Categorized | Commentary/Editorial

Romney’s Support of Minimum Wage Indexation Provides Political Cover to the Left; Updated





This was as predictable as the sun rising in the east.

MITT ROMNEY has had a rough time explaining how he would maintain a social safety net for the poor. His recent remarks have suggested callousness. But amid the kerfuffle, he offered one good idea: specifically, he told the Associated Press on Wednesday that he backs indexing the federal minimum wage to inflation, just as he did when running for governor of Massachusetts a decade ago.

It was only a matter of time before liberals realized the gift Romney gave them with his announced support of minimum wage indexation, and those at the Washington Post were quick to exploit the opportunity Mitt gave them.  Obama and others on the far left have always revved up their base by promising to index the minimum wage to inflation.  Despite the fact that none of their members earn the minimum wage, Obama’s union buddies in particular are big supporters of the job-killing scheme since it reduces competition for union members in the unskilled labor market.  Obama promised to pursue indexation during his 2008 campaign and we again see it in his 2012 platform. But despite their campaign rhetoric, we rarely see any concrete legislation promoting this job-killing scheme.  Obama never formally proposed this, even when he had super majorities in both houses of Congress sufficient to ram ObamaCare down our throats (which has made elements of his kook base most unhappy).  Why?

The answer is simple: Even many liberals know this will effectively create a built-in job killer which will bite the economy each and every year as employers are forced to lay off those workers whose productivity doesn’t justify the artificial price floor imposed by Washington. Since Republicans, at least until Mitt Romney, refused to go along with this self-destructive measure, Democrats didn’t want to assume sole ownership of a hare-brained law that the overwhelming majority of economists — and empirical evidence — agree will inevitably increase unemployment among the ranks of unskilled and low-skilled workers each and every year when the COLA is applied.  Democrats have been content to use the issue mainly in deep blue districts to rally their uneducated Democrat voters (a redundancy, I know) by painting Republicans as "out of touch" or something, knowing full well the proposal was never going to become law.

But those days are over since we’re now faced with the appalling likelihood that Mitt Romney will be the standard bearer for the Republican Party.  And given that Romney is in favor of such an abomination to free markets, how can Republicans oppose it?  Ann Coulter and other Romney apologists have been forced to tie themselves in knots to justify government decreed mandates that private citizens enter into private contracts under the force of law as a conservative stratagem.  Now, assuming Mandate Mitt does indeed secure the nomination, Republicans will be forced to justify minimum wage indexation. They’ll have to in order to support his candidacy. I’ve written several posts in the past ridiculing Democrats for their support of the minimum wage. I never thought I’d be writing them about a Republican candidate for president, though.  But that was before Mitt came to town.

The irony is palpable. As the Wall Street Journal notes, even the "Pelosi Democrats" avoided legislative action to index the minimum wage to inflation when their party controlled both Capitol Hill and the White House. Despite the protestations of their base, they knew it was too risky politically. Not anymore. If Romney’s the Republican nominee, they’ll have their cover.  If they’re smart, they’ll name the legislation the "Mitt Romney Minimum Wage Indexation Law".

Rick Santorum noted a few weeks back that Multiple Choice Mitt ran to the left of Ted Kennedy on some issues in 1994.  Now we’re faced with the prospect of the Republican candidate effectively running to the left of Barack Obama on what’s been a part of the Holy Grail of the Left for decades.  Thus, in order to support the "conservative" candidate in 2012, conservatives will have to defend individual mandates and price floors.  The GOP establishment who gave us this guy believes we’ll fall dutifully into line and do just that.  Not me.

Update: In the comments C4P reader "Ellengba" notes that it would be nearly impossible politically to repeal the minimum wage. Excellent point. I agree that repeal would be difficult, at the very least, due to the pervasive ignorance surrounding this issue. I advocate what Reagan did: Quietly freeze it. After a sufficient period of time, the price floor (i.e. minimum wage) will fall below equilibrium and its job-destroying impact in the unskilled labor market would be significantly reduced if not eliminated entirely. This would have the same practical effect as repealing the law.

It worked quite well for Reagan (see 1980s) but, unfortunately, he has been the only President since FDR initiated the gimmick who possessed the common sense and courage of his convictions to put sound economic policy above politics. But Romney is no Reagan. Indeed given the Mittster’s long history of flip-flopping, he has no convictions at all (other than his desire to be President, that is). His recent pronouncements make it clear he intends to use this issue to pander to the ignorant, as Democrats do. Either that or he doesn’t have a clue how markets work.  Take your pick.

 

 



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  • free4now

    God help America! She needs Your help desperately.

  • PhilTan

    Fortunately for Romney he has no core convictions. He can either say he misspoke or that he is no longer for a wages " right to choose to increase every year " .

