THE BLOG
09/28/2012 02:35 pm ET | Updated Nov 28, 2012

NJ's Minimum Wage Proposal Deserves a Vote This Year

New Jersey's Democratic legislative majority is very clear that it wants to increase the state's minimum wage from $7.25 to $8.50 per hour and adjust it to match inflation thereafter. When the two presiding officers are the chief sponsors of identical bills, the message is strong that the bill is a high priority.

The Assembly passed the measure, sponsored by Speaker Sheila Oliver, with a party-line vote in May. Despite the sponsorship of Senate President Sweeney, the bill has languished in the Senate Budget Committee.

Fearing a gubernatorial veto, Senator Sweeney now proposes that the constitution be amended in 2013 to increase the minimum to $8.25 an hour with an escalator to adjust it upward for future inflation.

The rationale for the bill is very clear: a full-time minimum-wage worker who takes no time off makes $15,080 a year - and is thereby destitute. And since 80 percent of workers making under $8.50 an hour are 20 or older, 24 percent are parents, and 55 percent are women, the canard about most low-wage workers being high schoolers saving for the weekend is put to rest.

With a wage increase of $1.25 an hour, you can be certain that every penny will be spent and spent locally on essentials like food, transit to work, and shelter. With so many New Jersey families slipping out of the middle class, the combination of an increased minimum wage and a fully restored Earned Income Tax Credit would help cushion the fall.

The governor asserts that increasing the minimum wage will lead to layoffs. The best evidence available is that states increasing their minimum wages have done better than those who haven't. Academic studies substantiate that jobs are added, not cut.

So, what is preventing the Senate majority from enacting the increase? One can only speculate, but the answer is probably "short-term political considerations" and fear that the governor will send back a bill with a smaller increase and no escalator in a conditional veto. Hence, the proposed constitutional amendment.

All 120 legislative seats are up in 2013. Democrats, naturally, want to protect their majorities. Therefore, why not place a constitutional amendment on the ballot that will energize all those members of the newly minted "47%" to vote and labor unions to mobilize their members? The Republicans did the same thing with gay marriage amendments in the 2004 presidential election year to animate their evangelical base in key states, and it seemed to have worked.

But putting the minimum wage to referendum is a bad idea for three reasons.

First, the primary reason for increasing the minimum wage - to assist destitute working families - is delayed by at least a full year. During that time, over 300,000 workers would be denied a hand up the ladder. This is akin to telling the starving refugee that food and shelter will be available - but not until next year.

Second, the struggling New Jersey economy would benefit from an immediate jolt of new spending. The annual incomes of New Jersey workers currently being paid under $8.50 an hour would increase by an average of $1,200 in the first year. Add the higher pay for workers making slightly more who would also see a bump in wages, and our flagging economy gets a $500 million infusion. Local businesses would surely welcome this increased consumer demand.

Third, the constitution is no place to settle issues like the minimum wage. California is famous for the ease with which its constitution can be amended; it now has over 500 amendments covering unimaginable detail like giving homeowners a vote on streetlights. That state has gone in 50 years from the exemplary to the ungovernable. It is bankrupt and locked into numerous policies and practices that seemed like a good idea when some billionaire financed a campaign ordaining that that Spanish-speaking immigrant children should be denied any instruction in Spanish.

Consider what would have happened if New Jersey's minimum wage of $1.40 per hour were approved in 1968 via a constitutional amendment. Since 1968, the legislature and governor have raised the wage twelve times. The legislative process is cumbersome enough, but imagine twelve different statewide campaigns to amend the constitution on wage issues. Any effort to increase the wage to match inflationary increases in the cost-of-living would be met by the well-funded resistance of business and industry. As we learn each year in increasingly nasty political campaigns, "free" speech is free to those who can buy it and many buyers are not constrained by standards of accuracy and civility.

The California experience offers a strong lesson: money talks. Campaigns for referendum questions are a major cottage industry there. The legislative process is not free of big bucks influence, but it is possible for citizens to be heard in a way that is impossible in a statewide media campaign costing millions.

No, this is the perfect opportunity for the legislature to carry out its constitutional obligations to legislate. The argument for the increase is strong and it will help real families who are playing by those rules but not prospering. They're, rather, barely surviving.

The governor might veto the bill because he doesn't like the escalator clause. Yes, he could return it with a smaller increase and no escalator and challenge the Democrats to turn it down (they should). Despite the perceived political advantages, Democrats should make their strong arguments, do their job, and send the bill to the governor.