Open thread Feb. 5, 2021 Dan Crawford | February 5, 2021 8:45 am Tags: open thread Comments (11) | Digg Facebook Twitter |
Senate Lawmakers Back Biden’s Stimulus but Reject Minimum Wage Increase
NY Times – February 4
Democrats agreed to limit direct checks for high earners
but rejected several Republican amendments to a budget
resolution key to passing the president’s $1.9 trillion rescue plan.
WASHINGTON — Senate lawmakers gave their support to President Biden’s $1.9 trillion stimulus package just before sunrise on Friday, clearing a major hurdle for the legislation to proceed without Republican support after an overnight voting session that stretched for about 15 hours.
Vice President Kamala Harris arrived early in the morning to the Senate dais, where she cast her first tiebreaking vote, and the Senate adopted the resolution along party lines, 51-50, at about 5:30 a.m.
In the marathon session — known as a vote-a-rama and for which more than 800 amendments were drafted — Senate Democrats maneuvered through a series of politically tricky amendments that Republicans wanted to attach to a coronavirus relief package as lawmakers pressed forward with a budget plan that includes Mr. Biden’s economic aid proposal.
The resolution will go to the House, where Democrats do not require Republican support to approve it.
Still, the proposal did not pass the Senate without setbacks for some Democrats. Lawmakers dealt a significant blow to Mr. Biden’s plan by dismissing a major tenet: a measure that would raise the federal minimum wage to $15 an hour.
In an impassioned speech around 5 a.m., Senator Bernie Sanders, independent of Vermont, called for his colleagues to back the budget resolution “in the strongest possible terms,” even after they rejected the minimum wage proposal for which he has been the Senate’s leading proponent.
“We now come to the end of the debate that has gone on for over 14 hours, and we end this debate in a moment in which our country faces more crises, more pain, more anxiety than any time since the Great Depression,” Mr. Sanders said. “But we have the opportunity to give hope to the American people and restore faith in our government by telling them that tonight we understand the pain that they are experiencing and we are going to do something very significant about it.”
By a voice vote, senators backed an amendment from Senator Joni Ernst, Republican of Iowa, to “prohibit the increase of the federal minimum wage during a global pandemic.” It was a signal that the wage increase would be difficult to pass in an evenly split Senate, where at least one Democrat, Senator Joe Manchin III of West Virginia, is on record opposing it.
“A $15 federal minimum wage would be devastating for our hardest-hit small businesses at a time they can least afford it,” Ms. Ernst said on the Senate floor. “We should not have a one-size-fits-all policy set by Washington politicians.”
Mr. Sanders seemed unfazed. He said that his plan was to carry out the wage increase over five years and that he had never wanted to raise it during the pandemic.
“We need to end the crisis of starvation wages in Iowa and around the United States,” Mr. Sanders said. He added that he planned to try to get the phased-in wage increase included in a budget reconciliation bill that would allow Mr. Biden’s stimulus plan to circumvent the Senate’s 60-vote filibuster rule.
Speaker Nancy Pelosi said during the debate that Democrats would not give up on trying to raise the wage to $15 an hour even outside the stimulus measure.
“It’s not the last bill we’ll pass,” Ms. Pelosi said. “This is the rescue package.”
Entering the early hours of the morning, senators in both parties pushed forward test votes to showcase their dueling priorities. In an evenly split Senate, any amendment required the majority’s support to pass, and therefore several failed on a 50-to-50 tie.
Among the Republican proposals that did not garner enough support were measures to reduce funding to states like New York, which is under investigation over coronavirus deaths in nursing homes; to prohibit funding for schools that do not reopen for in-person classes once teachers are vaccinated; and to block funds from so-called sanctuary jurisdictions that do not cooperate with federal law enforcement.
Senator Patty Murray, Democrat of Washington and the chairwoman of the education committee, called the effort to put restrictions on sending aid to schools “simply a political show.” …
… Democrats did, however, rally around some amendments from Republicans. The Senate, by unanimous vote, agreed to a motion from Senators Marco Rubio and Rick Scott, both Republicans of Florida, to block tax increases on small businesses during the pandemic.
Lawmakers also backed a measure from Senator Roger Wicker, Republican of Mississippi, and Senator Kyrsten Sinema, Democrat of Arizona, to establish a fund to provide grants to food and drinking establishments affected by the coronavirus crisis. And, by a vote of 58 to 42, they agreed to prohibit stimulus money from going to undocumented immigrants — something that is not included in Mr. Biden’s economic rescue plan.
The eight Democrats who voted with Republicans on that last measure included John Hickenlooper of Colorado, Maggie Hassan of New Hampshire, Gary Peters of Michigan and Mr. Manchin.
The Senate also approved an amendment to maintain the U.S. Embassy in Jerusalem. Under President Donald J. Trump, the United States recognized Jerusalem as the capital of Israel, breaking with decades of precedent, and opened a new embassy in the city, complicating peace in the Middle East. …
thanks for this. not sure i would have heard about it (details) otherwise.
all in all it looks fairly good for the good guys.
thing about the min wage increase is that it would need to be increased again and again every year to keep up. a phased in increase just makes it worse. i understand the need for phase in… people don’t respond well to sudden shocks. on the other hand maybe rents are low enouugh in arkansas that they dont need the same min wage as new york. seems like a complicated measure would be needed to solve all problems… but without that automatic cost of living adjustment to min wage it doesn’t look like it would solve much. i stand to be corrected.
i’d also like to se a worker paid unemployment insurance plan along the lines of SS… but keyed to the actual cost of unemployment in good times and bad, which are less predictable than the cost of retirement or disability over time…. no need for a Trust Fund to save for a rainy day… just pay as you go. (yes, people who are still working can afford a tax increase during a recession. that’s pretty much the way it worked for the last million years of human evolution.)
