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Senate Defeats Minimum Wage Increase
By DAVID ESPO, AP Special Correspondent
WASHINGTON - The Senate defeated dueling proposals Monday to raise the $5.15-an-hour minimum wage — one backed by organized labor, the other salted with pro-business provisions — in a day of skirmishing that reflected Republican gains in last fall's elections.
Both plans fell well short of the 60 votes needed to advance, and signaled that prospects for raising the federal wage floor, unchanged since 1996, are remote during the current two-year Congress.
"I believe that anyone who works 40 hours a week, 52 weeks a year should not live in poverty in the richest country in the world," said Sen. Edward M. Kennedy (news, bio, voting record), D-Mass., arguing for the Democratic proposal to increase the minimum wage by $2.10 over the next 26 months.
Republicans countered with a smaller increase, $1.10 in two steps over 18 months, they said would help workers without hampering the creation of jobs needed to help those with low skills. "Wages do not cause sales. Sales are needed to provide wages. Wages do not cause revenue. Revenue drives wages," said Sen. Mike Enzi, R-Wyo.
The Democratic amendment was defeated, with 46 votes for and 49 against. The GOP alternative fell by a wider margin, 38 for and 61 against.
While the outcome was never in doubt, Democrats said in advance they hoped to use the issue to increases chances for passage of state minimum wage initiatives in 2006, as well as to highlight differences with Republicans who will be on the ballot next year.
Kennedy accused Republicans of advancing a "deeper poverty agenda" for the poor by including several provisions to cut long-standing wage and overtime protections for millions of Americans. He took particular aim at Sen. Rick Santorum (news, bio, voting record), R-Pa., a conservative who is atop the Democratic target list for 2006 and the lead supporter of the GOP minimum wage alternative.
"The senator from Pennsylvania has a record of opposing increases in the minimum wage," Kennedy said. "He has voted against it at least 17 times in the last 10 years."
"I have not had any ideological problem with the minimum wage, " Santorum responded, adding he voted for the last increase to clear Congress, in 1996. He said the other elements of the GOP plan were designed to help small businesses and give workers more flexibility in their work schedule, and not, as Kennedy said, weaken their rights.
Democrats sought minimum wage increases in three steps of 70 cents each, to $7.25. Republicans countered with raises in two steps of 55 cents apiece, to $6.25, as well as several pro-business provisions.
These include an option for employees to work up to 80 hours over two weeks without qualifying for overtime pay; a provision restricting the ability of states to raise the minimum wage for restaurant employees; and waiving wage and overtime rules for workers in some small businesses now covered.
The clash unfolded as part of a debate over business-backed legislation to overhaul the nation's bankruptcy laws.
The overall measure enjoys bipartisan support, although no vote on passage will occur until the Senate settled the minimum wage dispute and resolved companion controversy over allowing protesters at abortion clinics and other sites to avoid paying court fines by entering bankruptcy.
Republican aides, speaking on condition of anonymity, said they had the votes to prevail on that showdown, as well, and send the measure to the House later in the week. "It's an uphill fight but it's not over," said Sen. Chuck Schumer, D-N.Y., author of the proposal.
Democrats conceded in advance they were certain to lose the minimum wage vote, particularly given the Republicans' four-seat gain in last fall's elections.
At the same time, they said they hoped to raise the issue to increases chances for passage of state minimum wage initiatives in 2006, as well as to highlight differences with Republicans who will be on the ballot next year.
Santorum was chief among them, the third-ranking member of the GOP leadership and an outspoken conservative. Democrats and Republicans alike said his decision to be the public spokesman for the Republican alternative reflected the potential significance of the issue.
At the same time, the Republicans' decision to allow a vote reflected their confidence that they could prevail. The GOP majority maneuvered successfully in the past two years to block votes on the issue, when Democrats might have won.
"When you raise the minimum wage you are pricing some workers out of the market," said Sen. John Sununu (news, bio, voting record), R-N.H. "It is an economic fact, and the proponents of raising the minimum wage like to dismiss this by saying we have a hard time measuring it and the economy is large."
Countered Sen. Tom Harkin (news, bio, voting record), D-Iowa: "This is a values issue. This is at the heart of what kind of country we want."
While Democrats sought only an increase in the minimum wage with their proposal, Republicans expanded theirs to include business regulatory relief as well as tax breaks totaling $4.2 billion, most of it directed toward the restaurant industry.
Forty-one Democrats, four Republicans and one independent voted for the Democratic proposal. All the votes in opposition were cast by Republicans.
