On wages, O'Malley returns to root causes

August 03, 2006|By DAN RODRICKS

Republicans can squawk all they like, but that's an effective move the O'Malley campaign made Tuesday. The Democratic mayor of Baltimore challenged the Republican governor of Maryland to join him in supporting an increase in the federal minimum wage -- without tying the increase to another ridiculous tax break for millionaires.

Republicans dismiss this as an election-year ploy by Martin O'Malley to score votes with the working class.

Ploy?

Supporting decent, living wages for working people is what a Democrat is supposed to do. You can look it up. In Maryland, it wouldn't hurt Republicans to do the same. (It certainly doesn't hurt Robert Ehrlich to march onto traditionally Democratic ground by asserting his interest in failing Baltimore public schools and to advocate more rehabilitation of criminals in Maryland's overcrowded prison system).

Easing up on their passionate opposition to minimum wage increases -- and their zealous support of tax cuts for millionaires -- might help GOP candidates make inroads among traditional Democratic voters.

But they don't, so populist causes like this go to the Democrats, and pretty much by default.

Championing the minimum wage increase was easy pickings for O'Malley -- predictable, really -- but nonetheless important.

O'Malley has yet to make clear why he wants to be governor. He is getting to it, but taking his time.

One Maryland Democratic leader told me recently that O'Malley needs to do a better job of defining himself and what he intends to do as governor.

O'Malley still must evolve from the energetic mayor of almost single focus (crime reduction) to a political leader of broader definition and substance. He not only has to convince voters that he can be a stronger governor than Ehrlich, but he needs to make clear what kind of Democrat he is as his party nationally emerges from a prolonged identity crisis.

In supporting an increase in the minimum wage, O'Malley embraces a root cause of the Democrats -- raising the standard of living for working-poor women and minorities.

Ehrlich, meanwhile, is stuck with his party's traditional opposition.

In reaction to O'Malley's challenge, Ehrlich cried "class warfare" -- a predictable and tiresome GOP plaint -- and said that raising the minimum wage "is a lousy way to fight poverty."

What's the Republican's way to fight poverty?

Cutting the estate tax for millionaires?

In case you missed it -- because it occurred in the wee hours of Saturday morning just before the do-almost-nothing U.S. House of Representatives left for a five-week recess -- Republicans linked a minimum wage increase to a tax break for that privileged sliver of Americans who manage to inherit so many millions that they have to contribute a big chunk of the gain to Uncle Sam.

The taxes apply only to about 1 percent of all estates in this country, but that's the 1 percent of which Republicans seem particularly fond. So they've invested a lot of time and energy on this issue, to the point of obsession.

By contrast, they've resisted the minimum wage increase, which would help, for the most part, Americans at the bottom rungs of the work force.

They squawked when the minimum rose to $5.15 an hour during the Clinton administration, saying the same thing they say now -- it will hurt small businesses, stifle economic growth and do nothing to fight poverty.

But somehow the nation survived the last increase.

"Following the most recent increase in the minimum wage in 1996-97," the Economic Policy Institute reports, "the low-wage labor market performed better than it had in decades (lower unemployment rates, increased average hourly wages, increased family income, decreased poverty rates)."

As a matter of fact, the timing of the last wage increase was significant.

Recall that, after years of demanding welfare reform, the Republicans finally got it. In the mid-1990s, Congress established new rules that required welfare recipients to work after an interval of public assistance. Many of them took jobs that paid the minimum wage, and the increase in 1997 gave poor families coming off the dole a boost.

The EPI favors another increase -- to $7.25 an hour over the next three years -- to help more families in the transition from welfare to work.

The EPI presents these facts, culled from numerous studies of the impact of the 1997 minimum wage increase:

Nearly 1.4 million single parents with children under 18 would benefit from a minimum wage increase.

Eight of 10 workers making the minimum are 20 or older, and the average minimum wage worker makes 54 percent of his or her family's weekly earnings.

"The majority of the benefits of an increase," the EPI says, "would go to families with working adults in the bottom 40 percent of the income distribution."

The value of the last minimum wage increase has been lost to inflation by now. In fact, the EPI says, "$5.15 today is the equivalent of only $3.95 in 1995 -- lower than the $4.25 minimum wage level before the 1996-97 increase."

We don't need more welfare for the wealthy. We need a decent minimum wage for the working poor. Hey, Republicans, get in on it!

dan.rodricks@baltsun.com

Hear Dan Rodricks every Tuesday and Thursday from 11:30 a.m. to 2 p.m. on WBAL Radio (1090 AM) and read his blog at baltimoresun.com/rodricks.

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