Behind the Ballot Measure Bonanza


People going to the polls will vote on a host of measures, from hiking the minimum wage to limiting property seizure by the government

From congressional page scandals to Saddam's sudden death sentence, the run-up to this midterm election has been anything but dull. But high drama isn't the only distinguishing characteristic: This year, voters in 37 states will be weighing in on 208 statewide ballot measures, up by a third from the last election. It's also the third-highest number of initiatives in history, trailing only 1996 and 1914.

What's at stake is everything from the quirky to the constitutional to the straightforward. Six states will decide whether to raise the minimum wage. Thirteen will have voters consider whether to restrict the government's right to seize private property. And in Arizona, citizens will vote whether to award a $1 million lottery prize to one lucky voter from the state (see BusinessWeek.com, 11/06/06, "Ballot Propositions: A Cheat Sheet").

Why the ballot measure bonanza? One reason is a "continued and growing dissatisfaction with elected officials," says John Masusaka, president of the Initiative & Referendum Institute, a nonprofit organization at the University of Southern California that promotes and tracks ballot initiatives. "More people are turning away from politicians and saying, 'I want to make this decision myself.'" Another factor relates to party strategy; Democrats are using issues like the minimum-wage boost as a get-out-the-vote tool in key states—hoping to have as much success as Republicans had in turning out the faithful with anti-gay marriage measures in 2004.

Mind the Minimum Wage

Whether pressure for these measures is coming up from discontented citizens, or down from party strategists, the shift in power from Capitol Hill to state ballot boxes may have just begun.

The issue grabbing headlines this year is a proposed minimum wage increase, on the ballot in six states: Arizona, Colorado, Missouri, Montana, Nevada, and Ohio. The proposals would give workers currently making $5.15 an hour a raise of $1 to $1.70 an hour, while indexing the rate to inflation each year to protect against wage stagnation. The AFL-CIO and the Change to Win Coalition, which together represent 15 million union workers, have joined with community groups like ACORN and religious organizations to promote the raise in each state.

"We're trying to get progressives to take a more proactive, aggressive posture," said Kristina Wilfore, executive director of the Ballot Initiative Strategy Center, a nonprofit that is helping coordinate the push for minimum wage hikes. "This work on the ground with religious and community groups helps progressive candidates. We saw an opportunity to exploit their interest in a positive way."

Small-Business Opposition

Raising the minimum wage is overwhelmingly popular. A Pew Research Center poll this spring showed support at 83% nationwide, including 72% among Republicans. Still, some business groups warn that letting states set wages is dangerous business. The National Restaurant Assn., which includes McDonald's (MCD), Yum Brands' (YUM) Pizza Hut, and Coca-Cola (KO), is fighting the measure in all six states where it's on the ballot, and its Save American Free Enterprise Fund has given more than $900,000 to local anti-minimum wage groups. The association's local chapters have teamed up with chambers of commerce and small-business associations to spread the word that raising the minimum wage could cost jobs and inflate prices at shops and restaurants.

"I think this proposal will hurt our business—especially because of the way the pay will escalate," said Mike Broncucia, owner of Mickey's Top Sirloin restaurant north of Denver. He currently pays his wait staff $2.16 an hour, just a hair above the $2.13 minimum for employees who receive tips, and they take home $120 to $150 per night, including tips. The new minimum for such workers would be $3.83 an hour, and that would increase by the same dollar amount as the minimums for nontipped workers. "Soon, we'll be paying $8 an hour for waitresses," he said. Other employees, he adds, receive more than $10 an hour.

Minimum-wage workers like Leann Kinsey, a 36-year-old mother of three who makes $6 an hour working for Hertz car rental in Phoenix, will be turning out to support the increase. "No one can really get ahead on minimum wage," said Kinsey. She has only voted once before, but will vote tomorrow for the measure, along with Democratic candidates for office.

Hodgepodge of Issues

Many economists argue that modest increases in the minimum wage won't have disastrous consequences, while not raising it could actually cut into consumer spending. "It's been shown very convincingly that there is no serious adverse effect on employment," said Joseph Stiglitz, a Nobel prize-winning economist and professor at Columbia University. "We saw unemployment plummet after it was last raised in 1997."

Other ballot measures showing up in several states include moves to restrict eminent domain, or the government's right to seize private property (13 states); smoking bans and tobacco tax hikes (10 states); and efforts to restrict government spending according to inflation and population growth, known as TABOR measures (four states). If the trend continues, we'll see more local action on issues that were once the province of the federal government as both political parties look to lure voters to the ballot box.

Herbst is a reporter for BusinessWeek.com in New York.

The Good Business Issue
LIMITED-TIME OFFER SUBSCRIBE NOW
 
blog comments powered by Disqus