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Republicans strive to raise the minimum wage



Washington — The policy debate about raising the federal minimum wage to $15 an hour is the latest disconnect between the Democrats and Republicans. Republicans generally oppose a large increase in wages, which is not good for businesses. The Democrats largely support this idea.

But it also reveals new rifts in the Republican Party, which is attracting its corporate supporters. Some of them believe that more than doubling the minimum wage will greatly reduce its profits, while the working class intensifies the interests of the president. . Donald J. Trump (Donald J. Trump) raises and will benefit from the raise.

For decades, either demanding the abolition of the federal minimum wage or arguing that the federal minimum wage should not be raised, Republicans began to succumb to the reality of the party’s populist foundation and put forward proposals that recognized the need to raise the minimum wage. President Biden may try to take advantage of this shift as he tries to fulfill his promise to raise the minimum wage, even if it was not included in the $1.9 trillion aid package due to the Senate’s ruling on Thursday.

For many years, Republicans have accepted the tax reforms that the Americans are sending to Congress this month, and the economic arguments put forward in the letter by the Growth Club and other conservative groups advocating free enterprise. They pointed out that some studies believe that mandatory wage increases can lead to job losses, small business closures and consumer price increases. They point out that the economic trade-offs are not worthwhile. They say that unemployment will be more than the number of people who are lifted out of poverty, and that states with lower living costs (usually conservative states) will lose more jobs. Bear the brunt of the consequences.

In 2016, as Republicans moved further to the right, moderate candidates such as former Florida Governor Jeb Bush and Florida Senator Marco Rubio strongly argued that the federal government The minimum wage does not need to be raised above $7.25 and still stands today. Mr. Bush said that wage issues should be left to the private sector, while Rubio warned of the risk of making workers more expensive than machines.

However, Republicans sometimes struggle to deal with challenging political positions, which clearly run counter to commercial interests. In the 2012 presidential election, Republican presidential candidate Mitt Romney (Mitt Romney) said that he believes that the federal minimum wage should rise in tandem with inflation as measured by the National Consumer Price Index.

Trump argued at the beginning of the 2016 campaign that the salary was too high, and later he said he could support a minimum wage of $10.

This is the number proposed by current Republican Senator Romney of Utah and Senator Tom Cotton of Arkansas. The plan will gradually increase the minimum wage to $10 over four years, and then link it to inflation every two years. .

Last Friday, Republican Senator Josh Hawley of Missouri took further action and set the minimum wage proposed by the Democratic Party at $15. However, his plan has a big caveat, and it only applies to companies with annual revenues of more than $1 billion.

Holly said: “Large companies can pay workers 15 dollars per hour, which is a long time, but this should not be at the expense of small businesses that are already struggling.

The proposal was severely condemned by Growth Club Chairman David Mackintosh, who hinted that Mr. Holly was adopting unfavorable policies in order to attract Trump’s voters. He said his organization would not support Republicans who advocate minimum wage increases, and said they should push for payroll tax cuts to give workers more take-home wages.

In an interview, Mackintosh said: “This is another example of his ambition driving him to hold these populist positions. This completely violates any of his principles of the free market.”

Although the topic surrounding the minimum wage has remained largely unchanged in the past few years, the political changes are partly due to the fact that the federal minimum wage has been stagnant for so long—a growing body of economic literature shows the cost of a higher minimum wage. May not be reduced. As important as analysts once worried.

After decades of gradual increases, the lowest point has been stable at $7.25 per hour since 2009. After that, the price gradually increased, so the hourly rate for these hours became shorter and shorter: today’s $7.25 is equivalent to 2009’s $5.97 purchasing power, adjusted for consumer price inflation.

Considering the minimum wage level, in fact only a relatively small number of American workers meet the minimum wage standard. In 2020, about 1.1 million people will have an income equal to or below the US$7.25 bottom line, accounting for 1.5% of hourly wage workers and 0.8% of all workers.

The states with the highest hourly wages or below the federal minimum wage are usually southern regions (such as South Carolina and Louisiana) and tend to be conservative. In the 2020 presidential election, 7 out of 10 states have workers whose average income is higher or lower than the minimum wage, and this state was voted by the Republican Party.

Although only a small percentage of workers have incomes at or below the minimum level, raising the federal base wage to $15 will drive wage growth on a larger scale. According to a recent analysis by the Congressional Budget Office, a minimum wage of US$15 will increase the wages of approximately 17 million workers earning less than US$15, and may increase wages for another 10 million workers earning slightly higher incomes.

Nonetheless, raising wages for as many as 27 million Americans may still come at a price. Based on the results of 11 studies and adjustments from the wider literature, the Budget Office estimates that with a minimum wage of $15, by 2025, 1.4 million people may lose their jobs.

Some leftist economists questioned the conclusion of the Budget Office.

Arindrajit Dube of the University of Massachusetts Amherst summarized 55 different academic studies in a study that looked at the period when the minimum wage was introduced or raised (36 in the United States and 11 in other developed countries). Directly affected, a 10% increase in the minimum wage may result in 2% unemployment. Looking at the impact of low-paid workers from a broader perspective, the cost of work is “minutes.”

Mr. Dube’s recent work has hardly found the impact of rising state and local minimum wages on employment.

However, many Republicans have captured the unemployment figures in the Budget Office.

In a column titled “How many jobs will “stimulus” kill?” Mr. Trump’s adviser and ally Stephen Moore and conservative economist Casey B. Mulligan argued that $15 The federal minimum wage will make one million jobs or more. Mr. Moore said in an email that they rely on estimates from the Congressional Budget Office.

Nevertheless, many economic officials emphasized that the cost of higher-minimum-wage jobs is not as large as people once thought, and that the federal minimum wage has not kept pace with inflation.

The President of the Federal Reserve Bank of New York, John C. Williams, said in a virtual speech on Thursday: “The higher minimum wage obviously does help the affected workers.” “There is some unemployment,” But recent evidence shows that the number of unemployed is not as high as expected.

There is a precedent for raising the minimum wage to $15, because as federal basic salary requirements have stagnated, states and localities are increasing their minimum wages. According to the analysis of the National Employment Law Project, at the beginning of 2021 alone, 20 states and 32 cities and counties raised their minimum wage standards. Among them, the minimum wage in 27 places has now reached or exceeded US$15 per hour.

The effort toward $15 began in 2012, when fast-food restaurant workers protested. It was initially seen as an incidental idea, but this momentum has grown even in states with serious Republican parties. The state of Florida, which Mr. Trump won in November 2020, voted in favor of a voting measure calling for a minimum wage of $15 by 2026.

Like in many local cases, the Democrats propose to gradually increase, and gradually increase. Janet L. Yellen, Secretary of the Treasury of the Biden Administration and former Fed Chairman,

Ms. Yellen wrote: “This is very important. The way it is implemented is very important. The president’s minimum wage will gradually increase over time, so that small businesses have enough time to make adjustments.”


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