WEBVTT FILE

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[demonstrators shouting]

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-If the car wash workers
can organize,

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any workers can organize!

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Sí ser pueden, sí ser pueden.
[Yes they can, yes they can].

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[police talking to demonstrators]

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-In 2015, demonstrators,

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including union leaders
and elected officials,

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blocked traffic and were arrested

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in front of a small
car wash in Brooklyn.

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-It was an empowering moment.

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These workers were willing
to stand out there

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to fight for their rights and
for basic human dignity.

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And that’s something you take
with you for the rest of your life.

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And you have the ability
to make change

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by coming together
and when you do that,

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sometimes you find that you’ve got
some friends on your side.

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-In the past 6 years industries
like car washes,

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that employ low-skilled workers,

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have been the target of lawsuits
for alleged underpayment of wages.

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-And they both engage in
rampant labor law violations.

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-An ambitious unionization drive.

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-Let’s hear it then!
[people shouting]

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-And a successful campaign
to raise the minimum wage in New York

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to $15 per hour.

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-We’re gonna lead the way!

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The Nation’s going to watch us

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and we’re gonna raise up this State!

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-But here’s what really happened.

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Instead of helping
New York’s low-wage workers,

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the movement is
destroying their jobs.

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It’s pushed some car washes

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to replace their employees
with machines

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and others to close down.

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Increasingly, workers have no choice

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but to ply their trade out of illegal
vans parked on the street,

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because the minimum wage
has made it illegal

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for anyone to hire them
at the going rate.

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At the same time,

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businesses that have chosen
to automate are benefitting.

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-Thank you so much for $15 an hour,

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the best thing
that could happen to us.

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-Because outlawing cheap
labor makes it harder

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for new competitors to undercut them
on price and service.

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This is an in-depth look at
the real-world consequences

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when politicians interfere
with a complex industry

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that they don’t understand,

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enabled by media coverage

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that rarely questions
their simplistic tale

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of exploited workers
in need of protection.

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-Protect against whom?

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[music playing]

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[demonstrators making noise]

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-The car wash campaign serves as
a model for what might be possible.

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-In 2012, a coalition
of progressive groups

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led by the National
Retail Workers Union

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launched an ambitious
campaign to transform

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New York City’s car wash industry.

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-The genesis of the campaign
came out of the realization

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that you had an industry,

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which was really just a breeding
ground for terrible conditions.

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Hottest days of the year
and the coldest days of the year

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these workers are outside
working 60-70 hours a week

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and sometimes more, and not even
getting paid the minimum wage.

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I think workers felt that
they didn’t have many choices

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and they really had no one
that they could turn to.

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And we felt that we could have
a real impact on the industry.

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-But the truth is
that almost from day one

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nothing about the car wash campaign
has gone as planned.

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For starters it turns out
that most workers

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don’t want help from organized labor.

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After 6 years organizers
have unionized 11 businesses,

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or about 4% of the city’s car washes.

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Two of them have since closed down

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and the union withdrew at 3 more

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because of a lack
of support from the workers.

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There are just 6 unionized
shops remaining,

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or about 2% of the city’s
registered car washes.

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-Ervin Par is an immigrant
from Guatemala

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who works at Main Street
car wash in Queens,

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one of the city’s 6 remaining
unionized shops.

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Organizers have held 2 strikes

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at this location in
the past few years.

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And the New York Times
has covered allegations

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of worker mistreatment here.

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Now Main Street could
become the fourth car wash

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where the workers pressure
the union to withdraw.

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-Protect against who?

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Protect against who?

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-At this particular time
we represent the workers there

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and we certainly hope that
we’ll be able to continue to do that.

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-With the unionization
drive floundering,

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the movement’s leaders shifted
their focus to get the city and State

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to mandate change.

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[people clapping]

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-The most significant
government intervention

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championed by the union

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was an increase in the minimum
wage to $15 per hour.

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-New York is the progressive
capital of the Nation!

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We fight for fairness.
We fight for justice.

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-This move is upending the industry,

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but not in the way
activists intended.

