Sanders, O’Malley Opposed By Liberal Economists on $15 Minimum Wage
Former Obama, Clinton advisers caution against such a dramatic wage mandate
Publication Date: October 2015
Topics: Minimum Wage
Washington D.C. — Today, in advance of a Democratic Presidential debate that will likely focus on minimum wage, the Employment Policies Institute (EPI) is highlighting Princeton economist Alan Krueger’s opposition to a $15 federal standard. He is the latest in a string of high-profile, left-of-center economists, including Drs. Arin Dube, Katharine Abraham, Ronald Ehrenberg, and Harry Holzer, who have expressed skepticism of the national application of a $15 minimum wage advocated by the SEIU labor-backed activist groups.
EPI’s research director had an op-ed in the Wall Street Journal last month highlighting this opposition. Read it here.
The minimum wage is likely to come up as a point of difference among Democratic presidential primary contenders at tonight’s debate. Candidates Bernie Sanders and Martin O’Malley are on the record supporting a $15 federal minimum, while Hillary Clinton has supported a $12 minimum. Joe Biden, who is considered a possible candidate, spoke favorably of a $15 wage floor in New York.
In a Sunday New York Times op-ed, Krueger writes that “a $15-an-hour national minimum wage would put us in uncharted waters, and risk undesirable and unintended consequences.” Other liberal economists have used similar language: Former Obama adviser Katharine Abraham wrote that she is “concerned about what a $15 minimum nationwide would do to employment.” Former Clinton administration economist Harry Holzer called a $15 minimum wage “extremely risky.”
Krueger is best-known for his now-debunked 1994 study with fellow economist David Card which concluded that New Jersey’s 1992 minimum wage increase didn’t reduce job opportunities compared to neighboring Pennsylvania, which did not raise its minimum wage. (Subsequent analyses using more robust payroll data have refuted this finding. Most economic research on this topic points to job losses following wage hikes.)
“At the $15 wage level, even liberal economists acknowledge the law of unintended consequences ,” said Michael Saltsman, research director at the Employment Policies Institute. “If Democratic candidates are interested in helping the poor, they could start by listening to their own economists rather than the SEIU.”