Sen. Bernard Sanders, wielding new power as the chairman of the Budget Committee, outlined a plan Wednesday to tackle income inequality by hammering corporations with higher taxes if their CEOs make 50 times more than their average workers.
Mr. Sanders, an avowed socialist from Vermont, also used his committee to spotlight a unionization drive at an Amazon distribution center in Alabama and demonize the company’s billionaire CEO, Jeff Bezos.
“The very, very rich are getting much richer while millions of Americans are struggling to put food on the table and meet their basic needs,” Mr. Sanders at a committee hearing on income inequality.
Calling the wealth gap a “crisis,” Mr. Sanders said the divide between the poor and the rich widened during the COVID-19 pandemic. He pointed to studies that show the nation’s billionaires made more than $1 trillion combined during the public health crisis.
His bid to close the gap between CEO and worker paychecks is part of a broader push by Democrats to raise taxes now that they control the White House and both chambers of Congress.
President Biden has promised that taxes will go up on the wealthy and corporations.
Republicans disagreed with Mr. Sanders’ soak-the-rich approach to income disparities.
“Sometimes some of what Bernie says has merit, but he lives in an unreal world about how to fix these problems,” Sen. Mike Braun, Indiana Republican, told The Washington Times.
The Sanders bill, which is titled the Tax Excessive CEO Pay Act, includes:
• Public and private companies would all see higher tax bills, but tax rates would go up more for those companies where CEO paychecks dwarf the median pay of employees. At a minimum, the tax rate would increase by 0.5% for companies where CEOs make between 50 to 100 times more than their workers. The increase would be higher for companies with a wider gap, such as a 4% increase if the CEO makes more than 500 times more than workers.
• Private companies would have to begin disclosing to the Securities and Exchange Commission the ratio between the pay of their CEO and the median of their workers. The 2010 Dodd-Frank Act only required public companies to disclose the gap.
• For companies where the CEO is paid little or nothing, the corporate tax hike would be tied to the difference between the highest-paid employee and the median of all employees.
If enacted, the bill is projected to raise $150 billion in tax revenue over a decade.
Mr. Bezos declined an invitation to appear at the hearing.
Had Bezos been there, Mr. Sanders said he would have told him: You are worth $182 billion. You are the wealthiest person in the world and you are doing everything in your power to stop your workers in Bessemer, Alabama, from joining a union.”
He then gave a stage to Jennifer Bates, an Amazon worker leading the unionization effort.
“Amazon brags it pays workers above the minimum wage. What they don’t tell you is what those jobs are really like. And they certainly don’t tell you that they can afford to do much better for their workers,” she said. “Working at an Amazon warehouse is no easy thing. The shifts are long. The pace is super-fast. You are constantly being watched and monitored. They seem to think you are just another robot.”
Jacking up taxes for companies with rich CEOs is just one step that needs to be taken, Mr. Sanders said. He also wants to raise the nation’s minimum wage and strengthen the rights of workers to unionize, create more green jobs and guarantee the right to health-care coverage.
The ideas are opposed by Republicans who can block most legislation in the evenly split upper chamber. Democrats, however, can force through some tax and spending measures in party-line votes, as they did with the $1.9 trillion COVID-19 rescue package.
Democrats also are considering changing rules that require 60 votes to advance most bills so they can ram through their liberal wishlist.
Sen. Lindsey Graham of South Carolina, the top Republican on the committee, said the focus on the wealth gap was misplaced. He cited a Gallup poll that found Americans are far more concerned about the pandemic than income inequality.
“Most don’t think about how to take from someone else but how to get ahead,” he said.
Still, Mr. Graham agreed with Mr. Sanders about taking on Mr. Bezos.
“Most of us don’t want a consolidation of wealth and power in the hands of the few,” Mr. Graham said. “The question for me is: have we let too much power lay in the hands of big tech.
“Have we allowed the new technology to become the modern version of robber barons,” he said. “I don’t know if we need to break these up.”
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