Republicans see Democrats' $15 minimum-wage increase and counter with $10 instead




  • In Politics
  • 2021-02-23 18:00:45Z
  • By Business Insider
mitt romney tom cotton
mitt romney tom cotton  
  • Republican Sens. Tom Cotton and Mitt Romney propose raising the minimum wage to $10 an hour by 2025.

  • Biden has proposed a Bernie Sanders-backed $15 wage increase as part of the $1.9 trillion stimulus.

  • The proposal comes as Biden reportedly doubts whether $15 can pass and a moderate Democrat suggested $11.

  • Visit the Business section of Insider for more stories.

To counter the Democrats' proposal of raising the minimum wage to $15 an hour by 2025, two Republican senators introduced a bill on Tuesday that maintained the 2025 timeline, but would instead raise the minimum wage to $10 an hour by then.

The Raise the Wage Act of 2025, led by Sen. Bernie Sanders of Vermont, was included in the Democrats' $1.9 trillion stimulus package that passed out of the House Budget Committee on Monday. Republicans oppose the stimulus package as too large in general, but a new bill by Sens. Tom Cotton of Arkansas and Mitt Romney of Utah signals bipartisan support for a minimum-wage increase.

Their Higher Wages for American Workers Act proposes to gradually raise the minimum wage to $10 an hour by 2025 with a mandatory E-Verify, which would ensure that all workers who would receive the higher wages are legal.

"American workers today compete against millions of illegal immigrants for too few jobs with wages that are too low - that's unfair," Cotton said in a statement. "Ending the black market for illegal labor will open up jobs for Americans. Raising the minimum wage will allow Americans filling those jobs to better support their families. Our bill does both."

A summary of the bill said that raising the minimum wage to $15 an hour would "destroy 1.4 million jobs," and said $10 an hour would be better for the labor market. Treasury Secretary Janet Yellen has previously said that raising the wage to $15 an hour would have minimal effects on the availability of jobs.

The government's nonpartisan budgetkeeper, the Congressional Budget Office, has actually looked at both numbers and their potential effect on the labor market. A 2019 report found that raising the minimum wage to $10 an hour would cost 0.1 million jobs, while a recent report said $15 an hour could reduce employment by 1.4 million jobs.

Other elements of Romney and Cotton's bill include:

  • After the raise to $10, indexing the minimum wage to inflation every two years;

  • Creating a slower phase-in for small businesses with fewer than 20 employees;

  • Raising civil and criminal penalties on employers that hire unauthorized workers;

  • Providing $100 million annually in automatic funding for the E-Verify system.

Democratic Sen. Joe Manchin of West Virginia has said he would support an $11 an hour increase, while Sen. Kyrsten Sinema of Arizona has said a minimum-wage increase isn't appropriate for reconciliation, the process Sanders wants to use for the raise to $15.

Although President Joe Biden has reportedly expressed his own doubts on whether the $15 increase would survive in the final version of his stimulus package, he and other Democratic lawmakers have repeatedly expressed their support for doing it to lift millions of Americans out of poverty.

"Raising the minimum wage is not just about economic justice - it is about racial justice," Sanders said on Twitter last Wednesday. "Nearly half of Black and Latino workers in America make under $15 an hour. We must end starvation wages, and give 32 million Americans a raise by increasing the minimum wage to $15 an hour."

Insider's own polling shows a majority of Americans support raising the minimum wage to $15, as reported by Juliana Kaplan.

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