Dems Aren’t Really Winning on the Minimum Wage

by Patrick Brennan

Republicans have probably had a pretty good election when liberal commentators are excitedly pointing to the results of referenda in Alaska, Arkansas, Nebraska and South Dakota as the outcomes that really matter. But their argument isn’t entirely risible: In those four states, by varying margins, voters approved modest increases to the states’ minimum wages, which is a big liberal priority. This is proof, some left-leaning commentators contend, that Americans basically like liberal policies but just happened to elect conservative politicians yesterday — or even that Republican politicians had to wholeheartedly endorse liberal policies in order to win.

Here’s the problem: In the most prominent races of the cycle, the Senate races, that didn’t happen. Out of more than a dozen competitive Senate races this fall, just one Republican candidate, West Virginia’s Shelley Moore Capito, kinda sorta supported Democrats’ proposed increase in the federal minimum wage. A lot of candidates basically said they didn’t support the concept of a federal minimum wage at all. Almost all of these candidates won. Ed Gillespie opposed a minimum-wage increase and nearly won in Virginia, which last time I checked is not full of wild-eyed Coolidge-ites.

So it’s hard to see how this is a killer issue for Democrats. There will be some, I’m sure, who argue that Democratic candidates could have talked up the issue even more and won on it; I won’t tangle with that counterfactual. But it was an issue that the GOP worried about: A top NRSC official who visited NR last winter, when we asked him what policy issues Republicans were going to get hit with, identified only one: the minimum wage.

Yet basically no Senate candidates gave in on the issue, and they performed remarkably well last night. How? Some of them simply won the argument against it — saying it’s not the federal government’s responsibility and that they want to see higher wages some other way. Some did endorse state-level initiatives to raise the minimum wage. Either approach seemed to work quite well. In fact, Tom Cotton did so well at it that Democrat Mark Pryor actually took his side — opposing the federal minimum-wage hike but supporting the measure in Arkansas.

Democrats are lauding the endorsements of state wage increases (in addition to the referendum victories) as a huge victory, but I don’t think President Obama and Tom Harkin should exactly be gloating.

State-level minimum-wage increases are meaningfully different from the Obama/Senate proposal and less offensive to conservatives. For one, practically, they’re more modest in scope: Most states are thinking about moving their wage into the $8 range, President Obama and Senate Democrats thought they could persuade politicians and Americans to support a $10.10 minimum wage. No state has a minimum wage that high, and a very small number of states are scheduled to get that high by 2017 and 2018. The higher the wage floor is set, the more it limits access to the labor market, of course. By definition, having an $8.50 minimum wage rather than a $10.10 one is a much less troublesome policy for those who are concerned about a wage floor cutting people out of the labor market. And if states find that a much higher minimum wage harms competitiveness or jobs growth, they can then reconsider their decision relative to other states.

It’s also superior on principle: Conservatives don’t really see a reason why the federal government should, or even has the power to, set a minimum wage. States, meanwhile, can regulate commerce how they wish. There’s both an economic and political logic to leaving it to the states: Why should legislators in Massachusetts get to decide what businessmen in Arkansas pay their employees? And does it really make sense for Boston businesses to have to pay the same minimum wage that Little Rock proprietors do? Probably not. (See here.)

A higher minimum wage also doesn’t seem to be steamrolling everywhere at the state level: New York State voters, for instance, elected a Republican majority in the state senate this year, putting an end to New York liberals’ hopes to push through a big hike as part of a set of progressive reforms championed by New York City mayor Bill de Blasio.

The minimum wage is, no doubt, a popular policy. But that doesn’t make it a good policy, and we set very little policy by popular vote. (I don’t think liberals would exactly love the set of economic policy preferences that polling your average American would create.) Liberals have been making some progress on the issue, but hardly winning easily or in the way they’d like to (at the federal level). Josh Barro points out that Democrats happen to have room for more minimum-wage victories. But they’re not leaping to do much about it, because, he notes, it’s actually not a frightening political cudgel against Republicans.

Danny Vinik of The New Republic argues that the issue is eventually going to become a problem for national Republicans, and he could be right. (I also don’t doubt that Republican leadership could fold on the issue without its being political necessary.) But every year they block a minimum-wage hike is a victory, even more than this is the case with a lot of policies conservatives try to stand athwart, because inflation and wage growth makes a static minimum wage less and less distortionary. If this is what it looks like when Democrats are winning an issue as a policy matter and a political debate, life isn’t too bad for Republicans.

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