In a different era many children were told that haste makes waste; the saying still holds true. A month ago Mitt Romney voiced his support for a higher federal minimum wage, and almost immediately conservative and libertarian-leaning commentators were at full roar. The former presidential candidate failed to understand (or chose to ignore) basic economic principles, he was an unprincipled moderate, a political appeaser. Yet the hasty criticism, was premised on the wrong perspective, and therefore missed its mark.
The world of principle-driven politics is much different from the world of business. Individuals who are passionate about specific ideas are often reactive, they defend their ideas quickly and fully, but struggle to adjust their principles when new circumstances arise. Successful businessmen frequently have the opposite problem: they assiduously avoid a rigid approach to new problems, and frequently integrate new information into their existing models.
In their haste to opine on the former Governor’s comments, many conservative and libertarian commentators looked through an ideological lens and shuddered. Businesses would become less competitive internationally, everyday prices would rise, and the least useful employees would be jettisoned by their employers. From an ideological perspective, Mitt Romney’s support for a higher minimum wage was damnable.
Yet by using their personal perspective, and not Romney’s, the commentators ended up sounding a little foolish. Mr. Romney was aiming at a different target altogether. A businessman though he is, the former presidential candidate was not focused on the economic impacts of raising the minimum wage – he was focused on the psychological link between ideas and actions.
According to the former Governor, Republicans “need to convince workers, particularly, Latinos, that this party will help them get better jobs and better wages.” The former governor’s concern is this: if Republicans oppose a minimum wage hike, their actions will hurt their message, they will look out-of-touch, uncaring, and disingenuous as they promise higher wages while simultaneously opposing higher wages for entry-level workers. For many voters the subtle economic impact of a higher minimum wage will be largely unknown, and therefore irrelevant. Electoral damage will ensue.
The argument in favor of a higher minimum wage is even more persuasive when the long-term political effects of opposing it are taken into account. If Republicans suffer electoral reverses due to their stance on the minimum wage, grow-the-government Democrats will have an easier path to future presidential and congressional victories. Thereafter, the United States’ response to red-ink budgets and
soaring government debt would presumably be guided by leaders who favor tax hikes rather than spending restraint. Higher taxes and spending-fueled inflation could easily damage the economy more than a minimum wage increase.
For a cadre of Republican-leaning voters, the existence of a federal minimum wage violates the spirit of the Constitution. Hence a strategic embrace of the minimum wage is constitutionally untenable. However, the vast majority of Republican-oriented voters have no constitutional qualms about the minimum wage. Consequently these voters have the luxury of making small concessions in order to strengthen their ability to reach more important objectives in the future.
Presently, many Republicans and Republican-leaning independents believe the economic costs associated with raising the minimum wage would outweigh the benefits. Before this agreement dissolves into an intra-party shouting match, conservative and libertarian-leaning voters should consider the delicate balance between principles and political realism. Political realism without principles is a rudderless boat, while principles without political realism is a sailboat without a sail.
Small-government voters and politicians must not abandon their beliefs. Instead they must thoughtfully consider the political costs of staunchly opposing broadly popular ideas. If the advocates of a smaller federal government fail to consider the possible consequences of a principles-only strategy, they will fail to prioritize their objectives, and most likely find themselves unable to achieve their long-term goals (e.g. reforming the federal budget and reducing the federal debt).
A higher federal minimum wage will not help the economy as a whole, it is a heresy to some principle-driven voters, and an anathema to many free-market economists. However, the political costs surrounding the issue are unknown; some voters demand a higher wage, while others label such a hike unwise or unconstitutional. Yet certainty still exists: hasty, reactive opinions are unhelpful. Fortunately, Mitt Romney expressed his opinions in a calm and reasonable fashion; powerful politicians across the political spectrum should emulate him.
Until the day economists agree about the deleterious economic side effects of the minimum wage, and voters are dutifully informed, ignorant and unscrupulous politicians will use the minimum wage to paint their political opponents as ogres. Only through firm principles, a timely dose of political realism, and a calm, rational demeanor can we hope to wisely guide the destiny of this great Republic.