Democrats’ attempt to raise the federal minimum wage to $15 in the emergency COVID-19 bill appears dead, as the Biden administration remains opposed to overruling the Senate’s procedural expert and legislative alternatives hit an impasse over the weekend.
Senate Democrats worked through the weekend to try to find some kind of legislative Plan B to encourage businesses to raise their wages, after the Senate parliamentarian told Democrats last week that including a minimum wage increase in the COVID-19 relief budget bill would break Senate rules.
But by Monday, lawmakers had nixed the proposal Sens. Ron Wyden (D-Ore.) and Bernie Sanders (I-Vt.) floated last week, which would have taxed corporations that didn’t pay a $15 wage and given tax credits to small businesses that raised their wages.
Without a legislative alternative, and with the Biden administration adamant that it will not buck the Senate parliamentarian’s ruling, Democrats are out of immediate options.
“We’re going to look at all paths forward, but it won’t get done in this bill,” said a source familiar with negotiations.
It became clear that pushing forward with any new policy, let alone a complicated tax proposal, would risk delaying the passage of the COVID-19 relief bill, the source added.
Democrats have set a March 14 deadline to pass their $1.9 trillion COVID-19 relief package — the date unemployment benefits begin to expire.
The Senate is on track to vote on the bill later this week. The package, which passed the House last week, is still a major progressive achievement and includes $1,400 in direct payments to most Americans, a five-month extension of federal unemployment benefits at $400 per week and hundreds of billions for state and local governments to fill budget shortfalls from the pandemic. It also includes hundreds of billions of dollars for schools, restaurants and bars, child care and vaccine distribution.
The House did include a provision that would increase the minimum wage to $15 an hour over the next four years, but Senate Democrats will ultimately strip that provision out in order to comply with budgetary law.
Democrats are relying on budget reconciliation, a legislative maneuver that allows lawmakers to pass some legislation with only a simple majority, in order to bypass Republicans’ vocal opposition to their emergency relief proposal. The process has limitations: The legislation must have a direct effect on federal spending and revenues.
Progressive lawmakers in the House are trying to lobby the White House to overrule the Senate parliamentarian, who said Thursday that an increased minimum only had an “incidental” impact on the federal budget.
“The idea that the impact on the budget of raising the minimum wage to $15 an hour is incidental is ridiculous, it is not factually accurate and we should just thank the parliamentarian for her advice, respect her completely and make our correct decision to move forward with this."”
- Rep. Andy Levin (D-Mich.)
The presiding officer of the Senate — which in this case is Vice President Kamala Harris — has the power to overrule the parliamentarian, but the White House has said it will not pursue that option.
Several House lawmakers are decrying their Senate colleagues for throwing in the towel on the policy. Twenty-two progressives signed a letter to President Joe Biden and his staff on Monday, urging them to change their position and push forward with a $15 minimum wage.
“The idea that the impact on the budget of raising the minimum wage to $15 an hour is incidental is ridiculous, it is not factually accurate and we should just thank the parliamentarian for her advice, respect her completely and make our correct decision to move forward with this,” Rep. Andy Levin (D-Mich.) said.
Several other lawmakers echoed his comments.
“I want to express to so many of my colleagues — some were actually relieved when they heard the parliamentarian’s decision, like okay now we can kind of move on. Well, no we can’t,” said Rep. Rashida Tlaib (D-Mich.), who represents one of the poorest congressional districts in the country. “Because guess what, people at home will not remember how it gets done, they remember it was done.”
These progressives do have some power over negotiations. Not a single House Republican voted for the bill, meaning Democrats can only afford to lose five votes to pass the final relief packaged. If progressive lawmakers wanted to strong-arm the administration into overruling the parliamentarian, they have political leverage. But so far, there doesn’t appear to be the appetite to do so.
“Do I think that anyone is actually going to tank the relief bill, which has the unemployment insurance increase, vaccines, the money to reopen schools?” said Alex Lawson, executive director of Social Security Works, which pushes progressive policies on Capitol Hill. “No, they’re not going to.”
However, one progressive lawmaker told HuffPost on Monday that a bill stripped of the minimum wage provisions could find some liberal opposition in the House.
“I will vote for it,” said Rep. Ro Khanna (R-Calif.). “I do know there may be some who may not.”
Khanna, who helped organize the letter to the White House, said overruling the Senate parliamentarian and keeping the $15 minimum wage increase in the reconciliation bill would be “procedurally elegant.” It would preserve the filibuster and would allow Democrats who oppose the $15 minimum wage to vote with Republicans on a procedural vote instead of tanking the entire relief package.
“There’s something in our power to do,” Khanna said. “We control the White House. The vice president and the chair has this in their discretion. It doesn’t require the abolishment of the filibuster. It requires a ruling on what shouldn’t be part of reconciliation.”
Under the Congressional Budget Act, it would take 60 votes to appeal a ruling from Harris to disregard the parliamentarian. In essence, Khanna said, only 41 Democrats have to defend the decision to go “nuclear” over the Senate rules and include the $15 minimum wage. That would allow Senate Democrats supportive of the filibuster and opposed to a higher minimum wage to vote with Republicans on appealing the rule of the chair ― as long as they eventually voted for the overall bill.
But again, the administration has been adamant in its opposition to this gambit. In response to the letter Monday, White House press secretary Jen Psaki said it was “not an action we intend to take,” adding that the Biden administration does not currently have a new plan to push forward a wage increase.
“We don’t have a clear answer on what that looks like at this point,” Psaki said. “It just remains a commitment and something he will use his political capital to get done.”
Ultimately, the fate of the $15 minimum wage was always in peril in the Senate, and not only because of Senate procedure. Two Democrats, Sens. Joe Manchin (D-W.Va.) and Kyrsten Sinema (D-Ariz.), are against the policy itself.
Without a minimum wage increase in this COVID-19 relief bill, Democrats are left with three options going forward. They can try to figure out a tax proposal to encourage businesses to raise their wages by the next reconciliation bill, which is expected to pass by the fall. They can negotiate a compromise minimum wage increase with Republicans that could pass the Senate’s 60-vote filibuster threshold. Or, in the most dramatic move, they could get rid of the filibuster rule altogether.
Republican Sens. Mitt Romney of Utah and Tom Cotton of Arkansas unveiled their conservative counterproposal on the minimum wage last week: raising it to $10 an hour over a five-year period, tied to a mandate that businesses use E-Verify to crack down on the hiring of undocumented workers. Key Democrats — including Sen. Patty Murray (D-Wash.), the chairwoman of the Health, Education, Labor and Pensions Committee — panned the proposal.
What’s left for progressives is to mount another push ahead of the next reconciliation bill, or use it as a rallying cry for abolishing the filibuster. Activists are already pushing the latter.
“Whether any compromises will be needed is too early to know for sure, but if there are, activists needn’t accept them as final,” said Jeff Hauser from the Center for Economic and Policy Research. “The $15 minimum wage is enormously, provably popular in purple to red states like Florida, and progressives should persist until a living wage is established.”