Beruflich Dokumente
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One of the most heated and commonly recurring social policy de-
bates in the United States has centered on the minimum wage. Its
constant reemergence over the course of the last century reinforces
Kingdons quoting of Ecclesiastes that There is no new thing under the
sun (2003, p. 141). Today is an important time for rigorous study of
current events and future directions for this policy idea, and research on
this issue must draw heavily on the agenda setting and policy formation
literatures. As of August 2005, seventeen states have adopted minimum
wages above the federal level, by far the most to do so at one time since
the New Deal coalition first legislated a federal minimum in 1938.
These events have effectively devolved to the states an issue that for the
past sixty years has largely been debated at the federal level. Further-
more, Florida and Nevada have passed minimum wage hikes through
open referendums on the 2004 ballot, and as many as nine states are
expected to follow suit in 2006 (Cauchon, 2005). While ballot refer-
endums are being used in some states, still other states including
Maryland, Pennsylvania, and Iowa are expected to or are currently con-
sidering raises in upcoming legislative sessions. The large number of
current state minimum wage efforts present research opportunities for
case studies of states and cross-state comparisons of minimum wage
initiatives that utilize both ballot referendums and traditional legislative
channels.
Using Kingdons (2003) agenda-setting model, the current study
seeks to build knowledge about minimum wage initiatives and inform
future research through an in-depth case study of Illinois, the first Mid-
western state to raise its minimum, up to $6.50 in January 2005. The
analysis uses a pluralist frame, highlighting the roles of issue formation,
agenda setting, and politics in policymaking. It asks, what factors led to
the successful passage of a state minimum wage? What interest groups
were important in determining the issues fate? Analysis of this case is
undertaken to address these questions and set the stage for future
minimum wage research.
BACKGROUND
works firmly within a pluralist frame, which assumes all interest groups,
to varying degrees, have tools at their disposal to affect governmental
decisions regarding issues that affect them. Kingdon theorizes that
policymaking follows a garbage can model, a framework originally
developed by Cohen, March, and Olsen (1972). Kingdons adaptation
of the model consists of three separate but loosely related streams af-
fecting the public agenda. There is the problem stream, dealing with
how problems arise and who defines them; the political stream, dealing
with how changes in the political environment (like electoral shifts and
major events such as September 11) change the public agenda; and the
policy stream, dealing with how policy proposals are developed and be-
come attached to specific problems. These three streams converge in a
metaphorical garbage can in various ways to determine the agendas of
formal governmental decision-making bodies. When they align in par-
ticular ways, policy windows open up and different actors including
elected officials, interest groups, and researchers try to implement pol-
icy change. Kingdon notes that the model is best used in examining the
successes and failures of policy stories.
Moving from the theoretical background toward the history of the
minimum wage, in terms of successful legislation in the United States,
the minimum wage began at the state level, with the first one passing in
Massachusetts in 1912 (Prasch, 1999). Following this law, similar mea-
sures spread to a number of other states over the early years of the twen-
tieth century (Levin-Waldman, 2001). However, most of these early
state laws were riddled with exceptions such as exclusions for appren-
tices and handicapped workers (Waltman, 2000, p. 29). These laws
were invariably impossible to enforce, and most employers were able to
circumvent them. These limitations, however, did not stop proponents
from pursuing the implementation of state-level minimum wages.
After years in which states softened up the ground (Kingdon, 2003,
p. 128), the minimum wage found its way into national rhetoric and
policy discussions, including in Theodore Roosevelts Progressive plat-
form of 1912, and this further paved the way for federal legislation.
However, during the war and the conservative 1920s, changes in the po-
litical stream, specifically the national mood, interfered with the suc-
cessful passage of a federal minimum wage. As Levin-Waldman writes,
It wasnt until the depths of the Great Depression that it came to be
understood that a wage floor would also serve to ensure a measure of
general economic stability (2001, p. 7). The dramatic legislative and
executive shakeup that led to the New Deal provided a policy window
for a wage floor.
70 JOURNAL OF POVERTY
The federal minimum wage program as it exists today was first estab-
lished as part of the 1938 Fair Labor Standards Act. Advocates had
hoped to establish a living wage that would stabilize the labor market
(Levin-Waldman, 2001). However, due to pluralistic compromise with
business interests that called the proposal a tyrannical industrial dicta-
torship (Waltman, 2000, p. 32), the bill passed well below a living
wage level, at twenty-five cents an hour with increases of five cents
each year up to forty, the administrations initial recommendation.
