Federal Reserve Chairwoman Janet Yellen lent credence Thursday to a Congressional Budget Office study of the minimum wage that White House economists had criticized for its finding that an increase favored by President Obama would cost 500,000 jobs.
In an unusual criticism of the nonpartisan budget scorekeeper, Jason Furman, chairman of the president's Council of Economic Advisers, had responded to the CBO report by directly challenging its estimates of job losses, claiming that they "do not reflect the overall consensus view of economists."
Yellen, who held the same position Furman does under President Bill Clinton, disagreed with that assessment at a Senate Banking Committee hearing.
"CBO is as qualified as anyone to evaluate that literature," Yellen said in response to a question from Sen. Dean Heller, R-Nev. "I wouldn’t want to argue with their assessment.”
"There are a range of studies, and they cited them," Yellen acknowledged. But she added that the CBO is "good at this kind of evaluation.”
The CBO had found that raising the minimum wage from its current $7.25 rate to $10.10 and indexing it to inflation would raise wages for 16.5 million Americans and lift 900,000 out of poverty -- but at the cost of 500,000 jobs.
Republicans, who oppose the minimum wage increase advocated by President Obama and congressional Democrats, highlighted the job losses to make the case against the measure. Furman immediately responded with a blog post noting the positive aspects of the CBO's findings and raising a point of "respectful disagreement" with its assessment of the jobs impact.