Online NewsHour: The Minimum Wage Debate

WAGING WAR

MARCH 28, 1996
TRANSCRIPT

Both houses of Congress took up the issue of raising the minimum wage. Senate and House Republicans rebuffed attempts by Democrats to increase the current wage by ninety cents over the next two years. Jim Lehrer discusses the possibility that an increase would result in higher unemployment overall.
JIM LEHRER: The debate over raising the minimum wage is first tonight. This afternoon, Republicans in both the Senate and House beat back Democratic efforts to force a vote on the issue. The Democratic proposal would raise the $4.25 an hour minimum wage to $5.15. Here to debate the proposal for us are two Senators, Edward Kennedy, Democrat of Massachusetts, Don Nickles, Republican of Oklahoma. Senators, welcome. Senator Kennedy, why should the minimum wage be raised?
SEN. EDWARD KENNEDY, (D) Massachusetts: Since 1938, Republicans, Presidents and Democratic Presidents believed, as I think the American people do, and that is for Americans who work 40 hours a week, 52 weeks of the year, they ought to be able to be rewarded with enough income to be out of poverty. There ought to be a livable wage, and that is what this battle is all about. Whether those on the lower level of the economic ladder are going to be able to have a decent income to be out of poverty, that's basically the issue.
We have done that at other times. President Eisenhower increased the minimum wage. President Nixon increased it, and President Bush has. And now we believe that those individuals who are at the bottom level of that ladder ought to be able to have a livable wage. I think most Americans agree.
JIM LEHRER: When was the last time the minimum wage was raised, Senator?
SEN. KENNEDY: 1989. And since 1989, as you will see, the value of the minimum wage in terms of wage, in terms of the purchasing power is at a 40-year decline. And the other point that is significant is after the passage of the minimum wage, it didn't mean a job less, it meant expanding of the job opportunities. The final chart shows that what we have seen now is the stock market going up through the roof. That's good.
People ought to be able, with investments, ought to be able to benefit from those investments, but we have seen is the minimum wage--excuse me--the minimum wage has been going right on down, and the stock market has been going right on up. We think we ought to have a livable wage for hard-working Americans, 2/3 of which are women, 70 percent, 60 percent are grown-ups, and this is an issue that affects women, but it also affects children. It's a basic issue of economic dignity, and today, 55 members of the United States Senate, Republicans and Democrats alike, voted for an increase, and it's about time that Bob Dole lets up and does what he's done at other times five years ago and help lead the United States Senate to an overwhelming vote. At that time, there were only eight Senators who voted against it. It's time that we get back to that kind of bipartisanship on an issue of fundamental decency and equity.
JIM LEHRER: Sen. Nickles, why are you opposed to this?
SEN. DON NICKLES, (R) Oklahoma: Well, Jim, I very much want wages to go up, but I don't want Sen. Kennedy and the others to pass a bill that says it's against the law for you to have a job if you make $5 an hour. And that's exactly what it is, and so--and first, I have to say this is not really about increasing minimum wage.
This is about politics, nothing but real crass politics. My colleague, Sen. Kennedy, and the Democrats, they controlled the House and the Senate in 1993 and 1994, had the White House with Bill Clinton, but they didn't offer it then. They offer it now. They offer it now trying to embarrass Bob Dole. They're trying to score political points. Organized labor was in town this week. They said they're going to give $35 million, an unbelievable amount, in independent expenditures in campaigns, and here's a pay back.
This is nothing about politics. They know it's not going to pass. They're trying to score political points. That's their right, but they're using, I think, people, and maybe the low-income people, somewhat to their disadvantage, to score political points, but the main thing as far as the substance of the issue, to have a 21 percent increase in the minimum wage, and my colleague says it is not going to increase unemployment. I disagree. If there's no negative economic impact from a big increase in minimum wage, let's do it, let's do it more. Let's double it. I want people to make $10 an hour.
Why should they be limited to $5? I would like to have a lot more money. But the facts are you can't repeal the law of supply and demand, and if you--if you increase minimum wage significantly, what you're going to do, you're saying it's against the federal law for you to have a job. If the job pays less than that, we're sorry. Uncle Sam says you can't have a job, it's against the law for you to have the job. I think that's a serious mistake, and it hurt the people on the low-income scale that wants to start climbing the economic ladder.
JIM LEHRER: How will that hurt them, Senator?
