Maryland’s minimum wage should adjust with inflation

Anyone who heard Gov. Wes Moore testify Monday in favor of his plan to raise Maryland’s minimum wage to $15, two years earlier than scheduled, and then link increases to inflation starting in 2025 (with a 5% annual cap), might have been surprised at how compelling his argument was and how tepid the opposition.

Appearing before the House Economic Matters Committee, Gov. Moore mostly let the facts speak for themselves.

The state’s current minimum wages of $13.25 per hour for employers with 15 or more workers, and $12.80 for those with fewer, are already on track to reach $15 in 2025. Yet with the recent uptick in inflation, that’s simply not good enough, especially given Maryland’s level of prosperity and how ignoring inflation means turning our collective backs on working families struggling with poverty — including the 126,000 children supported by minimum wage jobs.

The chief counterargument offered, that small businesses can’t afford the added burden in these uncertain times, might have been more compelling had business owners not also complained about how difficult it is to fill entry-level jobs. If anything, a statewide minimum wage provides employers with some protection against a race-to-the-bottom on wages while reducing the burden of taxpayer-subsidized safety net programs.

Yet there are signs the General Assembly may balk on a key provision. Republican votes against raising the minimum wage are a given, of course, but Democrats hold a commanding majority in the State House. And Democratic leaders in both the House and Senate are already signaling that they don’t much like the automatic inflation rider.

Really? We haven’t heard much explanation of why a costof-living adjustment that is not only capped at 5% annually, but could be denied entirely in any given year by a vote of the Board of Public Works (as a kind of circuit breaker against unforeseen economic hardship), should be a deal-breaker. Not when voters just weeks ago swept Moore into office on the mantra of leaving no one behind. Not when the need is so obvious. Not when inflation has just demonstrated how quickly a minimum wage can turn inadequate.

So what gives? Democrats, it appears, are more interested in holding onto their own wages. Their apparent thinking? “Why make inflation adjustments automatic and take the power to cast a popular vote to increase the minimum wage out of our own hands?” In other words, Democratic delegates and senators, particularly in deep-blue sections of the state, like telling their constituents they just voted to raise the minimum wage. They’d like to retain that authority. They’d like to keep all the fundraising, the public outreach and the partisan speeches on the floor that come with it.

Weirdly, in a debate that’s supposed to be about a living wage, it’s threatening to be focused on what’s in it for lawmakers. And that’s just wrong — economically, politically, morally. Contrast this position with Democratic support in cost-of-living adjustments in the gas tax. That was a decision we supported as well, but apparently it was an easier call because raising taxes can make one unpopular. Who wants that vote on the record every election cycle?

It should be noted 20 states have chosen to embrace automatic COLA adjustments in the minimum wage. Caps on such increases are also commonplace. Vermont, for example, uses the exact same 5% cap that Moore has proposed. The $15 minimum wage is hardly novel given that Maryland already requires state contractors to pay at least that in Baltimore City and in Baltimore, Anne Arundel, Howard, Montgomery and Prince George’s counties. Local subdivisions are free to set a higher minimum as well.

There are moments when the insider politics of State Circle in Annapolis elude us. This is one of those times. With all due respect to the business community, the opportunity to enable more Marylanders to support themselves is simply too compelling a public interest to be ignored. And adjusting the minimum wage for inflation automatically each year is the right thing to do to ensure that circumstance will continue.