CBS News on Saturday published an article applauding President-elect Joe Biden's proposal to raise the federal minimum to $15 an hour. Right now the federal minimum wage is $7.25 an hour, where it has sat since 2009.
Of course, the news outlet cheered the decision, saying it could benefit Americans who have suffered throughout the course of the Wuhan coronavirus pandemic.
And they did their best to bury the real story: that the Congressional Budget Office (CBO) says almost doubling the federal minimum wage would result in 1.3 million fewer jobs. Plus, the higher wages would mean consumer pricing would increase. In other words, we would see massive rates of inflation.
Here's what they buried (emphasis mine):
The CBO also estimated the move would cost 1.3 million American jobs, a claim long made by conservative economists. Mr. Biden's call to boost the minimum wage to $15 an hour "is the absolute last thing that unemployed workers need right now," Michael Farren, an economist with the right-leaning Mercatus Center at George Mason University, said in an email. "After all, they can't benefit from higher wages if those higher wages result in slower job growth."
Heidi Shierholz, senior economist and director of policy at the left-leaning Economic Policy Institute, rejects the argument that a wage hike would lead to job losses.
"That claim of job loss isn't supported by evidence — it's likely an overestimate of negative employment impact. But even if you accept their findings, they still find the benefits far outweigh the costs," Shierholz, formerly the Labor Department's chief economist under Barack Obama, told CBS MoneyWatch.
Higher labor costs from raising the minimum wage would be shouldered by businesses, some of which would pass them on to consumers, according to the CBO.
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There are serious flaws with the proposal, like the fact that small businesses – the ones that have survived this far into the pandemic – would be hit the hardest.
Big box stores like Walmart, Target and Amazon can afford to pay employees more. It won't be a make or break decision for their business. But for a small mom and pop coffee shop or convenience store, that could mean the difference between closing their business or getting rid of all of their employees.
CBS padded the piece and failed to include those numbers at the beginning of the story because they knew it's not only a terrible proposal, but a terrible time to introduce it. Unemployment has been high over the last year, almost to Great Depression numbers, because people were asked to stay home. Some businesses closed their doors for good. And others, like the restaurant industry, are barely getting by due to COVID lockdowns and restrictions.
Whenever conservatives warn about this possibility, we're often told we're heartless and don't care about those at the bottom who are making minimum wage. The truth is we do care. We don't want to see peoples' livelihoods go out the window because government tries to dictate how their business should be run. We don't want to see Americans lose a job because the business can't live up to government mandates. And these are the very real consequences of poor policy decisions.
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