Congressional Democrats on Tuesday introduced legislation that would raise the federal minimum wage from $7.25 an hour to $15 over the next five years.
Senator Bernie Sanders (I., Vt.), the incoming chairman of the Senate Budget Committee, said of the proposed increase, “In the richest country in the history of the world, if you work 40 hours a week, you should not be living in poverty.”
“Minimum wage must be a living wage, enabling people to live with dignity. It is unacceptable that Congress has not passed an increase in the minimum wage since 2007 — 14 years ago,” he added.
President Joe Biden has also included a provision to boost the federal minimum wage to $15 an hour in his $1.9 trillion COVID-19 relief plan. Last week he signed an executive order directing the Department of Labor to draft recommendations on increasing the minimum wage to $15 for federal workers.
While Republicans have widely opposed the $15 minimum wage, arguing that it would burden small businesses and kill jobs, Sanders indicated he believes passing the $15 minimum wage measure could be done through budget reconciliation, allowing Democrats to pass the bill as part of taxing and spending policies with a simple majority, avoiding a Republican filibuster.
While the budget reconciliation process can technically be used to make policy changes that significantly alter federal spending or revenue, using it to push a minimum wage hike would represent a significant departure from norms that could allow a future Republican majority to push through major policy changes without standalone legislation.
The break with tradition is already making some Democrats hesitant to embrace Sanders’ strategy.
“I’m not sure it’s the smartest thing to do,” House budget chair John Yarmuth (D., Ky.) told Politico.
“The bottom line, I think common sense makes this point: If millions of workers receive a pay increase, there will be less dependency on public assistance, which will have a significant impact on the deficit, which means that it should be considered as part of reconciliation,” he said.
Without reconciliation, the measure would have a tough time passing the evenly divided Senate, as it would require support from all 50 Democrats and 10 Republicans.
In 2019 the Democrat-controlled House passed a bill to raise the federal minimum wage to $15 an hour, but Republicans opposed the bill, saying it would devastate working families.
That same year, the Congressional Budget Office found that raising the federal minimum wage would, in 2025, grow the earnings of 17 million workers, potentially raise wages for roughly 10 million others and bring about 1.3 million people above the poverty threshold. However, another 1.3 million other workers would become jobless.