All 38 votes in favor of the GOP proposal were cast by Republicans. Opposed were 43 Democrats, one independent and 17 Republicans.
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FCC=For a Communist Country
Arnjolt wrote:SpikeJ:
If you would've taken a simple macro or micro economics class you would understand this. When you raise the minimum wage you decrease the amount of people that companies are willing to hire. It's supply and demand. Employers have a supply curve. They're willing to hire so many people at a certain wage. When they are forced to raise the wage, the number of people they are willing to employee and hire goes down. More people enter the work force for more money, but less people are hiring. To raise the minimum wage actually hurts the economy.
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FCC=For a Communist Country
Just makes you look stupid. Communism is a form of economics. It is an economic system that is controlled by the government. FCC has to do with regulating things that are on tv and radio, like Howard Stern. In that context it is socialist, like Russia and China.
Arnjolt wrote:SpikeJ:
If you would've taken a simple macro or micro economics class you would understand this. When you raise the minimum wage you decrease the amount of people that companies are willing to hire. It's supply and demand. Employers have a supply curve. They're willing to hire so many people at a certain wage. When they are forced to raise the wage, the number of people they are willing to employee and hire goes down. More people enter the work force for more money, but less people are hiring. To raise the minimum wage actually hurts the economy.
Arnjolt wrote:Quote:
FCC=For a Communist Country
Just makes you look stupid. Communism is a form of economics. It is an economic system that is controlled by the government. FCC has to do with regulating things that are on tv and radio, like Howard Stern. In that context it is socialist, like Russia and China.
spikej wrote: I actually did take a micro economics course in high school so I know all about Supply & Demand. Minimum wage right now is $5.15, lets do a little bit of math here, 5.15 x 40hrs = $206 x 52 weeks = $10,712 a year. Fed. state and local taxes will probably take $200-300 now you have $10,412. If you rent an apartment or house you have to pay rent which will probably be around $350 x 12= $4,200. 10,412 - 4200=$6,212 left to spend for groceries and whatever else. What if you own a vehicle that costs around $.30 a mile to drive and you drive it 12,000 mi that equals another $3,600 out of your pocket which leaves you with just $2,612 left to feed and clothe yourself for the year. Raise the min. wage to 6.25 and you earn an extra $2,788 a year or $13,000 for total years earning. The minimum wage will have to be raised within the next 4 yrs to keep up with inflation.
Arnjolt wrote:SpikeJ, it's idiots like you who help f-up the economy and government because you think you know stuff, but you don't. Get an education. You're going to be 26, put down the car magazines and video game controllers and step back into a school. It's people who only have a highschool education that f stuff up because of their ignorance.
Arnjolt wrote:Niceguy, on an interesting note, both my micro and macro econ classes touched and explained the econ of wages and hiring. I had the same professor and he said that they apply to both views.
Simply, raising the minimum wage is bad. Look at what wages generally start at, around $7 an hour. At fast food places, it starts around $7 to $8 an hour. The place where I work starts at $7.75. With an open market like we have, the supply and demand eventually come to an equilibrium and have a general happy wage that is higher than the minimum wage. There will always be the crap jobs that pay only minimum wage, but that's to be expected.
SpikeJ, it's idiots like you who help f-up the economy and government because you think you know stuff, but you don't. Get an education. You're going to be 26, put down the car magazines and video game controllers and step back into a school. It's people who only have a highschool education that f stuff up because of their ignorance.
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Living wage: How about $9 an hour?
With the federal minimum wage stuck at $5.15 for years, cities and states are rebelling. The so-called living-wage campaign rewards workers, but critics say it discourages business.
By Melinda Fulmer
Donna Riley never liked taking handouts. The 49-year-old parking lot attendant had for years subsisted on disability payments for her injured back and $6-an-hour part-time work, eventually filing for bankruptcy in 2003 because of her mounting medical debts.
In 2004, when the city of Buffalo, N.Y., passed its last living-wage ordinance, raising city contractors' minimum pay to $9.03 plus benefits, she saw the opportunity to finally get off disability and work full time.
Now, Riley and her husband, who also works for a city parking company, make $6 more an hour combined -- enough to pay all of their bills and buy their first new car.
"Driving out of the car lot at the dealer with a brand new car was a total blow-away," Riley said. "Now we are working on buying a house."
With federal minimum wage stuck at $5.15 since 1997, many cities and states are taking matters in their own hands. They are enacting minimum wages for city contractors and, increasingly, mandatory minimums for all area businesses in an attempt to lift the fortunes of workers on the lowest rungs of the economic ladder.
