Finance

Democrats scramble to rescue minimum wage hike

Democrats are scrambling to chart a path forward on a top progressive priority after the Senate parliamentarian blocked them from including a $15 minimum wage in a sprawling $1.9 trillion pandemic relief package.

Senate Finance Committee Chairman Ron Wyden (D-Ore.) and Budget Chairman Bernie Sanders (I-Vt.) have already pitched an alternative approach — taxing big, profitable companies that pay below $15 an hour — that could find broader backing from moderates, but have a more limited impact on poverty.

A senior Democratic aide said Senate Majority Leader Charles Schumer (D-N.Y.) was looking to add the provision to the relief package.

The White House, however, was noncommittal in its response to the so-called Plan B approach, while suggesting negotiations and debate over the new provision could slow the relief bill’s advance. Emergency unemployment benefits begin running out on March 14, and Democrats have vowed to have the bill approved and signed before then.

“We recognize there will be continued conversation on this proposal and others as the legislative process plays out over the coming days,” a White House spokesperson said Friday.

“Meanwhile our focus will be on the urgent priority of getting this package passed and delivering the relief that is so desperately needed — $1400 rescue checks for most Americans, funding to get this virus under control, aid to get our schools reopened and desperately needed help for the people who have been hardest hit by this crisis,” the spokesperson added. 

Some top Democrats in the House signaled there was no consensus with their Senate colleagues on what strategy to employ. 

“I think there’s broad support here for raising the minimum wage. And I think that based on what they decide to do in terms of the reconciliation package, that I assume we’ll react to that, but I wouldn’t prescribe, from my vantage point, giving them any advice on that,” said House Ways and Means Committee Chairman Richard Neal (D-Mass.).

Progressives appear open to the alternative plan put forth in the Senate, though they indicated they’ll keep pushing for enacting a statutory minimum wage increase, even if it’s separate from the relief bill.

“Bernie and I talked about it and I’m very supportive of doing whatever we can. But at the end of the day we promised a $15 minimum wage, so if that $15 minimum wage isn’t in this package, we are going to have to figure out a way to get it through,” said Congressional Progressive Caucus Chairwoman Pramila Jayapal (D-Wash.).

Republicans are largely opposed to raising the minimum wage to $15, although some are open to a smaller increase from the $7.25 rate that has been in place since 2009.

The debate around the minimum wage had already begun to evolve in recent days, before the Senate parliamentarian’s ruling on Thursday, as five Senate Republicans signed onto a plan from GOP Sens. Mitt Romney (Utah) and Tom Cotton (Ark.) to raise the minimum wage to $10 an hour and tighten enforcement against hiring undocumented workers. Their bill would also index the minimum wage to inflation.

The newfound openness on the Republican side of the aisle is being viewed by some as a response to broad public support for raising the minimum wage. Florida voters approved a $15 minimum with 61 percent support in November, 10 points more than former President Trump received in the presidential election. Even before the pandemic, the Pew Research Center found that 67 percent of the public supported the $15 target.

While the majority of Democrats would be loath to accept either a $10 minimum or the tightened restrictions outside of a wider immigration deal, the gambit puts in play the kind of bipartisan compromise Biden campaigned on last year.

Even if Democrats postpone efforts to boost the minimum wage through the COVID-19 relief bill, they could return to it in a separate measure that would be subject to a 60-vote threshold to break a Senate filibuster. The relief bill requires only a simple majority because it’s being considered under the budget reconciliation process.

Still, the approach of taxing big companies for low wages floated by Wyden and Sanders found unlikely support from Sen. Josh Hawley (R-Mo.), who on Friday unveiled his own bill that would tax corporations with over $1 billion in revenues for paying wages below $15 an hour.

“For decades, the wages of everyday, working Americans have remained stagnate while monopoly corporations have consolidated industry after industry, securing record profits for CEOs and investment bankers,” Hawley said in a statement.

“Mega-corporations can afford to pay their workers $15 an hour, and it’s long past time they do so, but this should not come at the expense of small businesses already struggling to make it.”

Even before Senate Parliamentarian Elizabeth MacDonough threw a wrench in the Democratic plans, the $15 minimum wage fight faced internal obstacles.

Sen. Joe Manchin (D-W.Va.) made clear that he opposed the $15 rate, saying $11 was more appropriate for a rural state like West Virginia. Sen. Kyrsten Sinema (D-Ariz.) said the provision should not be considered as part of emergency relief legislation, but has not weighed in on a preferred hourly rate.

Most House Democrats are on board with the $15 minimum wage, prompting Democratic leaders to keep the provision in their version of the pandemic relief bill set for a vote on Friday evening despite knowing it’ll eventually end up on the cutting room floor.

The only remaining House Democrat who voted against raising the minimum wage to $15 in 2019, Rep. Kurt Schrader (Ore.), told The Hill that he might vote against the COVID-19 relief package in part because of the provision.

“Let’s do something that, especially in the middle of a pandemic, that doesn’t cost jobs and encourages folks to hire, gives them some hope,” said Schrader, who prefers a minimum wage that’s regionally adjusted, adding he would “have to take a look” at the Wyden and Sanders proposal.

While House Democrats can afford a small number of defections, Senate Democrats are in a more precarious position.

With no GOP support expected for the relief bill, a single Democratic defection could sink the whole package in the evenly divided Senate, where Vice President Harris would cast any tie-breaking vote.

The Thursday night decision by MacDonough sparked renewed calls from progressives to have Harris overrule the parliamentarian, have Schumer replace her, or even scrap the filibuster, another plan that lacks the support of all Senate Democrats.

“So we mean to say millions and millions and millions more people voted for Democrats in the Senate than Republicans, and to say that, you know, that their lives won’t change, I don’t think that that’s something that we can really accept as a party. And so really our options right now, at least our immediate options on this specific issue, is to do something about this parliamentary obstacle or abolish the filibuster. Those are our two options right now,” Rep. Alexandria Ocasio-Cortez (D-N.Y.) said Friday.

The Biden administration had already made clear that it has no interest in pursuing either of those options.

“Certainly that’s not something we would do. We’re going to honor the rules of the Senate and work within that system to get this bill passed,” White House chief of staff Ron Klain said Wednesday on MSNBC.

Tags $15 minimum wage Alexandria Ocasio-Cortez Bernie Sanders Charles Schumer COVID-19 relief Donald Trump Joe Manchin Josh Hawley Kurt Schrader Minimum wage Mitt Romney Pramila Jayapal Richard Neal Ron Klain Ron Wyden Tom Cotton West Virginia

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