Now, conversation on the pros and cons of raising the minimum wage. From washington journal. Host a discussion about raising the minimum wage with two guests. David cooper, senior economic analyst, and mercatus veronique de rugy. To both of you, thanks for coming on. Over the weekend, we saw several enact a higher minimum wage. On first blush, as they what faces the cities and states as they consider doing that . As far as the minimum wage, what happens . Veronique de rugy, you first. Guest it depends, as we saw with the latest study from washington university, the first increase in seattle from nine dollars to 11 created a hiccup, almost nothing. When you increased it furthermore, then you start seeing a cost or low income workers. So it depends. Not every worker will be affected the same. Some workers will not be affected at all. The question is what happens over time. Host to go back a little bit, who will be the most directly affected negatively and what factors into that . Guest it depends on the level of minimum wage where talking about but the most likely people affected are the low income workers. Host mr. Cooper. Guest overwhelmingly, the vast majority will be benefited. At the end of the year, they will be better off than they would have been otherwise. Even the studies that take a more pessimistic view of minimum wage have found benefits greatly outweigh the cost and overwhelmingly, these workers benefit. When there are any negative consequences in terms of the job market, over time, as the increases are phased in, businesses learn to operate with higher productivity, they dont have to keep replacing workers all the time, and maybe they have to increase prices a little bit to hire the labor scott labor costs, but overwhelmingly, staffs the staff is happier and everyone wins. Host this is only because the employees employers have to bear the cost of these higher rates . Guest there really arent that significant job displacement. Overwhelmingly, businesses are able to adapt to these increases. True that some businesses may cut jobs but others are adding jobs. It has been shown that when you raise the minimum wage, some businesses have to lay people off but more distance more businesses are adding jobs, often higherpaying jobs, and the workers can now find a new job someplace paying even better than it otherwise would have. Guest we talk about this in terms of jobs but it is not the only way. You can see a case where there is an increase in minimum wage where workers dont lose their jobs. The recent study in seattle, deemed credible by economists on the right and economists on the left, because it brings to bear a whole new data set with quarterly data from the city of seattle, and a whole lot of other things, shows that when you look at hours, some will not be fired out right. The number of hours can go down. There are always people who will be alarmists and say no matter what the increase is, people will suffer. The question is when does it really start to make a really big difference and have a really negative impact . We dont know yet. The reason is known has gone to 15 an hour. Host that is the sweet spot, that is the rate they are looking at. Guest they are trying but to be clear, none of them have gotten there yet. Seattle just got there and those increases have not been studied yet and a lot of them are targeting 15 in the next two the next few years, but they are not there yet. I want to pick up on something that was said. All the studies in the past have shown that these increases have not led to negative consequences. That in it self is reason to go on. They have not had any substantial cost. We should then be taking the minimum wage to levels where we can see, are we leaving money on the table we could give to lowwage workers without any cost . We need to get to those levels. If we dont do that, if we dont go beyond where we have gone before, we will never have a minimum wage at the level that actually provides enough income to give someone a decent quality of life. Host what do you think of some of the negative findings that came from the seattle study . Guest this seattle study as no adds no information to our understanding. With all due respect to the researchers i think they made a , serious attempt. But there are problems with the study that are so serious that we cannot take those findings seriously. In that study, their own data shows that that increase lead to a large increase in the number of jobs that paid more than 19 an hour. In the restaurant industry, they found the men wage increase led to twice as much job growth and high wage restaurant jobs than it did declined in lowwage restaurant jobs. Frankly, i dont think that is possible that did that. That means the findings are not valid. Their statistical techniques are not isolated in the minimum wage from the rotter trend taking place in seattles labor market. Guest i dont agree with this because again, it is uncharted territory. It is new data, it is better data recognized i everybody, a Pretty Amazing data set. This has been two of a series of eight commissions by the state or by the city of seattle. One thing they found, which is quite striking, and they themselves say you have to make choices and they have been extremely transparent and try the data with different methodologies and still found the same thing, a big step in showing theres a lot