The bill to raise the federal minimum wage introduced by Sen. Bernie Sanders, I-Vt., may have a chance of passing through reconciliation, according to a recent letter from the Congressional Budget Office.
The letter notes that “Senator Bernie Sanders asked for information about the breadth of the budgetary effects of the Raise the Wage Act of 2021 … as compared with certain other reconciliation legislation that the Congressional Budget Office has analyzed in the past.”
Reconciliation allows Congress to expedite certain legislation related to budget through the Senate to avoid a filibuster, allowing it to pass with a simple majority vote.
The CBO found that “The bill would raise the federal minimum wage, in annual increments, to $15 per hour by June 2025 and then adjust it to increase at the same rate as median hourly wages.
“As CBO noted in a report published last week, an increase in the minimum wage would have broad economic effects that would, in turn, affect most areas of the budget. The set of budgetary effects incorporated in CBO’s analysis of the bill is therefore more extensive than the set incorporated in most cost estimates.”
The CBO found in the report that the bill would result in an increase to the cumulative budget deficit from 2021-2031 by about $54 billion, with smaller increases during the initial years. It would also cause higher prices for goods and services due to the higher wages of the workers involved, as well as increased spending on programs like unemployment compensation and reduced spending on others.
Sanders previously said that Democrats will use reconciliation “as soon as we possibly can” on a coronavirus relief package “to pass legislation desperately needed by working families in this country right now,” in an interview with CNN last month.
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