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-We’ve heard over the years
from employers repeatedly

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that any time that we’ve made
changes within the industry,

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that either they’d all automate

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or the industry would suffer
massive shutdowns.

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We haven’t seen that happen to date.

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-In reality that’s exactly
what’s happening.

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The $15 minimum wage is driving
many New York car washes

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to replace men with machines,

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such as at this large
operation in Queens

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that installed a new arch
for hosing down vehicles,

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which will replace about 4 workers.

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Like many of the city’s car washes,

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this one was designed at a time
when manual labor

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cost less than installing
and maintaining machinery.

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-Labor was cheap, yeah, real cheap.

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-Amir Malki is a second-generation
car wash builder.

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When he started in
the industry in the 1980s,

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operators all over the city
were actually dismantling machinery

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because rag, hose, and brush welding
men did a better job for less.

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-Today it’s reversing.

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Labor is expensive and
we need the proper equipment

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to clean so we don’t
have to use extra men.

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-Its not just renovations.

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New, fully automated
car washes are opening up,

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such as this, state of the art
outfit near JFK airport

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with electronic gates,
a self-serve vacuum,

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and a single manager on-site,

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making sure everything
is running smoothly.

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Car wash owners
are choosing to automate

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even though it entails
substantial risk.

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Take Best Auto Spa in Brooklyn -

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one of the city’s
premier hand washes,

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drawing clients who care deeply
about the appearance of their cars

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and are willing to pay more
for the human touch.

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The $15 minimum wage means

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that this business model
is simply no longer viable.

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So Best Auto Spa is transforming

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from the equivalent
of an artisanal bistro

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to becoming just another
fast food joint.

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Two years ago the owner installed
$200,000 worth of equipment,

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which allowed him
to lay off 8 workers.

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Now he’s facing another policy change

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that would further increase
his labor costs.

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Employers are currently allowed

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to attribute a portion of the tips
earned by their workers

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towards meeting the minimum
wage requirement.

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New York State is seriously
considering a proposal

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to eliminate the
so-called tip credit.

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If that happens come January,

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the owner of Vegas Auto Spa
says he’ll have no choice

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but to give all these employees
a pink slip and go fully automated.

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-Then you have MM Wonder Bar,
Church Avenue.

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You have new fully automated
places opening up,

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like City Car Wash Express on
Northern Boulevard in Staten Island.

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I could go on. What is your take
on these examples,

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which I think do actually show
a major trend towards automation?

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-I get it if you go into a car wash
and the owner has said,

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“I’ve automated because of
what’s going on here,”

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that it makes you think
that it’s like, you know,

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part of a much broader story.

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I’m not saying it isn't the case.

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I’m just saying that, it’s like,

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that might not
necessarily be the case.

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-It’s true that not every
car wash owner

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is willing to take on the risk
and expense of automation.

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And there’s another option.

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Exit the business
and relinquish their land

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for more profitable uses,

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which has also been happening
at many New York car washes.

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Several car washes have closed
after their owners were sued

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for paying off the books and not
complying with labor regulations.

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-We will continue to keep
an eye on these businesses

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to ensure that they don’t
stray from the path of

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righteous business practices.

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-A lawsuit contributed to
the closing of this car wash

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in Woodside, Queens,
to this one in Harlem,

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and to this one in Upper Manhattan.

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At each of these locations,
dozens of low-wage jobs disappeared.

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-Are workers really better off

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when the car wash that
they work for closes down?

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-Yeah, I don’t agree
with your assessment that

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these car washes are closing as
a result of wage and hour lawsuits.

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Umm, that’s, umm, that
might not necessarily be the case.

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That may be how it’s
being characterized to you.

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-Another unintended
consequence is that

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for business owners who choose
to stick it out and automate,

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the $15 minimum wage actually
protects them from competition

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by making it harder for
new car washes to open up.

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-Solely from being a businessman,
the increase in the minimum wage

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makes my business so much easier -

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the best thing that could happen
to me and I think to the industry.

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-Jack Belinski is the Manager
of a new car wash in Queens.

