The $15 per hour minimum wage has risen from the ashes to threaten the passage of the president’s $1.9 trillion pandemic relief bill that passed the House on Saturday. Radicals are urging their compatriots in the Senate to refuse to vote for the bill unless the minimum wage hike is included.
The problem for the radicals is how to get around the ruling of the parliamentarian that the wage hike is “extraneous” and doesn’t belong in the package. The only way that will happen is if the president of the Senate, Vice President Kamala Harris, overrules the parliamentarian and allows a vote on the bill. Harris has indicated that she won’t override the parliamentarian’s decision.
Even if they overcome Harris’s objections, at least one Democratic senator, West Virginia’s Joe Manchin, has come out and said he wouldn’t vote for the minimum wage increase. The radicals would likely need the vote of at least one Republican to snatch defeat from the jaws of victory. And with even “moderate” Republicans like Susan Collins of Maine and Lisa Murkowski of Alaska opposed to the minimum wage increase, prospects for success are very dim.
“There are progressive Democrats that have that muscle in the House. If we as a party decide to stand down on our promise of elevating the minimum wage, I think that’s extraordinarily spurious and it’s something that as a party we could have a further conversation about how to fight for it,” Representative Alexandria Ocasio-Cortez said, Newsweek reported.
Representative Pramila Jayapal of Washington, chair of the Congressional Progressive Caucus, indicated to reporters that Democrats could lose support from progressives if they fail in finding a way to include the wage hike.
“I don’t think we can go back to voters and say, ‘Look, I know Republicans, Democrats, independents support this; we promised it, but because of an unelected parliamentarian who gave us a ruling, we couldn’t do it,'” she said. “There’s a lot of great things in the package, but if it’s watered down, that’s a whole different issue. So we just have to see what it ends up as.”
AOC and her crew have lost this round, but they’ll live to fight another day. It’s not the last we’ve heard of this issue.
Instead of an across-the-board wage hike, Senate Democrats are likely to offer an amendment that would force large corporations to pay the wage or get a tax penalty.
The plan being drafted by aides to Senate Finance Committee chair Ron Wyden of Oregon — in close consultation with Senate Budget Chair Bernie Sanders of Vermont — would impose a 5% payroll tax penalty on “very large” companies that do not pay workers a certain amount. That amount is still unclear: Wyden favors $15 an hour, but is currently seeking feedback from fellow Democrats on that figure and on exactly which companies would face the penalties.
“Everyone in the caucus is envisioning ‘very large’ companies – think Walmart, Amazon,” a Senate Democratic aide told CBS News.
Under the proposal, which Senate Democrats hope to finish crafting by early next week, smaller businesses that raise their workers’ wages would be eligible for income tax credits equal to 25% of wages — up to $10,00 per employer to year — tax incentives to increase wages.
Using the tax system to affect social policy is nothing new. Congress does it all the time in order to incentivize or penalize certain behaviors. There’s nothing really objectionable about it. It’s not ideal but it has the virtue of being within the budget rules.
Most small businesses can breathe a sigh of relief. If, after they get back on their feet, they choose they want to offer the employees the increased wages, they can do so, and get a tax benefit, to boot.
The fiddling with the relief package may delay a vote a few days, but Majority Leader Chuck Schumer is still shooting for a floor vote before March 14 when certain unemployment benefits are set to expire.