GOP Relaxes Opposition to Minimum Wage Increase

Tax cuts. More money for the Pentagon. Less for social programs. That’s what one expects to find on a GOP congressional agenda.

But a strange idea is creeping into Republican plans for this spring and summer, one that has long constituted rank heresy in the party: an increase in the minimum wage. Fearing that they are on the losing side of a powerful issue, key House Republicans are softening their traditional opposition to a higher minimum wage and may soon devise a proposal for an increase of their own.

The emerging GOP strategy represents a remarkable shift that could put more money in the pockets of the nation’s lowest-wage workers later this year. To make that more palatable to the party’s conservative core, GOP strategists are considering linking any minimum wage hike to tax cuts or other labor law changes that would help small business.

The maneuvering does not signal a real change of heart about minimum wage policy itself, as the GOP is still dominated by conservatives who think such increases hurt the economy. Instead, it reflects a growing recognition of a cold, hard political reality: With their razor-thin House majority and a substantial number of moderate Republicans favoring a minimum-wage hike, GOP leaders are largely powerless to stop it.

By addressing the issue this year, key Republicans hope to keep Democrats from using it as a campaign issue in 2000, especially against the many moderate Republicans who fear that they lost significant support among labor constituents for backing President Clinton’s impeachment.

The shifting GOP position also reflects the changed climate for the recurring minimum wage debate: The economic boom has undercut the usual argument that such increases cost jobs and feed inflation.

“I believe it is a foregone conclusion that some type of minimum wage increase bill will be approved in this session of Congress,” said Rep. Jack Quinn (R-N.Y.), the leading GOP proponent of such a move. “Rather than fight the thing and have Republicans being dragged kicking and screaming to a vote on the minimum wage, I say to my party, ‘Why not take the lead?’ ”

Clinton and congressional Democrats have proposed raising the minimum wage, now $5.15 an hour, to $6.15 over two years. Quinn wants to raise it to $6.15 over three years and to index it for inflation in the future.

It is not clear whether GOP leaders will respond with a bill generous enough to win support from Democrats and GOP moderates. Regardless, the matter could come before the full House before the end of the summer, said Michael Scanlon, spokesman for House Majority Whip Tom DeLay (R-Texas).

The debate begins in earnest soon after Congress returns this week. The House Committee on Education and the Workforce will conduct a hearing on the issue later this month that probably will showcase critics’ arguments about problems with raising the minimum wage, such as potential layoffs by businesses with large numbers of minimum wage employees.

What comes next is uncertain. But as one Republican strategist close to the House leadership put it, “I think they are preparing for preemptive surrender.”

“The leadership is bright enough to realize we can’t win by saying no,” said Patrick Murphy, a top aide to Rep. Cass Ballenger (R-N.C.), a senior member of the committee. “It makes sense to get in early to fashion the vote to cause the least damage possible.”

About 4.4 million workers are paid the federal minimum wage or less, according to the Bureau of Labor Statistics. Nine states have set a higher floor than the federal one, including California, where the minimum wage is $5.75 an hour. But even in most of those states, employers would have to pay more if Congress votes to increase the federal minimum to $6.15.

A History of Contention

The last time Congress voted to raise the minimum wage was in 1996, when it approved a two-step increase from $4.24 to $5.15 an hour. The last stage of that hike took effect in September 1997, and Clinton and other Democrats are saying that the time is ripe for another increase.

“Our country is prospering,” said Sen. Edward M. Kennedy (D-Mass.). “But millions of the country’s hardest workers are not sharing in that prosperity. The take-home pay of a mother trying to raise two children on a minimum wage job is still almost $3,200 below the poverty line.”

Critics argue that raising the minimum wage would hurt low-wage workers because higher labor costs would slow job creation and make it harder for entry-level workers to get their first jobs.

Concern runs highest among restaurant owners, who are the largest employers of minimum wage workers. Lee Culpepper, vice president for federal relations at the National Restaurant Assn., blames the last minimum wage increase, in part, for the decline in the number of jobs created by his industry (from 276,400 in 1995 to 110,000 in 1998). He also links the wage hike to continuing inflation in menu prices at a time when general inflation rates have dropped.

But Culpepper acknowledged that the current political and economic climate make it harder for him to make the case against a minimum wage hike, especially since the economy in general has continued to boom since the last increase.

The battle over that hike was a prolonged, bitter one in which Democrats scored election year points by portraying the GOP as mean-spirited foes of the working poor. Now, with Democrats spoiling for another fight, many Republicans want to avoid a reprise of that public relations bruising.

Since becoming House speaker in January, J. Dennis Hastert (R-Ill.) has suggested, if grudgingly, that action on the minimum wage is unavoidable. Even House Majority Leader Dick Armey (R-Texas), a staunch free-market conservative who pledged during the 1996 debate to oppose a minimum wage increase “with every fiber of my being,” has softened his rhetoric. He recently indicated that the leadership would take steps to accommodate Republicans clamoring for a chance to go on record backing an increase this year.

“We understand their needs. We understand their priorities, and I am sure someplace, as the year goes forward, we will work out something on that subject,” Armey told reporters.

Quinn is leading a group of 30 or so Republicans, mostly moderates, who come from districts with big labor voting blocs and who favor an increase in the minimum wage. With Republicans controlling the House by a mere handful of seats, that group is big enough to tip the balance against leadership efforts to simply block a minimum wage hike. And these moderate Republicans also represent precisely those swing districts that could be the key to whether the GOP can hold on to the House.

In Quinn’s case, winning a vote on a minimum wage bill could help him rebuild bridges to union supporters who were infuriated by his vote to impeach Clinton. Quinn was particularly hurt when the roll call came in December because earlier he had opposed impeachment.

The challenge for Republicans is to craft a package that makes a minimum wage hike more acceptable to conservatives and the business community by, for example, making it a smaller or more gradual increase or linking it to tax breaks or labor law changes that business groups support. Many restaurant owners, for example, would probably temper their opposition to a minimum wage increase if it is joined with an increase in the tax deductibility of business meals.

That’s the model Republicans finally followed in 1996, when, after spending months vehemently opposing a minimum wage increase, they relented and linked the wage hike to a package of tax cuts.

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Wage History

The federal hourly minimum wage through the years and the rate adjusted for inflation (using 1996 dollars):

1960: $1.00 ($5.30)

1970: $1.60 ($6.47)

1980: $3.10 ($5.90)

1990: $3.80 ($4.56)

Current: $5.15 ($5.03)

Source: U.S. Employment

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