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Minimum advantage


Recently it has become clear that the only way Congress will consider a bill to raise the minimum wage -- favored by 83 percent 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.

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, manufacturers, restaurant chains and such. 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. "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. The restaurant and hotel industry, which invested $9.5 million in candidates and soft money contributions in the 1997-98 cycle, will likely get an increase in the business-meal tax deduction that will cost taxpayers $11.6 billion over 10 years. Other sweeteners include increased tax credits aimed at helping businesses hire entry-level workers (cost: $2 billion over five years).

Clearly, even the most popular legislation aimed at working people gets held hostage to wealthy special interests.

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