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O'Malley, skeptics spar over minimum wage

Restaurant and Catering IndustryExecutive BranchAnthony G. BrownMartin O'MalleyGeorge Mason UniversityU.S. Congress

Lawmakers in Annapolis waded into a fraught debate over raising Maryland's minimum wage Tuesday, as advocates for workers and business owners used statistics and emotional appeals to square off on whether a higher rate would help the working poor or cost them jobs.

Gov. Martin O'Malley, making one of his last appearances before the General Assembly, joined Lt. Gov. Anthony G. Brown in telling the House Economic Matters Committee that raising the state's lowest hourly wage from $7.25 to $10.10 over the next two years would be good for business and the right thing to do.

The measure would index the wage to increase automatically with the cost of living, and it would raise the base pay of waiters and other workers who earn tips.

"One thing that I think that all of us can agree on is that anyone who works and plays by the rules — sometimes working 60 hours a week — should not have to raise her children in poverty," O'Malley said. "That's not how our economy functions when it's functioning well."

Raising the minimum wage is one of O'Malley's legislative priorities this year and one of the most contentious issues facing legislators. More than 100 people signed up to testify, and the hearing room was so crowded that some had to watch the proceedings remotely in another room.

Maryland last raised its minimum wage in 2006, to $6.15. Congress trumped that in 2008, raising the federal minimum wage to $6.55 and pushing it to $7.25 the following year. Twenty-one other states and the District of Columbia have since raised their minimum wages above that.

About 67,000 Marylanders now make the current minimum wage. Raising it to $10.10 could lift the pay of more than 300,000 workers who are making that much or less, according to the Economic Policy Institute, a think tank that advocates for higher wages. Another 151,000 workers could also get raises to keep their wages above the new minimum, the institute predicted.

Labor, civil rights, religious and women's advocates are pushing for the increase. They note that a minimum-wage income is below the poverty line.

Business owners and their advocates, though, say raising base pay would actually hurt low-income workers. Restaurateurs took particular aim at raising the discounted wage for tipped workers, which they said would drive up costs in an industry with thin profit margins.

"We'll undoubtedly lose jobs," predicted former Republican Del. James King, who owns a steak and seafood restaurant in Gambrills.

If the bill goes through, King warned, "I'll have no choice but to look at 57 employees and decide which 40 of them I'm going to keep."

Republican Del. Rick Impallaria, who owns an auto body shop, suggested the increase would hurt teenagers and the elderly, many of whom work part time.

Stephen Fuller, an economist at George Mason University in Virginia who studied the issue for a pro-business group, predicted that raising the minimum to $10 an hour would cost the state 11,500 jobs. Maryland's economy would still grow, he said, but more slowly.

Advocates countered by pointing to other studies that found no economic harm from earlier wage hikes.

"When we raised the minimum wage eight or nine years ago," O'Malley said, "there were no cataclysmic repercussions where McDonald's and Walmart shuttered their doors and moved to Virginia."

tim.wheeler@baltsun.com

Copyright © 2014, The Baltimore Sun
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Restaurant and Catering IndustryExecutive BranchAnthony G. BrownMartin O'MalleyGeorge Mason UniversityU.S. Congress
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