Democrats to push $15 minimum wage amid party infighting

By Minimum WageFOXBusiness

The economic costs of a federal minimum wage increase to $15 an hour

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Democrats are expected to bring a bill to raise the federal minimum wage to $15 per hour to the House floor this week, amid infighting among members of the party.

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The legislation would increase the national minimum pay rate to $15 per hour by 2024 through scheduled annual increases. It has more than 180 co-sponsors, including support from House Speaker Nancy Pelosi, D-Calif., and Senate Minority Leader Chuck Schumer, D-N.Y.

The current federal minimum wage is $7.25 per hour, unchanged since 2009.

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Some Democrats, however, have expressed concern that broadly increasing the federal minimum wage would have differing effects among communities across the country, specifically between rural and urban areas.

As a result, Democratic Reps. Stephanie Murphy, D-Fla., and Tom O'Halleran, D-Ariz., have proposed an amendment to the legislation that would require an analysis of the economic and employment impacts of the first two scheduled wage increases, according to people familiar with the matter. After that, Congress would decide on how to proceed toward the ultimate $15 per hour goal.

Meanwhile, Politico reported that there is another proposal to soften the wage increase, which would allow employers six years to phase in the increases – as opposed to five.

There has also recently been public tension between Pelosi and New York Rep. Alexandria Ocasio-Cortez, where the freshman congresswoman alleged Pelosi was targeting “women of color” – referring to herself and a group of minority women in Congress.

Last week, House Minority Leader Kevin McCarthy, R-Calif., said it was difficult to work with the Democrats to button up other important issues because of their “family feud.”

Meanwhile, Republican leadership has said the minimum wage hike would be “devastating” for middle-class families, citing research from the Congressional Budget Office. The CBO report found that the Democrats’ bill would boost wages for about 17 million people – but it would also reduce business income, raise consumer prices and reduce the nation’s output. Overall, the CBO said the move would reduce real family income by about $9 billion in 2025 – or 0.1 percent. Those effects, however, would be felt differently depending on where families fall on the income spectrum. Job losses were estimated at a median 1.3 million, though the range could extend as high as 3.7 million.

“Think about that, that’s the entire state of Oklahoma losing their job,” Minority Whip Steve Scalise, R-La., said on Capitol Hill last week. “The CBO report that came out should be alarming to everybody in America who believes in trying to become part of the middle class.”

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Not all conservatives are opposed to bigger paychecks, however, though they typically don’t support a federal mandate.

White House economic adviser Larry Kudlow, for example, argued against having the federal government set the national minimum wage since conditions vary meaningfully among states.

“The federal government shouldn’t have jurisdiction over the states anyway in a matter like this,” Kudlow told FOX Business in November 2018. "The conditions are different in these states, the cost of living is different, the state of business is different.”

A number of states and cities – including New Jersey and Oregon – raised their minimum wages in July.