Sen. Lindsey Graham (R-S.C.) on Thursday found himself to the right even of the chief executive of a major corporation as the two debated a $15 minimum wage.
Costco CEO W. Craig Jelinek couldnâ€™t quite get why Graham was arguing about the higher wage â€” perhaps because Costco is preparing to up its own minimum wage to $16 an hour starting next week. The company, which employs 180,000 workers, paid $15 an hour back in 2019, and more than half of the workers are now earning $25 an hour.
The increase â€œisnâ€™t altruism,â€ Jelinek said at a hearing of the Senate Budget Committee.Â â€œAt Costco, we know that paying employees good wages … makes sense for our business and constitutes a significant competitive advantage for us. It helps us in the long run by minimizing turnover and maximizing employee productivity.â€
He added:Â â€œWeâ€™re certainly not perfect, but we try to take care of our employees because they play such a significant role in our success.â€
But Graham tried to tell Jelinek that now is â€œnot the timeâ€ to institute a higher minimum wage because of the COVID-19 pandemic.Â
The senator said he wasnâ€™t really concerned about large companies like Costco. But he was â€œworried about the small business ownerâ€ â€” though apparently not about workers â€” â€œwho is struggling because COVID has reduced their capability to earn a living. Do you understand where Iâ€™m coming from?â€ he asked.
Jelinek responded that he did.
â€œSo if you run a restaurant or hotel and nobody can travel in the country and seating capacity has been reduced … the revenues are down … can you understand why an increased mandate from the government in terms of cost would be a devastating blow?â€ Graham asked.
Jelinek replied: â€œI canâ€™t understand why it would be a devastating blow. I think itâ€™s a devastating blow to the employees,â€ he began, perhaps to make a point about minimum wage, but Graham spoke over him.
The senator chided him for not seeing the business hardship of â€œdoubling the minimum wage. You donâ€™t understand that?â€ he snapped.
â€œI donâ€™t know that I was suggesting doubling the minimum wage,â€ the Costco CEO responded.Â
When asked by Graham if he would support an $11 minimum wage, a proposal put forward by Sen. Joe Manchin (D-W.Va.), Jelinek responded: â€œItâ€™s better than $7.25.â€ Graham answered: â€œFair enough.â€
Budget Committee chair Bernie Sanders (I-Vt.) pointed to a study by the Government Accountability Office revealing that millions of American workers are paid so poorly at companies such as Walmart that they need food stamps and Medicaid to survive, which he characterized as a massive taxpayer subsidy for corporations.
Congress had been preparing to vote on legislation that aims to gradually increase the federal minimum wage to $15 an hour by 2025 â€” which was a campaign pledge by President Joe Biden. The federal minimum has been stuck at $7.25 an hour since 2009, though many states already have higher minimum wages.
But the Senate parliamentarian ruled Thursday that theÂ Democratsâ€™ strategy to pass the increase as part of their $1.9 trillion COVID-19 relief package violates Senate rules. The decision was almost certainly a fatal blow to quickly give tens of millions of workers a raise, at least as part of the relief bill.
Watch Graham try to explain to Jelinek about the hardships of business owners â€” but not workers â€” in the video up top.
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