CBO: $15 minimum wage will cost millions of jobs, increase deficit by $54B

WASHINGTON  — The nonpartisan Congressional Budget Office came out with a new report Monday estimating a $15 minimum wage would increase the budget deficit by $54 billion over the next decade, cause a spike in the cost of goods and services and lead to 1.4 million job losses.

While prompting concerns in some quarters, the report provided ammunition to proponents of the bill whose only hope of getting it passed is on a party-line vote using a legislative maneuver known as budget reconciliation.

“The CBO has demonstrated that increasing the minimum wage would have a direct and substantial impact on the federal budget. What that means is that we can clearly raise the minimum wage to $15 an hour under the rules of budget reconciliation,” tweeted Independent Sen. Bernie Sanders of Vermont.

As of Friday, the Senate started the process of passing President Joe Biden’s $1.9 trillion coronavirus relief plan using a procedure that would allow Senate Democrats to secure their priorities with a 51-vote majority, avoiding the regular requirement of 60 votes.

Under budget reconciliation, the Senate can only consider items that are related to the budget. Amendments that don’t pertain directly to the budget or arent’ deficit-neutral can be struck down under what’s known as the “Byrd Rule.”

Sanders, the chairman of the Senate Budget Committee, said the CBO report provided the needed proof that the minimum wage hike would impact the budget—both deficits and revenues—and therefore should be considered when the Senate formally takes up the coronavirus relief bill.