Nothing polarizes people — and impoverishes people — like the minimum wage.

The Tories froze it for nine years. The Liberals boosted it but then froze it again for another four years.

Now, after waiting far too long, the Liberal government wants to raise the minimum wage to $11 an hour for the 535,000 people who depend on it, up from $10.25 today. That would make it the highest of any Canadian province — tied only with the northern territory of Nunavut — but that’s it for now.

For years, Ontario’s working poor have been paying a price for the back and forth on minimum wages: Not just poorly paid, but hostage to the ideologies of politicians and the vagaries of economists.

Bowing to demands for more clarity (and humanity), Premier Kathleen Wynne vowed to take the politics out of the equation. Instead of ad hoc increases and politicized freezes, Wynne promised to make the minimum wage more predictable for both business and workers.

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On Monday, an outside panel reported back to the Liberals that the fairest, simplest way to keep pace would be to mirror the inflation rate going forward. And while it stops short of calling for an immediate increase, the report also lays out the case for inflation adjustments going backward as well — to 2010, recovering the lost ground since the minimum wage was last frozen.

The inflation catch-up — 6.7 per cent over the past four years — isn’t so much a formal recommendation from the deeply divided panel as an obvious corollary. Wynne has taken the hint.

On Wednesday, her cabinet will decide on a new mechanism to compensate minimum wage earners for both future and past inflation.

By the panel’s math, making up for 6.7 per cent in lost purchasing power would bump up the old $10.25 rate to $10.94 an hour. The Liberal plan going to cabinet would round it up to $11 an hour.

But that’s as far as it goes. Despite a high-profile campaign by the labour movement and anti-poverty groups to raise the minimum wage to $14 an hour, the government isn’t about to boost the base beyond inflation.

The compromise plan, if it passes cabinet as widely expected, will ultimately satisfy no one.

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Big labour argues that the working poor can’t lift themselves out of poverty earning only $19,000 a year. Boosting wages would ultimately ramp up purchasing power and help the economy, they say.

Small business and the Tory opposition have lobbied ferociously against any increase, arguing that higher wages would ultimately harm the working poor by killing jobs. At nearly every business meeting or roundtable that Wynne attends, local executives lecture her on the perils of higher wages in a competitive world.

In between lie the economists, practitioners of the dismal science who can’t agree among themselves on where the truth lies.

Is the minimum wage an anti-poverty tool, an economic marker or a political symbol? It is surely all three.

Wynne had hoped to navigate through that perennial debate by appointing an outside panel with a cross-section of labour and business types. But the panel stuck to a middle course.

It found conflicting evidence on the impact of any increases: U.S. research is largely inconclusive, the Canadian experience suggests some employers reduce hiring at the margins. Yet in Ontario the track record is mixed, with no concrete evidence of reduced employment after the last increases.

The report also restates what many economists believe: That the minimum wage can be a blunt and inefficient anti-poverty tool, because not that many people who get it are especially poor.

The majority of minimum wage earners — 56 per cent — are working-age children who are dependents living in the family home, not in poverty. Only about 12.5 per cent of minimum wage earners live in poor households, according to Statistics Canada.

But as the report acknowledges, the minimum wage is not solely a statistical or economic debate, it is also a benchmark, “a wage floor” that establishes a bare minimum for society. While the minimum wage cannot do it alone — child care, affordable housing, tax credits and tax exemptions are essential — it is also a key component of any realistic anti-poverty strategy, no matter how blunt or inefficient it might be.

Wynne’s panel has done its work, but the debate will not go away soon.

Martin Regg Cohn’s provincial affairs column appears Tuesday, Thursday and Sunday. mcohn@thestar.ca , Twitter: @reggcohn

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