Senate’s Turn to Undo Cynical House Poison Pill on Minimum Wage Vote

by Mike Hall, Jul 31, 2006

It’s now up to the U.S. Senate to put a halt to what longtime Capitol Hill observers call one of the most cynical legislative maneuvers in many years. In the middle of the night Friday, House lawmakers tacked a minimum wage increase onto a bill that will drastically cut taxes on a handful of multimillion dollar estates and in the long run cost the U.S. Treasury more than $750 billion.

Senate Democrats vowed to stop the House bill—passed early Saturday morning—as Republican leaders scrambled to find a way to stop the political bleeding over their 10-year refusal to vote on raising the federal $5.15-an-hour minimum wage.

With minimum wage raises on the November ballots in six states, an energized grassroots movement to hold lawmakers accountable at the ballot box and the AFL-CIO America Needs a Raise campaign spotlighting House members who voted to raise their own pay while refusing to raise the minimum wage, the 1:30 a.m. vote was simply political cover.

Rep. Sander Levin (D-Mich.) says Republican lawmakers acted out of fear of voter backlash—and the potential loss of their majority in the House—if they didn’t raise the minimum wage:

In all my years here, this is the height of hypocrisy. If you really cared, you would have acted long ago. This is not an election-year conversion; it is an election-year trick.

The estate tax ploy was used to block a straight up or down vote on a bill to raise the minimum wage to $7.25 an hour. According to an analysis by the Center on Budget and Policy Priorities (CBPP), hourly wage would give some 6.6 million low- and minimum wage workers a $1,200 a year pay raise. On top of that, it would not cost taxpayers a dime.

Republican leaders have fought with the same fervor to repeal the millionaire estate tax as they have against raising the minimum wage. Unable to achieve complete repeal, they’ve sought to deeply cut the taxes on the multimillion dollar estates.

In this package, estates as large as $7 million would be permanently exempt from any estate tax and wealthier estates would be taxed at far lower rates. Here’s what the CBPP says:

In contrast to the millions of workers who would benefit from a minimum wage increase, the House proposal to sharply reduce the estate tax would benefit only about 8,200 estates [and]…would yield an average of $1.4 million for the 8,200 beneficiaries.

How much would that cost the U.S. Treasury? At least $753 billion, in the first 10 years the estate tax cuts are in full effect, according to CBPP.

Sen. Edward Kennedy (D-Mass.), chief sponsor of a bill to raise the minimum wage to $7.25 an hour, calls it “political blackmail” to say that the only way minimum wage workers can get a raise is to give tax giveaways to the wealthiest Americans:

Members of Congress raised their own pay—no strings attached. Surely common decency suggests that minimum wage workers deserve the same respect.

The Senate could take up the House estate tax cut-minimum wage bill on Wednesday—the 10th anniversary of the last time Congress passed a minimum wage increase. Senate Minority Leader Harry Reid (D-Nev.) says Democrats will fight to block the estate tax giveaway:

The Senate has rejected fiscally irresponsible estate tax giveaways before and will reject them again. Blackmailing working families will not change that.

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