It’s almost cliched now to say that free market advocates expecting Republicans to control the growth of government shows the triumph of hope over experience, but the Bush Administration doesn’t seem to even pretend to fight. Today, the President said that he would support a hike in the federal minimum wage, from $5.15 to $7.25 an hour, in exchange for “targeted tax and regulatory relief” for small businesses.
Yes, the minimum wage hike is popular and enjoys political momentum. It’s bad policy, but it’s a great issue for left-liberals to grandstand on because its costs are hidden — there is no organized political pressure group of people who would have occupied jobs that an increased minimum wage kept from coming into being. So President Bush is trying to make the best of a bad situation. But it’s very bad strategy to announce what you’re willing to go along with before negotiations have even started.
What could the President gain politically from outright opposition to the minimum wage hike? First, he would appear bold and principled, willing to spend political capital to oppose bad policy. Second, he could use this fight as an educational opportunity to tell the American people about the job losses that a higher minimum wage would create — a move that would help Bush regain considerable support among his party’s conservative base.