MINIMUM WAGE, MAXIMUM GALL

In the last few days, it has become clear that the only way Congress will consider a bill to raise the minimum wage--favored by 83% of the public according to the latest ABC News poll--is by tying it to tens of billions of dollars in tax breaks for big campaign contributors. America may deserve a raise, but only if special interests get one too, it seems.

This is deja vu all over again.

Back in 1996, when Congress voted to lift the minimum wage 90 cents an hour, to $5.15, business interests extracted $21 billion in custom-designed tax benefits. While the politicians harped on what they were doing for working people, the fine print actually did a lot more for pharmaceutical companies, big manufacturers, soft-drink makers, restaurant chains and convenience store owners. According to The Washington Post, these interests gave more than $36 million in campaign contributions in the previous election cycle to the members of the House Ways and Means Committee and Senate Finance Committee who wrote that fine print.

Now the same dynamic is at work, except that business interests and their congressional allies have gotten bolder--having seen how easy it is to tack their pet proposal onto the highly popular minimum wage issue. "Instead of having a spoonful of sugar to help the medicine go down, some of our Members would like a wheelbarrow of sugar," says a spokesman for House Ways and Means Chair Bill Archer (R-TX). "People realize this tax bill is leaving the station," says Lee Culpepper, vice president of the National Restaurant Association. "They're going to start coming out of the woodwork with their tax proposals."

Thus, a bipartisan group of House members is about to propose a bill that ladles out $35 billion in sweet business tax breaks, while spreading out the dollar increase in the minimum wage over three years, rather than two as urged by proponents. There's a dollop for the restaurant and hotel industry, which has invested $9.5 million in candidates and soft money contributions in the 1997-98 cycle. They'll likely get an increase in the business meal tax deduction that will cost the taxpayers $11.6 billion over the next ten years. Other sweeteners include an increase tax credits aimed at helping businesses hire entry-level workers (cost: $2 billion over five years), and full deductibility for small businesses health care expenses (cost: $3 billion over five years).

Overall, when it comes to campaign contributions, business donors outspend labor interests by a factor of eleven to one. With that kind of influence, even the most popular legislation aimed at working people gets held hostage to the needs of wealthy special interests.