of credibility in this study, but also low income workers lost in terms of wage 125 an hour. Per month. So we can debate and say this is definitely not the ultimate study. I think the debate will not be settled with empirical studies because you will always have a study on one hand and a study on the other hand. That being said, i think the goal we need to improve the lives of all workers and not to just be married to a way to do it. It is possible that a certain level of minimum wage, the cost will be too high for workers. Host lets pick this moment, again, the guests will talk about the topic of minimum wage. Call on the phone lines and pick a line that best resort best represents you. Also on twitter this morning. As far as statistics from the bureau of labor statistics, about 80 million workers, a 16yearold, this is 2016, paid hourly wages, about 700,000, 1. 5 million below that earning the federal minimum, and it comes up about 2. 7 hourly workers. Most hourly workers do not make the average 7. 25. Guest that is just the federal minimum wage per 29 states have an active minimum wage that is higher than that. A lot more workers are earning the minimum wage but it is in their state, higher than 7. 25. Guest the other thing is that the tip industry actually accounts for much more competition. Tip workers in maine have actually reversed the decision to increase minimum wage. They said it would affect them adversely. It goes to say just looking at the minimum wage does not tell you everything about the conversation. There are also benefits. In these conversations, we always exclude the conversation about employerprovided benefits. Not everyone gets it, for sure. But again, you are talking just about the minimum wage, as if every worker is affected the same by one policy or every worker is cheated the same, i think could lead to a misunderstanding of the problem. Guest i think that is right. If we are talking about the welfare of workers, including lowwage workers, we have to think about more than just lowwage policy. We will not solve all of this countryss problems with the minimum wage. But the fact is the federal minimum wage is worth about. 5 25 less in inflation in inflated adjustment terms. Those workers today are more educated, more productive than the counterparts along long time ago, and they are making less money, able to afford less with paychecks, it hurts the economy, it hurts public budgets that have to provide public supports to support the workers to make ends meet. No one is being held by having a minimum wage that is 25 less than it was 50 years ago. Host the first call this morning is from jeff in louisiana. You are on with our guest talking about the minimum wage. Go ahead with the question or comment. Caller thank you and i have a foundation here, 23 years with the Number One Quick Service Restaurant in management, store management only. 15 years with one of the top travel businesses and the nation. Let me tell you exactly what happens when wages are increased. Number one, we go to the menu board first, raise all prices. Number two, we go to the employees and either cut their hours or when the minimum wage comes up, we do what is called a compression, so people who have been there for a while only get pennies compared to some people who may get a significant raise. So that ruins the morale. I heard someone say that morale gets raised. That is 100 false. The next thing we do is start cutting their benefits. At the Quick Service restaurant, we used to give them free food when they work a shift, they got a free meal. Then we started cutting it to 50 , and then we cut it out altogether. So raising the minimum wage is not good for anybody. Matter of fact, there at the end, the longer a person stayed working for you, the more likely some of the businesses were franchised, they wanted you to fire longterm employees because they were not getting a good return on their investment. Host jeff in louisiana giving us a realworld example of what happens in these situations. What is your analysis . Guest i do not think jeffs description is representative of all businesses. A lot of businesses find when they raise minimum wage, employee turnover goes down because workers want to stand stay on the job longer and the job is worth more than them. The productivity goes up and that provides cost ratings for the business, that they are able to recoup some of the additional labor cost. At the same time, they may have to increase prices a little bit too, with the high later labor costs, but those price increases are very small compared to the increase in rate in wages is going to workers simply because lowwage labor is one part of a businesss overall operating costs. Maybe the consumer pays little more but now you have a whole set of workers not just at that business but every other business that pays lowwage workers now has more money to spend and now has a bigger paycheck and a lot of times, they are spending it in those same businesses. Guest i think the debate is far from settled but i think the most important thing lost in this debate is we should not be surprised that raising the minimum wage creates some benefit for some workers. Also that there could be a cost to others. The question is how much . Not all industries are the same. I think the restaurant industry, like the seattle one focuses on all industries, but there are a