News

Democrats Fear Big Minimum Wage Hike Will Reduce Welfare Rolls

on

Rep. Scott Hamann (D-South Portland) wants to raise Maine's minimum wage.

Rep. Scott Hamann (D-South Portland) wants to raise Maine’s minimum wage.

AUGUSTA – Amid Friday’s debate over whether to raise Maine’s minimum wage law, some Democrats fear doing so might make some Mainers ineligible for food stamps, Medicaid, and other welfare benefits.

During a Friday work session on L.D. 611, An Act To Adjust Maine’s Minimum Wage Annually Based on Cost-of-living Changes, the Committee on Labor, Commerce, Research and Economic Development pondered an amendment to raise the minimum wage even more.

Whereas the bills sponsor, Rep. Scott Hamann (D-South Portland), originally proposed that the minimum wage increase by $1 and be indexed to inflation, the proposed amendment would have increased the minimum wage $.50 per year for three years, also indexed to inflation.

But for Sen. John Cleveland (D-Androscoggin) there was one serious problem with such an increase in the state minimum wage – and it wasn’t the added costs to Maine’s businesses.

According to sources present during the hearing, the freshman senator was concerned that the higher wages may make some Mainers ineligible for food stamps, Medicaid, and other welfare benefits.  Sen. John Patrick (D-Oxford) agreed.  The possibility that higher wages may help welfare recipients achieve independence was apparently unpalatable for either senator.

In his testimony on behalf of the bill, Hamann said that now is the time to raise minimum wage.

“This bill has been before the committee each session since the most recent minimum wage increase way back in 2009,” said Hamann. “In that time, the US economy was beginning an unprecedented national recession. And in fact a previous bill in 2010 that sought to address the minimum wage was killed by its own sponsor because it wasn’t the right time,” he said.

“There is a belief that increasing the minimum wage will hamper job growth, but this text book theory has been proven true only in an academic vacuum,” said Hamann. “With more money to spend, local businesses will see this drive consumption and demand for goods. An increased demand for goods requires businesses to hire more employees. So the result will be either an offset or increase to employment,” he said.

House Majority Leader Rep. Seth A. Berry (D-Bowdoinham) and Senate President Justin L. Alfond (D-Portland) have sponsored L.D. 611.

Maine is ranked second among states for food stamp enrollment and third for availability of TANF cash welfare benefits and Medicaid.

Maine is also the second-biggest welfare spender per capita in the nation.

Follow The Maine Wire on Twitter and Facebook

About Steve Robinson

Steve Robinson the editor of The Maine Wire. A native of Dexter, Maine, Robinson is a graduate of Bowdoin College.

Recommended for you

Discuss this story