Minimum-wage push hinders stimulus plan
GOP resists Biden call for $15 an hour
WASHINGTON — The Democratic push to raise the federal minimum wage to $15 an hour has emerged as an early flash point in the fight for a $1.9 trillion covid-19 relief package, testing President Joe Biden’s ability to bridge Washington’s partisan divides as he pursues his first major legislative victory.
Biden called for the wage increase during his campaign and has followed through by hitching it to a measure that, among other things, calls for $1,400 stimulus checks and $130 billion to help schools reopen. Biden argues that anyone who holds a full-time job shouldn’t live in poverty, echoing progressives in the Democratic Party.
“With the economic divide, I mean, I want to see a $15 minimum wage. It should actually be $20,” said Rep. Rashida Tlaib, D-Mich. The federal minimum is currently $7.25 and has not been raised since 2009.
Some Republicans support exploring an increase but are uneasy with $15 an hour. They warn that such an increase could lead to job losses in an economy that has nearly 10 million fewer jobs than it did before the pandemic began. Moderates such as Sen. Lisa Murkowski, R-Alaska, and Rep. Tom Reed, R-N.Y., are urging Biden to split off the min
imum-wage increase from covid-19 talks and deal with it separately.
“The more you throw into this bucket of covid relief that’s not really related to the crisis, the more you risk the credibility with the American people that you’re really sincere about the crisis,” Reed said. Including the wage increase, Murkowski said, “complicates politically an initiative that we should all be working together to address.”
The resistance from moderates has left Democrats with a stark choice: Wait and build bipartisan support for an increase or move ahead with little to no GOP backing, potentially as part of a package that can pass the Senate with Vice President Kamala Harris’ tiebreaking vote.
Democratic leaders appear to be moving toward the latter option, with no guarantee of success. Even if raising the wage can get past procedural challenges, passage will require the support from every Democrat in the 50-50 Senate, which could be a tall order.
Leading the charge is Sen. Bernie Sanders, I-Vt., who unveiled $15-an-hour wage legislation last week with the backing of 37 Senate Democrats. His bill would gradually raise the wage to $15 over five years.
Sanders, the incoming chair of the Senate Budget Committee, said it was fine with him if Republicans were not prepared to “come on board.” He said the government needed to pump money into the economy to make sure “people are not working on starvation wages.”
Democrats are moving toward using a tool known as budget reconciliation that allows certain budget-related items to bypass the Senate filibuster — a hurdle requiring 60 votes — and pass with a simple majority. Sanders is confident that a minimum-wage increase fits within the allowed criteria for budget reconciliation, though the Senate parliamentarian has final say on what qualifies.
“As you will recall, my Republican colleagues used reconciliation to give almost $2 trillion in tax breaks to the rich and large corporations in the midst of massive income inequality. They used reconciliation to try to repeal the Affordable Care Act and throw 32 million people off the health care they had. They used reconciliation to allow for drilling in the Arctic wilderness,” Sanders said. “You know what? I think we can use reconciliation to protect the needs of working families.”
Senate Majority Leader Chuck Schumer, D-N.Y., said the Senate as early as this week will begin taking the first steps toward getting the covid-19 relief bill passed through the budget reconciliation process. The goal would be passage by March.
FOR AND AGAINST
The latest sign that a $15 minimum wage is popular with voters came in November, when more than 60% of voters in conservative-leaning Florida approved an amendment to the state’s Constitution that will raise the minimum there from $8.56 an hour to $15 an hour by 2026.
The U.S. House passed legislation to gradually increase the minimum wage in the last Congress, but it went nowhere in the GOP-controlled Senate. Opponents argue that a large increase would lead many employers to cut the number of workers on their payrolls.
A 2019 study from the Congressional Budget Office projected that an increase to $15 an hour would boost the wages of 17 million Americans. An additional 10 million workers making more than $15 an hour would see a boost as well. However, about 1.3 million workers would lose their jobs, the office projected.
“There’s no question that raising the minimum wage, especially to $15, will put some small businesses out of business and will cost a lot of low-wage workers their jobs,” said Neil Bradley, chief policy officer at the U.S. Chamber of Commerce.
Bradley said there should be a separate debate on the minimum wage, and while the Chamber opposes $15 an hour, “we’re open to a reasonable increase in the minimum wage, and that ought to be a topic of discussion. But, you know, including that in the covid package just imperils the whole thing.”
Mary Kay Henry, international president of the Service Employees International Union, said increasing the minimum wage would benefit many of the people who have been working on the front lines of the pandemic. That’s why she supports including it in the covid-19 relief package.
“They’ve been called essential, but they all believe they’ve been treated as expendable or sacrificial, because they don’t earn enough to be able to put food on the table and keep themselves and their families safe and healthy,” Henry said.
Henry said nursing home workers, janitors, security guards and home healthcare workers are among the union’s 2 million members.
“The real way to appreciate this work is to raise the minimum wage to $15,” she said.
Most states also have minimum wage laws. Employees generally are entitled to the higher of the two minimums. Currently, 29 states and
UNITY ELUSIVE
The president began bipartisan talks on the relief package last week saying he was “open to negotiate” on his plan, but no counterproposal emerged. Republicans, balking at Biden’s price tag, have said the unilateral moves by House Speaker Nancy Pelosi, D-Calif., and Schumer to pass the bill under budget reconciliation amounted to a rejection of a bipartisan approach.
White House Press Secretary Jen Psaki said Friday that the question instead was why GOP members were blocking the proposal given broad public support.
The president made clear he wouldn’t halt the maneuvering toward a Democrat-only package.
“I support passing covid relief with support from Republicans if we can get it. But the covid relief has to pass — there’s no ifs, ands or buts,” Biden said Friday. Before a meeting with his economic team earlier in the day, he warned that an entire cohort of children face the danger of weaker lifetime earnings because of the crisis.
Economic data Friday underscored both the shakiness of the recovery and the potential for fiscal spending to make a difference. Consumer spending fell for a second straight month in December. Yet personal income also climbed, thanks in part to distribution of assistance from the $900 billion December relief bill.
Failure to secure bipartisan backing is a major disappointment for the new president, who in his Jan. 20 inauguration speech spoke about the need for unity after the bitter partisanship and violence of the final days of Donald Trump’s presidency. It also follows his own individual outreach efforts to members of the Senate, the chamber where he worked for 36 years.
Biden has called Republican Sens. Susan Collins of Maine and Rob Portman of Ohio — who recently announced he won’t be running for reelection.
Yet by Friday afternoon no GOP member of the chamber had come out to back his package. Republicans including Sens. Roy Blunt of Missouri and Mitt Romney of Utah were open to looking at more money for coronavirus vaccines and testing, spurring speculation that Biden’s plan could be split.
The White House made clear that wasn’t going to happen. “We’re not going to break it apart,” Psaki said Friday.