Advertisement

Ted Cruz Uses Discredited Talking Points To Make Case Against Minimum Wage Hike

Cruz’s opposition to a minimum wage hike isn’t borne out by research. CREDIT: AP PHOTO/CHERYL SENTER
Cruz’s opposition to a minimum wage hike isn’t borne out by research. CREDIT: AP PHOTO/CHERYL SENTER

The day after the Democratic presidential candidates discussed their shared desire to realize a $15 minimum wage during a debate in Brooklyn, Republican candidate Sen. Ted Cruz (R-TX) went on CNBC and said he thinks the very concept of a wage floor is flawed.

“Every time we raise the minimum wage, predictably what happens is a significant number of people lose their jobs, and they’re almost always low-income, they’re often teenagers, African Americans and Hispanics,” Cruz said.

Research, however, shows no significant connection between increasing the minimum wage and jobs. A 2009 analysis of 64 United States minimum-wage studies found “little or no evidence of a negative association between minimum wages and employment.” Likewise, a 2013 Economic Policy Institute (EPI) report found that “Research over the past two decades has shown that, despite skeptics’ claims, modest increases in the minimum wage have little to no negative impact on jobs. In fact, under current labor market conditions, where tepid consumer demand is a major factor holding businesses back from expanding their payrolls, raising the minimum wage can provide a catalyst for new hiring.”

Those findings are reinforced by a 2014 Center for American Progress Action Fund (CAPAF) study that looked at two decades of minimum wage increases in various states and “found no clear evidence that the minimum-wage increases affect aggregate job creation when unemployment rates are high,” let alone when unemployment is relatively low.

Advertisement

On CNBC, Cruz went on to say he thinks “the minimum wage systematically hurts the most vulnerable.” In fact, the EPI report found the exact opposite. Women, older workers, and low-income families would benefit the most from raising the current federal minimum wage of $7.25 to $10.10, the study finds, with CAPAF adding that “wage hikes are particularly beneficial to working women.”

Cruz characterized a wage floor hike as “bad policy,” but research indicates raising the minimum wage is good for the economy as a whole. EPI found that a $10.10 minimum wage would mean a direct raise for 16.7 million workers who would then have more money in their pockets to spend on goods and services, boosting the economy. The study also found that $10.10 minimum wage would increase wages by $35 billion, which would spur about $22 billion of GDP growth.

Opposing a minimum wage increase has been Republican orthodoxy this presidential election cycle. During a debate last November, Republican presidential frontrunner Donald Trump argued a higher wage floor would make the United States uncompetitive. “Taxes too high, wages too high, we’re not going to be able to compete against the world,” he said. “I hate to say it, but we have to leave [the minimum wage] the way it is.” The third GOP contender, Ohio Gov. John Kasich, has staked out a position similar to Trump’s.

Cruz’s seeming opposition to the very concept of the minimum wage echoes comments made last summer by then-GOP presidential candidate Carly Fiorina, who said, “I believe that the minimum wage should be a state decision, not a federal decision.” The most progressive Republican position on the minimum wage this cycle was articulated by Ben Carson, who expressed support for tying the minimum wage to inflation.