File photo: McDonald's jobs. General view of a McDonald's restaurant in Camden, London.
Press Association via AP Images

McDonald’s announcement jolts debate over minimum wage increase

The last time Americans saw an increase to the federal minimum wage was in 2009, when it climbed to $7.25 from $6.55. It was the final part of a phased-in increase approved, interestingly enough, by George W. Bush and a Democratic Congress a few years prior.

And since then, nothing. Several states have boosted their minimum wage laws, but at the federal level, steadfast Republican opposition has stood in the way of every Democratic effort to hike the existing floor.

When pressed, many GOP policymakers tend to say they have no choice: it falls to Republicans to ignore public support for a higher minimum wage because businesses affected by the change require protection.

But what if those businesses stop asking for protection? Politico ran an interesting report this week:

Fast-food giant McDonald’s boosted congressional Democrats’ efforts to hike the minimum wage Tuesday by telling the National Restaurant Association that it will no longer participate in lobby efforts against minimum-wage hikes at the federal, state or local level.

“We believe increases should be phased in and that all industries should be treated the same way,” Genna Gent, McDonald’s vice president of government relations, wrote in the letter. “The conversation about wages is an important one; it’s one we wish to advance, not impede.”

McDonald’s’ dramatic shift on the issue comes after the U.S. Chamber of Commerce signaled it would be willing to negotiate over raising the hourly minimum, which for a decade has been stuck at $7.25. “We’re going to listen,” Chamber President Tom Donohue told reporters in January.

To be sure, news like this comes with some caveats. When the U.S. Chamber of Commerce signals openness to an increase, for example, it likely means the business lobby is prepared to negotiate. In practice, maybe the Chamber would look to strike some kind of deal with House Democrats, in which the organization endorsed a minimum wage hike in exchange for some other priority.

But as important as those details are, let’s not miss the forest for the trees: when McDonald’s drops its opposition to a minimum wage increase, and the U.S. Chamber of Commerce signals a willingness to deal, it suggests the debate is changing in ways that are likely to produce results.

Those results may, however, have to wait until there’s a new president in the White House. Late last year, Larry Kudlow, the director of Donald Trump’s National Economic Council, suggested he doesn’t believe the federal minimum wage should exist at all.

“My view is a federal minimum wage is a terrible idea. A terrible idea,” Kudlow said, adding that he considers the idea of hiking the federal minimum wage “silly.”

This more or less echoed what the president said during his 2016 candidacy, when Trump suggested a federal minimum wage need not exist.

Change is likely to come on this issue, but it may not come before January 2021.