Good decision, big institutional problem on minimum wage work-around
Senior Democrats are abandoning a backup plan to increase the minimum wage through a corporate tax penalty, after encountering numerous practical and political challenges in drafting their proposal over the weekend, according to two people familiar with the internal deliberations. . . .
Economists and tax experts have said that the tax outlined by Sanders and Wyden could be easily avoided and difficult to implement, with large corporations able to reclassify workers as contractors to avoid potential penalties. “I would be extremely nervous about trying out a brand new idea like this with virtually no vetting,” Jason Furman, a former Obama administration economist, said on Twitter on Friday.
The good news here is that the Democrats care enough about policy – or perhaps political blowback – that they decided this idea wasn’t ready for prime time.
But there is another story here that is less visible but more important. The institutional capacity of Congress is so limited that Democrats didn’t have a well-vetted tax proposal waiting in the wings when, predictably, Senate Parliamentarian ruled that a straight-up minimum wage increase could not be passed in reconciliation.
How is a Congress that lacks the institutional capacity to vet a relatively simple tax proposal like this supposed to tackle an issue like climate change? My sense is that the Democrats know this is a big problem, but increasing spending on Congressional staff is a political liability, so . . .
is anyone looking at other plans to help the working poor besides raising the min wage. helping unions organize and fight for a fair wage? aggressively defining and prosecuting predatory business practices? government hiring, directly or by contract, with living wages (formerly known as prevailing wages)? prosecuting abuse of fake designation of employees as “independent contractors”? an honest measure of inflation (not the let them eat turnips measure proposed by the Boskin commission)?
instead of bigger congressional staff, just do what the R’s do: let the interest groups write the laws. of course it would be worthwhile to read them before voting on them.
Convincing anyone (even those selected to have the ability to represent voters on difficult issues 🙂 using research has gone out of style.