News / Economy

US Budget Agency Defends Wage Report After White House Criticism

Congressional Budget Office Director Doug Elmendorf testifies before the House Budget Committee hearing on the nation's economic outlook, on Capitol Hill in Washington, Feb. 1, 2012.
Congressional Budget Office Director Doug Elmendorf testifies before the House Budget Committee hearing on the nation's economic outlook, on Capitol Hill in Washington, Feb. 1, 2012.
Reuters
The head of the U.S. Congress' budget agency on Wednesday defended its findings that President Barack Obama's proposed minimum wage increase would cause job losses, a day after the White House criticized the agency's methodology.

White House officials have taken issue with the Congressional Budget Office's conclusion that raising the minimum wage to $10.10 per hour would lead to a loss of about half a million jobs by late 2016.

The administration's criticisms of the non-partisan CBO were unusual, given the respect that the agency commands from both Republicans and Democrats as Washington's referee on budget and economic issues.

CBO director Doug Elmendorf pushed back against suggestions the agency had not taken into account some research on the effects of raising the minimum wage.

“Our analysis is quite consistent with the latest thinking by economists,” he told reporters at an event sponsored by the Christian Science Monitor.

The report, however, struck a nerve among Democrats, who are advocating a minimum wage of $10.10 - up from $7.25 now - along with allowing it to rise with inflation, as a winning issue for the party in congressional elections in November.

The report gave Republicans an avenue to attack this strategy, and they quickly issued statements claiming that the wage hike would “destroy” jobs. The report came just two weeks after a CBO budget analysis found that federal health insurance subsidies under Obama's signature health reform law would contribute to a reduction in workforce participation later this decade, increasing future deficits.

Obama administration officials were quick to dispute the CBO's employment findings in the minimum wage report, despite another finding more favorable to Democrats - that the wage hike would lift more than a million people out of poverty.

The rare criticism of the CBO continued on Wednesday, as top White House economic adviser Gene Sperling said the jobs finding was “an area where I'd say we respectfully disagree with the CBO.”

Sperling told MSNBC's Morning Joe program that many economists have found no negative jobs impact from lifting wages.

“I think their mistake was not looking at the practical research that was done,” Sperling said of the CBO.

600 Economists, no numbers

On Tuesday, House Democratic Leader Nancy Pelosi said the report “contradicts” the findings of “hundreds of top economists, who predict that a maximum wage hike would actually stimulate the economy, raise demand and job growth, and provide help in job creation.”

In part, she was referring to a letter signed in January by more than 600 economists endorsing the $10.10 minimum wage proposal. These economists, mainly academics, wrote “the weight of evidence” showed that “increases in the minimum wage have had little or no negative effect on the employment of minimum-wage workers, even during times of weakness in the labor market.”

While Elmendorf, a Harvard-trained economist, did not directly respond to Pelosi's criticism, he said: “Those economists don't put numbers to their words, so it's hard to know exactly what people meant by 'little to no effect.”'

He said CBO's findings were consistent with several recent studies that have analyzed a minimum wage increase to $9. This includes a University of Chicago survey of economists in which roughly equal numbers agreed and disagreed that a $9 minimum wage would make it “noticeably harder” for low-skilled workers to find jobs.

A minimum wage increase to $10.10 would affect more workers and be a larger relative to any other proposed wage increase previously studied.

He said this “means that employers will face a larger shock in their costs,” and have more incentive to respond by reducing the size of their workforces.

“A balanced reading of the set of research studies in this area led us to conclude that an increase in the minimum wage would probably have a small negative effect on employment,” said Elmendorf, first appointed to his post by Democratic congressional leaders in 2009 and reappointed in 2011 after Republicans took control of the house.

Under Elmendorf, who served in the 1990s as an economic adviser to former Democratic president Bill Clinton, the CBO has produced some reports viewed as favorable to Obama, finding in 2010 that the Affordable Care Act would actually reduce deficits over its first decade. It also concluded last year that a Democratic immigration reform bill would cut deficits by $900 billion over 20 years and significantly boost economic growth.

Elmendorf, who said his personal political views have no bearing on CBO research, ends his current four-year term at the agency in January 2015.

You May Like

Video New Brain Mapping Techniques Could Ease Chronic Pain

New methods for mapping pain in the brain not only validate sufferers of chronic pain but might someday also lead to better treatment More

Sierra Leone's Stray Dog Population Doubles During Ebola Crisis

Many dog owners fear their pets could infect them with the virus and have abandoned them, leading to the increase and sparking fears of rabies More

Fake, Substandard Medicines Pose Global Challenge

So-called 'fake drugs' include expired medicines, those with manufacturing defects, and bogus tablets More

This forum has been closed.
Comments
     
There are no comments in this forum. Be first and add one

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
New Brain Mapping Techniques Could Ease Chronic Paini
X
Shelley Schlender
April 20, 2015 7:03 PM
Pain has a purpose - it can stop you from touching a flame or from walking on a broken leg. As an injury heals, the pain goes away. Usually. But worldwide, one out of every five people suffers from pain that lasts for months and years, leading to lost jobs, depression, and rising despair when medical interventions fail or health experts hint that a pain sufferer is making it up. From Boulder, Colorado, Shelley Schlender reports that new methods for mapping pain in the brain are providing validation for chronic pain and might someday guide better treatment.
Video

Video New Brain Mapping Techniques Could Ease Chronic Pain

From Boulder, Colorado, Shelley Schlender reports that new methods for mapping pain in the brain are providing validation for chronic pain and might someday guide better treatment.
Video

