Driving home from a New Years Eve party I noticed it was business as usual at one local McDonald's, where no matter what hour of the day or night the drive-through lane appears clogged with cars, an apt metaphor for the passengers' arteries. But whatever the health of its customers, this burger joint appeared to be thriving, despite the fact that only hours before, Washington state had raised its minimum wage to a nation
high best $8.07 an hour. Our state's lowest paid workers now earn $2.22 an hour more than their counterparts across the border in Idaho, and yet McDonald's franchises in both states manage to profitably sell double-cheeseburgers for a buck a piece. Go figure.
When organized labor put Initiative 688 on the ballot back in 1998 -- raising Washington state's minimum wage to $6.50 while mandating automatic annual increases pegged to the Consumer Price Index -- our business community, right-wing "think tanks" and Republican establishment warned of dire economic consequences: lost jobs, small business closures and a steady stream of industry moving to greener (ie, cheaper) pastures out of state. I-688 we were told, would hurt those it was intended to help most: unskilled and young workers who would be better off earning a low wage than none at all. Yet since its passage, Washington workers have not only enjoyed the highest minimum wage in the nation, but one of the strongest state economies as well.
While our economy certainly isn't immune to downturns, Washington has weathered recent economic turbulence well, currently boasting robust job growth, record state budget surpluses and a real estate market that continues to defy the gravity of a nationwide housing bubble collapse. And while it would be silly of me to argue that I-688 deserves much of the credit for Washington's prolonged economic boom, it would be even sillier still to argue that our state's relatively high minimum wage has produced any sort of noticeable economic drag. Hell, even Forbes Magazine ranks Washington state as having the fifth best business climate in the nation. What more do the pro-business lobbyists want?
What I-688 has done is made the lives of our state's 80,000 to 90,000 minimum wage workers just a little bit easier. The difference between Washington's $8.07 an hour and even the recently raised federal minimum of $5.85 is the difference between earning $16,786 a year for a 40-hour work week versus only $12,168, and it doesn't take an economist to figure out what an extra $89/week can mean to our state's working poor. Plus, a higher minimum wage raises the bar for all workers, resulting in larger paychecks for more skilled jobs. No, such policies don't come free, and at least some of the costs are passed on to consumers. But given the choice between a race to the bottom and a race to the top, Washington's voters proved wise to choose the latter.
It took ten years and a new Democratic majority to finally raise the federal minimum wage from where it stood back when I-688 went to the polls, and despite Washington's decade of prosperity in the face of what should have been a competitive disadvantage, minimum wage opponents trotted out the same old dire warnings that failed to hold true here in the Evergreen state. Conservatives used to hold forth states as laboratories for experimentation, but when these experiments disprove their firmly held theses, the lessons learned are quickly dismissed and discarded. There is no compelling evidence to suggest that workers have been harmed by Washington's minimum wage law or that our economy has been significantly disrupted, while the benefits to our state's low wage workers are as obvious as the extra dollars in their wallets.
What the other side fears, what they refuse to acknowledge, and what they so vociferously reject in rejecting the minimum wage is that experience tells us that sometimes government regulation of the market does indeed improve the lives of many of our citizens while ultimately costing the rest of us little or nothing of consequence. If the minimum wage, a concept absolutely anathema to the principles of an unfettered free market proves a net benefit to the economy as a whole, what sacred tenet of the anti-government / anti-regulatory ideologues will fall next? First the minimum wage, next "socialized" medicine? If government is given the opportunity to prove it can provide universal health care security where the market clearly cannot, is it Katie bar the door to a new progressive era that re-embraces the principles of managed economy that helped us rise from the Great Depression, irrigate and electrify rural America, defeat the Japanese and the Nazis simultaneously, construct the interstate highway system and build the United States into the greatest military, industrial and economic power on the planet while providing its citizens the highest standard of living average workers have ever known?
Like Social Security, the minimum wage has been a target of the right since its inception, not because it harms workers and business owners, but because its failure to do so refutes the core principles at the heart of right-wing ideology. Eight buck per hour workers producing double per buck cheeseburgers is an example of something that government does right, and as such is a threat to the agenda of those who would see our destiny placed solely in the hands of corporatists and preachers, for whatever reason.
[David Goldstein blogs on WA state politics at HorsesAss.org]