The minimum wage bill saw a lot of action in the Senate but few actual results.
As promised, Harry Reid let the Republicans propose a line-item veto amendment on the bill. That was rejected 49-48, but could come back up again because that vote was far less than the 60 needed to invoke cloture and cut off debate.
However, the immediate debate moved on to other grounds, namely Republican insistence that the wage increase be paired with tax breaks for small businesses to help cushion the blow. Senate Democrats are amenable, but the House could force the issue on two fronts: the House bill doesn’t contain tax breaks, and it’s the House’s prerogative to propose tax measures.
The lack of tax breaks led Senate Republicans to block the wage bill, so it’s currently at an impasse.
I would have liked to see the line-item veto pass, but it had its chance and is done. If there’s a reasonable opportunity to revive it, fine, but it should not be used to hold up the wage bill.
Overall, the House should compromise in this case. The proposed tax breaks are reasonable: extending a tax credit for employers that hire low-income workers, and a simplified expense deduction for small businesses. Further, as required by the new pay-as-you-go rules, the $8.3 billion cost will be offset by a cap on tax-deferred executive pay and the elimination of an array of tax shelters. That provision alone is worth the price of admission, as such tax-deferred paydays are at the root of many a tax-avoidance scheme. House Democrats would be foolish to let a fit of pique get in the way of such progress.
Negotiations continue, and the Senate will take another crack at it soon. Let’s hope reason prevails.