Five by 8 – 7/7/10: Myths and the minimum wage

1) The owner of the Eagle Street Cafe in St. Paul acknowledges that no waitperson is making $100,000, as he allegedly told gubernatorial candidate Tom Emmer. Now, perhaps, we can get back on track on this year’s most misfocused story. True, it was outrageous to suggest that someone was making $100,000, but the story was about tax policy, not waitpeople making “too much” money. Rep. Emmer created his own noose, but his proposal to cut the minimum wage for people who work for tips didn’t hinge on people who make $100,000. It could easily have hinged on people making $30,000 (a more believable figure). But Emmer didn’t — or wouldn’t — say at what wage his idea for a lower minimum wage should kick in, or even what it should be.

Emmer says when the minimum wage was before the Legislature in 2007 and 2008, he “supported a modest tip credit, freezing tipped employees at the current minimum wage to account for the wages they received as tips.” But a check of committee and House records shows no proposed amendment to attempt to include it. If there had been an amendment, we might have a better idea of the specifics of his idea. But we don’t.

In the comments section of yesterday’s 5X8, former Rep. Duke Powell makes a case for having no minimum wage at all. He says a wage should be between an employer and an employee.

So while the myth of the $100,000 waiter/waitress is interesting, the more important question of the role of the minimum wage has still not been fully debated.

Emmer tried to explain his proposal yesterday:

When a reporter asked if I supported the concept of a tip credit, I answered yes. I want the wait staff at a restaurant to be successful and make as much as they can, and a recent study published in Applied Economics Letters shows that tip credits have essentially no negative impact on wages for tipped employees. So contrary to what some people are saying, I have no interest in “cutting wages.”

Emmer said the “tip credit” is in force in 43 other states “including all of our neighboring states.”

Is he right? Yes. The states do not have their own minimum wage laws so they use the federal minimum wage laws that allow employers to pay $2.13 to workers who make tips. Iowa pays tipped employees $4.35 and there’s no minimum wage for businesses making less than $300,000 a year. In Wisconsin, minimum wage for tip employees is $2.33.

What he didn’t say, however, is that Minnesota has its own minimum wage laws and those rates are presently lower than the federal minimum wage for small businesses. It’s only $5.25 — $2 lower than neighboring states. And North Dakota, for example, has been much more aggressive than Minnesota at raising the minimum wage since the 1960s. So has South Dakota, Iowa, and Wisconsin.

Consider the map from the U.S. Department of Labor (click on image for a larger view):


2) From the “What Would I Do If it Were Me?” Department: Assistant Olmsted County Attorney Ross L. Leuning is leaving for Iraq to serve as a legal adviser at a military base. He’s leaving his job and his family and he didn’t have to, the Rochester Post Bulletin reports. But he has a friend in Boston who is starting a law practice, and has a young family and he was called to active duty, a mobilization which surely would’ve ruined him. So Leuning volunteered to take his friend’s place. Olmsted County will hold his job open for his return.

3) Baseball players are people, too. Seconds after a fan fell from an upper deck in Texas while he was trying to catch a foul ball last night, Cleveland’s Trevor Crowe collapsed.


TV broadcasts, mercifully, did not show the incident. The fan lived.


How did he survive the fall? The people he fell on cushioned it. They were treated at the park for minor injuries. Incidentally, St. Paul’s Tim Tschida was the crew chief for the game. He stopped the game for several minutes to give players — and fans — time to recover. There’s nothing in the how-to-be-an-umpire book that tells you what to do when someone falls from the upper deck.

4) Should gas tax money go to projects other than those that involve people driving in their cars? MPR’s Bob Kelleher looks at the issue today. About 3 percent of the gas tax is diverted to motorized recreation infrastructure — trails for ATVs and docks for boats, for example — instead of roads and bridges.

On one side is Jeff Brown of Minnesotans for Responsible Recreation:

“Our state is in a financial crisis,” he said. “Our roads and bridges are falling apart. If you look at MnDOT’s 20-year plan they identify many unfunded high priority needs. This is the moment for Minnesotans to go to their legislators and tell them to end the $18.5 million in annual gas tax diversions to motorized recreation.”

On the other side is Sen. Tom Bakk, head of the Senate Taxes Committee:

“It really is an industry that’s kind of stood on its own, with registration fees, with the in-lieu of payment of gas taxes,” Bakk said. “They’ve built an incredible trail system, and they’ve paid for a lot of enforcement. In the case of boats and the water-rec account — invasive species work, boat landing work — there’s a lot of good that’s come out of it and it’s really been paid by the users.”

From the mailbag this morning, Jeff from Pemberton read — and doesn’t like — the story:

“We are using these gas tax funds which we pay for every time I put gas into my ATV/snowmobile/boate and it is providing trails and support for our sport including enforcement . we are not asking for a taxpayer handout unlike the walking/bicycling trails which have no user fees and are funded out of the general fund.”

Should gas tax money be spent on motorized recreation infrastructure?Market Research

5) If it hadn’t been for a whistleblower named Daniel Ellsberg — and the courage of some newspapers back when many newspapers had courage — thousands more young men might’ve died in Vietnam before we learned the truth that the president of the country was lying to us about Vietnam. Make no mistake, however. At the time, many people thought Ellsberg a traitor, that exposing truth about government misdeeds was, itself, treason. The debate is raging again because the U.S. government is now moving against Bradley Manning, who, among other things, is believed to have leaked an out-of-context video of a U.S. strike on insurgents, that may have killed unarmed people. He also is said to have leaked a video of a May 2009 air strike in Afghanistan that reportedly killed about 100 civilians, most of them children.

