Taneia Davis

News Analysis #2
February 20, 2014

Minimum Wage Increase Would Have Mixed Effects, C.B.O. Report Says By Annie Lowrey.
New York Times Online Feb. 18, 2014.
In this article there is contemplation between the mixed conclusions of the raising of the
minimum wage. If it is raised to $10.10 per hour it could take 900,000 families out of poverty vs
the reduced employment by 500,000. Its a hard decision to make. Republicans didnt want the
wage to rise because of the employment rate dropping and the Democrats wanted it to be raised
so that the poverty rate would decrease.
Analysis:
. The employment rate would drop because with higher cost for labor, employers would
raise prices, if the prices are raised the number of consumers would decrease, if the number of
consumers decrease the number of workers would also decrease. This matter wont be solved too
easily. It depends on what the majority rules. Republicans say dont raise it, Democrats say raise
it. Republicans have the numbers. The real question is what would benefit the people in the long
run? Less poverty rate or, adding of more unemployed people. Either way we all are affected and
it may not be beneficial.