Minimum Wage Hike Would Cut Food Stamp Costs- Daily Kos

Wed Mar 05, 2014 at 09:44 AM PST

Minimum wage hike would cut food stamp costs beyond Republicans' dreams

by Laura ClawsonFollow for Daily Kos Labor

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attribution: Alice Herden | Dreamstime.com

Raising the minimum wage to $10.10 an hour would cut food stamp spending by $4.6 billion a year, according to a new report from the Center for American Progress:

According to the finding in this report a 10 percent increase in the minimum wage reduces SNAP enrollment by between 2.4 percent and 3.2 percent and reduces program expenditures by an estimated 1.9 percent. Taking into account each state’s 2014 minimum wage level, we apply these results to the legislative proposal put forward by Sen. Tom Harkin (D-IA) and Rep. George Miller (D-CA) to raise the federal minimum wage to $10.10 per hour. Our results imply that the effects of the Harkin-Miller proposal on wage increases would reduce SNAP enrollments by between 6.5 percent and 9.2 percent (3.3 million to 3.8 million persons). The total anticipated annual decrease in program expenditures is nearly $4.6 billion, or about 6 percent of current SNAP program expenditures.

Harkin-Miller proposes to index minimum wage levels in subsequent years to the consumer price index, or CPI. The minimum wage would then increase at the same rate as SNAP benefit and eligibility levels, which are also indexed to the CPI. Consequently, the savings over 10 years in 2014 dollars would be 10 times the one-year savings, for a total of approximately $46 billion.

That $46 billion over 10 years is more than the $40 billion House Republicans wanted to cut, only this reduction could be achieved by raising people's wages, not by simply taking away the nutrition assistance they need to survive. Naturally, Republicans are more opposed to requiring businesses to pay wages that keep working people off of food stamps than they are in favor of reducing the expenditures. Because their crusade is much less about saving the government money than it is about redistributing money upward to the already rich. Sign the petition: Thank President Obama and join the call for a higher minimum wage.