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You don’t have to dig too deep into President Biden’s Build Back Better bill to see special interests getting their piece of the $2 billion dollar pie. The winners include labor unions, trial lawyers, and the rich.
First, the labor unions will benefit from one of the biggest provision in the legislation: universal child care. Everyone making less than $50,000 would basically get free child care. The federal government is going to pick up 90% of all child care expenses under this bill, but there’s a catch. You have to be an approved, recognized child care provider, and you must adhere to specific hiring requirements to get on the government payroll. For example, the bill stipulates that everyone providing child care must be paid the same amount as elementary school teachers in their area. Well, that’s a big difference. Elementary school teachers on average make around $61,000. Child care providers make only about $25,000. So this will more than double the cost of hiring people to work in child care centers.
In addition, there are a whole bunch of licensing requirements. Effectively, you’re gonna need a college degree in order to work in a child care center.
Well, when you start putting all of these provisions in and you push up the amount of the wages, then you suddenly make unions attractive because the union is there to represent people with particular interest, particular skill sets.
And you don’t have to worry about competition from non-union people because they don’t qualify for the jobs. In fact, the District of Columbia, which was looking at a similar provision, estimated that child care costs to people will double with that kind of provision in place.
Energy efficiency provisions which would give you $14,000 to update your house are also going to give an edge to labor unions.
I think that’s a great idea, way of saving energy, but there’s an exception. In order to get the $14,000 credit, you have to hire a union firm in order to do the work. Well, 95% of these people who actually do that kind of work are not unionized. They’re basically mom and pop operations. They often hire family members. Your typical construction crew, well they’re out of luck.
How about trial lawyers? A special tax provision would save them about $2.5 billion dollars. And as for the rich, people in the top 1% would get an average tax cut of more than $14,000. Everyone else gets an average tax deduction of $214.
So the effect of this bill is actually much different than what people think. Special interest power is well entrenched in the bill, and we’re just gonna have to see whether the special interests in the end prevail.
We’ll see how this all plays out after the first of the year. Since Senator Joe Manchin (D-WV) said he wouldn’t vote for the bill, White House officials are working to come up with yet another version of the president’s signature legislation.
