Support for Raising Minimum Wage Gains Momentum

Last week, both Governor O’Malley and President Obama expressed support for raising the minimum wage. In the coming legislative session, the Maryland General Assembly has the opportunity to act on these calls and increase the economic security and earning power of Maryland workers.

On Thursday, President Obama expressed support for raising the Federal minimum wage to $10.10 per hour via the Harkin-Miller bill. The current federal minimum wage is $7.25. The Harkin-Miller bill would raise the minimum wage in three incremental steps of 95 cents over two years, after which the minimum wage would be indexed to inflation. Indexing the minimum wage to inflation is an important policy measure that would allow it to keep up with the cost of living so that workers’ earnings do not erode when policy makers fail to adjust the minimum wage even as prices increase.

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Source: Economic Policy Institute  

While the President’s support for raising the minimum wage is a positive step, Maryland lawmakers should not wait for the federal government to act. These days that seems like a losing proposition. Instead they should take a leadership role and raise the minimum wage in Maryland independent of federal action. Nineteen states and the District of Columbia currently have minimum wages higher than the level set by the federal government. Maryland is not one of them. Nor is Maryland among the ranks of the ten states which currently index their minimum wage to inflation.

For his part, Governor O’Malley argued that raising the minimum wage is a way to “give dignity to every Maryland family that works hard and plays by the rules” and other state lawmakers and candidates for office have expressed support for raising the minimum wage as well. Further, recent polls suggest that the public favors doing so by a four-to-one margin.

In the coming legislative session, Maryland lawmakers should capitalize on this momentum and enact an increase in the minimum wage that will reduce inequality and support economic growth.

Maryland Allocates Funds to offset Federal Cuts

Maryland Governor Martin O'Malley announced the allocation of $8.8 million in reserve funds to offset federal budget cuts. This action commits nearly $9 million of the $100 million set aside during the 2013 legislative session to offset the results of federal budget actions.

The Governor's statement says:

Nearly 500 low-income children will be able to participate in Head Start programs that will prepare them to enter school ready to learn ($4.1 million). Approximately 3,000 individuals will receive the substance abuse prevention and treatment services they need ($1.6 million). Approximately 3,000 older adults will receive 180,000 meals, 2,500 seniors will have access to health screenings, and 200 seniors will be provided with home and community-based services, including personal care and adult day care. ($1.4 million). Fifty individuals in need of vocational rehabilitation services will receive those services without delay ($800,000). Approximately 7,000 people will receive job placement and training assistance ($500,000). Seventy-five adult education classes serving about 800 students will be offered as planned ($400,000).

Congress will confront another set of deadlines shortly as the federal fiscal year ends without an approved budget one September 30, and the Treasury runs out of authority to issue new debt in mid-October.

The continued federal budget impasse harms Maryland in two ways. First, the direct budget cuts affect services currently received by Marylanders. Secondly, the reduced federal activity in paying salaries and in buying goods and services hurts Maryland's economy.

These temporary back-fills from state funds are helpful in reducing the hardships to families and individuals that would occur if the federal cuts took their full effect. In the long run, however, Congress must do its job of approving a regular budget for the nation on a timely basis.

The Week Ahead, Dog Days of August Edition

Last week we blogged about the need to reform corporate income taxes as part of any rate-cut deal, and about why "the tax-free week" is a wasteful, expensive and ineffective program. Also Marceline White of the Maryland Consumer Rights Coalition guest-blogged about how Baltimore City's proposed use of foreclosure settlement funds would not actually help victims of foreclosures. 

For the week of August 12th through the 18th:

Monday, August 12 the Task Force to Study Economic Development and Apprenticeships meets at 3 pm in Annapolis.


Wednesday August 14 the Telemedicine Task Force Telemedicine Solutions And Standards Advisory Group meets at 9:30 am in Baltimore

Wednesday August 14 - Saturday August  17; The Maryland Association of Counties (MACo) holds its annual conference in Ocean City. The MACo conference is the traditional start of political and policy-making activity in preparation for the January legislative session. The Governor's address to the conference on Saturday is often our first look at the Administration's top priorities for the coming year - in this case Martin O'Malley's last year as Governor.

On Thursday, August 15, the US Bureau of Labor Statistics releases data on inflation and wages for July.

Stay cool.