Bernie Sanders is going after large corporations with low wage employees with his Stop Bad Employers by Zeroing Out Subsidies, a tribute to Amazon CEO Jeff Bezos. The bill being introduced by Sanders and Rep. Ro Khanna will be targeting companies who employ low earning workers that qualify for government support such as public housing, food stamps, and Medicaid.
What the bill is planned to do is tax these companies by 100% of the benefits their low wage employees earn. The hope of the bill is that to avoid the tax, companies will raise their wages for those workers and enable them to be disqualified for government help by raising their yearly income to a livable amount. Sanders is calling this “corporate welfare” to hold companies accountable for their employee’s poverty.
Sanders announced, “Our legislation gives large, profitable employers a choice: Pay workers a living wage, or pay for the public assistance programs their low-wage employees are forced to depend on.” The issue with this idea and the concept of the bill is that companies are not being forced between the two options Sanders claims, there is a third more obvious one – these companies being targeted can simply not hire people on government welfare programs. This way, they get out of paying the 100% tax on welfare and do not have to raise their payroll bill.
The bill tries to refute this thought by making it illegal for hiring companies to question potential employees on whether or not they receive government benefits. However, as Andy Pudzer of the Wall Street Journal points out, “But how hard is it for a hiring manager to distinguish between an unemployed 20-year-old living with her parents and an unemployed single mother living with her children or a father of four who’s been out of work for months?” And sadly, he has a point. No matter who you are or who your background is, people inherently judge and stereotype everyone around us, and a hiring manager for a company is no exception.
Based on the profit-driven ideals of large companies, one can take a guess as to how America’s corporations will respond to this bill. Even if a company decides to give its welfare workers a raise, they will give the bare minimum raise so that the worker no longer qualifies for government benefits but still has not enough income to support themselves while the company will no longer have to pay the tax.
The bill, in theory, is well founded and intended for good, however, execution of the idea is poorly planned. Should this bill become law, corporations will discriminate against prospective employees who receive welfare, or they will raise their compensation just enough to raise their current employees out of governmental “poverty” to avoid the tax but leaving the employee still unable to make ends meet. The idea of the bill is a step in the right direction, the execution of the bill is a setup for disaster among the impoverished working class.