U.S. Senate Majority Leader Chuck Schumer (D-NY) speaks to reporters in the Senate reception room during the second day of Trump’s second impeachment trial in Washington on February 10, 2021.
Brandon Bell | Swimming pool | Reuters
Senate Democrats will abandon plans to help raise workers’ wages through tax sanctions and other economic incentives that some lawmakers had seen as an alternative to raising the federal minimum wage, according to someone familiar with the matter.
A handful of lawmakers last week introduced a “plan B” to President Joe Biden’s $ 1.9 trillion Covid-19 stimulus bill that would have punished companies that paid workers below a certain threshold.
Senators had unveiled the support plan Thursday and Friday, after the Senate lawmaker decided that a proposed federal minimum wage increase of $ 15 per hour did not meet the requirements Democrats must follow to pass the stimulus bill without the support of Republicans.
“Plan B,” advocated by Senate Finance President Ron Wyden, D-Ore, and Senate Budget Chair Bernie Sanders, I-Vt., Would have punished billions of companies that did not pay workers enough through various tax incentives.
Lawmakers were considering several penalties, including a 5% tax on the total payroll of a large corporation if any worker is paid less than $ 15 per hour.
The fate of Biden’s first historic piece of legislation now lies in the Senate after the House of Representatives passed its $ 1.9 trillion version of the bill early Saturday morning, largely along the lines of the party.
Democratic lawmakers say the rush is key to passing the big-ticket stimulus and that it is trying to send a final bill to the Biden counter on March 14, when unemployment assistance programs end. The House bill includes $ 1,400 direct controls on many Americans, vaccine distribution funds and $ 350 billion in aid to state and local governments.
Senators are expected to consider the bill seriously starting this week and offer amendments to legislation they received from the House. Given the backlash with the parliamentarian and the tight schedule, party leaders are likely to choose to pursue an increase in the federal minimum wage in future legislation.
They are likely to appeal to certain external groups, including unions and the business roundtable, who had expressed concern that a protracted battle for a pay rise would urgently delay the relief of workers and industries hardest hit by the pandemic. coronavirus.
Given that the lower house passed the bill with a minimum wage increase of $ 15 per hour, it is likely that the Senate will pass a different version of the bill. Both chambers should draft a final proposal in a conference committee.
Democrats, who maintain few minorities in the House and Senate, decided to follow the latest stimulus bill without Republican input through a process known as budget reconciliation. While reconciliation allows a bill to be passed with a simple majority of votes, it also limits the provisions that may be included in legislation to those that have a material impact on the federal deficit.
Some progressive lawmakers have urged the Biden administration, specifically Vice President Kamala Harris, to overturn the ruling of Senate MP Elizabeth MacDonough, which would rule out raising the minimum wage.
While some unions and business groups may be relieved, any decision to postpone the pay rise is likely to weaken the party’s progressive wing and put it back in disagreement with Democratic leadership.
The deputy representative of the whip of the Progressive Caucus, Ro Khanna, and 22 other lawmakers on Monday offered the president and vice president a new impetus to challenge the parliamentarian’s ruling.
“This sentence is a bridge too far. We have been asked, politely but firmly, to commit almost all of our principles and goals. Not this time,” Khanna said in a letter. “If we do not repeal the Senate MP, we are tolerating the wages of poverty for millions of Americans. That is why I am leading my colleagues to urge the Biden Administration to rely on the clear precedent and annul that wrong decision “.
Administration officials, including White House Chief of Staff Ron Klain, said Harris is not expected to oust the MP. House Speaker Nancy Pelosi, D-California, said Friday that she believed the House would “absolutely” approve the bill if it returns from the Senate without raising the minimum wage.
– CNBC’s Ylan Mui and Jacob Pramuk contributed to this report.