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House Votes to Raise Minimum Wage by 40 Percent in Two Years

Wednesday's House proposal to increase the minimum wage comes against a backdrop of growing concern about increasing income inequality in America. An author and a policy expert discuss the proposed wage hike.

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  • KWAME HOLMAN:

    It was on August 20, 1996, that President Bill Clinton signed the last increase in the federal minimum wage, a 90-cent hike, bringing it to the current rate of $5.15 an hour.

    In the decade since, Democrats tried to raise the wage further, but were unable with Congress in the hands of Republicans. Now with power in their hands, Democrats in the House tried again this morning.

    California's George Miller sponsored the bill.

    REP. GEORGE MILLER (D), California: This is a big day, because this is the first time in 10 years that the Congress signals that, in fact, we are going to raise the minimum wage.

    It's what our leader, Speaker Pelosi, said she wanted to do in this first 100 hours. In this first 100 hours, she wanted to address urgent parts of the national agenda that are of deep concern to the American people.

  • KWAME HOLMAN:

    The proposal, which would directly affect 2 million workers, and indirectly as many as 13 million, would boost the federal minimum wage $2.10 cents, to $7.25 an hour over the next 26 months, in three stages: to $5.85 an hour 60 days after being signed into law; to $6.55 an hour a year later; and to $7.25 an hour a year after that.

    According to the Labor Department, minimum wage earners tend to be young, part-time workers, and often are under the age of 25. Many have never married and are more likely than the rest of the workforce to be a woman or minority.

    Democrats repeatedly cited that worker profile, arguing the increase was a matter of fairness…

  • CONGRESSMAN:

    The little guy is going to get help from this Congress!

  • KWAME HOLMAN:

    … while Republicans said raising the wage was bad economics that would do nothing to reduce poverty.

  • CONGRESSMAN:

    It will harm both the wage-payer and the wage-earner.

  • KWAME HOLMAN:

    Republicans argued the increase would drive up payroll costs even for employers who pay above the minimum wage, forcing small businesses to lay off workers or hire fewer new ones. California's Dana Rohrabacher said those economic realities prevented Democrats from proposing the wage be raised even higher.

    REP. DANA ROHRABACHER (R), California: Why are we not offering a minimum wage hike of $5 an hour, or $10, or maybe even $20 an hour more? We know that that's not realistic, because there is a downside that can be calculated.

    In fact, by mandating the pay raises that we're talking about today, economists have estimated that about 1.6 million people, the people at the very bottom rung of our economic ladder, will be put through great hardship.

  • KWAME HOLMAN:

    Texan Pete Sessions warned of the potential impact on those workers at the lowest end of the pay scale.

    REP. PETE SESSIONS (R), Texas: I will tell you that these 1.6 million jobs were important to families and people. It may not be much of a job. It may be in a small, rural community, but they were jobs that were important to those people.

    They were jobs, even if they aren't high-paying jobs, that would provide them the opportunity to get up, and find self-worth, and go and do their very best, perhaps not just with limited resources, but with the very best that that community may offer.

  • KWAME HOLMAN:

    But throughout the debate, Democrats charged that Republicans had chosen to help wealthy interests during their time in power and now were against helping lower-income earners. New Jersey's Rob Andrews.

    REP. ROB ANDREWS (D), New Jersey: When the energy bill was on the floor, the energy companies came in and wanted massive subsidies and no crackdown on pricing. It was their day, and they got it.

    When the tax bill was on the floor, the wealthiest people in the country, people making more than $300,000 a year, wanted massive tax breaks. It was their day, and they got it.

    I'm sorry to disappoint the opponents of the minimum wage, but this is not your day. This is the day for the people who empty the bedpans, change the bed linens, sweep the floors, and do the hardest work of America.

    After a 10-year wait, even though they don't have the lobbyists here, even though they don't have the political action committees here, this is their day.

  • KWAME HOLMAN:

    The measure passed easily, as more than 80 Republicans joined all Democrats in favor.

    The Senate, meanwhile, is expected to move perhaps in the next few weeks on similar legislation. President Bush has said he will support a wage hike if it's paired with tax relief to help small businesses, something not in the House version.

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