lot of industries that are very heavy on labor. So their Profit Margins are really small. It is not a surprise that they may be affected more. And again, yes, some people benefit. The idea that no one benefits is never true. The question is at which level are the costs just not worth it . Guest this raises a good point. I completely agree we have to be thinking about more than just as someone working or not. That is not the reality in the labor market. Most of these workers are going in and out of jobs all the time. If a higher minimum wage did have a negative effect on job growth, what it means in the real world is that some workers who might be moving in and out of jobs might spend a longer portion of the year not employed. For the portion of the year that they are employed and the hours they are working, they are making a lot more poor our per hour. They hopefully have earned as much or more income than they would have otherwise and there are some great studies that have looked at this, a researcher has was at the effect on Family Income of increases on minimum wages and he is found minimum wage increases by and large raise the Family Income of families. There are different effects playing out in terms of employment and their hours but we know overwhelmingly these families are better off because of a higher minimum wage. Host ohio, independent line. Caller top of the morning to you. I think we should do away with minimum wage completely and we should replace it to with a livable wage. In other words, if a family has to have a certain amount of money to live, and you have a walmart or somebody, a big is a big business, paying minimum wage, who is basically whole it isfamily not the company, it is us, the taxpayers. They have go on assistance to make ends meet. If a person, in my estimation, is willing to work 40 hours a week, he should be able to earn a livable wage. Thank you. Guest i think, again, there is debate, some of it is true, but i think i would like to warn, the idea that we need to lay at the feet of businesses, the responsibility of addressing questions of income inequality, of living wages, i think it is dangerous. It is not first and foremost their jobs. Of course we think it is their job if we assume their businesses dont have the good interest of the workers at heart. Which is not the case. It is not Good Business to treat employees badly. That does not mean some dont do it. That we have to be extremely careful about using businesses when addressing a lot of these problems. I would like business to be more transparent care if a city wants to address some of these problems, they should a dress and get taxpayers on board to do it. It is more transparent and creates much fewer distortions. Guest i agree it has to be a mix of both what is expected of business and the quality of jobs and what government provides to the low workers lowwage workers and government familys and families. They still may not earn enough to meet all their needs or may have disabilities or things that prevent them from working a full, regular 40 hour week. We need to have both in the mix. At the same time, i think the gentleman raises a good point that for a long time, we have had the minimum wage so low that even when someone is working a fulltime regular job, they have to rely on public assistance to feed their families. We did not have to do that as much 50 years ago because we had a higher minimum wage. There is no reason why we cannot set standards for job quality that are at least as good as they were for the previous generation. It would help not only those workers but taxpayers as well. Host what about the idea of a minimum wage livable wage . How is that number determined . Guest there are different metrics to determine a livable wage. My institution has what we call a Family Budget calculator that tries to do this. The truth is the amount it would , take for someone to have a decent quality of life, especially in a lot of cities, it will be a lot higher than what folks are talking about in terms of minimum wage policy to 15 today is not enough to afford a decent quality of life and a lot of u. S. Cities. We need to have a wage floor and then provide support through government to get folks the rest of the way. Guest again, i think, you know, we have to be careful about introducing distortions because look, i come from france, you can tell from my accent. They have dealt with these problems for a long time. They have tried everything and the reality is not one that is really glorious. I think the u. S. Should follow. In france at low skill levels, there is still high unemployment. What is the exact solution apart from Economic Growth . I am not sure. I think Economic Growth is the solution, how we get there is a whole debate. But i just want to warn, a lot of countries have tried and it has consequences. Guest to that point, Economic Growth is absolutely essential but not enough. We have had a lot of Economic Growth and inequality has skyrocketed and more families are in poverty and more folks are struggling to get by p or we need to do whatever we can to encourage growth but that is not enough. We also have to take steps to make sure all workers are paid. Host 2009 we saw the federal minimum wage go to 7. 25. That one back to 1997, 5. 