“Waging” War on Local Governance (and Appropriate Pay)

“Louisiana remains one of only five states in the nation without its own minimum wage, relying on the federal minimum instead,” Gov. John Bel Edwards declares, as when addressing the Baton Rouge Press Club at the beginning of the year. “$7.25 per hour is not a meaningful wage in 2019.”

Those five states – Alabama, Mississippi, South Carolina, Tennessee and Louisiana – are, unsurprisingly, often listed at or near the bottom on national quality of life rankings. Also unsurprisingly, all five of those states have embraced state preemption, adopting laws prohibiting local governments from acting on their own to establish locally-appropriate minimum wage rules.

Setting a state minimum wage higher than the federal minimum wage (which was last upped in 2009) was part of Edwards’ 2015 campaign platform; part of his 2016, 2017 and 2018 legislative agendas; and setting a “modest” raise is already promised to be part of Gov. John Bel Edwards’ legislative goals for this year’s session. As of this writing, that bill has yet to be officially filed, although Sen. Troy Carter (D-New Orleans), author of prior year minimum wage bills, has promised to keep bringing the measure back until it succeeds.

It has to be done statewide, if it’s to be done at all, because of a law Louisiana’s legislature enacted in 1997. It’s state preemption of local democracy at its most egregious.

Act 317 of the 1997 Louisiana Legislature says: “No local governmental subdivision shall establish a minimum wage rate which a private employer would be required to pay employees.” (Actually, it says a lot more than that, but we’ll get to that in a bit.)

Garey Forster

The bill’s primary author was Rep. Garey Forster of New Orleans, owner of a direct mail company and an NFIB (National Federation of Independent Business) member. As a legislator, he was also an active member of the American Legislative Exchange Council (ALEC), and this was one of ALEC’s model pieces of legislation.

Immediately following the 1997 session and passage of this bill, then-Gov. Mike Foster appointed Forster as state Labor Secretary. (And here’s today’s trivia: Forster’s assistant Labor Secretary was Raj Jindal, Bobby Jindal’s mom. Bobby himself had already been appointed to Foster’s cabinet, as state Secretary of Health).

Notable among the co-authors of this bill sanctioning state preemption of local minimum wage options were then-state representatives Steve Scalise, David Vitter and Tony Perkins (current head of the Family Research Council, not the actor who starred in “Psycho”). Among those who voted for its passage are still-familiar names, including John Alario, Jim Donelon, Danny Martiny, Mike Strain, Francis Thompson, and Mike Walsworth.

Act 317 starts off nobly, stating, “The Legislature of Louisiana finds that economic stability and growth are among the most important factors affecting the general welfare of the people of this state and are, therefore, among its own most important responsibilities.”

Seems like a good reason to set and/or establish a minimum wage, doesn’t it? But what follows is – shall we say? – problematic.

The law states: “Local variation in legally required minimum wage rates would threaten many businesses with a loss of employees to areas which require a higher minimum wage rate and many other businesses with the loss of patrons to areas which allow for a lower wage rate. The net effect of this situation would be detrimental to the business environment of the state and to the citizens, businesses, and governments of the various local jurisdictions as well as the local labor market. Therefore, no local governmental subdivision shall establish a minimum wage rate which a private employer would be required to pay employees.”

Let’s pause and unpack this.

Basically, it says that if Baton Rouge (for example) set a requirement to pay a higher minimum wage, the folks slinging burgers at McDonald’s in Shreveport would be moving to Baton Rouge to take advantage of the better pay. That would threaten the burger business in Shreveport. And folks from Baton Rouge would start driving to Shreveport for their burgers because, since the Shreveport McDonald’s would then be paying their employees less, they could sell their Happy Meals cheaper. That loss of customers would then be bad for the fast food operators in Baton Rouge. It says – essentially – that competition for better pay and competition over lower prices for goods and services is bad for business, for consumers and for government.

This is part of the law passed 22 years ago.

Let’s compare this to what we’ve been hearing the past couple of years from those that currently oppose increasing the minimum wage (or those that oppose this Governor, because he’s a Democrat.)

“LABI, NFIB and other business groups say that government-mandated pay levels take discretion and decision-making away from business owners and may end up actually reducing the number of jobs,” Tim Morris of nola.com reported in November, following Gov. Edwards’ tweet noting that voters in Missouri and Arkansas had just endorsed raising their states’ minimum wage.

