Governor Rick Perry of Texas (R) had suggested that not only should the federal government not increase the minimum wage, it should not even set one.
Governor Perry was appearing on CNN’s ‘Crossfire’ program with the Democratic Governor of Illinois Pat Quinn. Quinn took the opportunity to express his gratitude to President Obama for his decision to bail out the American auto-industry, which saved jobs in his home state. He then turned to the increase in the federal minimum wage, and challenged Governor Perry to clarify his position on the issue.
Governor Perry told the program:
[box type=”shadow”]”I don’t think — I don’t think it’s government’s business to be setting the minimum wage out there. And even the CBO said if you want to get rid of a half a million jobs between now and 2016, raise the minimum wage.”[/box]
It is true that the Congressional Budget Office (CBO) warned that an increase in the minimum wage could lead to job losses. However what Governor Perry failed to mention was that the same report estimated that an increase in the minimum wage would improve the rate of pay for 16.5 million Americans, and make a significant dent in America’s poverty rate, which is largely made up of the working poor.
Governor Perry went on to say that given the fragility of the American economic recovery, and the persistent problem of unemployment, it would be irresponsible for President Obama to sign a federal minimum wage increase into law. Governor Quinn replied that it was in the best interests of the long term economic recovery if Americans had more money in their pocket to spend:
[box type=”shadow”]”The Federal Reserve Bank of Chicago says every dollar you raise on the minimum wage creates $2,800 in purchasing power. Seventy percent of our economy are consumers buying things.”[/box]