15. The far as tying it to economic metrics, perhaps a better way than setting an arbitrary number for minimum wage . Guest absolutely. A couple of ways to do it. Every year, it is adjusted by however much prices go up. The most recent federal proposal did this, to tie the minimum wage to overall wage levels. Back in the 1960s, when the minimum wage was at its highest, it was equal to about half the wages of the typical worker in america. We could do that again and raise the minimum wage to around half of what a typical worker gets paid and every year adjusted by however much typical wages went up for the country. That was a gap between the lowest paid and the average paid worker, it would never go never grow. We maintain the same level of quality. Lowwage workers today would be much better off relative to their peers than currently. Guest or we would have more unemployment. Again, it is not the ultimate study, but it shows there is a level of minimum wage that has growing costs on low income workers. We cannot pretend that any level of wage, every single worker is worth hiring either fulltime or at all, for a company. Im sure it breaks a lot of employers hearts, but there is a moment where the cost of the labor force is too high and they need to make choices. We are trying to help low income workers here. The competition of the labor force in america has changed dramatically. The idea that we should the average workers are not what they were 50 years ago, low income workers, i think it has inherent dangers and it. I vaguely have to be careful. I think we have to be careful. Host fort myers, florida, democrat line, bruce, hi. Caller thank you for taking my call. First, minimum wage is definitely too low, but i think 15 an hour is too high. Minimum wage should be a living wage like 40 hours for 12 to 15 hours of overtime, a single guy, that is good. Then you have the motivation to work out of it and you just dont settle. But what is a living wage . I work with guys for make 1500 a week and they are broke week to week. A living wage is what you make it. 15 an hour for a fast food worker where i have to repeat my order three times before i get it, that is too much money. Guest so raising the minimum wage, again, potentially, it is interesting. A study shows that raising the minimum wage from 7 7. 25 to 10. 10 would cost half a million jobs p or we need to big of the cost half a million jobs. Of the workersk but i think the color raises a very good question. That is, i mean, not every worker is in the same situation. If you work in d. C. Or if you work in new york or if you work in booming seattle, the costs of living are just not the same in the middle of america. This is why i believe it is better to try to address these problems more locally than federally. You can address the problem with your workers in a way that is much more adequate. Guest i think it is right that cost of living varies across the country and i guess fundamentally, we need to at least get back to a point where we were before where the federal minimum wage was around 10 an hour back in the 1960s. There is no reason we could not at least get up to their and then let states and cities go higher if they need to, if the cost of living in those places demands it. Unfortunately what has been , happening in a lot of places is in some cities, they passed a minimum wage increases and then the state legislatures have gone back and undone those increases. This happened in alabama, a number of iowa counties. It is fine to have local control, but you need to actually let the local governments enact those wages and not take them back as soon as they determine they need a higher wage floor. Host our guest, david cooper, from the Economic Policy institute, and veronique de rugy, talking about the min minimum wage. Republican line. Caller thank you for taking my call. A quick statement. I agree with the previous caller regarding, it should be localized because, you know, if you have a business located near big cities, you can probably absorb a lot of the 15 minimum wage versus small town usa. So it should not be across the board, across the country, it should not be 15 an it should hour. Be based on the local economy. Thank you. Guest i think it is fine to settle local standards and a lot of proposals to go to 15 are going to that in a number of years from now. 15 by 2024. That gives time for businesses to adjust, and that is probably the equivalent about 12. 50 in todays dollars. So you have to take that into account. But i agree it is partly fine for localities and states to set minimum wages higher than federal minimum wages and set it at levels appropriate for them but we still need to have experience has shown us that some localities are just never going to act on this. We have two states today with a minimum wage of five dollars 5. 