At the time of its original implementation, the minimum wage was
regarded as an important labor market policy that would stabilize wages
for all American workers. Today, because of declines in its purchasing
power and increasing wealth among the middle class, it has been trans-
formed into a marginal policy that most people assume has little effect
on the overall economy. Therefore, it has lost social significance for the
general population and is less likely to become an issue that will seri-
ously expand into the arena of a larger public, as defined by Cobb and
Elder (1972).
Since 1938, constantly recurring policy debates regarding the mini-
mum have been waged at the federal level. However, the federal rheto-
ric around the minimum changed dramatically during the 1980s when a
shift in federal leadership and the national mood stifled any chance for
regular increases. The Reagan administration, armed with arguments by
Milton Friedman (1982) and others, began an assault on policies that
they believed interfered with free markets (Levin-Waldman, 2001).
Conservative advocates have sought to redefine the problems of low-
wage workers in such a way as to make it appear that a minimum wage
does more harm than good. This assault is supported by the view of the
minimum wage held by most economists today. Neo- classical eco-
nomic theory contends that a minimum above the equilibrium wage
hurts employment by raising labor costs, as any economics textbook
will tell you (see Krugman & Wells, 2005, pp. 90-91). Lindbloms lam-
entations in The market as prison (1982) captures the basis of the
neo-classical argument. Many economists might agree with the goal of
the minimum wage: to increase the earnings of low-wage workers to a
base level. Friedman himself advocated for a minimum family income
in the form of a negative income tax (Bowler, 1974; Levin-Waldman,
2001). However, opponents argue that raising the minimum wage will
only engage the automatic punishing recoil of the free market. Em-
ployers assume that their costs will rise because of the wage increase,
and they believe they will be forced to cut labor to compete, so they do
just that. Therefore, economists argue, raising the minimum wage does
H. Luke Shaefer 71
more harm than good. In this way, Lindblom argues that, with the mini-
mum wage and other social policies, the market controls policymakers
because any effort to change the market is stymied by the reaction of the
market itself.
There are, however, notable exceptions to this view among econo-
mists. Card and Kruegers studies and especially their book Myth and
Measurement (1995) provide recent evidence in support of the mini-
mum that has been widely influential and hotly debated (see Kosters,
1996). Furthermore, there has been historical support by economists for
the minimum wage. Beyond Keynesian support (see Caporaso & Le-
vine, 1992), during the Progressive Era a vocal group of economists
strongly supported the adoption of a minimum wage because they be-
lieved it would help protect markets by giving laborers needed leverage
to bargain with employers (Prasch, 1999).
In terms of the available empirical data, results are mixed. Some
studies support the view that minimum wage hikes lead to labor cuts by
employers or other negative economic outcomes (Colberg, 1981; Deer,
Murphy, & Welch, 1996; Neumark & Wascher, 1996). However, other
studies suggest that minimum wage increases may lead to positive
economic outcomes, including, at times, a small net growth in jobs
(Baiman et al., 2003; Card & Krueger, 1995; Katz & Krueger, 1992).
The latter studies contend that the time series statistical models used in
traditional economic examinations of the minimum wage are flawed
because of inadequate indicators used to represent variables in the mod-
els (Bernstein & Schmitt, 2000; Card, 1992; Card & Krueger, 1995).
They advocate the use of updated models such as the Card Test, which
takes into account variations in low-wage employment across states to
measure the effects of an increased minimum wage, or the use of quasi-
experimental methodologies that take advantage of different state mini-
mum wages (Bernstein & Schmitt, 2000; Card, 1992; Card & Krueger,
1995).
Leaving the policy stream for the political stream, some critics of the
minimum wage have been especially virulent. In a 1999 online strategy
briefing titled How to Argue Against the Minimum Wage Law, Jim
Cox, then an associate professor of economics at Georgia Perimeter
College, asked, How do we, the good guys, reach them and persuade
them of the truth and light? His suggestion is to:
wage workers, Illinois small business and restaurant lobbies, and a can-
didate and later newly elected governor looking for a popular, offense-
minded issue.
The story begins with a policy window to legislate a state minimum
wage in Illinois that opened up through the political stream with the
election of Congressman Rod Blagojevich to the governorship in 2002.
During the election, Blagojevich made a campaign promise to raise the
minimum to $6.50. His campaign rhetoric led to the identification and
framing of a larger problem centering on low-wage work. In campaign
materials, he argued that Illinois workers deserved a long overdue
raise because people that work should be able to support their families
on the wage they earn. In terms of Kingdons analysis, this pledge
linked the problem definition to a sense of fairness, a value to which most
Americans subscribe (Tropman, 1998), arguing that it was not fair that
people could not live on what they make in full-time work. Blagojevichs
campaign attached to this problem definition a solution that was easy to
understandraising the minimum wage to $6.50. This simple policy was
a straightforward political solution for a candidate looking to shore up a
liberal base of support in an election, thus connecting the policy with the
political domain.
