- A federal minimum wage hike was struck from the stimulus package on Thursday.
- Sen. Bernie Sanders said Democrats instead will propose to strip tax deductions from large corporations who don’t pay workers at least $15 an hour.
- He also said they would provide incentives to small businesses so that they can raise wages.
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Sen. Bernie Sanders said Democrats would try to devise a backdoor to implement a $15 minimum wage after a pay hike was struck from the $1.9 trillion stimulus package on Thursday evening – a major setback for progressives.
Senate parliamentarian Elizabeth McDonough ruled that a $15 minimum wage violated the strict guidelines of the reconciliation process. It’s the legislative method Democrats are using to approve the package in a party-line vote without Republican support.
In a statement, Sanders criticized McDonough’s decision. “It is hard for me to understand how drilling for oil in the Arctic National Wildlife Refuge was compliant with the Byrd rule, but raising the minimum wage is not,” the Vermont Democrat said, referring to a part of the 2017 GOP tax law allowed through reconciliation.
Then he said he will work with other Senate Democrats on “an amendment to take tax deductions away from large, profitable corporations that don’t pay workers at least $15 an hour and to provide small businesses with the incentives they need to raise wages.”
There were early signs of Democratic support for the move on Thursday evening. Sen. Brian Schatz of Hawaii tweeted “COUNT ME IN” on the Sanders proposal.
—Brian Schatz (@brianschatz) February 26, 2021
Sen. Ron Wyden of Oregon, chair of the tax-writing Senate Finance Committee, also said in a statement: “I’m looking at a tax penalty for mega-corporations that refuse to pay a living wage.”
Democrats are rushing to approve the emergency spending package ahead of March 14, the deadline when enhanced unemployment insurance starts to expire.
Yet designing and gathering support for a new plan to raise wages could complicate the swift timeline Democrats are pursuing. Some centrist Democrats may be reluctant to raise taxes on large corporations during the economic downturn.
It’s also unclear whether the proposal would be supported by Sen. Joe Manchin, a key West Virginia Democrat. The provision would also have to clear the reconciliation process governed by the parliamentarian.
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