15. There would be no minimum wage in those places, so we have to set it someplace adequate because we know otherwise some workers and certain places will be totally left behind. Guest it is interesting that you should raise the lack of minimum wage in some states cousin i was just reading that in denmark, not a libertarian paradise, does not have a minimum wage. That have sector wide collective bargaining. Guest there are other ways to set a floor. Again, studies are not going to settle the issue, but 500,000 people, workers, losing their jobs by raising the federal minimum wage, is a problem. The question of locality, and i take your points about states but it is interesting that even in d. C. , we have noticed that even within localities, there are differences. One thing studies show us, businesses within seattle are able to stomach it better than outside and in d. C. For instance, for people who know washington, d. C. , you can see the impact of minimum wage would be much less powerful and georgetown that in other areas. It is, the location location location, it does matter for these types of labor policies. Guest i apologize for interrupting you a second ago. You raise denmark. Denmark and other countries in europe do not have minimum wages because they have sector wide collective bargaining. They have unions that cover an entire sector and the Union Negotiates whatever the wage floor will be for that sector. We could certainly have that in the United States, but we have eroded our unions and enacted laws that have destroyed unions in the u. S. So that today, about 6 of privatesector unions, 6 of privatesector workers are covered by unions. If we had sector wide collective bargaining, we would not need minimum wages and we could let the workers negotiate for a wage floor. Unfortunately, we have eroded the Bargaining Power of workers so much that we have to turn to Government Policies like the min ways to set standards. The minimum wage to set standards. We have eliminated the ability for workers to negotiate for themselves. Guest you said something important. Negotiate by industry. That to me is, again, important. Nothing stops workers from organizing. Guest a lot of things. Guest the reason why our was also bring in denmark is it is just not one way to provide the kinds of outcomes we are looking for. Host lets hear from illinois, independent line, robert. Caller good morning. Thanks for taking my call and i really appreciate cspan and what you all are doing. I have a comment and then a question. Republicans want to eliminate all of these entitlement programs. But businesses have it both ways p they are able to keep wages low and they come up with all kinds of excuses, i worked 25 years and a factory and until and until unions were broken up, they treated us pretty different pretty decently. After they broke up in unions two years later, i mean everything we had worked for, because we were nonunion, went to hell. It became like working for a tyrant. Secondly, businesses do have it both ways here they are able to come up with excuses for why they should not raise wages. At a time when they are making profits like never before, some of them not paying any taxes, and others are not only not paying taxes, but they are getting a tax refund every year. Secondly, and this is the question, can either one of you answer the question, what good does it do to have a job if it does not pay you enough to at least provide very basics for yourself and your family . If you have a family . Host veronique de rugy you start. Guest i am sure there are a lot of workers struggling out there. I think not all businesses are big. This is a problem with this debate. We say business, a business, and you are lumped together, momandpop shops and boeing and all of these giant guys. And i think we have to be careful in that. I think this is one of the problems with the conversation about minimum wage. A lot of the time, we are looking at big company sitting on a lot of profits, overseas, and we are saying well, the minimum wage, and were asking Small Businesses to address this problem. I think that is not the way to go. It is not the way to address or to get the outcome we want. Guest i think fundamentally, this is a question about workers ability to share in the benefits of Economic Growth and share in the income that is in says are income that their businesses are producing. I agree that the minimum wage is not going to solve all of these problems. We have other changes we would need to make to tax policy and things like that to get businesses to bring profits back on shore. Other things we can do to encourage them to pay workers more, but as the general men on that the gentleman on the phone mentioned, one thing that has played a big role in the ability, in the way that workers have no longer been able to afford or be paid a decent wage is these decline unions, again, as i said before, if we had stronger unions, we would not need to enact higher minimum wages. But because we dont, we have to try to improve Bargaining Power because they dont have any on their own. We have to look at things like raising the minimum wage to try and make sure they get a fair share of the income being produced by their businesses. I agree that we have to be thinking about both Large Business as an Small Businesses and in many ways, the minimum wage is a great tool to help the workers and keep businesses on an even playing field. Because as an individual business owner, you know, if i saw the wage increase coming, i would start to think this is going to hurt my bottom line, i need to pay my labor costs will , go up and what i might not think about is all of my competitors will also face the exact same increase in labor costs. Even if i have to raise my prices a little bit, so will the ap or no one will be placed at a competitive disadvantage and all of our employees will be making more money. Host louisiana, democrats line, hi. Caller you all have never been poor. You all have never been poor. You need to raise