  • virginiagentleman1

    Elect ME, Mitt Romney! I’m all things to all people! I can out-Obama, Obama! I can lie more convincingly too! I can offer more and deliever less! I can lean to the left!  I can lean to the right!  Just don’t ask me to walk the tightrope that is the Constitutional center! You’ve seen me flip-flop on every issue! You don’t want me to fall do ya? Where’s the dang safety net?!!!
    Everybody loves me! All my elitest friends in the GOP establishment say it’s MY turn! SO THERE!!

  • http://teamsarah.ning.com/profile/HymanRoth Hyman Roth

    Yep, Republicans who love to make liberals happy LOSE ELECTIONS, DESTROY THEIR PARTY, and GET NOTHING DONE.

    How great a Romney administration would be!  NOW LET’S ALL GO CAMPAIGN FOR HIM, cause ya know, OBAMA IS ON THE OTHER SIDE!

    GET OUR THERE, troops!  ROM-NEY!  ROM-NEY!  ROM-NEY!

    • http://www.facebook.com/people/Carolyn-Dixon/100000062171632 Carolyn Dixon

       I am sorry i will not be voting for romney.  I’ll write in my candidate’s name or not vote at all if romney becomes the gope candidate.

      • c4pfan

        He’s being sarcastic.

        • 4rcane

          I rather Obama win than allow the gop establishment the power to say, see we need to elect a liberal to beat democrats. Sometimes taking two step back is needed to take 3 steps forward

    • http://www.facebook.com/natewebb Nathan Webb

      I’ll be caucusing in Colorado Feb 7th.  Gonna pass on the adulterer in chief.  That leaves Ron, Rick or Mitt.

  • onparade

    our republican liberal can beat the democrat liberal……why are all the conservatives and tea party people voting for romney…..

  • http://lenbilen.com/ Lennart Bilén

    Hillary Clinton and Barack Obama voted NO on the
    Iraq Funding bill May 24 2007. We know this because every media outlet
    shouted these headlines. However, the $2.10 minimum wage increase was hitched to the Iraq funding
    bill, and $6.4 Billion Hurricane Katrina aid was piggybacked to the
    Iraq funding bill.

    Therefore, Clinton and Obama voted NO to the minimum wage increase and NO to
    the $6.4Billion Katrina aid package.

    To them it was more important to deny George Bush funding for the troops and the surge than just about any domestic issue.

    This would normally leave a mark with the
    candidates’ liberal party members. But you won’t read or hear about the Clinton
    and Obama "No" votes on the minimum wage or Katrina funding anywhere
    in the media .

  • pete4palin

    A Romney administration would be more liberal than the Bush admin was.  And the congressional republicans would be pushed to go along with it all as they were with Bush.

  • BostonBruin

    This highlights one of the reasons why Romney wants to end the primary season asap. The longer it drags on, the more it will become obvious how liberal he is and, therefore, is unlikely to beat Obama.

    His support from the conservative base is also eroding with his vicious, negative campaigning.

    • http://teamsarah.ning.com/profile/HymanRoth Hyman Roth

      For the love of God, what self-identified conservatives are voting for Romney???  WHO ARE THESE PEOPLE?

      Are there that many people on our side pining for the good ole days of Gerald Ford???

      • Guest

        Lots of folks who use the label "conservative" are Republicans first and foremost. When the party Establishment signals who they want, those folks follow suit…and then angrily denounce as "true conservative" (contempt only very thinly veiled) those of us who are left baffled by their apparent dramatic flip-flops. So why don’t they just call themselves "Republicans?" Because the "Rep" brand is in the toilet, perhaps for good, thanks to the same Establishment elders.

        You see the same phenomenon in polls that consistently show that, by a large margin, Americans *self*-identify as "conservative," even while they are demanding that government protect or increase their gubmint benefits. Are "conservatives" in love with government bene’s?  Nope. Many of these folks are really just Republicans who aren’t comfortable admitting their Republicanism.

        What does "conservative" mean in the USA in 2012?  The term is more or less content free.

        For many reasons, I’d love to see the aforementioned "true conservatives" set up their own party and take the l"conservative" label with them.  Among other benefits, it would return some meaning to our philosophy,  and make the Republicans identify themselves as "Republicans" and stop ripping us off.

        • c4pfan

          I don’t see any difference and that’s why Colorado is like it is.

      • http://lenbilen.com/ Lennart Bilén

        Mormons, lots of them in Nevada.

        • Guest

          Bigot! (joking). 

      • Kino24

        Most voters don’t have the slightest idea what Romney has said or done in the past or what he really stands for.  The (previously) conservative media is so in the tank for Romney that they won’t give more than a passing mention to these issues, and even then they use terms like "taken out of context" or "flubbed his response" to describe them.  If Newt or Rick cannot overcome the media bias during the primary and get the message out about who Romney really is, how can they expect to do it against Obama in the fall?