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It opened last year at the site
of yet another labor-heavy operation

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that closed following
a wage and hour lawsuit.

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The new owner converted it to

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a fully automated
exterior-only car wash.

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Meaning customers are left
to vacuum the interiors

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of their own vehicles.

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-’Cause we used to do
the same thing with 25 people,

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now I’m doing it with 2.

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-By making cheap labor illegal,

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the $15 minimum wage
made it possible for Belinski

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to downgrade his service.

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-Before, if I go exterior
and my competition says,

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“ha, he went exterior
and I’m still full service,

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I’ll take all his customers”,

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that never gave me
a chance to go exterior.

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Right now everybody
is forced to go exterior

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because of this crazy law
and the minimum wage of $15 an hour.

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Now everybody…
it evened out the field.

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-The $15 minimum wage amounts to

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government prohibition
of low-wage work.

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And yet, just making
something illegal

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won’t stop able-bodied men
with few alternatives

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from meeting a market demand
for their services.

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-These workers have few
options and little power.

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They live in the shadows.

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-The irony is that progressives
have pushed car wash workers

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further into the shadows.

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Since legitimate car washes
can no longer hire them,

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workers are going to the streets,
where it’s all cash,

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no taxes, no unions,
no workers’ comp,

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no insurance and certainly
no wage floors.

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-Fausto, who asked to be identified
by his first name only,

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is an illegal car wash worker.

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He’s part of a three-man operation
washing cars on the curb

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out of a van for about $15 a pop.

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-He’s lived in the US for 19 years

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and still sends
a portion of his earnings

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back to the Dominican Republic

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to help support
his wife and children.

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-How the hell can you,
how can I compete?

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Because if these guys, they’re
paying, they’re paying cash...

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you understand, they’re not paying
the proper taxes, FICA,

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on insurance, but I am.

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-And now the established car washes,

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left with no choice but
to install expensive machines

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and plaster their walls
with operating licenses,

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are the ones clamoring
for the government

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to enforce the minimum wage.

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-You worry for the workers,
look at the rules that we make.

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But if those rules are not enforced,
those laws are toothless.

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They only destroy
the good guy that tries to

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follow all the rules
and has to compete

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00:12:02.184 --> 00:12:04.562
with the bad guy
that breaks all the rules.

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-Some of these guys,
working out of these vans

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don’t have other employment options.

275
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Are you sure that it would be in

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their best interest
to shut them down?

277
00:12:18.795 --> 00:12:20.910
-Yeah, I actually, I do

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and I’m going to be
very blunt about that.

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You can always make the argument that

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you can allow some people
to skirt the law,

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00:12:27.555 --> 00:12:29.515
some people to skirt
regulations that are meant

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to protect workers in an effort
to give people work opportunities.

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That’s a devil’s bargain.

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-Or maybe the real devil’s bargain

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is championing a set of policies
that sound good at a rally

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00:12:42.581 --> 00:12:43.834
but that in the real world

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00:12:43.874 --> 00:12:47.775
jeopardize the livelihood
of the working poor.

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00:12:47.815 --> 00:12:50.386
Which brings us back
to Vegas Auto Spa -

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the Brooklyn car wash
that progressive activists

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00:12:52.768 --> 00:12:58.486
made an example of back in 2015.

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00:12:58.526 --> 00:13:00.569
Shortly after the car wash unionized,

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00:13:00.609 --> 00:13:03.496
the owner started planning
his exit strategy.

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00:13:03.536 --> 00:13:05.415
Two years later he found a buyer

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00:13:05.455 --> 00:13:08.150
who kept it running
for one more year.

295
00:13:08.190 --> 00:13:10.635
Today Vegas Auto Spa is shuttered

296
00:13:10.675 --> 00:13:13.079
and the ripple effects
of the entire movement

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00:13:13.119 --> 00:13:15.602
have been to destabilize an industry,

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00:13:15.642 --> 00:13:17.602
pushing the men and
women who worked in it

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00:13:17.642 --> 00:13:19.781
even deeper into the shadows.

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[people shouting]

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[music playing]