Blagojevich won the election decisively and Democrats retook the
State Senate, giving the party control of all three branches of Illinois
state government for the first time in decades. This success led to the
mobilization of political interest groups and policy entities that had sup-
ported raising the minimum for years. Illinois has a strong union pres-
ence, and the AFL-CIO chose to take on the minimum wage as a
priority. For them it provided a straightforward message to low-wage
workers that the union was looking out for their interests, and therefore
was a clear political winner that would help their constituents, strength-
ened their credibility and visibility among potential members, and put
some business lobbies on the defensive (as seen in Whitley, 2004). The
Illinois chapter of the Association of Community Organizations for Re-
form Now (ACORN) is a community organization and the Service Em-
ployees International Union (SEIU) a union who work closely with one
another and both specifically organize low-wage workers. Active sup-
port of this measure was an exciting opportunity for them. ACORN had
recently led a successful coalition effort to add a cost-of-living adjust-
ment (COLA) to the city of Chicagos living wage ordinance, so under
the leadership of head organizer Madeline Talbott, ACORN began to
reach out and build a coalition among labor and other advocates, calling
it the Campaign to Reward Work (Talbott, 2005). While the campaign
H. Luke Shaefer 77
was officially separate from the efforts of the AFL-CIO, the parties
worked closely with each other. Together they drafted legislation that
called for an increase of the state minimum to $6.50 in January 2004 for
all workers, including tipped employees who have a much lower per-
centage rate under federal legislation. After much discussion among the
advocacy campaign, the Illinois AFL-CIO, the Governors office, and
the legislaturefollowed by some confusion as the wrong bill was intro-
duced by a legislator anxious to be the first to proposethe proposed bill
that received consideration in the General Assembly included a COLA.
The COLA would regularly increase the minimum wage by the rate of
inflation by automatically raising it fifty cents every time its real value
drops by that amount.
Other interest groups came from the Chicago advocacy community
and included, among many others, Work Welfare and Families, Women
Employed, Chicago Coalition for the Homeless, Target Area Develop-
ment Corporation, Developing Communities Project, and Business and
Professional People for the Public Interest (Talbott, 2005). Another im-
portant player came to the table from the policy community. The Uni-
versity of Illinois at Chicago, Center for Urban Economic Development
(UIC-CUED) regularly conducts quantitative research on local and
statewide social policy issues and actively joins policy debates in Illi-
nois. They are a case example of what Kingdon calls policy entrepre-
neurs, their defining characteristic being their willingness to invest
their resourcestime, energy, reputation, and sometimes moneyin hope
of a future return (2003, p. 122). Immediately following Blagojevichs
election, they connected with the advocacy campaign and became ac-
tive participants in the minimum wage legislation formation and evalu-
ation process, in hopes of implementing what they thought would be a
positive policy change, and perhaps furthering their departmental repu-
tation as a serious player in the policy community.
Like so many political leaders, when making his campaign promise
the new governor was looking for an issue that offered high salience
with low cost (Kingdon, 2003; Price, 1972). Blagojevich knew that
campaigning on a pledge to raise the minimum wage would be popular.
The issues of fairness that he enlisted in his pledge resonated with the
electorate, especially his base. However, the cost in political capital to
actually implement the increase was another matter. While Blagojevichs
labor liaison Catherine Shannon devoted some time to the issue, in prac-
tice his administration undertook little advocacy to insure its passage.
This is very similar to the actions of the Clinton administration before
passage of the federal raise in 1996, with the exception of Labor Secre-
78 JOURNAL OF POVERTY
tary Robert Reich, who took it upon himself to lobby inside and out of
the executive branch and softened up the ground for the measure that
few thought was possible (Reich, 1997; Waltman, 2000).
