Rep. Cindy Axne (D-IA) joins Yahoo Finance Live to discuss providing tax relief to unemployed Americans.
AKIKO FUJITA: For more reaction on the data we got out this morning, let's bring in Congresswoman Cindy Axne, a Democrat from Iowa. Congresswoman-- and Yahoo Finance's Jessica Smith, I should point out, also joining in on the conversation.
Congresswoman, it's good to talk to you today. You have introduced this legislation to provide tax relief for unemployment-- unemployed Americans, but specifically, providing relief on the unemployment benefits they've collected over the last year. I want to see if we can start there. Walk me through the numbers and why you think that this needs to be done right away.
CINDY AXNE: Well, we've got to make sure that we're keeping money in people's pockets. And the first thing that we need to do is ensure that the money that they've received actually goes towards purchases that they need to keep their family afloat. And right now, what we're seeing are folks who have as much as dozens of weeks of unemployment, and they're going to receive a tax bill.
And that's going to be a surprise to them. And that's something that they don't expect, and it could really impact their families' finances. And so, we've got to make sure that we're addressing that. This bill would allow us to write off the first $10,200 of that unemployment insurance and not receive a tax bill on that, something that I think Americans are really needing right now.
JESSICA SMITH: Hi, congresswoman, Jessica Smith here. What's been the reaction from your colleagues? Do you expect this to end up in the stimulus package?
CINDY AXNE: Well, you know, we'll try to get it in the stimulus package. If not, we've got an opportunity, of course, to just pass it on its own. I think there's great support for this. Certainly, Senator Durbin, on the Senate side of things, is pushing this. He knows what a common sense bill it is.
And when I've discussed it with my colleagues and I put a text out, for example, just to discuss it, folks are like, sign me up. I want to be on this bill. So I know that there's a heck of a lot of support for this. It's just something that's needed right now. And it's a great way for us to be able to keep money in people's pockets.
JESSICA SMITH: Do you think this is something that needs to be a long-term change, not just focused on the pandemic, but looking at unemployment benefits beyond?
CINDY AXNE: You know, really, as somebody who's been on unemployment before-- many of us in this country have-- it is really difficult to get a tax bill on those unemployment wages that you received. Now, do we need to support our taxes, our tax base? Sure, we've got a lot of things that we need to support. And we need the revenue for that. But hitting somebody when they're down is probably not the best way to collect our taxes. And so, I think it is something that we could look at long term.
ZACK GUZMAN: And looking forward to the current discussion here, Congresswoman, I mean, when we looked at where President Biden's $1.9 trillion plan might go, it is interesting to watch kind of the discussions around working with Republicans across the aisle to make good on that promise to bring unity together here. What do you make of that debate right now when we're hearing pushback on the Republican side to maybe change some of the qualifications for those stimulus checks set to possibly go out?
CINDY AXNE: Well, we've obviously, as much as we possibly can, we need to get something done in a bipartisan way. It's how we move things forward more quickly. But we are at a point in this country where if we don't get a decent stimulus check out there, if we don't get the shoring up that we need for our state and local funding for our schools, firefighters, et cetera, we're going to do even more damage to the economy.
So I'm hoping that many of our Republican colleagues understand how important it is to get money in people's pockets to keep our economy up and running, and that they'll get behind this. We're going to do everything we can to push forward a good stimulus bill, one that meets Americans' needs so that we can come out of this.
AKIKO FUJITA: To add to Zack's point, congresswoman, we've heard a number of Republican lawmakers say, look, number one, we need to see the benefits from the stimulus package that was passed in December before we go big on another one. Also, there's economic data that they don't believe necessarily supports the urgency that President Biden has talked about. We're looking at initial unemployment benefits today. The numbers are down, compared to previous weeks. Certainly, a lot of lawmakers point to that and say, that's proof that maybe we should be a little more patient on this. What do you see?
CINDY AXNE: Well, you know, let's just not look at those numbers in a vacuum. There are many people, hundreds of thousands of people, who have left the job market completely. We know, right here in Iowa, that we have hundreds of thousands of people who are reliant on unemployment and that they're not back in the marketplace right now. They've either lost their job, and they're not looking for one right now because they feel that there is no opportunity for them. And they're not even declaring unemployment.
