AS part of his focus on combatting “income inequality,” President Barack Obama has called for increasing the federal minimum wage from $7.25 to $10.10 an hour. Democratic strategists thought this would put Republicans on the defensive, forcing them to either acquiesce to Obama’s demands or appear indifferent to the struggles of low-income workers.
Yet it’s Senate Majority Leader Harry Reid, D-Nev., who’s now delaying a vote on a minimum wage increase. Reid previously planned to take up the issue on Thursday, but now says it won’t be voted on until sometime after March 24.
The Hill, a newspaper focused on congressional coverage, reports that Reid is making that change “amid escalating Democratic resistance” to the proposal. Democrats have solid majority control of the Senate, holding 55 of the 100 seats (including the two independents who caucus with the Democrats). Yet just 32 Democratic senators have signed on as co-authors of the minimum wage bill, which is supposedly the centerpiece of their party’s 2014 agenda.
The Democrats refusing to co-author the bill include several in competitive races in Arkansas, Louisiana, North Carolina and Virginia. But even Sen. Tom Carper, who represents reliably Democratic-voting Delaware, has suggested an increase to $10.10 an hour is too much.
Apparently, Democratic political strategy is crashing on the rocks of economic reality. A recent report by the Congressional Budget Office estimated that raising the minimum wage to $10.10 an hour could cost the equivalent of 500,000 jobs by late 2016 — although the document acknowledged some workers would benefit.
Then there’s the fact that few heads of households work for minimum wage. The U.S. Department of Labor’s Bureau of Labor Statistics reports that just 2 percent of married workers earn the federal minimum wage or less. In 2013, James Sherk, a senior policy analyst in labor economics at the Heritage Foundation, noted that over half of minimum wage earners were between the ages of 16 and 24, mostly high school or college students working part-time jobs.
Those workers came from families with average income of $65,900 per year. Among adults age 25 and up who earned minimum wage, the average family income was still $42,500 a year. In those families, one spouse often worked full time while another worked at a part-time job that paid minimum wage.
In short, the minimum wage has little bearing on the lives of the average voter, and the most notable impact of Obama’s plan could be its associated job losses. This is justifiable cause for many Democrats to sidestep the issue, particularly when facing voters already upset over other aspects of their economic records, such as Obamacare.
At the same time, Republican refusal to support a minimum wage increase doesn’t mean wages won’t rise. Gap Inc. recently announced an hourly minimum wage increase to $10. Locally, Hobby Lobby pays $14 per hour. Republicans have long argued that wages will rise with the demand for workers, regardless of minimum wage laws. Employers are proving them right.
Like so many of his economic policies — the stimulus, crony capitalism bailouts, green energy subsidies — Obama’s minimum wage plan is yet another example of trumpeting hype rather than substance. What’s astounding is that this fact is no longer noted solely by Republicans, but also tacitly acknowledged by many Democrats as well.