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Michael Zimmer: Downsides to raising minimm wage

The president and Maryland's governor agree that it is time to raise the minimum wage.

On the surface it may seem right to want to give people a raise. This topic was the lead story on MSNBC's "Morning Joe" show Wednesday. On Tuesday, the nonpartisan Congressional Budget Office released a report of likely impacts of raising the minimum wage to $10.10 per hour.

The CBO report determined that it was likely that 500,000 folks would lose their jobs were the minimum wage raised to this level. Show host Joe Scarborough, a former GOP Representative from Florida, observed that there's no such thing as a free lunch.

In his view, we're still in the midst of a "jobless recovery." Scarborogh expressed the need to be careful about a policy that would help some poor people by hurting other poor people.

Polls generally show that raising the minimum wage is popular with a sizable majority of Americans. If Republicans are going to resist a minimum wage hike, maybe it is time for them to lay out a specific case for why it may do more harm than good to our economy and to workers.

There are a lot of things I appreciate about Maryland Sen. Joe Getty, R-Dist. 5. One thing I appreciate is his regular email newsletter. It either features historical content or policy content.

His email from Monday was chock full of information about the Maryland version of the minimum wage debate. He noted that two senators representing Carroll County, David Brinkley, R-Dist. 4, and Allan Kittleman, R-Dist. 9, will be in a position to exercise influence on a minimum wage bill because they serve on the Senate Finance Committee, which is considering Senate Bill 331. That is the bill which would raise Maryland's minimum wage to $10.10 per hour.

Getty notes that it would be a feather in Gov. Martin O'Malley's cap to raise the minimum wage in a future Democratic primary for president of the United States.

Kittleman is quoted in the newsletter with some past context on this issue: "Last year, our committee killed the bill on a bi-partisan vote of three for and eight against the bill." Kittleman thinks a bill will pass this year, but observed that last year's vote "underscores the concern even among Democrats that this bill could hurt business at a time when the economy in Maryland is still stagnant."

Getty's newsletter also quotes business leader Larry Helminiak who testified in committee against the bill: "Increasing the minimum wage will put more people out of work by encouraging more automation." Helminiak, who is also a member of the Carroll County GOP Central Committee, added, "Think about ATM machines, EZ pass and electronic checkouts at supermarket." He further noted, "Every one of these are jobs that used to be done by humans but have been replaced by machines - usually machines made in China."

One area that a minimum wage hike could impact that you might not think about is the nonprofit sector that cares for adults with disabilities. Getty's email quoted from a letter from Don Rowe, director of The Arc Carroll County that he had sent to the governor.

Rowe noted that increasing the minimum wage without increasing state funding levels to caring agencies such as The ARC puts pressure on its ability to pay for the workers engaged in direct support for disabled adults. Rowe observed that raising provider reimbursement was unlikely given the tight budgets in Annapolis.

Getty also referenced a study commissioned by the Maryland Foundation for Research and Economic Education analyzing the proposal to hike the minimum wage. The study was written by economist Stephen Fuller, director of George Mason University's Center for Regional Analysis. The report was highly critical of the O'Malley-backed bill, especially for expected job losses for entry-level positions in the private sector.

There are definitely two sides to something like raising the minimum wage. Maybe we're overdue for an honest-to-goodness in-depth conversation about when good intentions may or may not lead to good outcomes over all.

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