CNMI allies asked Block minimum wage hike

House Speaker Benigno R. Fitial yesterday reached out to friends in the US Congress to enlist their help in defeating a bill seen to further aggravate the current condition of the Northern Marianas economy.

In a letter to Senate Majority Leader Trent Lott, Mr. Fitial solicited the assistance of CNMI allies in the nation’s capital to block the advancement of S.8, which seeks to increase local minimum wage to federal levels.

The speaker said S.8 could easily destroy the CNMI economy. “I felt that the best way to defend ourselves from this attack was to enlist the help of the Senate Majority Leader.”

He added that the proactive step of writing the US senator and seek his support would help local efforts aimed at preventing the passage of any federal legislation seen detrimental to the growth of the islands’ economy.

“I am writing to strongly urge you to oppose S.8 introduced by Sen. Dashele, D-SD, that, among other things, would apply the federal minimum wage to the CNMI,” Mr. Fitial told Mr. Lott in a Feb. 7 letter.

He pointed out that enactment of S.8 would increase CNMI minimum wage by more than 200 percent, adding that even the most vocal opponents of the locally-controlled rate have argued that such as drastic increase could be accommodated in such a short period.

“Indeed, doubling the minimum wage so rapidly would force most of the territory’s businesses, large and small, into bankruptcy. In short, an increase of that proportion would have one certain effect — destruction of the CNMI economy,” he stressed.

Mr. Fitial said the proposed measure appears to be in line with the “faulty reasoning” that backed previous proposals to extend federal minimum wage rate in the Northern Marianas, amid a slumping economy.

The Northern Marianas was given the authority to set its own wage rates because of the US government’s recognition that the local economy is fragile because of its heavy dependence on Asian financial forces, said the house speaker.

“It is important to realize that the CNMI did not share the recent boom economy of the 50 states. The Asian economic flu hurt all local businesses. Tourism was down and bankruptcies hit record numbers,” he added.

Mr. Fitial emphasized that the last thing the local economy needs would be drastic increase in labor costs in such a hurried and confused manner. “Such action would be punitive, unnecessary, and in the end, indefensible.”

He also reminded federal government officials that the Commonwealth’s authority to control its own wage rate was mutually agreed upon by the US Congress and the residents of the Northern Marianas.