Analysis

Is This A Rare Case In Which Bernie Sanders, Walmart And Amazon Agree?

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Bradley Devlin General Assignment & Analysis Reporter
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Independent Vermont Sen. Bernie Sanders has made a career going after capitalism and the big businesses he believes embodies corporate greed. But, Sanders agrees with big corporations like Amazon and Walmart on a crucial policy issue: a $15 minimum wage.

For most of his career, Sanders has supported raising the minimum wage, according to his campaign website, and has introduced a number of bills in order to accomplish his goal. It was not until 2015, however, until Sanders began to support a $15 minimum wage via a legislative amendment.

The policy proposal ran in concert with his 2016 bid for the Democratic presidential nomination. Big businesses who once opposed increases to the federal minimum wage, according to CNN, have reversed course as the left has exerted an intense amount of internal and external social pressure against these corporations to fall in line with progressive values.

Sanders’ support from the minimum wage seems to originate from his sense of progressive ethics and combatting income inequality. While corporations have adopted this language to voice their support for a $15 minimum wage, their economic reasons for supporting the minimum wage increase is based in quashing competition.

The Fair Labor Standards Act (FLSA) first established the federal minimum wage at $0.25 an hour in 1938, according to the U.S. Department of Labor (DOL) website, which is equivalent to $4.60 in today’s dollars, Business Insider reported. The federal minimum wage has gone through a number of iterations based on amendments proposed for certain kinds of workers, the DOL website shows. Under the FLSA, the $0.25 minimum wage has undergone 22 separate increases, and now sits at $7.25 an hour, according to the DOL.

States, and localities for that matter, also have the capability to create and implement their own minimum wages. In deep-blue states like California and New York, the minimum wage is already close to the $15 threshold Sanders and a number of Democrats are trying to attain, according to a chart generated by Statista. However, in the middle of the country, the minimum wage is set by the federal minimum wage of $7.25, or hovers just above, Statista’s chart shows.

Sanders, whose state has a $11.75 minimum wage, according to Statista, started to push for increases to the minimum wage when he was in the House of Representatives. In 1993, Sanders introduced the Liveable Wage Act of 1993. At the time, Sanders called the $4.25 an hour minimum wage (which is equivalent to $7.80 in 2021 dollars) a “starvation wage,” according to Dollar Times. “The standard of living of the average American worker continues to decline while the chief executive officers of America saw last year a 56% increase in their income,” Sanders said in a speech on the House floor advocating for the bill.

The bill did not pass, but Sanders continued to re-introduce the legislation in 1995, 1997 and 1999, according to his campaign website. Two years later in 2001, Sanders introduced the Minimum Wage Restoration Act, and cosponsored a number of minimum wage-related bills over the course of the next decade, both in the House and the Senate, his campaign website claims. In 2013, Sanders pushed for a budget amendment to increase the minimum wage to $10.10 an hour before he proposed a similar amendment in 2015 that would raise the federal minimum wage to $15 an hour, according to his campaign website. (RELATED: Corporations That Support The $15 Minimum Wage Can Afford It. Here’s Who Can’t)

Given Sanders’ proclivity to argue for increases to the minimum wage on the grounds that CEOs in America are taking more than their share, why would major American CEOs sign on to his proposals?

Amazon announced in 2018 that it would be increasing its minimum wage after workers at the Amazon owned Whole Foods organized against Amazon and forwarded their demands, which included a $15 minimum wage. “We listened to our critics, thought hard about what we wanted to do, and decided we want to lead,” Amazon founder Jeff Bezos said in a blog post. “We’re excited about this change and encourage our competitors and other large employers to join us.”

The online retail giant wasn’t the only large corporation to follow progressive trade winds. In July 2020, the traditional brick and mortar retailer Target announced its employees would see their minimum wage increase to $15 an hour. Last September, Walmart, who is trying to transition its traditional retail empire to increasingly sell products online, announced a new pay scale that would increase the minimum wage of those working in a “lead roll” positions to between $18 to $21 an hour.

“The minimums for hourly associates in the deli and bakery areas are increasing from $11 an hour to $15 or higher,” Walmart’s announcement read. 

These companies’ push for an increased minimum wage is economically advantageous to them because while they can afford a minimum wage increase, small businesses and competitors cannot. 

A 2017 case study on Seattle’s $13 per hour minimum wage by the National Bureau of Economic Research (NBER) found that the minimum wage increase disproportionately affected small businesses. The increase in labor costs caused small businesses, which typically operate on much smaller-percentage margins, had to lay off workers to decrease their payroll hit, according to the NBER. The result was low-wage employees saw their total payroll earnings drop by $125 a month, the NBER study found.

A 2018 survey also found that if the minimum wage was increased by just $1 an hour, small businesses would take a hit of tens of thousands of dollars a year in increased labor costs.