the minimum wage is. Just like the guy who just called and said yes, a whole month, you work and you do not have money to pay for your rent. Dont pay for your rent or dont eat, ok . So we need that minimum wage raised up. Another thing, minimum wages, losing thousands of jobs, that is a lie, ok. Cutting everything. People lost jobs. You dont tell people that. You dont tell the public that. You all cut jobs. That is the truth. Guest as far as minimum wage, you talk about lowwage workers, what about when people rise up . Coming at 15 an hour, what happens when they make 15 an hour already . I assume they will want increases as well. I assume job impacts to go all the way up the chain. Maybe i am wrong. Guest i do not know if they go all the way up the chain. It is a spillover effect but it is true, raising the minimum wage, someone who was making a little more than the minimum wage is probably going to see a raise. I think this is a good thing. It means even some of the middle wage workers will benefit from the policy change. Just put numbers on it, the most recent federal or postal to proposal to raise the federal minimum wage by 2024, we estimated that would raise the wage to 41. 5 million workers per 22 million of those workers are directly affected meaning they would have earned less than 15 otherwise. The other 19 million roughly our workers that would have been making just above 15 an hour but also will see a wage increase because of what you are describing, the desire for employers to maintain some sort of wage ladder in their business. Guest so one of the things that was interesting and needs to be seen, whether this is actually a consistent result of the seattle study was that the loss of employment affected not just minimum wage workers, but actually, it fell through for all 19 and down workers. So i guess it can go both ways up to a certain level. Again, we dont know what 15 an hour minimum wage looks like in the real world. It has not been done before. The idea that the seattle study settled the debate, that is incorrect. But it is also true that the previous studies, they have strengths and flaws, and they also do not settle the debate. It is uncharted territory but i think if we think about it logically, it makes sense to think there is a moment when employers are going to see costs go up to a point where theyre are going to have to make choices. Logic tells us there is a moment where the cost could be really negative for a lot and the people most affected will be low income workers. Host florida, thanks for holding on, george, republican line. Caller great show, youre a good moderator. Here are my questions, to the gentleman. I dont mean to be rude or i will just be honest because i own a business and i want you to try hiring some time. I dont know if you have ever been in business. You may have been a lawyer because you do answer with fake, vague minimizing , everything answers. So far, you told us workers are collectively innocent and businesses all wrong. Here is my question. Aside from all of that. I came back from vietnam and combat, once every trade union goes up, they basically laughed at us. You had to have a sponsor to get in. Unions are full of it, you know. Your organization, do you take any government funding or grants at all . Host did you have a group a direct question . Was it about trade unions or Something Else you would like to bring up . Caller you want to cut me off . Host no, i am just asking caller im a european american, i dont know if that means anything. Give me the last couple of seconds. I was almost done before you cut in. Here is the question. Are you actually just buying more votes for government control . Guest i dont think i really need to react to that. Host lets go to pennsylvania, bob, independent line. Caller good morning. You can sure tell where that fellow was coming from. Mr. Cooper, you have been speaking well for the working person and i agree with the last llers before that fella. What good is it for a person who works 40 hours a week and cannot feed his family, cannot pay his rent, cannot by his medicine . This is just a tip of the iceberg. It goes way back to Ronald Reagan and trickle down economics. The rich were going to get richer, and they were supposed to trickle down a few pennies to the poor. And what happened with the greed of the wealthy, they do not have any heart. They do not mind driving around in limousines, go back to his mansion with flowers in his garden that cost more than he is paying the chauffeur. Until they find they have got some heart and a little touch of god in their heart, this will stay the same. But mr. Cooper, you keep on speaking. I understand where youre coming from and any working man should understand. God bless you. Guest that was very kind of him to say. Host it largely depends on the status of the economy whether minimum wage in the long run ultimately work. Does that there itself in history as far as the state of the key economy the economy . And the impact of minimum wage . There have been a small number of studies looked at this and most of it has found the same thing. At least the increases we have done in the past have not really had any measurable effect on employment. I guess the larger point i would make is the economy just not does not just exist in a vacuum. It exists in the structure we create for it in law. It is kind of the