BRATTLEBORO — Sen. Becca Balint and I recently talked about all the things that are happening in Montpelier and how they shake out for Windham County - particularly, about what the state Senate has been doing with the minimum wage.
Balint, a Democrat in her third term, serves as the Senate majority leader. She also sits on the Senate Committee on Economic Development, Housing, and General Affairs, the Senate Committee on Finance, and the Senate Rules Committee. She also chairs the Senate Sexual Harassment Panel.
She is one of 15 co-sponsors of a bill that would raise the minimum wage in Vermont to $10.78 per hour, a rate that would increase to $11.50 per hour on Jan. 1, 2020 and rise incrementally to $15 per hour in 2024. The bill has crossed over to the House of Representatives.
A similar bill in the last biennium passed both House and Senate but was vetoed in 2018 by Gov. Phil Scott.
In his veto message, the governor wrote: “I believe the bill is more likely to harm those it intends to help, weaken small businesses and the economy as a whole, and deepen the economic inequality that exists between Chittenden County and other counties in the state.”
Balint hopes that both the minimum-wage increase bill and the paid family medical leave insurance bill, also vetoed, will make it to the governor's desk again.
“We're really trying to once again make our case that we need a suite of bills that are supporting our workers here in Vermont,” Balint told me in our interview.
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Olga Peters: One of the things about the minimum wage I hear from opponents is that it is, by law, pegged to the rate of inflation. So why do we need something that raises it further?
Becca Balint: It is pegged to inflation; at the current rate, by 2024, our minimum wage would be at $12.04. Now, that would still be drastically below what a worker needs to afford basic necessities here in Vermont, so our bill would bring it up to $15 per hour by 2024.
However, by then, because of projected inflation, people would still only have the buying power of just over $13 an hour in today's dollars.
Stagnant pay is really the primary economic challenge in the nation. Workers have become 77 percent more productive since 1973, but their wages have grown by only 12 percent. People who were making minimum wage in 1968 were effectively taking home more money per hour than people working the minimum wage today.
There's been no increase in the standard of living for folks at the bottom, which has grown bigger.
We often have this narrative that these minimum-wage workers are high-school kids or college kids just trying to make a little extra money. That's not actually true. About 50,000 Vermonters are minimum-wage workers, and 41 percent of them are the heads of their families; 56 percent are women, and 90 percent of them are 20 years old or older.
And when you look at women, more than 60 percent of these minimum-wage workers are over 30 - well into their their adulthood.
We often think of these folks as being uneducated, or assume that if they had more education then they would be making more money. But more than half of these workers have some college education, and almost 25 percent have bachelor's degrees.
Forty percent of these workers are the head of their families, they're making minimum wage, and their wages have been stagnant for decades.
So it is just not true that what we're asking for is audacious. A bold audacious plan would be to say we are going to pass a livable wage in Vermont.
I wish that we had the votes to do that - we don't right now.
This bill is going to be a battle in the House more so than in the Senate. House districts are very small, so House members tend to know a greater proportion of individuals in their districts. So even if a few people reach out to them about a bill, it feels like a groundswell of support - or opposition.
A lot of House members representing rural areas are hearing a lot from their small businesses in their area that they can't absorb the costs. It's going to take a lot of individual conversations with members about their particular districts and their needs.
O.P.: People on the pro side argue that if you raise the wages for those at the lower end of the economic spectrum, their money will go more than likely go right back into the economy, because they're not investing in stocks - their money is going for food and groceries and cars.
On the con side, we hear, “Yeah, but businesses can't afford to pay more. And so people will end up losing their jobs.” Can you respond to those?
B.B.: Let's tease that out a little bit, starting with the issue of job loss. Yes, there will be some job loss.
But in areas where the minimum wage has increased, workers actually come out ahead financially because they're not having to juggle so many jobs to come out in the same place financially.
Will there be challenges for small businesses? Absolutely. But we also know that to be in business in Vermont, you have to be a highly adaptable anyway. The only constant is change. So you have to trust that they're going to figure out how to make it work.
We also know that workers who are paid more have longer stints at their places of work, so that gives back to the owners in all kinds of ways, in terms of not having to pay for retraining and turnover.
The other argument we often hear is that prices are going to go up dramatically for everybody; what we've seen is like a 0.3-percent to a 1.5-percent percent increase on item costs. Some people will feel that impact, but it's not dramatic. And workers would have increased spending power that would more than compensate for the price increases.
So in study after study, we see that workers come out ahead in total income. And we see that although there are some negative impacts, they are nominal.
The minimum wage really is the most-studied topic in economics. One study I've seen - “Why Does the Minimum Wage Have No Discernible Effect on Employment?” by John Schmitt of the Center for Economic and Policy Research - confirms that minimum wage does not negatively impact employment.
Hristos Doucouliagos and T. D. Stanley did a very big meta-analysis in 2009 - a study of all the studies - and that there is no appreciable negative impact for areas in terms of economy because of a minimum-wage increase.
