Better ways to help than wage increase

Published on Wednesday, 21 May 2014 22:18 - Written by

It sounds like a good idea — the best kind of idea, really. Raising the minimum wage gives people a raise — but with other people’s money! That’s where its allure comes from. Politicians can support it at no cost to themselves (or to the government).

That’s why eventually, even Republicans tend to support minimum wage increases.

“When the federal minimum wage was last raised, in 2007, all but three Republican senators voted for it,” points out Bloomberg columnist Ramesh Ponnuru. “The typical pattern for Republicans on minimum-wage increases is to hold out for a while, sometimes even a few years, then acquiesce. In recent days, several prominent Republicans — Mitt Romney, Tim Pawlenty and Rick Santorum — have suggested that it’s time to cave again.”

Romney, whose political sensitivities are questionable at best, is baldly pragmatic about his newfound support for minimum wage hikes.

“The key for our party is to be able to convince the people who are in the working population, particularly the Hispanic community, that our party will help them get better jobs and better wages,” he said.

A far better approach, both more meaningful to the poor and intellectually honest, would be to promote policies that actually expand opportunity.

“The political power of the minimum wage comes from its appeal to Americans’ values,” said Ponnuru. “It doesn’t come from their self-interest: Most voters don’t benefit from it directly. They favor raising the minimum wage because it seems like a way of giving people a leg up and making the economy fairer. Opposition is politically dangerous because it signals indifference to those goals. If that’s right, then Republicans can mitigate the political harm they incur from opposing an increase. They just need to find different ways to associate themselves with those goals.”

For starters, Republicans should stop falling into the trap of talking solely about take-home wages. An employee’s pay package is more than that. The GOP should point out that many factors help determine the numbers on a paycheck.

“Rising health-insurance premiums are a big reason wages have stagnated,” Ponnuru said. “Scaling back the tax break for the most expensive policies, as part of a market-based reform of health care, could help wages rise again. And wages would stretch further if costs were lower. Higher education seems ripe for reforms that make financing easier and create lower-cost alternatives to a traditional four-year degree. Energy costs could be restrained through increased exploration and decreased regulatory mandates.”

These arguments are more complicated (and harder to make) than the minimum wage argument. But they could nevertheless be made effectively.

Republicans “should answer the president’s push for the increase, and the larger campaign against economic inequality, by changing the subject to something more important: how to create broad-based prosperity,” Ponnuru said.

He’s right. The left knows how attractive a minimum wage hike can be, and that’s why the Democrats are pushing it now.

Republicans can cave in, as they have in the past, for all the wrong reasons. Or they can offer more effective alternatives of their own.