Is this anything?
Lou Dobbs’s Show Is Canceled by Fox Business
Lou Dobbs, one of former President Donald J. Trump’s most loyal media supporters, abruptly lost his pulpit on Friday when Fox Business canceled his weekday television show, which had become a frequent clearinghouse for baseless theories of electoral fraud in the weeks after Mr. Trump lost the 2020 presidential race.
Mr. Dobbs’s decade-long tenure at the network ended with little warning — a guest host filled in for his Friday slot — only a day after the election technology company Smartmatic filed a defamation lawsuit against Rupert Murdoch’s Fox Corporation and Fox News.
The suit, which seeks damages of at least $2.7 billion, also named Mr. Dobbs as an individual defendant along with two other Fox anchors, Maria Bartiromo and Jeanine Pirro. Smartmatic specifically cited Mr. Dobbs’s program, which by late last year had become so packed with falsehoods about Mr. Trump’s defeat that Fox Business was forced to run a fact-checking segment debunking some of its own anchor’s assertions.
Executives at Fox did not elaborate on Friday about why they had canceled Mr. Dobbs’s program, which was the top-rated show on Fox Business and drew a bigger audience than its competition on CNBC. The network said in a statement that it regularly reviewed its programming lineup. …
I just fired off this response to WSJ’s Notes on the News — which I get in my inbox every morning:
* * * * * *
The trouble with expecting a whole lot of social progress from a minimum wage raise is that the hourly amount cannot be pegged above what the bottom of the barrel union contract would be – above labor’s weakest bargaining result.
Taking $15 an hour as that bottom peg for argument’s sake, that would meant almost 40% of American workers are earning less than the weakest union contract would yield them.
(http://fortune.com/2015/04/13/who-makes-15-per-hour/ — 2015)
Check these out:
https://data.bls.gov/cgi-bin/cpicalc.pl?cost1=0.75&year1=195001&year2=202012 .75 8.31
https://data.bls.gov/cgi-bin/cpicalc.pl?cost1=1.60&year1=196802&year2=202012 1.60 12.19
Never mind any bottom of the barrel pact — 2012’s federal minimum wage is a dollar an hour short of the 1950 federal minimum (!) – and five dollars short of the 1968 (!) — been something like tripled per capita income since 1950 – doubled since 1968.
* * * * * *
Seattle supposedly “anti” min wage study — records only raging bracket creep
“50,000 more jobs above $19/hr (44,000 more jobs overall — 6,000 fewer under $19/hr)”
Denis: “the hourly amount cannot be pegged above what the bottom of the barrel union contract would be”
Can you explain this better? Why?
Otherwise setting a minimum wage above what the market was willing to pay the lowest paid workers would tend to put lower wage businesses out of business — or cost a loss of business and jobs.
My point is that setting the minimum wage as low as lowest contract might be — typically $15 in a very high, 25% labor use business like fast food — where adding say <b>50%</b> to salary would add 12.5% to prices; hopefully not enough to scare customers off — won’t do much to help Target workers who could <b>double</b> their salaries with the same 12.5% effect on prices — or do much to help Walmart workers squeeze their consumers for <b>more than double wages</b> for the same effect on prices since Walmart has only 7% labor costs.
Keeping always in mind that doubling the overall wages of the bottom 40% (who earn $15 or less) from 10% of overall income to 20% of overall income would fill in the lost demand caused by higher prices. Overall demand would never diminish, it would just be redirected from different quarters.
Nobody ever seems to weigh the effect of “redirection” (don’t look up this label on Google). Of course as jobs increase on the bottom 40% level with higher incomes they must decline on what I call the upper 59% level — or upper wages would have to go down; but wages are sticky so this cause unemployment (at first) among upper 59% consumers. Low wage employees in high end restaurants would lost jobs too — but higher wages and more jobs would be available in lower price product firms.
Everybody understands “redirecting” on the high side of things — works the same way down south too.
It seems you are implying that McDonalds employees and Target employees be in different unions because the labor costs are different. Do I have that right?
I can’t follow the sentences about redirection.
Well, Target and Mac employees — if they happened to be one company — could simply set different wage scales for different sections of employees. A certified union is by law the exclusive bargaining agent for all employees — that’s what certification means. Any group of people can associate for anything — First Amendment of course — cert actually limits that right if you think about it.
Redirection as I call it (as I try to come up with something to call it) means taking the calculation of jobs lost to higher prices one step further — at least one step further than I think economists go when estimating the effect of wage raises. I am just referring back to the old Henry Ford thing where paying employees more allows them to buy more of what they make. Only Ford was only paying a tiny, tiny fraction of the workforce — we are looking at a major section of the workforce (something like 40% of the workforce earns less than $15 an hour).
I don’t know if economists do anything like actually calculate the “Ford effect” when they estimate job gain/loss. Never have heard of it. Wasn’t too long ago that Kuerger-Card minimum wage study took a close look at what actually happened after a fed min wage increase. Never hear anything about actually calculating the Ford thing in numerical equations to explain why there was no job loss. No to low job loss outcome even seemed to take everybody by surprise.
I can’t tell whether you are saying “redirection” means higher wage workers are gaining or losing. If Ford’s workers have more money to spend on Ford’s products they will also have more money to spend on higher end products. Yet, yesterday you were talking about “unemployment (at first) among upper 59% consumers.”
Henry Ford claiming that paying workers more allows them to buy more cars came years after he raised their wages so that they would actually come to work.
I think he was right, but I think he just happened to be on the cusp of having a product that could have a price point that opened up a whole new market.