Indiana–Always Last

The Hill recently reported on a number of states where 2018 will see raises in the minimum wage. Indiana, of course, was conspicuously absent from their list.

The lowest wage workers in 18 states will get a boost in their paychecks starting on New Year’s Day, as minimum wage hikes take effect.

Many of the wage hikes are phased-in steps toward an ultimately higher wage, the product of ballot initiatives pushed by unions and workers rights groups over the last few years.

The minimum wage in Washington state will rise to $11.50 an hour, up 50 cents and the highest statewide minimum in the nation. Over the next three years, the wage will rise to $13.50 an hour, thanks to a ballot measure approved by voters in 2016.

Mainers will see their minimum wages rise the most, from $9 an hour to $10 an hour, an 11 percent increase. Voters approved a ballot measure in 2016 that will eventually raise the wage to $12 an hour by 2020.

Arizona, California, Colorado, Hawaii, New York, Rhode Island and Vermont will see their minimum wages increase by at least 50 cents an hour. Smaller increases take effect in Alaska, Florida, Michigan, Minnesota, Missouri, Montana, New Jersey, Ohio and South Dakota.

Our overlords at the Indiana Statehouse like to brag that keeping Indiana a “low wage” “right to work” state means we are attractive to businesses looking to relocate. What they don’t seem to understand is the flip side of the equation, beginning with the state’s inability to provide the quality of life amenities (not to mention smooth highways)  that appeal to businesses proposing to relocate. Higher wages would generate more tax dollars. Higher wages would also reduce the number of people who–despite working full-time–must depend upon social welfare programs funded by tax dollars simply to make ends meet.

I have posted before about the ALICE study, conducted a couple of years ago by Indiana’s United Ways. That study found

  • More than one in three Hoosier households cannot afford the basics of housing, food, health care and transportation, despite working hard.
  • In Indiana, 37% of households live below the Alice threshold, with some 14% below the poverty level and another 23% above poverty but below the cost of living.
  • These families and individuals have jobs, and many do not qualify for social services or support.
  • The jobs they are filling are critically important to Hoosier communities. These are our child care workers, laborers, movers, home health aides, heavy truck drivers, store clerks, repair workers and office assistants—yet they are unsure if they’ll be able to put dinner on the table each night.

Here in Indiana, we don’t seem to find ALICE poverty problematic or immoral, despite the fact that virtually all of us who are more privileged depend upon the services these people provide.

Even more immoral, in my humble opinion, is having my tax dollars effectively paying a portion of the wages of Walmart, McDonalds and other big employers’ workers. As I have previously posted,

Walmart generates nearly $500 billion in revenue annually; over the past five years, its yearly profits have averaged $15.5 billion dollars, and the family that owns it has a net worth of $129 billion dollars.

Despite its obvious ability to do so, the company declines to pay its employees a living wage, instead relying upon government programs–taxpayer dollars– to make up the difference between its workers’ paychecks and what they need to make ends meet. In essence, when a Walmart employee must rely on food stamps or other safety-net benefits, taxpayers are paying a portion of that employee’s wages.

Walmart (including its Sam’s Club operation) is currently the largest private employer in the country–and one of the largest recipients of corporate welfare. Walmart employees receive an estimated $6.2 billion dollars in taxpayer-funded subsidies each year. Money not paid out in salary goes directly to the shareholders’ bottom line.

The Indiana legislature declines to offer even a modicum of help to the third of Hoosiers who are working for below-subsistence wages, but they are evidently happy to continue subsidizing the wealthy.

The Hoosier bottom line.

20 thoughts on “Indiana–Always Last

  1. ……….and prices have been rising steadily and exponentially at the supermarket while corporations are receiving welfare, another reason for expelling greedy Republic-rats

  2. And the other issue which the Lilly Foundation doles out millions for universities to study our annual brain drain.

    Why are young people leaving for more progressive communities?

    Other states have a higher quality of life and they pay better wages. When all you have is farm fields and flat ground, you better make yourself even more attractive than our competitors. Until we change our economic system, we are in competition with these other states for workers. We don’t offer much except cheap housing because there is no demand to live here.

    We always rank high for CEO’s, but they always complain they can’t find trained workers. LOL

    They might want to look out West for those trained workers where they’re paid more and have more recreational areas to enjoy themselves.

  3. Todd, you have touched on something I have wondered about for a long time. Why do states not do something about reinventing (for lack of a better word) themselves? West Virginia surely has more than coal to offer the US, Indiana could increase recreational facilities and training, etc. What do people need for that push to change?

  4. This is a silly question but…are any of the listed states who are raising their minimum wage level red states? Indiana is always at the bottom of any progressive list on any issue but we have carried the name “land of taxes” for many years…due to the long list of itemized taxes deducted from paychecks and added to our utility bills. That title has been downplayed in recent years; probably due to overall Republican government control.

    Our state motto, “Honest To Goodness, Indiana” needs to be changed to “WTF, Indiana?”

