WASHINGTON — The Democratic Party wants to pick a fight with corporate America to win back Congress.
The big ideas in the economic agenda that congressional Democrats unveiled on Monday, including a higher minimum wage and lower drug prices, are aimed at reclaiming the party’s populist mantle from President Trump.
Senator Chuck Schumer of New York, the driving force behind this “Better Deal,” said that Mr. Trump won the presidency by promising to help working Americans, only to abandon them. The Democrats are now hoping to reclaim Congress by making a number of the same promises to the same people.
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“Old-fashioned capitalism has broken down to the detriment of consumers,” Mr. Schumer said on Monday afternoon in Berryville, Va., about an hour west of Washington.
Yet there were some striking omissions in the plan. There was no talk about health insurance beyond prescription drug prices. There was no discussion of trade policy beyond a placeholder sentence promising more details later; Mr. Schumer’s office said Democrats planned to roll out a detailed trade agenda in the fall. And party leaders did not embrace liberal concerns about the outsize economic role of the financial industry.
The focus, instead, was on a fairly small set of battle-tested ideas. And though Senator Bernie Sanders of Vermont was not present on Monday, the imprint of his presidential campaign was unmistakably present. Democrats proposed to raise the federal minimum wage to $15 an hour — an idea the party’s 2016 nominee, Hillary Clinton, never heartily embraced.
The “Fight for $15” has energized parts of the Democratic base, and it has racked up impressive victories in states including New York and California and cities from Seattle to Washington. But raising the price of work could reduce demand for workers, and some economists see a particular danger in states like Alabama, where average wages are lower and employment has not recovered from the 2008 recession.
Seattle raised its minimum wage for many workers to $13 an hour last year, en route to $15 an hour for all workers by 2021. A pair of studies published last month reached opposite conclusions about the impact, fueling the debate. Economists at the University of Washington said the change had significantly reduced minimum-wage work. Economists at the University of California, Berkeley, found little impact on employment.
Democrats also proposed new tax credits for job training, an old idea that has been tried many times before.
The party’s proposal to reduce the cost of living was its freshest set of ideas. That part embraces an emerging concern among liberal economists and activists that corporate concentration is damaging the American economy.
Since the early 1980s, the federal government has intervened to prevent mergers only when there was clear evidence that consumers would be harmed, giving consolidation the benefit of the doubt. That has allowed a few giant companies to dominate industries including air travel, cable television and the eyeglasses business.
The pace of corporate mergers reached a peak in 2015. The next year, the Obama administration published a report arguing that the economy was suffering from a dearth of competition. Other studies found that consolidation is not only driving up prices but also causing other problems, including reduced investment in innovation.
“This matters because giant corporations jack up prices and cut corners on quality,” said Senator Elizabeth Warren, the Massachusetts Democrat who has been a highly visible advocate of the issue. She said at the event on Monday that consolidation also allowed corporations to increase profits while holding down wages, and to exercise outsize political influence.
The Democrats proposed changing the merger rules, instructing regulators to presume that consolidation is bad for consumers. They suggested the creation of a federal office, a “consumer competition advocate,” that would report problems to regulators.
The idea replicates the party’s strategy of creating an independent Consumer Financial Protection Bureau after the financial crisis. Democrats regard existing agencies as overly beholden to corporate interests and insufficiently attentive to consumer abuses. The creation of the protection bureau, in 2010, removed those responsibilities from the Federal Reserve and other agencies charged with overseeing the health of the financial system. And Democrats view that agency as a success story; it has aggressively pursued a range of measures to protect financial consumers.
But the emphasis on new protectors, rather than improved performance, raises the question of why existing agencies cannot be relied upon. The Federal Trade Commission, for example, was created to protect consumers and police anti-competitive behavior. The Democrats are essentially creating a new arm of government to make sure that an old arm of government fulfills its duties.
Democrats also took on the pharmaceutical industry, proposing a number of measures they said would help reduce the cost of medications.
One proposal would give Medicare greater latitude to negotiate drug prices, an idea that Mr. Trump has also endorsed. The intuitive appeal is clear: Medicare’s drug plans cover more than 40 million people — surely it can obtain a decent group discount.
But experts including the Congressional Budget Office and Medicare’s actuary see little upside in the change. The government requires Medicare to cover nearly every approved treatment for cancer and a range of other conditions. Since Medicare cannot say no to drug companies, it lacks the leverage to negotiate effectively.
Democrats also proposed the creation of a federal agency that would police drug prices, “dedicated to stopping this outrageous behavior in its tracks.”
But the broader reality is that the federal government has sought to encourage innovation by codifying the industry’s profitability, for example by maintaining stronger intellectual property protections than drug companies enjoy in the rest of the world.
On that, the Democrats did not propose any fundamental changes.