same with labor market. We can set the floor for wages and wages can exist above that floor. The problem in todays economy in a lot of cases is we left that fall back from where it was in the past. We need to get the floor back to a level that is adequate. There is a point where you could raise the floor too high and the cost would outweigh the benefits. I do not think we got it, you can get to the place where there is a decent standard of living. Guest Economic Growth is important. Companies, workers, small or big, can stomach way higher wages when the economy is moving. We have not had a booming economy since 2004, more than we were accustomed to, Economic Growth rates in this country. It makes sense to when the economy is booming, some of the Bargaining Power moved toward the employee side and workers, businesses were fighting for employees. One thing we have not talked about is we cannot ignore, talking just about wages, ignore what has happened on the supply side. A lot of good, granted, not all, because Health Care Costs have gone up dramatically, but a lot of good people do in their lives have gone down dramatically. If we going to be comparing what happened, what the u. S. Is like 50 years ago, and today, for a big part, the costs of these goods have gone down dramatically. Just looking at wages does not tell you the whole story about purchasing power. Granted, there are big important costs that have exploded and this is why also we think we cannot ignore the french benefit side of the argument because these are not small costs on the shoulder of employees. This is probably something where we should be focusing a lot of effort. Bringing the kind of innovation we have seen in other industries to health care, that would raise quality and lower costs and do a lot of good all around. Host lets go to florida, lance, hello. Caller good morning you are missing two basic points, and this is coming from someone who employed other people. Minimum wage is never supposed to support a family. If you think you can support a family on minimum wage, youre not thinking. If a guy or a girl works 40 hours a week, he should make an you know to support himself, not a family, this is unskilled work. The other is the basic problem that i have so much money to do a job, i need four people to do it. If you tell me i have to double the price of the people i employee, i have to go out of business or figure some way to charge much more. It just does not work. Host you can start. Guest minimum wage, no one is debating, some people will benefit and there will be some costs. There is clearly some business there are clearly some businesses that cannot afford to see labor costs go up and there will be consequences. Maybe in the first phase, because we have not talked about doubling the minimum wage yet, even though i guess if we were doing it at the federal level, from 7. 25 to 15, in the first, some people may lose their hours and some people may not be hired. All people will stand the sidelines because they will not they will not be hired because productivity is seen as not worth the new wage level, and then going forward, some people actually lose their jobs and that translates to lower wages and lower compensation, unemployment. For some businesses, it will be a really big cost and whose shoulders the cost . Workers. Host they first started with that the minimum wage wasnt designed to support a family . Guest i think that is debatable it when the minimum wage was passed in 1938, it was supposed to be passed in a level that would allow someone to provide for themselves to visibly men who were working. If you are talking about a minimum wage to provide for themselves and their family, presumably that would mean just a man was working in providing for his wife and children. In todayss economy, i agree it would be really hard to raise the minimum wage to a level that would allow someone to support themselves and a family. I think we need to hold businesses to a higher standard. Raise minimum wage. Part of the way to get folks to have a decent life and then have support to get them the rest of the way. Host florida, hi. Caller i was in business for 45 years. Never mentioned the fact that a 15 minimum wage, added by 20 for social security, unemployment compensation, workman compensation, and i had six cameras set up in different places, and they were broken within a week. The other thing is they never think of, when they grab a soda, they think they get that from nothing. I dont know how you are going to benefit when you raise wages to 15, when it is actually close to 20, not 15. Guest you are talking about the fact that there are other costs to employers and i do not disagree. A minute ago, it was said that there will be winners and losers. I dont dispute that. There definitely will be changes to the labor market if we were to raise the minimum wage significantly higher than before. Some studies have shown that when you raise the minimum wage, some businesses do go out of business. At the same time, new businesses are coming into the labor market better higher productivity businesses paying higher wages and that have a better time and easier time operating at the higher wage levels. Over time, that will shift the nature of employment and it will change the composition of jobs, the composition of businesses. I dont think anyone disputes that. The fact is there