The Illinois bill was strongly opposed by some business lobbies, in-
cluding the Illinois Retail Merchants Association (IRMA), the Illinois
Chamber of Commerce that represents mostly local businesses and the
restaurant lobby (Whitley, 2004). However, the bill did not receive
much attention from large national corporations, who at the time were
mostly paying their employees above the proposed minimum already,
giving them little to lose with the new rate, and perhaps even something
to gain, since many of their customers would receive the wage raise and
perhaps buy more of their products. However, in the pluralist interest
group environment, concentrated interest appeared to be winning the
day. In this case it appeared early on to advocates that the business lob-
bies had a distinct advantage in this situation. Schattschneider argues
that Business so dominates the nongovernmental world that it looks
very much like a power system able to compete with the government it-
self (1964, p. 116). In their efforts to defeat the legislation, the mobi-
lized coalition of small businesses and restaurants used well-known
arguments against increasing the minimum wage. For them the problem
was not that low-wage workers are paid unfair wages, but instead that
minimum wages force employers to hire fewer workers because they
must pay artificially high wages. As already discussed, this argument
connects with Lindbloms The market as prison, where policy decisions,
the political realm, and the scholarly world are boxed in by automatic
punishing mechanisms inherent in capitalism.
In Illinois, these criticisms were magnified by claims that the wage
increase would hobble Illinois in its competition in the region and in the
global marketplace. Press accounts in major outlets tended to focus on
the fears of the business community that an increase would hurt firms,
with bylines like Firms worry as wage hike looms (Schmeltzer &
Garza, 2003; Chase & Long, 2003). The Chicago Tribunes editorial
board voiced opposition to the wage raise in exactly this way calling it
a misguided, inefficient way to help low-wage workers. Worse, as the
state tries to draw jobs in a tough economy, this will put the state at a big
disadvantage to surrounding states (Chicago Tribune Editorial Page,
2003). Doug Whitley, President of the Illinois Chamber of Commerce
in January 2004 said his members called the law one more obstacle to
effectively competing in the international marketplace (Whitley, 2004).
After redefining the problem, minimum wage opponents like Jim
Cox (1999) usually try to attach a policy solution that has been circulat-
H. Luke Shaefer 79
bill (Talbott, 2005). As Cobb and Elder might say, Madigan did not
think there was a larger public interested in the raise. At one point, he
reportedly said to Illinois AFL-CIO president Margaret Blackshere,
Other than you, Margaret, who really cares about the minimum wage?
(Talbott) ACORN decided to use a previously scheduled lobby day to
show support for the minimum wage bill. They engaged in a number of
direct actions that got press coverage, but still the Speaker did not agree
to let the bill be heard.
As the end of the session approached, ACORN organizers arranged
to attend a final hearing of the committee that had to vote on the bill
before it was passed onto the House floor. Speaker Madigan had still not
given approval to the committee chairman, Representative Larry McKeon,
to hear and vote on the measure. Prior to the committee hearing, orga-
nizers approached Chairman McKeon, who supported the increase, to
let him know that they intended to protest. He agreed that if they did, he
would be forced to order arrests, which advocates believed might pro-
vide the publicity needed to push the bill through. Organizers then
informed reporters that ACORN members would be arrested at the
hearing and they should have cameras ready. Three ACORN members,
Christin Howard, Toni Foulkes, and Connie Solano, would be given
time to speak, but when they finished they would refuse to yield the
floor and be arrested.
Minutes before the meeting began, AFL-CIO president Blackshere
came in and told ACORN organizers that Madigan had reached an
agreement with IRMA for a two-phase increase, to $5.50 in January
2004 and $6.50 in January 2005, but Madigan still refused to commit to
calling up the bill. ACORN organizers agreed to the compromises, but
said they must proceed with the action unless the Speaker agreed to let
the bill come to a vote. As the hearing came to order, Representative
McKeon announced that the bill would not be heard (as had been previ-
ously planned) and ACORN members began to chant, We cant sur-
vive on Five-One-Five. After some time, McKeon offered them time
to speak, and each of the three designees did. But when they had con-
cluded speaking, they refused the yield the floor by resuming their
chanting. Blackshere came rushing into the room to tell organizers that
Speaker Madigan would be furious if there were arrests, but organizers
reiterated that they could not back down unless they had a firm agree-
ment that the bill would be called. It went on, and organizers stalled the
arrests.
McKeon finally said he must move on and order the arrests, and at
that moment, Blackshere came in and announced that the Speaker had
82 JOURNAL OF POVERTY
agreed to call the bill and schedule a vote before the end of the session.
The crowd of ACORN and other activists exploded into cheers (Talbott,
2005). The bill as amended did pass through the House, was reconciled
in the Senate, and the Governor signed it. When the Governor signed
the legislation, he quoted statistics from the UIC-CUED study regard-
ing the impact that increased wages would have on the lives of low-in-
come workers and their families, and the minor costs that businesses
would incur.
NOTE
1. Evidence of this is available in coalition correspondence and meeting notes.
H. Luke Shaefer 85
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