June 29, 2017
Minimum Wage Hike To Save Taxpayers $4.6 Billion Per Year, New Study Says

A minimum wage hike to $10.10 per hour would save taxpayers $4.6 billion per year and reduce the dependence of American families on food stamps, according to a new study released Wednesday.

The minimum wage is currently $7.25 per hour

Last week Louisiana Governor Bobby Jindal emerged from a meeting with President Barack Obama declaring the president's push to raise the minimum wage, "the white flag of surrender."

Jindal, as do most Republicans, opposes raising the minimum wage, though a separate report from the Congressional Budget Office last month found that the minimum wage hike would affect 15 percent of the nation's work force and raise almost a million people above the poverty line.

"What I worry about is this president and the White House seems to be waving the white flag of surrender," Jindal said on the White House lawn following a meeting of governors with Obama. "The Obama economy is now the minimum wage economy."

Connecticut Governor Daniel Malloy took the microphone next and, with Jindal by his side, slammed the Louisiana governor's views on the minimum wage hike as "insane."

"I don't know what the heck was a reference to white flag when it comes to people making $404 a week," said the Connecticut governor, a Democrat. "I mean, that's the most insane statement I've ever heard, quite frankly,"

The evidence from Washington state, which currently enforces the highest minimum wage in the country, would seem to favor Malloy's view over that of Jindal. Republican assertions that a minimum wage hike would cost jobs have not been borne out in Washington, where the minimum wage now stands at $9.32.

In fact, according to a report today by Bloomberg Business News, Washington's job growth over the last 15 years, since the state voted to raise its minimum wage, has outpaced the national average — 0.8 percent annually compared to 0.5 percent.

Amazingly, though restaurants and bars were predicted to suffer the worst job losses under the raised minimum wage, in Washington payrolls in that sector have increased by 21 percent.

According to a study issued Wednesday by Washington D.C. think tank Center For American Progress, a minimum wage hike to $10.10 per hour would reduce spending on food stamps by an average of $4.6 billion per year, cutting enrollment in the Supplemental Nutrition Assistance Program by 9.2 percent.

About one out of every seven Americans requires SNAP, aka "food stamps," just to put food on the table, due to the rapid expansion of the low-wage job sector. In the 2008 recession, 21 percent of all lost jobs were in the low-paying category.

Since then, out of all jobs added back into the economy, more than half — 58 percent — pay low wages, defined as a median hourly rate between $7.69 to $13.83.

Obama continued to campaign for the minimum wage hike Wednesday, traveling to New Britain Connecticut, where he lunched on a steak sandwich at Cafe Beauregard, a restaurant notable for paying its employees more than the minimum wage.

"We were just talking to the owners of this establishment who pay their workers more than the minimum wage because as the owner put it, he knows what it's like to work your whole life and understands that if people are working hard, they shouldn't be in poverty," Obama said at the restaurant.

Image: Center For American Progress