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Costco CEO doesn’t understand Lindsey Graham’s problem with $ 15 minimum wage

Sen. Lindsey Graham (RS.C.) found himself on Thursday to the very right of the CEO of a large company as the two debated a $ 15 minimum wage.

Costco CEO W. Craig Jelinek didn’t quite understand why Graham was vying for the higher wage – perhaps because Costco is preparing to raise its own minimum wage to $ 16 an hour starting next week. The company, which employs 180,000 workers, paid $ 15 an hour in 2019, and more than half of workers now earn $ 25 an hour.

The increase “is not altruism,” Jelinek said at a Senate Budget Committee hearing. “At Costco, we know that paying good wages to our employees … makes good sense for our business and is a significant competitive advantage for us. This helps us in the long run by minimizing staff turnover and maximizing employee productivity. “

He added: “We are certainly not perfect, but we try to take care of our people because they play such an important role in our success.”

But Graham tried to tell Jelinek that now is “not the time” to institute a higher minimum wage because of the COVID-19 pandemic.

The senator said he was not really concerned about big companies like Costco. But he was “worried about the small business owner” – but apparently not the workers – “struggling because COVID has reduced his ability to make a living. Do you understand where I come from? ” He asked.

Jelinek said yes.

“So if you run a restaurant or a hotel and no one can travel around the country and the seating has been reduced … incomes are declining … can you understand why an increased tenure of the government in terms of cost would be a devastating blow? ”Graham asked.

Jelinek replied, “I can’t understand why this would be such a devastating blow. I think this is a devastating blow to the employees, ”he began, perhaps to make a point about minimum wage, but Graham spoke about him.

The senator criticized him for not seeing the business difficulties associated with “doubling the minimum wage.” Don’t you understand that? he said dryly.

“I don’t know if I was suggesting doubling the minimum wage,” replied the CEO of Costco.

When asked if he would support a minimum wage of $ 11, a proposal put forward by Senator Joe Manchin (DW.Va.), Jelinek replied, “It’s better than $ 7.25.” Graham replied, “Very well.”

Budget Committee Chairman Bernie Sanders (I-Vt.) Referred to a Government Accountability Office study revealing that millions of American workers are so poorly paid at companies like Walmart that they need food vouchers and of Medicaid to survive, which he called a massive taxpayer subsidy for businesses.

Congress was preparing to vote on legislation to gradually increase the federal minimum wage to $ 15 an hour by 2025 – which was a campaign pledge from President Joe Biden. The federal minimum has been stuck at $ 7.25 an hour since 2009, although many states already have higher minimum wages.

But the Senate parliamentarian ruled Thursday that the Democrats’ strategy to push through the increase as part of their $ 1.9 trillion COVID-19 relief package violated Senate rules. The move 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 the struggles of business owners – but not workers – in the video above.


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