President Obama’s chief economist
on Tuesday blasted the Congressional Budget Office for a report on the
impact of raising the minimum wage, claiming the non-partisan CBO’s
findings do not represent the best latest economic thinking on the
subject.
The CBO report found that the
president’s proposal to raise the federal minimum wage to $10.10 per
hour, a 39 percent increase over the current rate of $7.25, would cost
the economy about 500,000 jobs. The job losses would be offset by
increased wages for 16.5 million workers, nearly a million of whom would
be lifted above the federal poverty line.
However, in a lengthy blog post
on the White House web site, Jason Furman, chairman of the White House
Council of Economic Advisers and Betsey Stevenson, a member of the
Council, wrote, “The bulk of academic studies, have concluded that the
effects on employment of minimum wage increases in the range now under
consideration are likely to be small to nonexistent. CBO also agrees
that the employment effect could be essentially zero, but their central
estimates are not reflective of a consensus of the economics
profession.”
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