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Five of eight Minnesota Reps. voted to hike the minimum wage to $15 and destroy 1.3 million jobs

Last week, Minnesota Representatives Angie Craig (DFL-Eagan), Dean Phillips (D-Eden Prairie), Betty McCollum (DFL-Saint Paul), Ilhan Omar (DFL-Minneapolis), and Collin Peterson (DFL-Moorhead), voted Aye to the Raise the Wage Act. This would raise the federal minimum wage to $15 an hour by 2025.

But, while that might be the law’s intention, that does not mean that it will be the law’s consequence.

Recently, the Congressional Budget Office released a study titled ‘The Effects on Employment and Family Income of Increasing the Federal Minimum Wage‘. As economist Michael Saltsman of the Employment Policies Institute explains in the Wall Street Journal,

The Raise the Wage Act of 2019, introduced in January, would set a $15 minimum wage by 2024. The trade-offs from this legislation are even worse than in 2014. CBO finds a $15 minimum wage would pull 1.3 million workers out of poverty at the cost of 1.3 million jobs in the median scenario, and 3.7 million jobs in the worst-case scenario.

Put differently, as many as three people would lose their jobs for each person no longer in poverty.

The CBO’s conclusions, based on a review of dozens of empirical studies, even suggest the title of the Democrats’ bill is a misnomer. The Raise the Wage Act would reduce real family income by $9 billion once phased in, as reductions in employment (among other impacts) offset the increase in some workers’ pay.

It is amazing how wedded some people are to the idea that just because government has commanded that people will be paid more, it will happen. In spite of the balance of evidence, we still see nonsense like this

When the House does approve the increase, everyone in Minnesota making minimum wage will get an extra $5.14 an hour added to their check.

No, they won’t. As I’ve written before, we must judge public policies by their effects, not their intentions.

John Phelan is an economist at the Center of the American Experiment. 




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