Minimum Wage Hike Passes With Iraq Bill

Victory on a key item in the Democratic agenda might taste a little bitter to Democrats, coming as it is with Bush's sought-after funding for Iraq. But at least now they can say that they can cross something of the list of must-do's.

I knew that the minimum wage was attached to the Iraq funding bill. But I also knew that a big obstacle was tax breaks to offset the higher prices for small businesses that the minimum wage would produce. The obstacle was resolved, in the usual political fashion, with no one getting what they wanted.

Those concerns delayed passage of the wage hike for months, as Republicans and conservative Democrats in the Senate battled Democrats in the House, who at first insisted that affected businesses get nothing. In March, Democrats tacked the wage issue onto the Iraq spending bill in hopes of breaking the logjam.

The two chambers finally struck a compromise last month that includes tax breaks worth $4.8 billion over 10 years, more than the House wanted but much less than the Senate had sought.
On the merits, the minimum wage is worse than useless. The article notes that thirty out of fifty states had already raised their own minimum wage beyond the federal rate. If minimum wage laws belong anywhere, they belong at the local and state level. It's ridiculous to think that the minimum wage in NYC is the same as Fargo, ND.

In fact last November in Ohio voters approved a change to the state constitution not only approving a minimum wage hike, but thereafter tying it to inflation. That seems dangerously close to starting an inflationary closed feedback loop, but the main result is that any efforts on the Federal level have lost a lot of their political effect locally.

Democrats have also had a lot of luck increasing their voter turnout and interest with these state minimum wage issues and amendments. That's probably over for the next cycle.

But still, at least the Democrats can say they got something done. Which might ease the pain of their defeat on the Iraq funding.

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