The Huffington Post came to the aide of the White House Wednesday by finding economists who disagreed with the Congressional Budget Office's report that an increase in the minimum wage would cost the economy about 500,000 jobs.
Citing two researchers whose work was among those used by the CBO to reach its conclusions, HuffPo set about its efforts to discredit the report that many have used as an indictment of the President's economic agenda:
Republicans opposed to a minimum wage hike got more fodder for their case Tuesday when the Congressional Budget Office released a report stating that a $10.10 minimum wage could cost the economy about 500,000 jobs. But some economists say that estimate may be overblown, and at least three whose research was cited in the report are now questioning that figure.
In a blog published by ThinkProgress on Thursday, Michael Reich, director of University of California-Berkeley's Institute for Research on Labor, argues that the CBO doesn't clearly explain how it came up with the 500,000 estimate. In his reading, it seems the budget analysts relied too heavily on studies "with methodological flaws" that found a higher minimum wage to be a job killer.
"They rely on the research literature, and the way they rely on the research literature is they say, 'Well, there are all these estimates out there' and then they somehow synthesize those estimates to one number," Reich told HuffPost. "In my view, they used numbers that were too high, based on what the research actually says."
Arindrajit Dube, an economist at the University of Massachusetts-Amherst, said the CBO "put their thumb on the scale a little bit."
Later, the article's defense of the Obama agenda evolved to say, even if the findings of the report were conceded, the overall impact of an increase in minimum wage would still be beneficial:
Even if one assumes that the CBO's projections for employment loss are correct, the report indicates that the benefits of a $10.10 minimum wage outweigh the costs. The hike would lift about 900,000 people out of poverty, the budget office estimates. In addition, a minimum wage hike would directly benefit 16.5 million workers by giving them a raise, the report found.
"If you take the half a million that everybody is talking about, that's still a very small number compared to the number of people that are going to be positively affected," Allegretto said. "But we don't believe that there are these disemployment effects."