CNN's Carol Costello might as well have read from a Think Progress cheat sheet when she battled conservative economist Stephen Moore over wages and economics on Wednesday. Moore, for his part, gave her a lesson in economics.
Starting with the recent CBO estimate that President Obama's minimum wage proposal would cost a half million jobs, Costello argued that it was just an estimate and that the net job loss could be zero. "So many people would say I'm willing to take that bet," she offered. That was only the first in a string of Costello's liberal economic claims. [Video below the break. Audio here.]
When Moore mentioned the CBO report that ObamaCare will trim 2.5 million full-time jobs, Costello gave the White House's answer:
MOORE: Now, remember this comes on the heels of a report last week that says that Obamacare may reduce the number of jobs by two-and-a-half million. So, in just the last two weeks the –
COSTELLO: But, again, you can parse that another way, too.
MOORE: How so?
COSTELLO: Those people could be people voluntarily leaving the workforce because now they can afford insurance. A lot of people work simply to get health insurance.
MOORE: Carol, we want people working. One of the reasons the economy isn't performing up to standard is because we've seen this record dropout of people from the workforce. As an economist, I find that to be a very troubling thing.
Yet Costello insisted that businesses aren't hiring simply because "they don't have to." Moore shot down that reasoning: "it's because they say they're afraid of what the next hit is going to be from Washington. Whether it's going to be, you know, new regulations under ObamaCare or tax increases."
And Costello claimed that "nobody" thinks "business leaders really want to create jobs or pay their workers more." Moore pointed to the recent developments at a Volkswagen plant in Tennessee, where workers voted against unionizing.
"If you look at, for example, what happened in this week in Chattanooga where they tried to unionize that plant, one of the reasons that it failed was because the workers are already earning about $27 an hour."
"I told you so. Minimum wage destroys jobs, Carol. I said this last week," Moore delivered his parting shot. "Well, I would say, not quite, but I let you have your say," the CNN anchor opined.
Below is a transcript of the segment:
CNN
NEWSROOM
2/19/14
CAROL COSTELLO: The fight over income inequality rages on with a new report from the Congressional Budget Office fueling the fire. The CBO's report says if the minimum wage is raised to $10.10 an hour, 900,000 workers would be lifted out of poverty. On the other hand, an estimated 500,000 jobs could – and I emphasize could – be cut.
Now, those against raising the minimum wage are saying I told you so , like our friend Stephen Moore. He's the chief economist at the Heritage Foundation and a contributor at The Wall Street Journal. Hi, Stephen.
STEPHEN MOORE, Wall Street Journal: Hi, Carol. I was going to say I told you so.
COSTELLO: I know you were. Okay, you always said this was a bone-headed move. So, expound for us.
MOORE: Well, look I think this report has, has a real important message which is that when you raise the minimum wage some people are going to lose their jobs and some people aren't going to get jobs. They're going to be priced out of the market. Now, it is true that some people will get a pay raise because people who are going to see that minimum wage rise are going to get a higher salary. But I think the real victims here, Carol, in my opinion, are the people at the very bottom of the income scale, the people with the least skills who may not be worth $10 an hour but maybe worth $8 an hour and they can't now find a job.
COSTELLO: Okay, but I want to be very clear about what exactly the CBO is saying, because it's easy to just look at this in terms of black and white.
MOORE: Right.
COSTELLO: The CBO acknowledged that its calculation is an estimate and said actual job losses could range from very slight to as many as one million positions. On the other hand, it also says it would increase the earnings for 16.5 million Americans. 900,000 workers would be raised out of poverty.
MOORE: That's right.
COSTELLO: So many people would say I'm willing to take that bet.
MOORE: I guess that's the question. Are you willing to destroy some jobs to raise the incomes of others?
COSTELLO: But it's not even clear that it will destroy any jobs at all.
MOORE: Well, I mean, look, their median estimate – and, look, economists make estimates, sometimes we're right, sometimes we're wrong, but the median estimate was 500,000 job losses, and you're right they said as many as a million jobs might be lost if we did this. Now, remember this comes on the heels of a report last week that says that Obamacare may reduce the number of jobs by two-and-a-half million. So, in just the last two weeks the –
COSTELLO: But, again, you can parse that another way, too.
MOORE: How so?
COSTELLO: Those people could be people voluntarily leaving the workforce because now they can afford insurance. A lot of people work simply to get health insurance.
MOORE: Carol, we want people working. One of the reasons the economy isn't performing up to standard is because we've seen this record dropout of people from the workforce. As an economist, I find that to be a very troubling thing.
Now, look, the other thing that the CBO found about this minimum wage was they found that 80 percent of the workers who would be affected by the minimum wage, who would get a raise – an increase in their wage, those are people not in poor households. Those are people oftentimes in, you know, teenagers and middle class households who are just working to get some walking-around money.
Your -- I think the point is that the minimum wage increase is not a very good way to cut poverty. We all want to reduce poverty in this country. I read that whole report and I came away thinking, this isn't a very smart way to reduce income inequality and to get people who are poor into the middle class.
COSTELLO: I hear you. I hear you. Forty-six and half million Americans live in poverty. So what's your idea?
MOORE: Well, I want to see more jobs in this country. I would – I would get rid of Obamacare –
COSTELLO: Everybody does. But what – but how?
MOORE: Okay. Get rid of Obamacare. I mean this is something right away that would help create a couple of million jobs. I think cut taxes on businesses so they can hire more workers. And balance the budget.
COSTELLO: Oh, come on, Stephen, businesses are not hurting. Banks are not hurting. They're just not hiring people because, you know what, they don't have to.
MOORE: Well, you know, you're right, Carol, that businesses are actually sitting on a lot of money right now. According to The Wall Street Journal, about $2 trillion. You know what the problem is, Carol, they're not reinvesting that money into the economy.
COSTELLO: Why?
MOORE: When I ask employers why not, it's because they say they're afraid of what the next hit is going to be from Washington. Whether it's going to be, you know, new regulations under ObamaCare or tax increases. I just think that it's the five-year anniversary of the fiscal stimulus. It hasn't created nearly the jobs that had been promised. Why don't we try a new approach of maybe taking some of these burdens off the back of businesses?
COSTELLO: There would be many people who argue that there are too few burdens placed on business. And when you have very wealthy Americans, frankly, coming out and saying the things they're saying in the recent past, that Americans should be satisfied because if they lived in China, golly, they would be rich. Nobody really believes that business leaders really want to create jobs or pay their workers more.
MOORE: They do. Look, I mean, if you – if you look at, for example, what happened in this week in Chattanooga where they tried to unionize that plant, one of the reasons that it failed was because the workers are already earning about $27 an hour.
I want a high wage economy, Carol, as you do. I want to see the American workers get a pay raise. But you've got to create a kind of economic environment in this country that rewards businesses for expanding. These people who say, oh, you know, businesses should be hiring more workers and so on, and that we should have more regulation on business, most of those people have never started a business. They don't know what it takes to meet a payroll. It's a tough thing to run a small business, and it's very risky to hire workers in this kind of environment.
COSTELLO: Well, we'll have to leave it there, Stephen Moore. An interesting conversation, as always. Thank you so much.
MOORE: I told you so. Minimum wage destroys jobs, Carol. I said this last week.
COSTELLO: Well, I would say, not quite, but I let you have your say.
