EITC VS. THE MINIMUM WAGE. You often hear conservatives argue that we shouldn't increase the minimum wage, we should raise the Earned Income Tax Credit. Setting aside the claim's disingenuousness -- not much in the way of EITC increases after six years of Republican governance, I fear -- it's not true that the two policies are interchangeable. The minimum wage has uses and benefits that tax credits don't, and vice-versa. Over at EPI, Max Sawicky has a paper laying those variations out in full. He concludes that while simplifying and expanding tax credits may be a worthwhile policy objective, "boosting incomes with a higher minimum wage avoids the dangers of reduced work incentives and larger marriage penalties in the income tax, escapes the burden of offsetting the cost of an expanded credit under the pay-as-you-go rules, foregoes the complexity of redesigning the tax system, and provides a benefit in plain view of the worker." That PayGo bit is particularly important, as the Republicans left the budget in such a mess there's really not much room for new spending (which Republicans will also fight). Boosting the EITC may be a good thing -- I certainly am sold on it -- but it's not an either/or choice, and a serious expansion/reform of the EITC and tax code are, in the short term, considerably less achievable than a boost in the minimum wage. Indeed, if Republicans were really serious about blocking the wage increase but helping poor people, they could have ratcheted down the pressure by increasing tax credits during their years of unified governmental control. That they showed no interest in doing so is further evidence that the sudden affection for the EITC is a diversionary tactic. --Ezra Klein
