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Obama's minimum wage proposal may split Democrats

Democrats can speak hopefully of a new populist moment centered on proposals such as a higher minimum wage, but this is the third or fourth time that the president has attempted to launch a new populist, progressive moment.

By Megan McArdle | Updated on January 28, 2014

Jan. 28 (Bloomberg) — With limited time left to advance his economic agenda, President Barack Obama is looking for ways to go around a Congress that won’t go along with his plans. He’s gotten the same answer he’s been getting for a while: Use executive orders to accomplish what legislation won’t. Tuesday night’s State of the Union address will propose, among other things, raising the minimum wage to $10.10 an hour for government contractors hired in the future. The progressive caucus, which has been pushing this idea, estimates that would affect more than 2 million workers.

There’s no estimate of what this would cost the government. When I tried to generate one, I quickly gave up, because I have no idea what it means to say that this will “affect” more than 2 million employees, or what those employees might be paid right now. Some back-of-the-envelope doodling suggests that it will probably cost the government a lot in actual dollars, but not that much per U.S. citizen. Which way we should look at it is left as an exercise for the reader.

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