Maximizing The Minimum

Bill Scher blogs for Campaign for America’s Future. This blog originally appeared in The Huffington Post.

Yesterday was a great day for the American worker and the American economy, as the House passed a long overdue raise in the minimum wage to $7.25 an hour.

The bill is particularly strong because it’s “clean.” It rejects the notion that a wage hike automatically leads to job losses, and needs to be “offset” by tacking on special interest tax giveaways for business.

But while Democrats are united on principle for a pay raise, they are tactically divided whether the bill should stay clean. Since several in the leadership are OK with dirtying it up, it will take a big grassroots push to keep it pristine.

Washington Post business columnist Steven Pearlstein recently shredded the business lobby’s hysterical claims:

…Both economic theory and history suggest that small business will, in time, pass on its increased costs to its consumers … [It] will have a minimal impact on adult employment … But largely offsetting those effects will be the increased demand for goods and services by tens of millions of Americans who will finally be getting a raise. A higher minimum wage doesn’t lower economic activity so much as rearrange it slightly.

Further, blogger Angry Bear crunched the numbers and found that under Bill Clinton and LBJ, wages went up, and so did employment.

Yet it’s likely the Senate version of the bill will include the widening of tax loopholes for business.

Congressional Quarterly reports that not only has Senate Finance Chair Max Baucus proposed such a bill, but that the strategy is backed by Senate Dem leaders Dick Durbin and Chuck Schumer, as well as Sens. Maria Cantwell, Kent Conrad, John Kerry, Blanche Lincoln and Ken Salazar. (Although, Sen. Ted Kennedy plans to fight for a clean bill.)

How the House responds after that is less clear. According to CongressDaily AM , House Majority Leader Steny Hoyer wants to capitulate right away and junk the clean House bill in favor of a sullied Senate version. While House Ways and Means Chair Charlie Rangel is threatening to prevent that, saying “Last I heard, they couldn’t initiate taxes in the Senate.”

The political argument for capitulating is that the Senate needs to get 60 votes to avoid a filibuster, and Dems need some Republican support to avoid a veto from President Bush.

But what happened when Republicans tried to dirty up the House bill on the floor yesterday? Lead Democratic sponsor Rep. George Miller stood up to them and shamed them, thundering: “What is it you don’t understand about being poor? What is it you don’t understand?” (See the video here.)

And 82 Republicans, reading the writing on the political wall, crossed party lines and supported a clean minimum wage bill.

The public will is clear. Eighty percent of the voters—and 65 percent of Republican voters —believe America’s workers deserve a raise.

If Senate Dems put a clean bill on the floor, Republicans oppose it at their political peril.

Or, if Dems didn’t want to scrub out the CEO favors, there’s another way they could clean up the bill: up the ante. Tie the minimum wage to inflation and the cost of living, solving the fundamental problem of the degrading minimum wage once and for all.

Yet some Democrats can’t get out of their defensive crouch and get comfortable in the driver’s seat. And they won’t, unless they realize the public wants them to follow through on the First 100 Hours pledge, not water it down.


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