Joelle Craft (C) holds a sign during a rally and strike aimed at the fast-food industry and the minimum wage in Seattle, Washington August 29, 2013.
David Ryder/Reuters

Minimum wage a potent political issue

Updated
When we think of the dominant political issues of the day, issues like health care, immigration, and foreign policy in the Middle East quickly come to mind, but it’s a mistake to leave the minimum wage off the list. In the face of Republican opposition, congressional action is unlikely before 2015 at the earliest, but there’s quite a bit of activism underway away from Capitol Hill.
States and municipalities across the country are leading a localized push to raise the minimum wage, driven largely by Democrats, who see an opening to appeal to working-class Americans at a time of growing inequity.
 
Efforts in Congress to raise the national minimum wage above $7.25 an hour have stalled. But numerous local governments … are forging ahead, in some cases voting to dramatically increase the pay of low-wage workers.
For Democrats, the issue checks a lot of boxes. Not only has the buying power of the minimum wage shrunk to indefensible levels, but this is a wildly popular economic policy that helps drive a wedge between Republicans and working-class voters, even in “red” states.
 
It’s one of the reasons efforts are underway from coast to coast. Just a month ago, voters in New Jersey approved an increase despite Gov. Chris Christie’s (R) objections, and on the same day, voters narrowly approved a $15 hourly minimum in the area surrounding the Seattle-Tacoma International Airport. State lawmakers in Massachusetts are eyeing a new increase, which comes on the heels of California adopting a $10 minimum wage of its own.
 
We can expect to see a lot more along these lines. The Washington Post report added, “Democrats are deep in the minority in legislatures in South Dakota and Arkansas, for instance. But both states allow for statewide referendums, and Democrats there are gathering signatures to put minimum wage increases on the ballot in 2014. Just as Republicans used initiatives banning same-sex marriage as a way to boost turnout in 2004, Democratic candidates may find that sharing a ballot with a minimum wage measure helps draw the contrast between the two parties.”
 
Republican opposition remains quite fierce, with the right arguing that minimum-wage hikes undermine job creation, but as Paul Krugman explained this morning, the evidence shows otherwise.
[W]e have a lot of evidence on what happens when you raise the minimum wage. And the evidence is overwhelmingly positive: hiking the minimum wage has little or no adverse effect on employment, while significantly increasing workers’ earnings. 
 
It’s important to understand how good this evidence is. Normally, economic analysis is handicapped by the absence of controlled experiments…. When it comes to the minimum wage, however, we have a number of cases in which a state raised its own minimum wage while a neighboring state did not. If there were anything to the notion that minimum wage increases have big negative effects on employment, that result should show up in state-to-state comparisons. It doesn’t.
Looking back, federal policymakers have packaged minimum-wage hikes with other economic measures Republicans can tolerate to get an increase through. Jonathan Bernstein made the case the other day that this seems unlikely in this Congress – the post-policy GOP just doesn’t have much of an agenda right now, so there’s nothing to bundle together.
 
But while congressional Republicans block action at the federal level, plenty of states and municipalities have decided not to wait any longer.
 
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Minimum Wage

Minimum wage a potent political issue

Updated