Republicans and the Minimum Wage

Republicans claim to believe in limited government, the free market, and the free-enterprise system, but their claims often ring hollow. A case in point is the outcome of a recent ballot measure in Florida.

It is not just men and women who won elections in the fifty states last month. According to Ballotpedia, “Voters in 32 states decided 120 statewide ballot measures on November 3, 2020.” The subject of these ballot measures was wide ranging: marijuana, taxes, rent control, gambling, firearms, paid family leave, abortion, interest rates, the cash bail system, and elections policies.

In my state of Florida, there were six ballot measures to amend the Florida constitution: four citizen initiatives and two legislature-referred amendments. Since 2006, constitutional amendments in Florida require a 60 percent supermajority to pass.

A notable ballot measure that did pass was Amendment 2, the “$15 Minimum Wage Initiative.” It amended Section 24 of Article X of the Florida Constitution. A “yes” vote supported the initiative to increase the state’s minimum wage incrementally until it reaches $15 per hour in September 2026. A “no” vote opposed the initiative, thereby keeping the current annually adjusted minimum wage of $8.56 per hour. The vote was 6,391,753 (60.82 percent) in favor and 4,117,815 (39.18 percent) opposed. The last time that Floridians voted on a minimum-wage increase was in 2004, when the minimum was raised to $6.15 an hour with a provision for annual adjustments due to inflation.

The federal minimum wage was instituted by the Fair Labor Standards Act of 1938. The rate was initially set at $0.25 an hour. By 1961, it had quadrupled to $1.00 an hour. The federal minimum has been $7.25 an hour since July 24, 2009; however, each state is perfectly free to enact a higher minimum wage in accordance with its constitution.

According to the National Conference of State Legislatures (NCSL),

Twenty-one states began 2020 with higher minimum wages. Seven states (Alaska, Florida, Minnesota, Montana, Ohio, South Dakota, and Vermont) automatically increased their rates based on the cost of living, while 14 states (Arizona, Arkansas, California, Colorado, Illinois, Maine, Maryland, Massachusetts, Michigan, Missouri, New Jersey, New Mexico, New York, and Washington) increased their rates due to previously approved legislation or ballot initiatives.

Currently, 29 states and D.C. have minimum wages above the federal minimum wage of $7.25 per hour. Five states have not adopted a state minimum wage: Alabama, Louisiana, Mississippi, South Carolina and Tennessee. New Hampshire repealed their state minimum wage in 2011 but adopted the federal minimum wage by reference.

Higher state minimum wages range from $8.56 in Florida to $13 an hour in California.

According to Ballotpedia, “From 1996 to 2020, there were 27 minimum wage increase measures on the ballot. Of the 26 measures, 25 were approved and 2 were defeated. On average, the 25 approved measures received 60% of the vote.” As of 2020, seven states (California, Connecticut, Illinois, Massachusetts, Maryland, New Jersey, New York) had passed bills providing for an incremental increase in their minimum wage to $15 an hour. Florida is the first state to increase the state’s minimum wage to $15 per hour through a ballot measure.

Under Amendment 2, the Florida minimum wage will increase each year as follows:

$10.00 on September 30, 2021;

$11.00 on September 30, 2022;

$12.00 on September 30, 2023;

$13.00 on September 30, 2024;

$14.00 on September 30, 2025; and

$15.00 on September 30, 2026.

Beginning September 30, 2027, the minimum wage will be adjusted annually on the basis of increases to the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W).

It is puzzling that Amendment 2 was passed by Florida voters. Most of them don’t make the minimum wage. And the official “fiscal impact statement” about Amendment 2 is quite negative:

State and local government costs will increase to comply with the new minimum wage levels. Additional annual wage costs will be approximately $16 million in 2022, increasing to about $540 million in 2027 and thereafter. Government actions to mitigate these costs are unlikely to produce material savings. Other government costs and revenue impacts, both positive and negative, are not quantifiable.

THIS PROPOSED CONSTITUTIONAL AMENDMENT IS ESTIMATED TO HAVE A NET NEGATIVE IMPACT ON THE STATE BUDGET. THIS IMPACT MAY RESULT IN HIGHER TAXES OR A LOSS OF GOVERNMENT SERVICES IN ORDER TO MAINTAIN A BALANCED STATE BUDGET AS REQUIRED BY THE CONSTITUTION.

But there is another reason why the support in Florida for Amendment 2 is puzzling.

Florida voters chose Trump over Biden by a margin of 5,668,731 (51.2 percent) to 5,297,045 (47.9 percent). Only twelve of Florida’s sixty-seven counties voted for Biden. Florida has had a Republican governor and a Republican-controlled House and Senate for twenty years. Republicans increased their control of the House to 78-42 and their control of the Senate to 24-16. In the U.S. Congress, both of Florida’s senators (neither of whom was up for reelection) are Republicans and sixteen out of twenty-seven of the state’s House members are Republicans after Republicans flipped Democratic seats in districts 26 and 27.

It is impossible that the 6,391,753 Floridians who voted in favor of Amendment 2 to raise the minimum wage to $15 an hour were all Democrats and the 4,117,815 Floridians who voted against Amendment 2 were all Republicans.

That means that Republicans — the ones who claim to believe in limited government, the free market, and the free-enterprise system — are in a large measure responsible for the increase in the Florida minimum wage.

A government-established minimum wage — even on the state level — is contradictory to the notional Republican ideals of limited government, the free market, and the free-enterprise system.

But that’s not all.

The question that is not being asked is this: What are the voters in a state doing deciding on what the minimum wage should be that an employer can pay an employee?

Should voters in the states have the power to decide what a grocery store can sell a pound of coffee for?

Should voters in the states have the power to decide the minimum price for a haircut?

Should voters in the states have the power to decide how much a teenager can charge to mow lawns in his neighborhood?

Should voters in the states have the power to decide the markup on a new car?

Should voters in the states have the power to decide the minimum price for a gallon of milk?

Why not? If voters can decide what the minimum wage should be that an employer can pay an employee, then no reasonable or logical argument can be made against voters’ deciding those things as well.

In a free society — which is obviously not a society controlled by Republicans — wages are negotiated between employers and employees without any interference from the government — or the voters, even if they are Republicans.

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