WASHINGTON, D.C. (CNN) – Congressional Democrats hoping to include a minimum wage increase in the massive COVID economic relief bill were dealt a blow to their plans this week. But it’s possible the ruling removes a sticking point among Democrats themselves.
House Democrats are moving fast on President Biden’s $1.9 trillion COVID relief plan. House Speaker Nancy Pelosi (D-CA) said, “It’s what this country needs…” While Republicans made their feelings clear.
“This $1.9 trillion liberal wish list is a giveaway,” Representative Steve Scalise (R-LA) said.
In authoring their 590-page bill, the House included an increase in the federal minimum wage to $15 an hour, by 2025. That’s put the focus on a debate less about Republicans versus Democrats and more about moderate Democrats versus a progressive push.
Senator Bernie Sanders (I-VT) said, “You cannot survive in any state in this country on 8 or 9 bucks an hour and you certainly cannot raise your kids on those wages.”
The federal minimum wage right now is $7.25 an hour and hasn’t changed since 2009.
Many cities and states across the country have moved to set their own floors higher, like New York City at $15 per hour.
Representative Adriano Espaillat (D-NY said, “A couple bringing home $600 a week in my district now is bringing $1200 a week. They can pay rent. They can go to the store. They’ll not go on a Caribbean vacation. They’re just going to buy emergency items at a local grocery store.”
A report from the non-partisan Congressional Budget Office found the proposed increase of approximately $1.50 every year for five years would raise income for 17 million people and lift 900,000 workers out of poverty. But the same report found the increase could cost 1.4 million jobs and increase the federal deficit by $54 billion over 10 years, points Republicans have seized upon noting a strain on small businesses.
Senator Tim Scott (R-SC) said, “You actually increase the costs, you lower employment, and you have a negative impact on the long-term viability economically of everyday families.”
On Thursday, the Senate parliamentarian ruled against Senate Democrats including the provision in their bill, which would have allowed them to pass it under the reconciliation process, a simple majority, versus 60 votes for other legislation.
But, that might help the overall relief bill’s prospects.
Democratic Senators Kyrsten Sinema of Arizona and Joe Manchin of West Virginia said they wouldn’t support the increase as part of the relief bill. Manchin has signaled support for an $11 per hour minimum wage.
With a 50-50 split in the Senate, Democrats can’t afford to lose them and economists say the nation can’t wait for relief.
Diane Swonk is the chief economist at Grant Thornton. She said, “What we’ve seen is how contingent the economy is on the course of the virus and the need for aid and stimulus for people who have really suffered through no fault of their own.”
A Democratic push for a standalone minimum wage increase would still face Senate roadblocks, requiring 60 votes to pass.
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