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CBO just released its new $15 min wage analysis—adds $58B to the deficit, kills 1.4M jobs. Have to look at how they reach these numbers, but it's a bad blow for the Raise the Wage Act. Progressive economists likely screaming into their laptops right now.
https://www.cbo.gov/system/files/2021-02/56975-Minimum-Wage.pdf
https://www.cbo.gov/system/files/2021-02/56975-Minimum-Wage.pdf
Between this and its serial failures on macro forecasting that are now influencing debates over Biden's relief plan, my guess is that at least some key Democrats will want to clean house at the CBO.
For those asking/confused:
Among other reasons, it's bad for the Raise the Wage Act because it means the parliamentarian is unlikely to say it qualifies for reconciliation. Including it would require overruling her (or taking a non-CBO estimate).
Among other reasons, it's bad for the Raise the Wage Act because it means the parliamentarian is unlikely to say it qualifies for reconciliation. Including it would require overruling her (or taking a non-CBO estimate).
Democrats could do that, but it's not clear the party is ready to.
The thing to remember about reconciliation rules is that, at least according to this parliamentarian, even if a provision affects the budget, the impact can't just be "incidental" to the main purpose of the bill. A $58 billion loss over 10 years in this case looks incidental.
It also likely increases the budget deficit after the 10-year budget window, meaning it would have to be paid for with some other piece of the bill.
OK. I just got a call from a Democratic aide saying they believe it's good for reconciliation, because at least the bill has a score with a large $ figure attached to it.
They'll have to argue to the parliamentarian...
They'll have to argue to the parliamentarian...
...that they're intentionally adding to the deficit. And they still need more info from CBO on the out-year budget effects.
I'm personally skeptical, given how this parliamentarian has ruled previously on what's incidental. But they're casting it as a potential positive.
I'm personally skeptical, given how this parliamentarian has ruled previously on what's incidental. But they're casting it as a potential positive.
Sanders statement. Same message. https://twitter.com/SenSanders/status/1358822350347722762?s=20
From a wonk perspective, one frustrating thing about this CBO report is that it doesn't actually include all of the information you'd need to figure out exactly how they reached their conclusions.
But some of the folks on an EPI call made a good, general point, which is that CBO is essentially saying that it thinks the $15 minimum will kill more jobs now than it believed 2 years ago.
Yet, if anything...
Yet, if anything...
...the minimum wage lit has probably been moving in the opposite direction (see how the findings in Seattle have shifted for instance). So it's a little discordant. https://slate.com/business/2019/02/new-research-15-dollar-minimum-wage-good-for-workers.html