        The next few weeks may well tell the tale, we will either have a candidate we can believe in, who will speak strongly and convincingly about conservativism, or we will be stuck with Obama vs. Obama lite.  Our job is to vote for the candidate that can take down Romney in each primary one by one, not to lock into just one of them and allow Romney to win.  We need to be ant-Romney, not pro-Santorum or Gingrich.

        As the Governor said, extend the primaries and let the vetting go on.

  • onparade

    latest real clear politics poll shows newt losing in all primaries on tuesday…. 

    • c4pfan

      No surprise there.  Mitt has been running for years and has more money and organization.

      • friskyness

        That doesn’t mean people have to vote for him.  

  • Guest

    Like the baseball crank wrote…"conservatives" who stand for Romney soon end up standing for nothing.

  • c4pfan

    Yeah, well wait until he gets the nomination and the conservatives will know how the GOP really thinks of them.  He hasn’t even gotten the nomination yet and he’s already talking like a Lefty.

  • Guest

    As if it isn’t enough that he is taking Obamacare off the table. It is almost as if he is working FOR Obama.

    • Kalena

      Mittens wouldn’t know a real conservative principle if he was slammed over the head with one.

  • MaMcGriz

    Tsk.

    Silly me…thinking we might be able to hire some help for my hard working husband this year.

    Not gonna happen.

  • Guest

    I’ve been thinking we should just let the spoiled brat have the nomination so Obama and the LSM can start beating him to a pulp.  That way we have enough time to see how he will hold up and if he will be as vicious and mean-spirited to Obama as he had been to his Republican opponents. 
     
    I so look forward to watching him having to take his own medicine!

    • Kalena

      He won’t fight dirty against Obama, just conservatives.  That is how he rolls.

      • 4rcane

        He and his supporters been behind the sabotage against Palin

        • friskyness

          They could easily win against Obama with Palin, but they are passing it up to lose against Obama.  I don’t understand why Romney is allowing himself to be the sacrificial lamb against Obama. He knows he is going to lose.  The republicans don’t seem to care about the low voting turnout in Florida or Nevada.  How do they expect to win the Senate, if people don’t come out to vote?  Like I have said before, the establishment are illogical.

          • 4rcane

            they’re thinking  that conservative/palin voters will vote for whoever the gop pick in the end. We’ve been picking the lessor of two evils for too long. Theres no way I’m supporting Romney or Newt, even in the general

  • ellengba

    As an economist I fully understand the arguments against the minimum wage.  The problem is those arguments have not won the day politically.  We have had a minimum wage since 1937.  Many states minimum wage exceeds the federal minimum wage.

    Democrats do not favor indexing, because it removes the politics from the issue.

    While I do not support Romney and I have said I will not vote for him.  I think it is obvious he is not a conservative, but I have to say so what none of the candidate running are true conservatives.  I think Newt is the most conservative, but he has voted to raise the minimum wage.

    Indexing is probably less job killing then what we currently do.  We leave it alone for years, and then raise it rather sharply.  Indexing is likely to save some Republican jobs at the congressional level.

    I hope some of you are reconciling yourself to casting a vote for a Republican.  You are going have to choice between a Republican who respects private property, but will expand the welfare state, or a socialist who does not respect your private property rights and wants to expand the State.  That is a socialist who wants to put more of the means of production in the hands of the State, and who wants to put more land in the hands of the State.

    Who will you chose?  The socialist or the Republican?  Looks at the four stiffs still standing and think which one gets the reality of getting over 60 million people to vote for you.

    Who cares whether the minimum wage is politically raised periodically or indexed to inflation and raised in a timely and none political fashion.  How can anyone care when no one is advocating the political suicide of repealing it?

    • Kino24

      I agree that raising the minimum wage dramatically is more detremental than small periodic increases, but only if the two ultimately end up with the same "minimum."  The fact is that the Dems were only able to get an historically large increase in 2007(?) because they had full control of both chambers of Congress and a "compassionate conservative" President with high disapproval numbers.  But even with that extreme increase, the minimum wage has never kept pace with inflation.  When I started working the minimum wage was around a buck and a half, it would have to be $12 to $15 per hour now to equal the rise in inflation, depending on which factors are used.  We simply can’t afford to index it.

      • ellengba

        Interesting thoughts.

        I checked out this inflation calculator.  http://www.westegg.com/inflation/infl.cgi

        The minimum wage was $0.25 in 1938, so using the calculator it would have been $3.83 in 2010.

        When I entered the work force as a teenager in 1978 the minimum wage was $2.65 if it had been index to inflation that year in 2010 it would be $8.76

        If it had been index in 1977 when the minimum wage was $2.30, it would be been $8.18 in 2010.

