So much for Joe Biden, moderate
By Merrill Matthews, Opinion Contributor — 01/28/21 08:30 AM EST
President Biden wasted no time releasing a flurry of executive orders and legislative proposals. Some of them may be helpful in addressing the economic challenges imposed by the coronavirus pandemic. But others would almost certainly “cancel†his effort to create jobs, grow the economy and promote equity.
Canceling jobs: the minimum wage increase.In his pandemic relief proposal, Biden is pushing a $15/hour federal minimum wage, more than twice the current rate of $7.25.
According to the Bureau of Labor Statistics, of the 80.4 million U.S. workers who were paid on an hourly basis in 2017, 542,000 – generally younger and low-skilled workers – were paid the prevailing federal minimum wage of $7.25/hour.
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But the added cost to employers isn’t limited to those making the minimum wage. Increases will ripple up as workers with more experience, responsibilities or skills who are currently making $15.00/hour understandably demand a commensurate increase.
The cumulative effect will force thousands of employers, already struggling to stay solvent, to close their doors. As Fox News recently reported, 48 percent of small businesses already say revenues are below what they need to stay open. The minimum wage increase would make that situation worse.
Ironically, Biden and the Democrats are pushing this increase even though Congress just passed the $935 billion year-end COVID-19 relief bill that included $325 billion (over 10 years) to help small businesses keep their doors open and workers employed. Another $120 billion was included to extend unemployment benefits for the millions who have lost their jobs.
Supporters will claim that recent economic studies downplay the job-losing impact of minimum wage increases. And it may be that small increases or increases phased in over a long period of time limit the negative impact. But that’s not Biden’s proposal.
It’s absurd for Biden to lament the thousands of businesses that have closed and millions of Americans who have lost their jobs even as he proposes dramatically raising employers’ cost of doing business. His proposal would only add job-loss fuel to the pandemic fire.
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https://thehill.com/opinion/white-house/536199-so-much-for-joe-biden-moderate
