Minimum wage deal emerging?

Majority Leader Harry Reid (D-Nev.) is struggling to stop Senate Democrats from backing a plan to undercut President Obama’s $10.10 minimum wage target.

Sen. Susan Collins (R-Maine) has been reaching out to Democrats to agree on a compromise that is threatening to divide the president’s party on this core component of its election-year message.

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Democrats already disagree among themselves over whether they should continue to stick to the $10.10 amount or try to work with Republicans on a lower figure.

A senior Democratic leadership aide said Reid is a “hardcore” supporter of Obama’s target number, to be achieved over three years, a proposal strongly supported by labor unions, which are powerful in the majority leader’s state.

But several Democratic senators have signaled they are willing to negotiate a lower wage floor that would be easier to get enough Senate votes to pass.

Now, despite his staunch personal preference for $10.10, Reid’s office doesn’t rule out compromise depending on feeling within his caucus.

“Sen. Collins is talking with colleagues on both sides of the aisle about a possible alternative that could raise the wage by a reasonable amount and avoid the loss of the 500,000 jobs that the nonpartisan Congressional Budget Office estimates could result from raising the minimum wage too quickly and by too large an amount,” said Kevin Kelley, a spokesman for Collins.

Kelley said the package could include tax incentives to encourage small businesses to hire workers. Collins, a centrist, is up for reelection this year.

Sen. Angus King (Maine), an independent who caucuses with Democrats, said he would vote for the measure to raise the minimum wage to $10.10 an hour but declared he would not be satisfied with a vote merely for show; he wants legislation that could pass.

“My only real concern is that we come out of here with something,” he said.

Sen. Mark Warner (D-Va.), a GOP target this year, also indicated a willingness to do a deal.

Even if senators agree and pass a bipartisan package, the GOP-led House is unlikely to follow suit. With Republicans well placed to win the Senate, some Democrats see a wage hike vote as a useful weapon on the campaign trail. A compromise deal could let GOP senators and candidates off the hook. But a deal could also shield centrist Democrats from GOP and industry attacks.

Sen. Tom Carper (D-Del.) worries that, if Senate Democrats refuse to compromise at below $10.10, no bill will get through.

“The president had, I thought, a very good proposal last year, $9 and indexed [to inflation],” he said.

The minimum wage is now $7.25 an hour and is not indexed to inflation. Liberal Democrats, most notably Sen. Tom Harkin (Iowa), persuaded the White House to embrace $10.10, after Obama initially proposed lifting the rate to $9 an hour.

Labor unions have panned a possible compromise.

“There’s no justification for it, other than to appease senators who don’t necessarily support the minimum wage,” said a senior labor official. “Looking to shave off part of it for political expediency doesn’t make any sense for people who work 40 hours a week and will continue to be in poverty if you lower it below $10.10.”

The CBO estimated raising the minimum wage to $9 an hour would likely cost 100,000 jobs, significantly below the 500,000 jobs it warned might be lost by raising it to $10.10.

Collins is stressing that point.

“The bottom line is — Sen. Collins is looking for a common-sense solution that would help struggling families and not force employers to eliminate jobs, rather than add them,” said Kelley, Collins’s spokesman.

The majority of the Democratic caucus favors $10.10, but no Senate Republican has publicly endorsed it. Of the 55 senators who caucus with the Democrats, 37 have co-sponsored Harkin’s wage bill. Democrats who have not signed on include Sens. Joe Manchin (W.Va.), Mary Landrieu (La.), John Walsh (Mont.), Jeanne Shaheen (N.H.) and Mark Udall (Colo.).

Sen. Mark Pryor (Ark.), the chamber’s most vulnerable incumbent, is the only Democrat who has said he flat out opposes a raise to $10.10. He instead supports a local initiative to raise Arkansas’s minimum wage to $8.50 an hour over the next three years.

“This hasn’t been an issue in our race because it’s one of the rare issues where Sen. Pryor and Tom agree,” said David Ray, a spokesman for Rep. Tom Cotton (R-Ark.), who is challenging Pryor. “A $10.10 minimum wage imposed by Washington is bad for Arkansas workers and businesses. It would hurt the very people we’re trying to help.”

Democratic senators, liberal groups and labor unions lobbying for the minimum wage hike say the vote on proceeding to the measure is likely to be delayed until next week. Reid’s office says that would be the result of Republicans slowing down the unemployment benefits bill, not because of internal Democratic dissent.

Democratic leadership aides, however, say there is little chance of reaching a compromise to raise the minimum wage to something between $7.25 and $10.10, unless Collins shows she could bring along other Republicans.

Democratic aides say Collins would have far less leverage to negotiate a minimum wage deal if Republicans block the vote on proceeding to legislation raising it to $10.10.

“Reid’s not going to have any trouble holding the line if it’s just a failed cloture vote and we move on,” said the senior Democratic leadership aide.

Her most likely allies are Republican senators who helped to negotiate a bipartisan deal to extend unemployment benefits, including Sens. Dean Heller (Nev.), Lisa Murkowski (Alaska), Kelly Ayotte (N.H.) and Mark Kirk (Ill.).

There is no chance that Senate Republican Leader Mitch McConnell (Ky.) will agree to a compromise. He has warned that raising the minimum wage by any amount could kill jobs.

“We need to focus on jobs and will cite the CBO’s study saying raising it will cost 500,000 jobs,” said a GOP leadership aide.

While Collins is expected to cruise to victory this fall, Maine has trended more Democratic in recent years.  Collins vented her frustration with McConnell last year, after he lobbied Republican senators to kill a bipartisan deal she crafted on the transportation spending bill for fiscal 2014.

“This is so absurd,” Collins fumed in August, after GOP leaders sank the measure. She grumbled that McConnell had never worked so hard against a member of his own party.

 

This article was updated and corrected at 10:15 a.m. Sen. Heidi Heitkamp (D-N.D.) is a co-sponsor of Harkin's legislation.