  5. If all you’re going to do is spout facts and figures, how can you expect any Republican to take you seriously?

  6. Does anyone recall the article in NUVO (maybe three years ago) based on a survey of CEOs heading companies that had considered but rejected moving all or part of their operations to Indiana? Those CEOs gave reasons like:

    Several people who are important to the success of this company will have to relocate to wherever we move and those critical employees will not tolerate bringing their children to a state that ranks so low in education.

    My management team is made up of several races, cultures, religions and sexual preferences and will not accept moving to a state that still clings to primitive prejudices.

    My people will not like driving across the badlands of Indiana’s potholes.

    My people have an eye for aesthetics, and they will not tolerate living in communities in which citizens prioritize spending on horsepower in their vehicles instead of improvements in curb appeal, where 75% of the cars and trucks on the roads appear to belong to upper middle-class families, but 90% of the homes look as if their owners have not gotten out of prison yet, where people are first to condemn a neighbor’s religion and last to remove their trash bins from the street.

    Instead of bribing companies to settle here, why not make our communities so desirable that companies will bribe Indiana to move here?

  7. Walmart is the largest employer in Indiana, public or private.

    The Republicans pushed through “right to work” legislation that made us just another rust belt state with lousy job prospects and low expectations of staying even with our neighboring states.

    As to corporate welfare, note that the Indiana House managed to ram through a bill allowing light rail in this session, just in case Amazon might disregard our racism and xenophobia if they thought we would pay more to facilitate their business needs.

  8. Larry; I agree. I pointed out the deplorable conditions of neighborhoods throughout Marion County, many are crime-ridden, through which employees would have to drive (no viable public transportation) to reach job sites in newly located businesses here. It is not only pot-holes but washboard streets causing wear and tear and damage to vehicles. These areas cannot be bypassed to reach downtown or go from downtown to outlying areas. More major stores are closing due to the low wages here not providing money for much but essentials. Washington Square Mall is now a no-man’s-land; appearing deserted except for the businesses in front of the Mall on Washington Street appearing to be a bustling business area. The primary anchor in Circle Centre Mall is a factor – the Indianapolis Star facility. And yet; I read Indianapolis is one of the finalists for Amazon to locate another headquarters. Could that be connected to the fact that Amazon on-line shoppers in Indiana have paid our 7% sales tax for years – long before the filed and won law suit by Indiana to legalize charging us sales tax on products from other states.

    Jim Nabors singing “Back Home Again In Indiana” always brought a tear to many eyes; but that Indiana has been gone for almost a century.

  9. Shockingly, Indiana ranked 3rd last year for “best places to work for women in tech industry”. I’m not exactly sure how that happened. We were also voted 4th best downtown foods. Carmel was ranked #1 best place to live in America (validity of the reporting websites not withstanding).

    Per the US News – Best Places to Live: 6.5/10
    “The median household income here is higher than the national median. Indiana’s 7 percent sales tax is one of the higher tax rates in the country, but property taxes and state income taxes have remained low for years.”

    Don’t know about everyone else, but my property taxes tripled 2016. And I ALWAYS owe IN state taxes, even though I pay an extra $20 per pay period and make less than $40K.

    Truthfully, I’d pay almost half of what I earn in taxes, if I didn’t have to pay for college and health care. If I had a subway or light rail. If drugs were decriminalized, and men had equal parental rights. You know.. like all the other cool countries. (I tried moving to another country, but none of them want Americans taking their jobs.. funny.)

  10. The only place in Indiana that is hiring and can’t find enough workers is in Elkhart county where the RV capital of the world is located. The companies there have hiring bonuses to get people to work for them but why don’t they have enough workers? Because as soon as there is a recession, they lay off people who end up having to leave the county because they can’t survive. This cycle has repeated for as long as I can remember. They hire these people to work in their RV factories and they don’t allow unions, they don’t pay a livable wage, they don’t offer proper benefits like sick pay and healthcare and complain that they can’t find workers.

    I’m not blaming people that have seen this cycle repeat over and over again for the past 40 yrs, this is the RV corporations fault for not investing in their community to retain those workers.

  11. Indianapolis has a Democratic Mayor and Democrats control the Council. Could these entities increase the minimum wage in Indianapolis – Marion County, unless the State Legislature has passed a law not allowing Marion County to do so.

  12. Indiana, as with Kansas and, to a similar extent, Wisconsin are seeing the results of politicians clinging to the disastrous and non-workable economic theory of Milton Friedman and Friedrich Hayak – SUPPLY-SIDE ECONOMICS. “Reaganomics” was the euphemism used for this overt attack on working people. Since 1981, Republicanism has based itself on this damaging “idea” and have caused the growing disparity between rich and not-so-rich.

    Yet, people who aren’t rich keep voting for Republicans thinking they will become richer. They won’t, but they also won’t admit that they made a huge mistake. It will only get worse until there is a major shift back to equitable earnings where the rich stop trying to screw the poor so they can get richer.

    Why would anyone want to be rich and live in a poor country?