O.P.: I'm curious about how Vermont wages are stagnant and low enough that they're not keeping up with our cost of living. I've talked to a lot of folks who are working in jobs where $15 an hour is a big deal. Yet their jobs require a lot of skill, a lot of talent, and a lot of education.
It feels like Vermont's earning potential is a bit at loggerheads with itself - that, yes, we need to raise the rate of lower-wage workers so fewer people are struggling. But what happens to folks who probably should be earning around $20 an hour but in our economy are only earning $15? Can something shift for them?
B.B.: It's a great question. It's not just going to be the folks at the very bottom that will see the increase - the few strata above the $15 wage will also see an increase because employers are going to have to bring wages up comparatively across the board.
The big elephant in the room I think in this conversation is the number of nonprofits we have in Vermont.
We are the state with the most nonprofits per capita. We all know people who have worked their tails off in nonprofits in our county who are working well over 40 hours a week and feel like they're still not making it work. When we take testimony on the minimum-wage increase, the part that doesn't get a lot of attention is when the nonprofits come to us and say, “We don't want you to increase the minimum wage.”
Nonprofits believe in a mission, right? They are there because they want to do good work in the world. But their wages are not keeping pace with wages of jobs in the private sector.
How do we as a state offer other programs to support this huge swath of workers who are working in the nonprofit field because they're mission driven?
And so that's why we pushed really hard for paid sick leave a couple of sessions ago, why we're working for paid family leave, why we are looking at loan forgiveness programs, and why we are looking at down-payment assistance.
It isn't going to be one thing that makes it more possible to work at these mission-driven entities. We have to figure out a way that workers at nonprofits are not being paid depressed wages.
O.P.: You talked about how folks working at nonprofits are on a mission. I think that plays into this unspoken agreement: “We know the wages are low in Vermont, and we know it's hard to make a living, but it's such a wonderful beautiful place that we'll put up with it.”
B.B.: Absolutely. This is another whole conversation, but we haven't talked about housing costs in Vermont or child-care costs. Right? And so this is another piece of it: if we aren't able to make the kind of sweeping changes we want on wages, then let's reduce the costs in other areas.
We had a huge housing bond that we passed last session. We're actually trying to do a similar one this session. In Brattleboro, we've seen more affordable housing at Great River Terrace. And then there's going to be that new development down on the Snow Block on Flat Street.
Those projects are happening across Vermont because we know you have to move several levers at once. So we have got to continue to work on housing costs, and that will make it possible for people to continue working at mission-driven organizations. And if we can crack the child-care nut, we will see thousands more jobs that would increase the tax base.
Then it becomes more possible for us to have these programs that support workers long-term without putting so much attention on attracting new people to Vermont.
We do need an influx of people - that is undeniable - but we have workers here who if given the right set of circumstances would go back into the workforce. People do want to live here, Olga! It is a beautiful beautiful place.
It's very difficult for me to talk with my constituents who are hustling three and four jobs and are just so, so tired and who have real worries about health insurance costs and housing costs.
They're really looking to us for some creative solutions, and we're doing our best. The problems are so complicated and so massive that it's difficult to see how a citizen legislature will be able to continue tackling them in such a complex economic global landscape.
But from January to May, we are here in Montpelier trying to make things more possible.
O.P.: Exactly. And I think I represent a lot of those Vermonters. This is the water I swim in, so when I talk to my friends who are in economies outside Vermont they look at me and they say, “You're crazy. Why didn't you kick that employer in the shins and walk out the door? [Editor's note: Thank you for not doing that.] Why didn't you do this or why didn't you do that?”
And it's because it never occurred to me, because this is how I've always lived. Which reminds me: We didn't get into this issue overnight. We are certainly not going to get out of it overnight.
B.B.: I think you're right. This is something I come up against a lot: that so much of the work that we're trying to do here around policy involves a culture shift and a reframing of issues in a way that people can hear them in a new way.
Take an issue like broadband: In the Finance Committee, two recent witnesses said that people under 40, maybe even under 50, are interested in better connectivity, but that most of the people in their area who are of retirement age don't care. They're satisfied with dialup or copper connection through broadband, and they're not interested in the investment it would take to upgrade their region to fiber-optics.
So that's a demographic issue that's coming to play in the committee rooms: when you have certain members of your constituent base clamoring for a change but the majority of the primary voters are actually much older Vermonters.
So it is often about culture change and, as you know, culture change is not easy. It takes a lot of individual conversations.
But I see a big change in the way we're talking about child care. I see a big change in the way that we're talking about housing. And we know how critical it is that we make these investments.
When I came in five years ago, I felt like people were not ready to have that conversation. We are finally getting some traction.
As much as I disagree with the governor on many issues, he has been a real champion on housing. He's being better about talking more about child care and how important it is. And although I disagree with his plan for paid family medical leave insurance, I love that he's talking about it.
I love that he understands that there are other programs we need to offer so that you and the thousands of Vermonters like you can make a go of it.
We want you to stay. We don't want you to pull up stakes and leave. We really don't.