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Tags: Exclusive Interviews | minimum wage | cbo | economy | jobs

Ex-CBO Director Holtz-Eakin: Minimum Wage Hike is Job Killer

Friday, 21 February 2014 04:07 PM

The Congressional Budget Office's conclusion that President Barack Obama's minimum wage hike will lead to massive job losses is spot-on accurate, according to Doug Holtz-Eakin, the CBO's former director.

"The report was utterly unsurprising. This is exactly what you would expect. It hits a population that really needs more help, not more hurdles," Holtz-Eakin told "The Steve Malzberg Show" on Newsmax TV.

"We're coming out of a very slow recovery, it's been hardest on the young and low-skilled workers, and this will be a bad news story for them."

Holtz-Eakin said the CBO's report shows the wage hike is "quite clearly" just redistribution through another means, with both winners and losers.

"If you're above six times the federal poverty line, you lose. If you're below the various stages, your wage income goes up," he said.

"This doesn't really help poverty because, of the $31 billion that goes to the low-wage workers, only 19 percent of them are poor and that's the problem with the minimum wage in the way the White House wants to spin it.

"Yes, you can raise people's wages, but it's not targeted on poverty and as a result you're not solving the problem you claim you're interested in."

Story continues below video.



Holtz-Eakin, who is now president of the American Action Forum, said a "very odd'' aspect to the wage hike was that it will both help the wrong people and hurt the wrong people.

"If you think about it, if you've got somebody who's lowed skilled, they're out of work, you raise the minimum wage, and instead of them getting a job, someone who has a job sees their wages go up," he said.

"What that really means is we took the opportunity for the out-of-work person to get a job and earn something and transferred that income to the person who has a job. That's a pretty peculiar way to try to help the people at the bottom out."

Holtz-Eakin is alarmed by another CBO conclusion that the Affordable Care Act will encourage people to work less so that they qualify for government subsidies.

"This is... paying people to retire. And it's fine if you want to retire, but they shouldn't be doing it on my dime and we should be rewarding work," he said.

"We have 13 percent of the population that's out of work or under-employed and that's the problem. We want more work, not less."

Vice President Joe Biden said this week it is possible healthcare exchanges would fall short of an initial estimate of 7 million enrollments in the Affordable Care Act by the end of March.

Holtz-Eakin is not surprised.

"The signup's been a disaster and … there's a big gap between the kinds of numbers you hear them advertise. 60 million visits to the website and people who actually pick a policy, pay for it, and, thus, effectively, sign up," he said.

"Given the fact that [administration officials] just don't tell us much, it's impossible to know where we are really, but they're not going to get to the seven million they promised originally.

"And, worse, it's quite clear that the young, healthy population is not signing up. They were always going to be a tough sell."


See the “Steve Malzberg Show” on Newsmax TV each weekday live by clicking here now.                               


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The Congressional Budget Office's conclusion that President Barack Obama's minimum wage hike will lead to massive job losses is spot-on accurate, according to Doug Holtz-Eakin, the CBO's former director.
minimum wage,cbo,economy,jobs
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2014-07-21
Friday, 21 February 2014 04:07 PM
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