        If it had been index to inflation in 1938 when I entered the workforce the federal minimum wage would have been $1.16.

        Maybe that is why democrats do not want to index it to inflation.  It appears to the wage would have been much lower if it were tied to inflation.

        Using the CPI inflation calculator $0.25 in 1938, $3.99 in 2011; in $2.30 in 1977, $8.54 in 2011; $2.65 in 1978, $9.14 in 2011.

        Here’s the cpi calculator http://www.bls.gov/data/inflation_calculator.htm

        • MaMcGriz

          Interesting indeed.

    • wpmwindsong

      The indexing idea is one reason that Mitt should not be our nominee.  It shows his mindset.  There are still 90% of the delegates yet to be selected.  No need to give up now that Mitt is inevitable.    The fact that Newt voted for an increase twice in 20 years is not the same as wanting to increase it automatically every year.   It keeps it as a political issue that should not be given up for expediency.

      • ellengba

        I did not write that Mitt was inevitable.  I just think the not conservative enough case can be made against any of these candidates running.  I think conservatives need to vote for the most conservative Republican, but we must accept that the most conservative Republican running at the Presidential level is not going to be that conservative giving the realities of needing to get over 60 million votes.  It’s kind of depressing to keep pointing out the flaws of these stiffs.

        At some point conservatives are going to need to start making the case against liberal positions and not against off the reservation republicans.  I feel the same way about the individual mandate.  It seems a distraction when we defeated a liberal push for socialized medicine.  We defeated the house bill, but no time to celebrate, because liberals were willing embrace the moderate compromise from the Senate.

  • http://www.projectweavers.com/ Matthew J. Weaver

    As noted and as a reality, minimum wage is here, is meaningful for a lot of people, and unless you like banging your head futilely against a wall, I would suggest redirecting your ire to matters you might affect. Regarding indexing, that is really a great way to remove this as a political football that Republicans always, in the end, lose on.

  • Bill589

    I hate minimum wage.  Tons of teenagers are out of work in my neighborhood, while non-citizen ‘yard workers’, who since they are here illegaly, can work for less than minimum wage, took the jobs that my friends and I did as teenagers.

    I’d rather have my teenage kids working for five dollars an hour, learning work skills and the value of hard work, but they can’t – they’re citizens.

    • ellengba

      I’m personally of the view that we need a specific minimum wage for youth.  A special wage for kids 15-18 who are full-time students living at home.  If their wage is lower, and you restrict the number of hours they can work a week employers will start to prefer to higher them again.

      When I entered the workforce it was under a program where I was only allowed to work 20 hours a week during the school, but during vacation weeks and the summer time I could work 40 hours a week.

      I think a different wage for high school kids would go a long way to making those low skill workers popular again.

      • DougBrady

        A sub-minimum wage for entry level employees is a step in the right direction. But I say, in an ideal world, no artificial price controls of any kind.  Let everyone, teens included, be paid according to their productivity.  And their productivity should be determined by their employer.  If the employee thinks he/she is being underpaid, he/she is free to seek employment elsewhere.  I know, I’m an idealist. Can’t help it, though. I believe in limited government and free markets, as the Founders did.

      • Bill589

        ellengba, I understand your point, but would rather have the ‘free market’ pick wages.
        The government should have nothing to do with this.

        Two individuals agree on a wage for work done. If I advertise I want to hire someone to work on my yard for 4$/hour, and nobody answers, I know I need to go higher. 5$/hr? No, then 6$/hr? Yes. Two individuals come to an agreement.

        No government involvement.

        • ellengba

          I agree with both you and DougBrady about markets, but we as a culture have decide we will not allow wages to fall to a subsistence levels.  Because of that view we have allowed the minimum wage to be price to high for youth.  Of course if we restricted immigration, limiting the immigration of unskilled workers wages would rise, because we would have few unskilled workers.  Simple supply and demand would cause wages to rise.

          Our markets are imperfect. 

          Regarding people receiving different wages of course miminum is wage is just a floor.  Without people could return to slavery, agreeing to work for food, shelter, and clothing.  We see with internship abuse in some industries that people are willing to work long hours for pay at all.

  • 4rcane

    an increase in minimum wage, dont mean much if your dollar loses value at the same time. Let say you increase minimum wage by 10%, but the dollar loses 20% in value. That minimum wage worker is still worst off. 

  • nkthgreek

    Personally, I’m in favor of the maximum wage:   earn as much as you’re capable of earning.

  • carmtom13

    Willard the admitted progressive (liberal) came out again, and the DC establishment want him to be the nominee. Romneycare mandate is the father of mandate obamacare.
    WAKE UP PEOPLE AND YOU TEA PARTY PATRIOTS WILLARD STANDS FOR EVERYTHING YOU DON’T
    I CAN’T BELIEVE YOU ALL DON’T SEE THIS.

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