Feb. 6, 2006 – Page 320
It was largely overlooked on Election Night back in 2004, overshadowed by
While the president carried Florida more easily than in the squeaker of four years earlier, the voters approved a constitutional amendment raising the state’s minimum wage to $6.15 and indexing it to future inflation — so that just last month it automatically increased again to $6.40.
Not only did the vote provide a curious cross-current in state politics, the margin of victory — almost 20 percentage points higher than Bush’s — provided a sizable exclamation point. Florida is one of the five states with the widest income disparity in the nation. It is increasingly conservative and Republican. But its voters wanted a minimum wage that now is $1.25 higher than the federal level.
If raising the minimum wage has negative effects on the labor market, as opponents of the measure claimed, they haven’t appeared yet. In December, the state’s unemployment rate dropped to 3.3 percent, its lowest in three decades and the lowest of any of the nation’s 10 largest states. Not only that, but Florida leads all those big states in job creation, adding 248,000 new jobs this past year alone.
Just a couple of weeks ago, Maryland became the 18th state (along with the District of Columbia) to enact a minimum wage above the current federal level of $5.15 — a level enacted a decade ago. The Democratic General Assembly overrode the veto of Republican Gov. Robert L. Ehrlich Jr. to enact a law bumping up the state’s minimum to $6.15 an hour, though unlike Florida (and three other states) it was not indexed for future inflation.
Now almost half the U.S. population lives in states with higher-than-federal minimum wages. More are coming, perhaps many more. Signatures are being gathered to put initiatives on the ballots in Montana, Arizona, Arkansas, Ohio and Michigan. Nevada’s is already scheduled. Govs. Bill Richardson of New Mexico and Edward G. Rendell of Pennsylvania, both Democrats, have proposed legislation to increase their states’ minimums and were recently joined by Republican Gov. Arnold Schwarzenegger, who called for a $1 increase in California, to $7.75.
It’s not just states, either. Perhaps the best-known local action came in Santa Fe, N.M., where the city council voted 7-1 to pass a law, which took effect in June 2004, raising the minimum in a series of steps to $10.50 in 2008. Richardson’s proposal for the state is more modest ($7.50 by 2009), and he wants to disallow local governments from exceeding the state level — except in Santa Fe, because the city “is undertaking an experiment that I think needs to let its course run. I shouldn’t interfere with it.”
All of this activity is not surprising, given the size of the margin in Florida and national polls last year showing that 82 percent back a minimum level of $6.45. These days, that’s overwhelming support on any issue. Yet it’s doubtful that Congress will enact federal minimum wage legislation this year. It could squeak through the Senate, but it would probably die in the House. You can bet, though, that the debate against it will be muted, because few members want to attract attention to their votes on something on which public opinion is so pronounced.
Why then, does the issue resonate across much of the country and not in Washington?
Economists are all over the lot on the issue. Most used to think that minimum wage laws really did dampen the number of jobs available, but recent academic studies, as well as the experience of the states with their own laws, suggest otherwise. Still, the laws actually don’t affect all that many people; even a $7.25 minimum wage would affect only 6 percent of the workforce. Even economists sympathetic to the idea of combating poverty look at these laws at best as blunt instruments that aren’t very efficient in achieving that goal.
Instead, what seems to be driving the issue is moral values. The backdrop is the toll that globalization is taking on U.S. manufacturers and their workers, the apparent collapse of the domestic auto industry, the competition for low-end work from illegal immigrants, the higher costs and shrinking availability of health insurance, splashy corporate scandals — plus stories of soaring executive pay and the growing gap between upper and lower incomes.
You get a feeling for the climate when Wal-Mart joins the unions and others supporting minimum wage laws. Despite its reputation for mistreating employees, the retail giant on average pays well above minimum wage, although it depends on lower-income workers for much of its customer base.
The end goal for minimum wage advocates, of course, is for Congress to act soon on a truly significant increase with indexation. But if that doesn’t happen, and it probably won’t, then it’s likely that it will be done piecemeal out in the country.
That’s the way policy seems to be made these days.
Peter Harkness is the editor and publisher of Governing magazine, published by Congressional Quarterly Inc.






