Stimulus Work Continues Through Reconciliation Process

This is my update for Thursday, February 11th. Biden is coming under more and more pressure from the left wing of his party to take action toward the $15 federal minimum wage, which is seen by many progressives as a crucial step toward providing a decent standard of living for all workers.

As I’ve said in earlier updates, moderate Democratic Senators are crucial obstacles for the minimum wage increase, there are 50 Democrats in the Senate, so if even one of them votes against a $15 minimum wage then it’s not going to pass without a greater majority. And Joe Manchin, one of the most moderate Senators in the Democratic party, has already indicated that he wouldn’t support bringing the minimum wage up to $15 per hour around the country, for example he supports the $11 minimum wage in West Virginia and he wants other states to increase wages to match their cost of living. But Joe Manchin isn’t the only roadblock here, if you remember my update on Saturday Joe Biden said that he didn’t think the minimum wage would survive, meaning that it wouldn’t be eligible for consideration in a budget reconciliation bill under the rules of the Senate. 

To be clear, Biden still supports the $15 minimum wage, White House spokesman Mike Gwin said “The president is firmly committed to raising the minimum wage to $15….That commitment will remain unshaken, regardless of what is determined to be feasible through the reconciliation process.” So he wants it to happen, he’ll sign it if it makes it to his desk, but it looks more like he’s expecting it to be passed separately rather than being included in the relief bill.

Of course the problem there is that you need 60 Senate votes if you don’t pass it through budget reconciliation, and at least in the current Senate that’s about as likely to happen as Trump is to be impeached. So when Biden indicates that he doesn’t expect it to pass right now, it’s hard to tell when he sees it passing, and progressives don’t want to miss the opportunity to push it through while they have a unified government. Democratic Representative Pramila Jayapal said “It’s a test for how we use the power of having all three, the House, the Senate, and the White House. Let’s not hand-wring over this…we should use every tool in our toolbox.” And similarly, Democratic Senator Bob Casey said “If it cannot be in reconciliation, if that’s the determination that’s made and that stands, it’s really difficult to see it passing and getting 60 votes.” So there will be pressure on the Biden administration to have Kamala Harris cast a tie breaking vote and overrule the parliamentarian if they determine that the minimum wage can’t be passed through reconciliation.

Of course, they will have to find 50 votes just to get to the point where they need a tie breaking vote, so this is mostly hypothetical, but it sets the stage for the negotiation between progressives, the Biden administration, and moderate Democrats who may be skeptical of the $15 minimum wage proposal. Nancy Pelosi indicated today that a minimum wage increase will be included in the House relief bill, and Chuck Schumer said “Senator Sanders and I are working very closely together to overcome the Byrd bath—[by by Byrd bath Schumer is referring to the Byrd rule and the parliamentarian determining which provisions are suitable for reconciliation]—and make sure we do everything we can to see that it survives.”

So there’s a lot of momentum behind this, but it’s hard to say whether it will be enough to overcome the challenges of passing a minimum wage through budget reconciliation with an extremely narrow majority.  Today is also the day for several committees in the House to markup their sections of the stimulus bill, there were three yesterday, and there are three more today with Energy and Commerce, Veterans’ Affairs, and Small Business, so let me get into each of those and what they’ve been working on.

Energy and Commerce chair Frank Pallone gave an opening statement earlier today, their plan calls for $14 billion in funding for vaccine distribution and administration, $25 billion for addressing health disparities, $7 billion for a jobs program that could add 100,000 full-time jobs in public health, and $46 billion for a national testing strategy including rapid tests, increased lab capacity, and community testing sites. They also want to spend $7.6 billion to improve internet access for students and another $5 billion on utility assistance.

Finally, last thing for Energy and Commerce, they want to incentivize states to expand access to Medicaid, so states that newly expand Medicaid will be eligible for an extra five percent in federal funding for two years. The parameters for what counts as “expanding” Medicaid are pretty complicated, the state needs to supplement rather than supplant its existing Medicaid plan, and they need to add at least one of 16 activities to indicate that they’re actually building the program.

So I don’t have time to get into the specific rules here, but the point is that states will be motivated to improve their Medicaid access if they know they can get extra funding.  The Veterans’ Affairs committee obviously has a smaller section of the bill, the full text of their markup is under 20 pages, it includes funding for supply chain modernization, state care facilities for veterans, and $10,000,000 for the VA Inspector General. They also want to start a program with 12-month retraining for veterans, which will help them pay for school and find work while receiving federal assistance when they start studying at a new school, get their degree, and find a job in a relevant field.  

The Small Business committee also finished their markup, chairwoman Velázquez gave an opening statement describing some of the most important provisions, and the full text of the markup from all three committees will be in the description in case anyone wants to read those in more detail. They want to expand eligibility for the Paycheck Protection Program to digital news agencies as well as 501(c) nonprofits aside from 501(c)(4) lobbying organizations, and they also want to allocate $25 billion for a new Small Business Administration program that would provide aid to restaurants, bars, and other food and drink businesses.

There’s another $15 billion that they want to earmark for Targeted Economic Injury Disaster Loan, that’s EIDL, payments, especially for those who applied and didn’t get payments in 2020. Finally, they want to set aside $840 million for administrative costs related to the Paycheck Protection Program and other grants and forms of aid that they’re working on during the pandemic.

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