Report touts benefits of minimum-wage hike

By By Lance Traweek / American Press

An increase in the minimum wage would decrease low-income citizens’ dependence on government assistance, according to a report

released Wednesday by the Center for American Progress.

“A lot of American families realize the economy isn’t working for them,” Ben Olinsky, senior fellow with CAP, told media members

on a conference call Thursday.

President Barack Obama has proposed raising the minimum wage to $10.10 an hour, which Olinsky said makes the economy work

for everyone — not just the wealthy. Minimum wage now stands at $7.25 an hour.

“It would actually put dollars in the pockets of hardworking, low-income Americans,” Olinsky said. “They would then have that

money, and they would spend that money almost immediately in their local businesses and communities, which would create a

virtuous cycle of prosperity.”

The Federal Reserve Bank of Chicago saw a stimulus effect in the first year after raising the minimum wage, he said. According

to the report, raising the minimum wage nationwide would lower government spending by $46 billion over the next decade.

“The best way to reduce government spending on a program like SNAP (Supplemental Nutrition Assistance Program) is not to just

cut benefits to families, but to actually raise the minimum wage and help them make more and sustain themselves,” he said.

Louisiana would see a decrease in spending of $108 million a year, or a 7.5 percent cut in 2012 expenditures in the state

on SNAP, he said. And more than 360,000 workers in Louisiana would benefit from the pay increase.

Jan Moller, director of the Louisiana Budget Project, said the report proves what “has been long suspected.”

“When people get a raise then they are less dependent on public assistance programs,” Moller said on the conference call.

“Contrary to some claims it would actually create jobs.”

Gov. Bobby Jindal has said he will not support raising the minimum wage because the economy is not strong enough.

According to the LBP, 73 percent of Louisianians support raising the minimum wage to at least $8.50 an hour.