“Discretion” and “decision-making” – aren’t those what state preemption takes away from local governing bodies and the people, themselves?

“The minimum wage argument is a distraction from more meaningful solutions that will truly lift our people out of poverty. The answer is not to squeeze dollars out of employers for entry-level jobs, but to increase training and educational opportunities for Louisiana’s workforce,” LABI’s former director of small business, Renee Amar, has stated. She is now the vice president of public policy for the Pelican Institute.

If you’re working full-time for minimum wage, and still can’t afford to feed your family, is hunger a “distraction”?

Republican lawmakers are partial to the business coalition arguments, and Sen. Conrad Appel (R-Metairie), a member of the Senate Commerce committee, has been rather outspoken on the subject. In 2017, when the minimum wage bill came up, he argued, ““If you raise the minimum wage, you might be jeopardizing those very jobs that earn that $7.25. Instead of focusing on increasing the minimum wage and possibly driving jobs away we should be focused on fixing our economy.”

In recent Facebook posts, Appel has said, “We all are very aware that we a state full of poor people, a state where our incomes are low and our options for upward mobility equally low… The negative economic policies…are to a great extent the fundamental basis of out-migration of Louisianans.“

In other words, people are leaving Louisiana because incomes are low, and options to move up the economic ladder are limited. And while our state’s economic policies (controlled by Republicans for the past 11 years) have not worked, rather than raise pay, we need to “fix the economy”. Details on how to actually do so remain as vague as the statement itself.

This is part and parcel of industry spin and conservative rhetoric that insists minimum wage never was supposed to be a “living wage”. It was “always” designed to be just a starting amount for people entering into the workforce. And many who embrace the “entry-level-pay-only” propaganda also insist minimum wage should not be determined by the government, but instead determined by the marketplace.

How does that mesh with Louisiana’s 1997 state preemption law, trying to force uniformity in the marketplace, through prohibiting local governments from enacting differing pay standards, because marketplace competition is “detrimental to the business environment of the state”?

Lest you think that wording in the 1997 is outdated, and minds have changed in the past 22 years, consider this: In 2012, Louisiana lawmakers added to this law, with Act 667 (SB 521), authored by Sen. Ronnie Johns (R-Lake Charles). Keeping the same anti-competition justification, state lawmakers further prohibited local government – parishes or municipalities – from establishing a mandatory, minimum number of vacation or sick leave days for businesses to provide their employees.

That, too, would “threaten” businesses.

None of this is how our nearest state neighbor to the north sees it. And while we’re sure Sen. Appel wasn’t intimating that everyone migrating out of Louisiana is moving to Arkansas, that state’s lawmakers have let voters decide – twice in the past five years – whether or not to increase minimum wage. Arkansas voters approved an $8.50 minimum wage in 2014, and this past fall voted to up the state minimum wage to $9.25 this year, $10.00 next year, and $11.00 in 2021.

To be utterly realistic, since House Speaker Taylor Barras and his ventriloquist – House Appropriations chairman Cameron Henry – have refused to acknowledge increased state revenue projections, it’s highly unlikely that they’d permit the Governor to achieve even a “modest” win by allowing a minimum wage bill to advance, period. Further, considering the stranglehold these extreme Republicans have on the leadership of Louisiana’s House, it’s implausible to expect this crop of elected lawmakers to permit voters to weigh in on raising the minimum wage. For one thing, that would mean framing the issue as a constitutional amendment, and that would require a two-thirds majority consensus of each chamber. With the Legislature’s current political climate, that’s a nigh impossibility.

Less difficult to achieve would be the simple majority vote of each chamber needed to repeal the state preemption of local option on minimum wage – in its entirety.

In this election year, Democrats could tell voters their vote to repeal is part of bringing democracy back home, closer to the people. Pro-business Republicans could say their vote to repeal is a reflection of their deeply-held personal belief in letting the marketplace determine its own levels. Or they could spin it as a move away from the “Huey Long model of government” — where local governing bodies have to repeatedly come, hat in hand, to ask the state government for their share of both revenues and authority to govern.

There’s some disagreement within the business community over whether they really want more local government autonomy, and less state preemption. Next up, we’ll look into the consternation over property tax policies – ITEP and now, the homestead exemption.