Citizens for Tax Justice (CTJ) has a note on the tax cut bill attached to the minimum wage attached to the war spending bill that the House and Senate have passed based on the Baucus-Rangel agreement. Note the language in the Ways and Means release: "tax relief so our small businesses can continue to hire new workers and promote economic growth in our communities." As though these businesses would fall apart if they all paid everybody not even $8.00 an hour for their labor without almost $5 billion over 5 years in tax breaks to make it possible, in addition to the hundreds of billions in business tax breaks they've received over the last ten years.
We cut taxes to give tax "relief" to big business and its wealthy owners (in the form of everything from reduced Subpart F taxes for multinationals and big banks to hugely reduced capital gains taxes on the main sources of income of most of the ultra-wealthy owners and managers of those multinationals and banks), so we borrow money to pay for government programs that can't be funded because of the tax cuts for the rich, so the Japanese and British and Chinese who own lots of our debt start to put more of their dollars into Euros so we won't be able to borrow money at this rate indefinitely, so we talk about cutting social insurance programs like Social Security and Medicare and Medicaid so we can pay for the tax cuts we gave to the rich. We decide rightly that we really ought to ensure that those who labor earn something less short of a living wage than they currently do so we decide to raise the minimum, but we can't do that without providing more tax "relief" to business (oh, this time it's "small" business--like those regional banks that get the break of being able to operate in (tax-cheap) S-corp form even though their managers have lots of special types of restricted stock.....).
Doesn't this sound like something from that old nursery rhyme about "The House that Jack Built"? Doesn't that very structure bring into question the process by which policy seems to be made these days in Congress--the backscratching isn't just the rather lamentable tradeoffs of one Congressperson's important goal to achieve traded for another Congressperson's important goal to achieve (presumably, in each case, on behalf of a reasonable segment of their constituents) but rather the ability of business to hold up for tax ransom anything to be done on behalf of those that are typically disempowered by our society (often by the actions of those very businesses who hire and then fire their workers as so many disposible commodities). After all, isn't it a form of exploitation when companies like Wal-Mart can hire experienced adult workers for very low wages with very few benefits in spite of the company's steady profits and global clout against suppliers that have contributed to the enormous wealth of each of the Wal-Mart heirs (worth, as I recall in the billions apiece)? Yet it now appears that businesses have the right to demand "compensation" whenever government acts to protect ordinary Americans from exploitation by those who are making the most money out of a growing economy.
See the following excerpt from CTJ's eNewsletter, with CTJ links intact.
While the new $4.8 billion level that both Baucus and Rangel have agreed to is a breakthrough, it is nonetheless disconcerting that several Senators on both sides of the aisle seem to believe that business should be "compensated" for raising the minimum wage from its lowest real purchasing power in 50 years. As we've pointed out before, business has received $273 billion in tax breaks since the last minimum wage hike in 1996. Remarkably, some members of Congress who are hostile to minimum wage legislation, such as Charles Grassley (R-IA), are actually complaining that the tax breaks are not big enough.
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