Video Hope, Prayer Enter Fight Against S. Africa Xenophobia

South Africa has been swept by disturbing attacks on foreign nationals. Some blame the attacks on a legacy of colonialism, while others say the economy is to blame. Whatever the cause, ordinary South Africans - and South African residents from around the world - say they're praying for the siege of violence to end. Anita Powell reports from Johannesburg.
Video

Video Italy Rescues Migrants After Separate Deadly Capsize Incident

Italy continued its massive search and rescue operation in the Mediterranean Monday for the capsized boat off the coast of Libya that was carrying hundreds of migrants, while at the same time rescuing Syrian migrants from another vessel off the coast of Sicily. Thirteen children were among the 98 Syrian migrants whose boat originated from Turkey on the perilous journey to Europe.
Video

Video New Test Set to Be Game Changer in Eradicating Malaria

The World Health Organization estimates 3.4 billion people are at risk of malaria, with children under the age of five and pregnant women being the most vulnerable. As World Malaria Day approaches (April 25), mortality rates are falling, and a new test -- well into the last stage of trials -- is having positive results in Kenya. Lenny Ruvaga reports for VOA from Nairobi.
Video

Video Are Energy Needs Putting Thailand's Natural Beauty at Risk?

Thailand's appetite for more electricity has led to the construction of new dams along the Mekong River to the north and new coal plants near the country's famous beaches in the south. A proposed coal plant in a so-called "green zone" has touched off a debate. VOA's Steve Sandford reports.
Video

Video Overwhelmed by Migrants, Italy Mulls Military Action to Stabilize Libya

Thousands more migrants have arrived on the southern shores of Italy from North Africa in the past two days. Authorities say they expect the total number of arrivals this year to far exceed previous levels, and the government has said military action in Libya might be necessary to stem the flow. VOA's Henry Ridgwell reports.
Video

Video Putin Accuses Kyiv of ‘Cutting Off’ Eastern Ukraine

Russian President Vladimir Putin, in his annual televised call-in program, again denied there were any Russian troops fighting in Ukraine. He also said the West was trying to ‘contain’ Russia with sanctions. Henry Ridgwell reports on reactions to the president’s four-hour TV appearance.
Video

Video Eye Contact Secures Dog's Place in Human Heart

Dogs serve in the military, work with police and assist the disabled, and have been by our side for thousands of years serving as companions and loyal friends. We love them. They love us in return. VOA’s Rosanne Skirble reports on a new study that looks at the bio-chemical bond that cements that human-canine connection.
Video

Video Ukrainian Volunteers Search for Bodies of Missing Soldiers

As the cease-fire becomes more fragile in eastern Ukraine, a team of volunteer body collectors travels to the small village of Savur Mohyla in the what pro-Russian separatists call the Donetsk Peoples Republic - to retrieve bodies of fallen Ukrainian servicemen from rebel-held territories. Adam Bailes traveled with the team and has this report.
Video

Video Xenophobic Violence Sweeps South Africa

South Africa, long a haven for African immigrants, has been experiencing the worst xenophobic violence in years, with at least five people killed and hundreds displaced in recent weeks. From Johannesburg, VOA’s Anita Powell brings us this report.
Video

Video Apollo 13, NASA's 'Successful Failure,' Remembered

The Apollo 13 mission in 1970 was supposed to be NASA's third manned trip to the moon, but it became much more. On the flight's 45th anniversary, astronauts and flight directors gathered at Chicago's Adler Planetarium to talk about how the aborted mission changed manned spaceflight and continues to influence space exploration today. VOA’s Kane Farabaugh reports.
Video

Video Badly Burned Ukrainian Boy Bravely Fights Back

A 9-year-old Ukrainian boy has returned to his native country after intensive treatment in the United States for life-threatening burns. Volodia Bubela, burned in a house fire almost a year ago, battled back at a Boston hospital, impressing doctors with his bravery. Faith Lapidus narrates this report from VOA's Tetiana Kharchenko.
Video

Video US Maternity Leave Benefits Much Less Than Many Countries

It was almost 20 years ago that representatives of 189 countries met at a UN conference in Beijing and adopted a plan of action to achieve gender equality around the world. Now, two decades later, the University of California Los Angeles World Policy Analysis Center has issued a report examining what the Beijing Platform for Action has achieved. From Los Angeles, Elizabeth Lee has more.
Video

Video Endangered Hawaiian Birds Get Second Chance

Of the world's nearly 9,900 bird species, 13 percent are threatened with extinction, according to BirdLife International. Among them are two Hawaiian honeycreepers - tiny birds that live in the forest canopy, and, as the name implies, survive on nectar from tropical flowers. Scientists at the San Diego Zoo report they have managed to hatch half a dozen of their chicks in captivity, raising hopes that the birds will flutter back from the brink of extinction. VOA’s George Putic reports.
Video

Video Exhibit Brings Renaissance Master Out of the Shadows

The National Gallery of Art in Washington has raised the curtain on one of the most intriguing painters of the High Renaissance. Mostly ignored after his death in the early 1500s, Italian master Piero di Cosimo is now claiming his place alongside the best-known artists of the period. VOA’s Ardita Dunellari reports.

VOA Blogs

World Currencies

EUR
USD
0.9247
JPY
USD
118.78
GBP
USD
0.6657
CAD
USD
1.2190
INR
USD
62.395

Rates may not be current.