Dems offer measure to raise minimum wage to $15 per hour

Dems offer measure to raise minimum wage to $15 per hour
© Greg Nash

Democrats in the House and Senate rolled out a proposal on Wednesday to more than double the federal minimum wage to $15 per hour by 2024. 

“A $15 federal minimum wage affirms the bedrock idea of fairness in our country: that hard work deserves a decent wage,” Speaker Nancy PelosiNancy Patricia D'Alesandro PelosiDemocrats are playing voters on their fantasies for impeachment The Hill's Morning Report - Trump tells House investigators 'no' Seven big decisions facing Biden in 2020 primary MORE (D-Calif.) said in backing the proposal.

The federal minimum wage of $7.25 per hour has not increased in a decade and was based on legislation passed in 2007. It amounts to about $15,000 a year for full-time workers.

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“When we put money in the pockets of American workers, they spend that money in their communities. So this bill will stimulate the economy on main street,” said Rep. Bobby ScottRobert (Bobby) Cortez ScottLabor Department official steps down amid ethics questions: report The Congressional Black Caucus: America stands to lose a lot under TrumpCare House passes Paycheck Fairness Act MORE (D-Va.), chairman of the House Education and Labor Committee.

The proposal, which has 31 co-sponsors in the Senate and 181 co-sponsors in the House, is unlikely to become law with the Senate in Republican hands and President TrumpDonald John TrumpForget the spin: Five unrefuted Mueller Report revelations Lara Trump: Merkel admitting migrants 'one of the worst things that ever happened to Germany' Financial satisfaction hits record high: survey MORE in the White House, but it underlines the efforts by liberals to push an issue they think will be popular with voters ahead of the 2020 elections. 

“We are living today in an American economy that is doing very well for the people on top. Not so well for working families,” said Sen. Bernie SandersBernard (Bernie) SandersElection analyst says Biden could face uphill battle attracting small-dollar donors Gillibrand 'not worried' about being 'discounted' in 2020 race Biden's sloppy launch may cost him MORE (I-Vt.), who sponsored the Senate version of the bill.

Sanders is one of several potential candidates for president who could highlight a $15 minimum wage as part of a national campaign.

Not all Democrats favor the measure, however.

Some think a $15 minimum wage would be too high for certain regions of the country.

As a result, the push could open up rifts between Democrats.

“It’s not something I’m crazy about,” said Sen. Jon TesterJonathan (Jon) Tester20 Dems demand no more money for ICE agents, Trump wall Overnight Energy: Bipartisan Senate group seeks more funding for carbon capture technology | Dems want documents on Interior pick's lobbying work | Officials push to produce more electric vehicle batteries in US Bipartisan senators want 'highest possible' funding for carbon capture technology MORE (D-Mont.), who narrowly won reelection in November in a state won by President Trump in 2016.

Critics say that raising the minimum wage has unintended consequences. Forcing businesses to pay workers more could lead to layoffs or a reduction in working hours. 

A 2014 analysis from the Congressional Budget Office (CBO) found that President Obama’s proposal to boost the minimum wage to $10.10 would have increased pay for 1.65 million workers, but also put half a million workers out of a job. That tradeoff, the CBO projected, would results in 900,000 fewer people living in poverty.

The Employment Policies Institute (EPI), a right-leaning think tank, estimated that a $15 minimum wage would put as many as 2 million people out of work, but that estimate assumed the wage would rise by 2020, not over the course of five years, as in the Democratic proposal.

“Our analysis shows that job losses would be concentrated among younger, less experienced workers,” said Dr. David Macpherson, a professor of economics at Trinity University in San Antonio, who contributed to the EPI’s study. “Congress would be wise to focus on better alternatives to reducing poverty, such as an expansion of the Earned Income Tax Credit to cover childless adults."

The EPI recently took out a full-page ad in The Hill opposing the hike. 

In August, Rep. Terri SewellTerrycina (Terri) Andrea SewellHouse Dem calls on lawmakers to 'insulate' election process following Mueller report Dems counter portrait of discord Congress should look into its own taxes and travel, not just Trump's MORE (D-Ala.) wrote a Wall Street Journal op-ed arguing that the vast regional differences in the country meant that an across-the-board approach to the minimum wage could cause problems.

Sewell proposed a regional approach, which would differentiate minimum wages based on cost of living. Spokane, Wash., where the mortgage on a large home costs $600, should not have the same minimum wage as New York City, where $600 gets you a monthly parking spot, she argued.

“The idea that Spokane, Manhattan and Selma should share the same minimum wage is nonsensical and unfair to low-wage workers everywhere,” she wrote, referring to the Alabama city.

The $15 per hour bill’s supporters argue that by 2024, the minimum wage they are offering would be appropriate for the areas with the lowest cost of living.

“By that year of 2024 that the wage will kick in, that will be the floor on all parts of the country,” said Rep. Mark PocanMark William PocanAppeals court rules House chaplain can reject secular prayers Dems counter portrait of discord Divided Dems look to regroup MORE (D-Wis.). 

He said skeptical Democrats can be won over.

“I think we haven’t shared the data we have with them, and I think once they see that they’ll realize what we’re doing is the right thing,” he said.

When adjusted for inflation, the minimum wage has been on a steady decline for 50 years.

In 1968, when the minimum wage was $1.60, it was worth the same as $11.79 in 2018 dollars, more than 60 percent above the current level.

Sanders called the current minimum wage a “starvation wage” and said that the increase would boost paychecks for 40 million people.

The bill offered by Democrats on Wednesday would also require that tipped workers be paid a full minimum wage, and it would eliminate exemptions for teenagers and people with disabilities. It would require automatic increases over time based on median wage growth to ensure the minimum wage's value doesn't decline over time.

Trump has given conflicting signals over his support for raising the minimum wage.

“Having a low minimum wage is not a bad thing for this country," he said in 2015.

At other times, he has expressed support for a $10 minimum wage and said that it “has to go up.”

PolitiFact awarded him “a full flip flop” for his shifting positions on the topic in 2016.