From WAPO: 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
Topics:
Eric Kramer considers the following as important: politics, US EConomics
This could be interesting, too:
NewDealdemocrat writes Real GDP for Q3 nicely positive, but long leading components mediocre to negative for the second quarter in a row
Joel Eissenberg writes Healthcare and the 2024 presidential election
NewDealdemocrat writes JOLTS report for September shows continued deceleration in almost all metrics, now close to a cause for concern
Angry Bear writes Title 8 Apprehensions, Office of Field Operations (OFO) Title 8 Inadmissible, and Title 42 Expulsions
From WAPO:
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 . . .