The Corner

Alison Lundergan Grimes Isn’t Great at Reading CBO Reports

Alison Lundergan Grimes, the leading Democratic candidate for this fall’s Senate election in Kentucky, supports raising the minimum wage, contra the position of Senate minority leader Mitch McConnell, her presumptive opponent. So what did she have to say when the Congressional Budget Office modeled the proposal she supports (raising the wage to $10.10 an hour over the next to years) and found it would destroy half a million jobs?

Pretend it does something else:

As Kentuckians know, raising the minimum wage would create thousands of good-paying jobs in Kentucky and increase the spending power for tens of thousands of the Commonwealth’s hardworking families. The people of Kentucky are ready to vote out a Washington politician, worth over $25 million, who is asking them to believe that giving 255,000 women a raise will somehow hurt the economy.

Grimes is right that raising the minimum wage would increase the spending power of tens of thousands of families in Kentucky — hundreds of thousands, probably, because families earning up to six times the federal poverty line would all see their incomes rise, on average.

But it wouldn’t “create thousands of good-paying jobs” at all. Rather, it would destroy, on net, about 7,000 Kentucky jobs, according to the CBO’s mid-range estimate and as many as 14,000 in their upper-range number. In fact, that’s just Kentucky’s even share of the estimated national job losses — the actual losses for the state should be larger, since Kentucky has lower wages than the national average and the job losses are expected to occur almost entirely in low-wage positions.

It would create some jobs, sure. The CBO writes, for instance:

The increased demand for goods and services that would result from an increase in the minimum wage would have a short-term impact, boosting employment by a few tens of thousands of workers in the second half of 2016 under the $10.10 option. The increased demand for goods and services that would result from an increase in the minimum wage would have a short-term impact, boosting employment by a few tens of thousands of workers in the second half of 2016 under the $10.10 option, CBO estimates.

That would translate into a few hundred jobs in Kentucky. And those are already accounted for and outweighed by the CBO’s prediction that raising the minimum wage would reduce employment across the country, and in Kentucky. 

Patrick Brennan — Patrick Brennan is a writer and policy analyst based in Washington, D.C. He was Director of Digital Content for Marco Rubio's presidential campaign, writing op-eds, policy content, and leading the ...

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