Sen. Sanders and Rep. Khanna at their press conference.
Bernie Sanders wants to end corporate welfare. The Independent Vermont Senator was joined by California Democrat Ro Khanna in introducing a new bill, Stop Bad Employers by Zeroing Out Subsidies, or the “Stop BEZOS” act. The bill is clearly aimed at Amazon’s CEO, the richest man in modern history, Jeff Bezos. However, it targets Walmart, fast food corporations, and other large corporations. The idea is to end corporate welfare, that is, the practice of paying employees so little that even a full-time employee must rely on welfare and food stamps to make ends meet.
The bill would tax corporations with 500 or more workers 100% for every dollar an employee receives in public welfare. Right now, tax payers are subsidizing the wages of Amazon, Walmart, and McDonalds employees. This bill would force corporations to pay their employees enough to keep them off of welfare. It would also reduce the burden of American taxpayers to pay for these missing wages through public assistance programs like food stamps and welfare.
Amazon just crossed the trillion dollar mark, and Jeff Bezos is the richest man in the world. Surely they can pay their employees enough to eat without relying on taxpayers to pay for their meals, right?
Stop BEZOS: What Does it Do?
The idea is simple: the American taxpayers shouldn’t pay $152.8 billion per year just so corporations can continue to undercut employee wages. These large corporations are paying their employees and contractors below the poverty line, and making them work just enough hours to not receive benefits, but not so little to give them time for a second or third job. The onus of employee welfare is passed on the the American taxpayer. Effectively, Americans pay more in taxes so the largest corporations in the world can continue to pay their employees below the poverty line.
If someone works all day at a restaurant they should be able to buy food for their families. Unfortunately, that is not the case. The Stop BEZOS act would set out to ensure that the world’s most profitable companies share their success with the employees who make those profits possible. It does this by taxing them 100% for every dollar an employee gets from the state. Effectively, it forces companies to pay their employees a living wage. Taxpayers would be off the hook.
Criticisms
Some have pointed out that the Stop BEZOS act is misguided. It’s a roundabout way to achieve change, which leaves gaps for corporations. These gaps could hurt the very people Sanders and Khanna want to help.
Corporations could stop hiring people who are statistically more likely to require assistance. Though this would be illegal discrimination, it’s on the burden of the applicant to prove an employer discriminated. It’s an extremely difficult to prove this, and is why we still see discrimination in hiring practices, even when it’s merely subconscious bias. The tech industry is a perfect example of these biases, which have largely kept people of color, women, and gender and sexual minorities out of the industry and out of management.
A 20 year old living alone making Amazon’s low wages would be less likely to need public assistance. However, that same 20 year old, if they are a parent, would be more likely to need food stamps for their kids. Older applicants would also be more likely to receive medicaid. Corporations could look at these factors, or subconsciously consider them when hiring.
Corporations would also likely lobby to reduce benefits to employees or increase the standard for welfare. A person would have to be far below the poverty line to receive assistance in this situation. Those who currently rely on these benefits would be exceptionally vulnerable. Sanders’ plan could—and likely would—easily hurt the people it sets out to help.
Good Idea, Poor Execution
No one working full time should rely on taxes from Americans just to put food on the table. This bill holds corporations accountable for their low wages, and, hopefully, would prevent companies from forcing their employees into poverty. Unfortunately, companies would find a way out of it. Furthermore, Republicans would block this bill.
That’s the real problem here. Sanders has made it clear: he wants to increase the minimum wage so people can afford to live in this country and feed their families. However, Republicans have blocked every attempt to do. $15/hour was passed in Vermont, only to have the Republican governor veto the bill. Full-time employees will continue to live below the poverty line until we’re able to adjust the minimum wage to account for inflation and increasing stress placed on families.
Stop BEZOS would never work. Republicans would block the bill. Even if it did pass, would likely either backfire or corporations would find ways around it. But perhaps it was made to fail. Perhaps Sanders and Khanna only want to raise awareness about extreme wage gaps in America, in a push for a real solution: an livable minimum wage.
Sources:
- Bob Bryan, Business Insider
- Jillian D’Onfro, CNBC
- Bryan Menegus, Gizmodo
- Catherine Rampell, The Washington Post
- Emily Stewart, Vox