SEN. NICKLES: Well, it's going to say they can't have a job. There's some jobs out there, Jim--I used to be in one--I used to--I used to be a janitor, and I made minimum wage. You increase the minimum wage a lot, some people aren't going to get those jobs, and maybe that job is sacking groceries, it may be pumping gas, it may be sweeping floors, but if you increase the wage too high, wherever that level is, and it may be $5.25 or something, that's okay for Massachusetts, they already pay $5.25, but we've got some places in Oklahoma our minimum wage is $4.25. We've got some places that I'm afraid won't pay that amount.
JIM LEHRER: In other words, you think--
SEN. KENNEDY: Can I just make a quick comment?
SEN. NICKLES: Well, I think it'll cost these people jobs, Jim, and--
JIM LEHRER: It would eliminate jobs? Sen. Kennedy.
SEN. KENNEDY: When Don was working for the minimum wage, it had the value in today's purchasing power of $6.17. Now at $4.25--
SEN. NICKLES: No, no, no.
SEN. KENNEDY: --that's exactly what it was, $1.25 an hour. That makes the point. That is considerably higher. We want to go up to $5.15. I think Don was worth that at that particular time. Beyond that, we're not looking for a maximum wage, we're talking about minimum wage, not a maximum wage, not a medium wage. What we're basically saying our American families ought to be able that want to work, will work, do work, ought to be able to have a livable wage, so that they don't--
JIM LEHRER: What about--
SEN. KENNEDY: --slip into poverty.
JIM LEHRER: Sen. Kennedy, what about Sen. Nickles' basic point that this will cause jobs to be eliminated, not to help the people who need the help?
SEN. KENNEDY: Well, we've heard that; seven times since the end of World War II we've raised it, and that hasn't been the case. I've shown you the most recent figures from the last time that we raised it, and we saw that the job--the employment line was going up, and that, that's been the fact--you can't really make that. We've got the 12 studies. We'll debate that. Let's just think about the people we're talking about. We're talking about janitors. We're talking about elevator operators. We're talking about cleaning women and men that clean the buildings. We're talking about people that do so much of the difficult, hard work of our society. We have seen the United States Senate raise its salary three times since 1991. We've raised ours by $30,000, and still we have Senators out there that won't even permit a livable wage for hard working people.
JIM LEHRER: Sen. Nickles.
SEN. NICKLES: Jim, I very much want people on the low-income scale to be able to climb the economic ladder, but what we do by increasing minimum wage, we say if for some reason you can't make $5.15 or something, you can't have a job. And I think that's grossly unfair, and the people it really hurts are people, maybe they're trying to get their first job, they're trying to learn a skill, they're trying to get going, and, and to say, well, wait a minute, it's against the federal law for you to have it, if it pays less than that is a serious--
JIM LEHRER: Senator, let me--Sen. Nickles, let me--what is--Sen. Kennedy has cited his charts to prove his point--what is the evidence that raising the minimum wage actually causes jobs to be eliminated?
SEN. NICKLES: Well, I hate to disagree with my colleague, but it will cause job loss. If you increase the price of something, you're going to be pricing some jobs out of the marketplace. I mentioned a couple of them, sacking groceries, and pumping gas.
JIM LEHRER: And there's evidence that that has happened in the past?
SEN. NICKLES: Well, there's no question. Sen. Kennedy, there's 77 percent of the economists say if you have an increase in minimum wage 20 percent or more than that, you're going to lose jobs, estimated hundreds of thousands of jobs, and my point, Jim, if it's not the case, if there's no negative economic impact, let's increase it to $10 an hour. I want everybody to make $10 an hour. Why not? And if there's no economic harm, if it doesn't cost any job, let's just make a minimum wage of $10 an hour. Obviously, common sense says if you do that, you're going to be putting a lot of people out of a job and that's grossly unfair.
SEN. KENNEDY: You see, that isn't held up, Sen. Nickles' point, in terms of facts. What they've seen is, for example, in New Jersey, the Krueger study made by Prof. Krueger--
SEN. NICKLES: That's--
SEN. NICKLES: Excuse me now--showed that actually it increased employment. And you want to know why? That is because people that were outside the job market saw that they could finally get a livable wage and, therefore, they went back in, and it mended expanding opportunities on it. The point is we've increased--most Americans would feel that we shouldn't be paying the wages that they pay in China or in the Far East, if you carry Don's argument out to the point that let's just leave it right down there to the poorest--we shouldn't be having a rush to the bottom. I think most Americans believe that someone that works in our society, plays by the rules, wants to look out after their kids, wants to pay a mortgage, food on their table, educate their kids, ought to have a livable wage.
JIM LEHRER: What about--
SEN. KENNEDY: That's been the way.
JIM LEHRER: What about that basic point, Sen. Nickles, is there just something--if people work hard, they ought to be--they ought to be able to have the benefits of the society, and you can't do it at $4.25 an hour?