So I think these jobless claims are one variable, but we've got to look at the picture holistically. Listen, we also know that if we infuse capital into our economy, that we're going to see the return on that. And one of the biggest issues that we had, coming out of our downturn in '08, '09, when I was at the state, was not continuing to infuse capital into our economic system. And we saw prolonged unemployment. And we saw a lot of folks who were underemployed for a heck of a long time. We don't want to see that again.
JESSICA SMITH: I wanted to ask about the minimum wage debate. Clearly, it's going to be a tough sell, even if Senate Democrats move forward with reconciliation, trying to get this done. We heard from Senator Manchin, who said he would not support $15 an hour. Would you back something lower than $15 an hour?
CINDY AXNE: You know, I think we need a $15 an hour minimum wage. We need to make sure that it works for every single business in this country as well. It's very different here in Atlantic, Iowa than it is in Seattle or Chicago. And as a matter of fact, I posed this question to some restaurant owners in Atlantic who said this would be really difficult for them.
So I think we can move in the direction of $15 an hour, use a gradient program to get that put into place. But I do believe that we should look at regions and industries and determine if they're going to be able to stay alive and provide jobs when it moves to $15 an hour. There may be additional incentives that we need to provide for some of our smaller businesses, some of the different industries, possibly the service industry.
And we should look at that, whether those are tax incentives or tweaks in policy. We have to manage this with raising the minimum wage for every single person in this country because it's needed, but we also have to make sure that we retain jobs at the same time. And that's why we need to look at this more closely and make sure that we really cover all those details.
ZACK GUZMAN: Yeah, the recovery and what's done to really boost that, obviously, very important right now, stimulus, the discussion in topic or in focus right now. Looking a little bit farther out to a topic important to people there in Iowa, on the farming front, I'd be curious to get your take on what you hope to see maybe shift in the discussions between Biden's camp and China on the trade front. We know that that was an area of focus for President Trump.
But in those discussions and the way that farmers specifically in Iowa are treated, what do you want to see maybe done differently to reach the end results that it seems like President Biden is also on the same page with what we saw with President Trump, at least in some items? But what are you specifically looking to change there?
CINDY AXNE: Well, you'll never hear an Iowan say anything different than we want trade, not aid. And unfortunately, the Trump administration relegated our farmers to living off of aid for far too long because they couldn't get this trade deal done. Certainly, we need to protect our intellectual property. We have to ensure that our trade secrets are proprietary, that they're not used against us in undercutting our products that we produce here. And so, that's a big issue. And we need to continue in that vein. And I do support the Trump administration for the approach that they took to address that issue.
But what's happened during all of this is that we've lost so much business. You know, we've lost 15% of our soybean market. We'll be lucky to get that back in a decade, if that. We've got to reopen new markets. Brazil has stepped in. We've got other folks who are supplying for China. And right now, we are literally on the back burner when it comes to getting the trade that we need from them.
So, what I think President Biden will do is, of course, take the opportunity to expand any of the good trade policies that have already gone through in these negotiations, but certainly pick up those where we're at a standstill. And of course, we have a lot that we need to recoup, and we haven't yet. So it's going to be another-- I think we're going to have to have a really good negotiation to move forward. Right now, we just aren't at where we need to be for Iowa farmers. And we've got to ensure that we've got that trade up and running.
But we also need to open up new markets around the country. And we need-- sorry, around the world. And we need new markets when it comes to things like sustainable agriculture, which is why I'm behind a bill, you know, that helps us create a market for carbon. Let's help our farmers keep nutrients in their soil, keep our-- protect our water quality, and of course, fight back against climate by opening up a new revenue stream to allow them to bury carbon. These are all the initiatives that we should be looking at, in addition to looking at how we can expand trade with China and other countries around the world.
AKIKO FUJITA: Yeah, and it's worth noting that as it stands, China still has yet to meet those commitments that were laid out in the phase one trade agreement. Representative Cindy Axne, Democratic Congresswoman from Iowa, it's good to talk to you today. And our thanks to Jessica Smith as well for joining in on the conversation.