will always be a lowest paid job. Maybe a different kind of job. We have to decide as a society what we want compensation to be for the lowest paying job. In the past, 50 years ago, we thought it would be higher than it is today. Given the fact that we have had tremendous growth and productivity over the last 50 years, the economy has gotten a lot bigger, the United States has become a much richer country, we can afford standards for the lowest paying job and what we currently have today. Guest when you take into consideration full compensation, economists have measured this, competition has kept up pretty well with increasing productivity. There is a big burden on businesses and employers that cant be ignored. We cannot take likely lightly the fact that some businesses will have to close down. And say that we should be ok with this because we dont know that others could come the matter what. It is ok for economist to say on the one hand, some workers will lose their jobs, but i have issues with the people losing their jobs and i have issues with, especially when it is created by a government policy, and we cannot take it lightly. I think it is time we think about whether that is acceptable or not. In the marketplace, there are always Companies Going in and out of business. That is the way it works. I think we cannot, just by looking at it on paper, taking and not think it does not affect peoples lives. Host illinois, you are on with our guest. Caller to me, the problem is American Workers are having to compete for income with Chinese Workers who get paid a whole lot less. We do not have any duties, chinese goods coming into the country who would protect American Workers. The guys sending work to china are making profits like you cant believe but the American Factory worker is really feeling the pinch. I hope trump gets his wish and we start taxing imports to make the chinese compete on an equal basis with their products and save american jobs instead of saving chinese jobs. Guest what about the correlation he is making us for us trade and policy . Guest it is true that trade in the last 50 years has heard a has hurt a lot of workers in terms of factories and things like that here i agree. I do not think that is necessarily that close to minimum wage policy. Minimum wage tends to affect industries that are not tradable industries. When you raise the minimum wage, the businesses most likely to be affected are businesses and retail, restaurants, some social services, some health care jobs, security jobs. Those are not jobs you can whicy affects every american but actually, it is for low income workers because cheaper the goods are, the higher your standard of living. It other thing to look at is is at an almost alltime high. We tend to think trade is the real reason why there is a decline in jobs in the manufacturing industry. Aen you look at the output, lot of it has been laborsaving innovation put in place. Putting in tariffs that make the price of goods higher will not address that particular problem. Host a caller from alabama, you are the last call. Go ahead with your question or comment. Caller thank you. Im calling in regards to the retired and retirement. No one is addressing that. When it be better to drop prices rather than made raise the minimum wage . For example, obamas global trade agreement, forget what it is called, wouldnt that lower prices . Guest ttp . Guest i dont know if that is what he was referring to. About if you are talking that, there were a bunch of studies done and talking, to your point, which is that the workers affected by the agreement, and by the way, it was put in place, as a response to china. It was a big response against china. I think it was Something Like 45,000 workers, potentially affected by the worker. Millions of low income workers, seeing the price go down. It has some benefit. Host before we finish, we started talking about localities and cities that put the higher measures on the plate and we in, about the data coming looking at the impact of these what might it say about the United States . Take a few years to understand fully how this plays out. A lot of states have scheduled increases, that is the way most are done. I think it will take time. The data for seattle are just starting to come back for 2015 and 2015 in 2016 increases. They just increased again on january 1 of this year. That will be out for a few years or so. Able to really not understand the full affects even six months a year out. It will take a while to see how the economy addresses it. Guest the studies coming out, the team is actually talking about linking administrative data, they have Economic Data and demographic data. They are making the case that they can credibly track low skill workers and the impact on low skill workers and i think they will be able to do even more. Frontier of the research on minimum wage. We will know soon. It will take some time but data is coming in and we will see. Host a conversation about minimum wage with veronique de rugy and david cooper washington journal continues. Ost joining us now for your money segment, Kevin Johnson covers the Justice Department that. Her issues regarding here to talk about security personnel at federal prisons. Good morning. Guest good morning. Storyyou started a recent talking about guamire hernandez, who is he and tell us about his story. Convicted s a