SEN. NICKLES: Let me tell you, I very much want people to have that opportunity, but what I'm afraid we're going to do if you keep jacking the minimum wage up too high, some people aren't going to get the opportunity. Instead of having a job, they're going to have no job. And a lot of these are people trying to enter the job market, trying to learn a skill. You price the job up too high, they're not going to have a job. Then they're going to be unemployed. They're going to get in trouble. They might be in crime. That's a bad result.
JIM LEHRER: Let's go back to the politics of the issue you raised a minute ago, Sen. Nickles. Sen. Kennedy, you heard what Sen. Nickles said, that all you Democrats are doing is playing politics, you're trying to embarrass Sen. Dole.
SEN. KENNEDY: Look, first of all, Sen. Nickles points out why did we raise in the last Congress, then we were fighting for comprehensive health care reform. The value of that comprehensive health care reform for a worker was between 40 and 50 cents an hour. We talked with workers. They said they'd rather have the 40 or 50 cents an hour in health care, rather than the increase in the minimum wage. So we responded to that. We were defeated in that first opportunity over a year ago. We tried to bring it up to the floor of the United States Senate, and we were not able to do it. We brought it up in December again. And now we've brought it up a third time. Let me just remind Don, the other day, two days ago, when I was on the floor with Bob Dole, I said, look, just give us any time before June 15th, give us a chance to just vote on this measure, and he would not do so. I don't know why because he supported the increase in the minimum wage.
JIM LEHRER: Why is that politics? Why is that just politics?
SEN. NICKLES: I don't know if you can see this or not, but here's a headline in the paper just yesterday.
JIM LEHRER: Hold it up a little. Yeah, there we go.
SEN. NICKLES: It says AFL-CIO endorses, Clinton approves $35 million political program. They want to elect more Democrats. They want to score points. And the facts are, let me just make a comment. I heard some of my colleagues on the floor today say, well this isn't about politics. And I enjoyed Ted Kennedy, we're friends, and we're debating this issue, and in his final summary, a two-minute speech, he mentioned Bob Dole's name four times. I mean, this is about politics. They know this bill has no chance whatsoever of passing.
JIM LEHRER: Why--
SEN. NICKLES: All they're trying to do is score points.
JIM LEHRER: Let me--here's my point--here's my question. I didn't phrase it well, Sen. Nickles. Why is this an embarrassment to Sen. Dole? I mean, if it's politics, why is it an embarrassment to him?
SEN. NICKLES: Well, I think what--I think they're trying to score some political points. This thing is not going to pass. They know it's not going to pass, and a lot of us in the Senate do not want to pass a bill that says it's illegal for somebody in rural Oklahoma to have a job, $5 an hour. If that's the best job they can get, I don't want Uncle Sam coming in and say, no, you can't have that job. We determined if that job doesn't pay $5.15, you can't have it.
SEN. KENNEDY: The point is--
JIM LEHRER: Sen. Kennedy, Sen. Kennedy, I mean, there is a kind of interesting coincidence here, is it not? The AFL-CIO is having its meeting. It's endorsed the President, then you all do the minimum wage. Is that--
SEN. KENNEDY: Well, first of all, we've offered it over a year ago and again in December, but let me put this out.
JIM LEHRER: All right.
SEN. KENNEDY: There isn't a member in that 13 million members of the AFL-CIO that is down to the minimum wage. They're all above it. So it doesn't really help their workers. I man that is ny--they've got other issues that they are very much concerned about, but basically, they're interested because they're interested in the working men and women, and it's always interesting to me that Don can talk about capital gains out there on the Floor of the Senate. We can't talk about the minimum wage issue. It just doesn't make a great deal of sense. The reason we talk about Bob Dole is because in 1989 Bob Dole was instrumental in making sure that we were going to have a bipartisan increase. And, Jim, you know what's happened. If we look at where the purchasing power of that minimum wage is today, as compared to where it was then, it' about at the same. And yet, the economy is stronger today.
JIM LEHRER: We have to leave it there. Sen. Nickles, do you have one word about Sen. Dole?
SEN. NICKLES: Well, I, I think he's going to make an outstanding President. Now, wait a minute.
JIM LEHRER: All right.
SEN. NICKLES: I going to get--but I might remind people, they didn't--the Democrats didn't bring this up. They did control Congress--
JIM LEHRER: Okay.
SEN. NICKLES: --the last two years, and obviously this is just politics.
JIM LEHRER: All right. Senator, thank--Senators both, thank you very much.
SEN. KENNEDY: Nice to see you.

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