Votes on Biden-Package Measures Start Tuesday: Stimulus Update
(Bloomberg) -- The first committee votes on elements of President Joe Biden’s $1.9 trillion Covid-19 relief package begin on Tuesday, House schedules showed. Biden’s proposed minimum-wage hike is likely to be trimmed back by lawmakers, according to analysis from Goldman Sachs Group Inc. highlighting the political challenges of the push.
The House Education and Labor Committee, with jurisdiction over school reopening funds, workplace safety standards and any minimum wage increase, tentatively set Tuesday for its vote. Biden said in a CBS interview Friday a wage increase “apparently” wouldn’t be part of the package due to Senate rules. Goldman analysts said a standalone bill phasing in an increase to $10 to $11 an hour is “more politically realistic” than Biden’s $15 proposal.
Progress made by committees this week will prove critical in determining whether Congress can keep to the objective of passing the final bill by the mid-March expiration of some current unemployment benefits. Goldman on Monday bumped its forecast for the stimulus up to $1.5 trillion from $1.1 trillion.
House Committees Set Schedule for Biden’s Bill
Committee meetings to detail the elements of Biden’s $1.9 trillion pandemic relief bill are set for this week, with so-called mark-up votes kicking off as soon as Tuesday.
“At this stage, we will learn much more about the details, size, and timing, of particular provisions,” Goldman Sachs Group Inc. economists wrote in a report Monday. After Democratic leaders last week moved forward with a legislative path that doesn’t need Republican support, the bank boosted its forecast for the spending package to $1.5 trillion from an earlier $1.1 trillion estimate.
Following is the current schedule for House panels, according to a senior Democratic aide:
- Education and Labor: Feb. 9th, afternoon
- Transportation and Infrastructure: Feb. 10th, 11 a.m.
- Financial Services: Feb. 10th, 12 p.m.
- Agriculture: Feb. 10th, 2 p.m.
- Small Business: Feb. 11th
- Veterans Affairs: Feb. 11th
- Energy and Commerce: Feb. 11th
- Oversight and Reform: Feb. 12th
- Ways and Means: Feb. 10th, 11th and 12th
The Transportation Committee will vote on renewed payroll aid to airlines according to chairman Pete DeFazio. The Agriculture Committee has jurisdiction over the expansion of food stamps and school lunches Biden has called for. Energy and Commerce will work on Covid-19 vaccine and related health-sector spending, while the Ways and Means Committee has a focus on stimulus checks and increased child and earned income tax credits. -- Erik Wasson
Goldman Sees Hike in Minimum Wage to $10-$11 More ‘Realistic’ (9:15 a.m.)
Goldman Sachs Group Inc. analysts estimated that a hike in the minimum wage to $10 to $11 an hour is more likely than the Biden administration’s $15 proposal.
“A key obstacle is that a $15 federal minimum would affect states quite differently, and Democratic senators from some lower-wage states have not yet signed on,” Goldman economists Laura Nicolae, David Mericle and Alec Phillips wrote in a note to clients Monday.
The Goldman team doubted that an increase in the federal minimum wage, currently at $7.25, could be shaped to qualify for inclusion in the stimulus package Congress is now considering.
The process Democratic leaders are using, known as reconciliation, requires that all measures have a fiscal impact. While a minimum-wage boost could be written to assure a fiscal effect -- such as imposing a tax on employers if they didn’t comply -- such a maneuver could end up widening lawmaker opposition, Goldman analysts wrote.
The House Education and Labor Committee, which has jurisdiction over the minimum wage, meets to vote on its portion of the Covid-19 aid bill Tuesday.
The bank noted that past increases in the minimum wage -- in 2007, 1996 and 1989 -- occurred well into an economic expansion phase, and when the jobless rate was relatively low.
“The current environment is economically and politically different to any of those experiences, and we think Congress is fairly unlikely to pass a minimum wage increase this year,” the Goldman analysts wrote. “If lawmakers were able to reach a compromise, it might be in the $10-11 per hour range. We would expect any increase to phase in no faster than around $1 per year.”
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