Yesterday, the CBO came out with an estimate of the effects that a rise in the minimum wage would have on the economy. They determined that an increase of the minimum wage to $10.10 per hour would cause a range of effects on the economy from the loss of as many one million jobs to a gain of a small number of jobs. Their “most likely” estimate is a loss of a half million jobs or roughly 0.35% of all jobs. The estimate for a $9.00 per hour minimum wage was a loss of 100,000 jobs, or roughly 0.07% of all jobs. Not surprising, the Republicans have run with this. Raising the minimum wage is a job killer!
There are a number of things to note about this. First is that this is a small number of lost jobs. Second, the purpose of raising the minimum wage is not to create jobs, even though there is a decent amount of evidence that it would do that. The idea is to allow those who work to get paid a reasonable wage. The Republican argument that we shouldn’t raise the minimum wage is the same as the argument for getting rid of the minimum wage altogether. I realize libertarians would make that argument, but very few mainstream Republicans would. And remember: according to a recent Washington Post-ABC News poll, 58% of Republican voters want the minimum wage increased.
Jonathan Chait brings up an excellent point about this, The Congressional Budget Office and the Bizarre, Partisan Jobs Debate. He takes a minor swipe at liberals, “[T]he party accustomed to heeding its findings has had to painfully spin.” I don’t think that’s right, but that’s all he has to say about that side. Quite rightly he focuses on the hypocrisy of the Republicans who are only ever interested in job losses when they come from programs for the poorer classes.
The Republicans were eager to end extended unemployment benefits. The CBO says that cost the country 200,000 jobs alone. The American Recovery and Reinvestment Act (“the stimulus”) that Republicans claim did no good has increased employment today by between 100,000 and 800,000 jobs. And the Sequester that Republicans see as their greatest recent accomplishment has destroyed almost a million jobs with a range from a quarter million to a million and a half.
Add on to this all of the things that Republicans are not willing to do to create jobs and you get what you always get: a party that is focused exclusively on the rich. What I find amazing is that anyone listens to the Republicans on these matters. They are clearly disingenuous on matters of job creation. They don’t care at all about creating jobs. It is just a cudgel to use to argue for policies they do like: tax cuts for the rich, military spending, and cutting programs for the poor.