February 20, 2014
There’s a lot of buzz right now about the new report from the Congressional Budget Office (CBO) about the effect of raising the minimum wage. My biggest takeaway: raising the minimum wage to $10.10 will raise 900,000 people out of poverty — and we cannot miss this opportunity.
Senator Tom Harkin, who introduced the Fair Minimum Wage Act, says in his press release: “Raising the minimum wage is not just the popular thing to do, or the right thing to do for millions of working Americans and their families — it’s also the right thing to do for our economy.”
Opponents of giving U.S. workers and their families a raise to a more livable wage are zeroing in on parts of the CBO report that state there might be associated job losses. From what I’m reading, it seems like a big might to me.
Things you should know:
- The CBO didn’t do independent research for this report (and we know that opponents are funding research that plays into their claims, so simply surveying all the research out there is problematic).
- More than 600 economists support the proposed $10.10 minimum wage.
- The proposed $10.10 raise would directly benefit 16.5 million workers, and an additional 8 million workers would see a ripple-effect increase.
- Historically, minimum wage increases do not cause job loss.
As Rep. Tom Harkin said: “Since the first minimum wage was enacted more than 75 years ago, opponents have argued that a wage floor would cause job loss. But this is a myth. Our own historical experience shows that nothing could be further from the truth,” Harkin said. “Indeed, the newest economic research using the most sophisticated methodologies has demonstrated that modest increases in the minimum wage do not cause job loss.”
I think that the New York Times did a fabulous job of responding to the CBO report in their editorial this morning: “The Clear Benefits of a Higher Minimum Wage.”
In summary, it appears that the CBO report underestimates the benefits and overestimates the costs of raising the wage. Our bottom line: raising the minimum wage is the right thing to do — morally and economically. Help us make it happen!