CBO says raising minimum wage to $15 would reduce poverty but increase the deficit and cost jobs

The proposed hike, which would take full effect by 2025, would increase worker pay by $333 billion, giving a boost to some 17 million workers whose wages would otherwise be below $15, as well as many of the 10 million workers whose wages would otherwise be slightly above that level.

The move would also reduce the number of people in poverty by 900,000 and result in lower spending on food stamps and child nutrition programs. However, spending on Medicaid and unemployment benefits would increase because of higher enrollment by those who lose their jobs, the CBO said.

The battle over raising the minimum wage, a longtime Democratic goal, was reignited last month when President Joe Biden included it in his $1.9 trillion coronavirus relief package. The minimum wage has been $7.25 since 2009.

However, the measure has already run into resistance on Capitol Hill, including from some Democrats, such as West Virginia Sen. Joe Manchin, who favors a smaller hike.

Democratic leaders are fast-tracking the passage of Biden's pandemic relief package through a legislative process known as reconciliation, which only requires a majority of votes. However, the party could not afford to lose the support of any member, assuming no Republican senators vote for it.

Biden conceded in an interview with "CBS Evening News with Norah O'Donnell" that he does not believe he will be able to raise the minimum wage due to the Senate's rules.

"I put it in, but I don't think it's going to survive," Biden said in excerpts of an interview that aired Friday.

However, Vermont Sen. Bernie Sanders, chair of the Senate Budget Committee and a fierce advocate of the increase, took issue Monday with the CBO report, pointing to the agency's analysis two years ago that concluded a wage hike would increase the deficit by less than $1 million over a decade. He also referenced other studies that found that raising the wage would significantly reduce the deficit.

The senator doubled down on his intention to include the provision in the relief package, saying the CBO report backs his contention that increasing the minimum wage would have an impact on the budget and could be included in a reconciliation bill.

He told CNN's Jake Tapper on Sunday that a "room full of lawyers" is working to make the case that a minimum wage increase conforms to those rules.

"I can tell you as chairman of the (Senate Budget Committee), we have a room full of lawyers working as hard as we can to make the case to the parliamentarian that, in fact, raising the minimum wage will have significant budget implications and, in fact, should be consistent with reconciliation rules," Sanders told Tapper on "State of the Union."