The government is going to make an example of Manning, but his case is raising the same questions that the Ellsberg case did: Where is the line between right and wrong? When does violating the laws of a country, serve the country?

TechDirt suggests a middle ground, but it’s not clear if either camp is interested in the middle ground:

It seems like the line is pretty clear. If the “leak” is designed to expose otherwise illegal activities, that should be protected in some manner. If the leak, on the other hand, has nothing to do with exposing illegal activities and, instead, is just to reveal secret (but legal) information, it probably falls on the other side of the line. Where Manning’s actions fall on this spectrum are still not at all clear — but it seems like folks are rushing to push him into one or the other camps already.

One interesting difference in the two cases. This time, it doesn’t include newspapers acting in their traditional role as the hall monitor. It’s WikiLeaks. A Web site.


Gubernatorial candidate Tom Emmer suggests that restaurants could pay waiters and waitresses less than minimum wage because of the money they make on tips. What’s your philosophy on tipping?


Midmorning (9-11 a.m.) – First hour: In a discussion held recently in London, Kerri Miller speaks with British and American lawyers about how the two countries differ in their approach to terrorism.

Second hour: Local singer-songwriter Jeremy Messersmith is known for sunny, melodic pop, yet his newest album is all about death and dying. He joins Midmorning to talk about the new record, and why he occupies a “nether-region” of music.

Midday (11 a.m. – 1 p.m.) – First hour: Political scientist and congressional expert Steven Smith discusses Sen. Al Franken’s first year in office, the legacy of Sen. Robert Byrd, and the work of Congress this year.

Second hour: From the Aspen Ideas Festival: Will the financial crisis lead to America’s decline?

Talk of the Nation (1-3 p.m.) – First hour: Ken Rudin and host Neal Conan talk about the political news of the week, and a look at the implications of California’s primary reform.

Second hour: New solutions — and new problems — for small businesses.

All Things Considered (3-6:30 p.m.) – The final section of the Paul Bunyan Trail connecting Brainerd to Bemidji, a 100-mile stretch, may be a boost for the economies of small towns along the route. Or not. MPR’s Tom Robertson will have the story.

Euan Kerr profiles a local musician who sings in seven languages, and plays music from three continents.

  • John O.

    Today’s special at the Eagle Street Grille: fresh crow.

  • I had no idea that Minnesota’s minimum wage was lower than the Federal. What happened to “Moscow on the Mississippi?” or the “Red Star State”??

  • Bismuth

    Seems like there is a word or two missing from this sentence:

    “He’s leaving his job and his family and he didn’t have, the Rochester Post Bulletin reports.”

  • Doctor Gonzo

    As a biker, I’d be happy to pay a registration fee of $10 a year for bike registration if that money went to trails and other biking improvements. I was very upset when the state ended the bike registration program several years ago.

    And walking trails are a handout? That’s like saying police protection is a “handout”. We all walk, just like we all use police protection. It’s a common good that we all should pay for so we all can enjoy it.

  • Jim

    Duke Powell’s view on the minimum wage is an example of why he is a former representative of the residents living in House District 40A.

  • Indeed, Jim. I was inspired to go back to that entry and refute his point.

  • Joanna

    There are many things I love about Minnesota, but the selfishness behind some of the whining about about taxes and the public good makes me gnash my teeth. The same people who want the illusion of a 1-1 relationship between their tax dollars and their road services would scream bloody murder if they had to pay out of pocket for the stop signs, traffic signals, paving and snow plowing, lighting, etc on their block, just to mention some of the services that various tax pools support.

    It’s the “I’ve got mine, eff you” attitude that has seriously undermined the legacy of smart public lnvestment that made MN a good place to live in spite of its hellish climate. You folks who want to cut cut cut taxes? move to California and see what it’s like after 20-30 years of disinvestment in the public good to live in state that is broke with crumbling public services.

  • bsimon

    “Should gas tax money go to projects other than those that involve people driving in their cars?”

    What is interesting about this story is Jeff Brown’s ever changing reasoning for cutting off funding for motorized recreation. His group, the MRR (which is essentially a one-man operation), has been fighting funding for ATV / OHV trails for at least a decade. This is the first time, however, that I’ve seen him mention the need for infrastructure funding as a reason for cutting trail funding.

    What Mr Brown fails to recognize is that trails, like roads and bridges, also require maintenance. In fact, if his real goal is for responsible recreation, he should endorse the funding for maintenance of designated trails for motorized use precisely so that ATV/OHV users will stay on designated trails and not create their own trails, causing extensive damage to areas we’d otherwise try to protect. What Mr Brown is trying to obscure is his preferred solution of simply banning ATV/OHV use of public land in Minnesota. I guess you could say he’s becoming more politically savvy, in learning to modify his argument to fit the day’s political environment.

  • I’d love a better explanation from Emmer on how wait staff would make “essentially the same” while being paid clearly less of a base wage.

  • Kevin Watterson

    Hi Bob,

    You needed to go back a little further, to 2005. SF 3, House Journal page 3412, the Gunther amendment.

    It’s only slightly disturbing that I knew that off the top of my head.