up in Michigan, so I was [inaudible] here in the Midwest. So, it’s good to be back here.
“I know you heard conflicting talking points and points of view on the minimum wage.”
But a Stand Up KC contingent simply got up and walked out. By this time, many audience members and pro-wage raise activists seemed to be growing weary with the slow pace of the hearing.
SALTSMAN: “And what I wanna do in my brief time today is try and move beyond the rhetorical debate and provide some perspective on the actual minimum wage effects we’re weathering right now in the Cities of Oakland, Seattle, and San Francisco, where a high minimum wage of, either, $12.25 or $15 dollars an hour is, actually, having an effect already or it’s phasing in, in the present.
“Some of this information has been reported in the San Francisco Chronicle and other newspapers. We’ve also conducted extensive surveys of hundreds of different [inaudible] in the West Coast. And what we’ve seen thus far is that the cost of these [inaudible] has been much larger than proponents anticipated.
“So, in the City of Oakland, for instance, the minimum wage rose from $9 an hour to $12.25 an hour on March First of this year. In a survey of over 220 businesses in the city, we found that 30 percent had reduced their employees’ hours or their hours of operation. 17 percent had laid off employees. About one in ten said they were very likely to close.
Now, let me give you a few good examples. There were ten restaurants and grocery stores in the city’s [inaudible] that were gonna close. They each had some partial consequence of the wage increase. Restaurants in the City have raised prices by as much as 20 percent. Some compare those prices increases with [inaudible].
“Even more concerning is the impact on childcare providers. The Salvation Army’s child care facility is looking to cut child care slots because of a over $146 thousand-dollar hole, that the wage increase has created in its budget.”
[technical difficulties prevented further audio recording]
STAND UP KC—Today, 48,000 Kansas Citians are employed in some of the world’s largest and most profitable fast food and retail corporatio…ns. But they work in our city’s worst paying jobs.
The average fast food worker is now 28 years old and the average retail worker is 38. Both make about $7.35/hour, have no healthcare, no paid sick days or vacation pay, and face daily discrimination. Top brands like McDonald’s make $5.4 billion in profit, pay their CEO $14 million, and have over 500 locations city-wide. It would take the average retail worker 823 years to earn what Walgreens CEO Greg Wasson earns in a year.
But fast food and retail workers won’t accept these facts any longer. Right now fast food and retail workers are sticking together to fight for higher pay so they can afford basic needs, like groceries, housing and transportation.
Learn more at STAND UP KC.
#FIGHT FOR $15—Fast-food workers have come together to fight for fair wages and the right to form a union without retaliation. We work for corporations who are making tremendous profits, but do not pay employees like us enough to support our families and to cover basic needs like food, health care, rent and transportation.
These are billion-dollar companies that can afford to pay their employees better. When workers are paid a living wage, not only will it strengthen the economy but it will also reduce crime in our neighborhoods.
[Last modified 21:53 CDT 21 MAY 2015]