  13. I note with interest that Trump last night in his selection of words and phrases neglected to use the word Russia, or the word deficit, or the phrase wage inequality. As my fellow commentators know by now, I consider wage inequality to be our most pressing domestic issue (aside from nation-killing Republican attacks on our democracy and democratic institutions) and the fact that the federal minimum wage has been stuck at $7.25 an hour for 21 years (since 1997) is a scab on our economy due to inflation (whose basket for computation wrongly excludes food and energy and thus skews the official rate downward). The purchasing power of $7.25 not only isn’t what it used to be but is not realistically measured. Food prices are going up and as to energy my daughter emails me that she paid a $325 electric bill last month. Economic growth depends solely upon aggregate demand and someone tell me how demand in the marketplace is enhanced by the payment of slave wages to workers.

    Sheila rightly notes that you and I have to subsidize the likes of Walmart by providing social services such as food stamps to its employees so that they can exist, thus paying our tax money into the coffers of Sam’s heirs and devisees, albeit indirectly. We even have to provide food stamps for some serving in the military, speaking of slave wages. Walmart is not alone; you and I are subsidizing many other corporations’ shareholders and bonuses for their executives along with capital gains opportunities as their stock values on the Dow go up, but such a rise not as a result of corporate efficiency or the patent of a better mousetrap – their compensation and stock values go up via taxpayer gifts from you and me, accentuated by the recent “tax bill” passed which amounted to a super gift to the corporate maw, a trickledown super gift to the superrich which will not translate into enhanced demand, new factories, massive increases in employment etc. as claimed by Trump and his sycophants. What corporate board in its collective right mind would increase production to sit on warehouse shelves unsold because of lack of aggregate demand caused by wage inequality?

    I think that wage inequality and economic growth are oil and water – never to mix – and I look to anemic economic growth due not to corporate performance but to automation and Amazon-like marketing techniques. Keynes had it right for the ages: That our problem is not overproduction but rather underconsumption.

  14. Jo Ann,

    Most of the States listed in The Hill article are at least nominally “red states” including the State of Arizona where I now live (i.e., Colorado, Alaska, Florida, Michigan, Missouri, Montana, New Jersey, and South Dakota are all usually classified as being reliably R states).

    One difference between Arizona (and many of the other state’s listed as having raised the minimum wage in the last few years) and Indiana is that there is a citizens’ ballot initiative provision written into Arizona’s Constitution (which AZ’s super-majority Republican legislature is striving hard to emasculate — another story!) that allows citizens to directly vote on whether the minimum wage should be raised or whether medical marijuana should be allowed. Both of those were approved by a majority of Arizona voters (although by a narrow margin in both cases) by ballot initiatives and can’t be (directly) tampered with by our Repub Gov and legislators.

    As has often been observed here, the majority of U.S. citizens are in favor of and want most of the things the Repubs (and their corporate masters) steadfastly oppose such as higher minimum wages, legalization of marijuana, affordable health care, and on and on. When given an opportunity to vote directly on such provisions by ballot initiatives, the citizens often override their Repub overlords (even when millions of $$$ are spent by ALEC, the U.S. Chamber of Commerce and pharmaceutical companies to oppose them).

  15. Every time the issue of raising the minimum wage is proposed, anywhere in this Country, businesses always predict two things; 1) they will have to raise prices, and 2) they will have to get by with fewer workers.

    As The Hill article cited in today’s blog attests, there are now a large number of states that have raised the minimum wage, albeit many, as in Arizona, where the minimum wage is being increased incrementally over a period of several years; so the full effect might not be known for awhile. Nonetheless, I have read and seen different reporting about whether the dire predictions from businesses about having to raise prices and hiring fewer workers have actually occurred.

    For example, both California’s and Washington’s economies are flourishing, and the number of jobs being added are good. Even here in Arizona, where low wage jobs in restaurants, the hospitality industry, etc. make up a very large percentage of the workforce, there were reports that the number of new employees hired in those sectors were the fastest growing sector even after the minimum wage was increased and will continue to increase over the next several years. And, of course, prices have gone up some, but then prices go up everywhere. How much of rising prices in the states with higher minimum wages can be attributed to the higher wage? Would be interesting to know.

    Of course, as observed in an earlier post today, facts really don’t matter to the current Repubs. Nonetheless, it would be interesting to see some actual facts about what the effects of having raised the minimum wage in those states have been. Perhaps a future topic for this blog?

  16. I’ll never forget going to the grocery store on the base in Stuttgart Germany with my military friends and seeing signs that said WIC approved. I asked my friend what WIC was? She said that was for the service members who used food stamps (WIC) to provide for their families. I was furious. How can we accept that our military members serving all over the world need food stamps in order to survive?

    We are doing this all wrong.

  17. As someone who moved to IN for grad school (3rd generation IU Hoosier), stayed around for a few years (loved living in Indy), and then moved to a high tax state (CA) for more career opportunities, better pay, and a better quality of life, I can attest to the accuracy of Todd’s point. IN’s years-long race to the bottom (You have Mitch Daniels to thank for that) is keeping it from achieving its true potential.

    It’s takes a community to build a state that is attractive to everyone. Not everyone is fighting for that goal in IN, though. Observe the best, adopt their approaches, and then adjust to leverage your unique assets. IN has much to offer, but it has to put the right pieces into place.

  18. I don’t think Republicans in Indiana will understand why young people flee and why good employers won’t come here even after the last person turns out the lights.

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