The floor has sunk
As it stands now, a worker making the federal minimum wage would make $10,712 a year, or less than $1,000 above the 2006 poverty line of $9,800 for an individual.
"If the minimum wage had kept pace with inflation, it would be more like $9 right now. We've let the floor sink so low, it's historically less than we were paying back in the 1960s," said Jen Kern, director of the Association of Community Organizations for Reform Now (ACORN), an advocacy group that has led the "living-wage" movement.
Twenty states, the District of Columbia and 140 cities and counties have now voted in new living-wage laws. Washington state's minimum wage is $7.63 an hour, highest of any state. And several cities have set their own rates much, much higher: Santa Cruz, Calif., for example, requires that city contractors pay more than $12 an hour, plus health benefits. Lawrence, Kan., sets minimum pay for all workers in the city at 130% of the federal poverty threshold.
And dozens more are now being debated this year, including at least a dozen state minimum-wage initiatives, according to ACORN.
Opponents of the living-wage movement believe market forces, not regulation, should set wages. Laws like these only hurt the people they are trying to help, said John Doyle, managing director of the Employment Policies Institute, a think tank supported by retail, hotel and restaurant businesses.
In many areas, these wages are not enough to lift workers' fortunes substantially, Doyle said, and often the added labor costs force employers to shed jobs and hours.
"More often than not, low or unskilled workers are displaced from the job they hold," oftentimes being replaced by a high-school student lured by the higher pay, Doyle said. He points to the 540 workers who lost their jobs in Santa Fe, N.M., the year following its first citywide minimum-wage increase to $8.50 in 2004. Those that lost their jobs had 12 years of schooling or less.
However, economist Robert Pollin, co-director of the Political Economy Research Institute at the University of Massachusetts at Amherst, notes that while these people did lose their jobs, employment in the city actually grew 2%. And in those industries with the lowest starting pay -- restaurants, hotels and retail -- it actually grew 3.2%.
"More people got jobs, but more people are also looking for jobs," he said. In other words, as wages have gone up, more people entered the market looking for work, making it harder for the least skilled to get work inside the city.
But, he said, that doesn't necessarily mean that people are getting laid off as a result of the ordinance, which was later boosted again to a starting wage of $9.50.
"There are more jobs in Santa Fe that are higher quality," he said. "Overall the benefit is positive."
The cost of a pricey town
Sam Gerberding, general manager of Santa Fe's chic Inn of the Governors hotel, said the ordinance has cost the 100-room hotel, especially during slow months, when extra pay from its profit-sharing plan didn't bring housekeepers up to the new $9.50 wage.
These costs have been manageable, he said, and the hotel hasn't furloughed any workers. But, Gerberding said, the pay raises, including a planned bump to $10.50 in 2008, do make him think twice about replacing people. When a houseman left his job this past year, the hotel tried to do without his position for several months.
Some Santa Fe employers say they feel they have to pay workers a higher minimum wage so that employees can afford a place to live in this pricey but beautiful city.
"This is an expensive place to live," said David Salazar, owner of El Farol, the city's oldest restaurant and cantina, housed in an 1835 adobe. "Not like San Francisco or Manhattan, but we still have some very expensive real estate."
Santa Fe's ordinance counts waiters' tips as part of the hourly minimum, so most sit-down restaurants don't wind up on the hook for much more money. Salazar says he pays an extra $8 for each of his two new dishwashers per day, not enough to make him raise prices or consider any layoffs.
"It never crossed my mind," he said.
The living-wage movement
The living-wage movement, started just over a decade ago in Baltimore, when labor and religious leaders campaigned successfully for a local law requiring city service contractors to pay a higher, "living" wage, a term that didn't really exist before. A string of other cities followed suit, with minimum wage requirements for city contractors in areas such as St. Louis, Los Angeles, Boston, Tucson, Ariz., San Jose, Calif., Portland, Ore., Minneapolis and Milwaukee.
The movement gained new momentum several years ago when cities and states began pushing for minimum wages for all companies located there of a certain size. So far, Santa Fe, San Francisco and Albuquerque have all enacted citywide minimum wages. States have acted, too. Florida, for example, set a statewide minimum wage of $6.15 -- not a huge increase, but it covers more than 350,000 workers.
Battling tooth-and-nail over these higher minimum wages are large retailers and fast-food chains that would see their costs rise dramatically. They argue that these lower wages help keep more of the workforce employed, a point Pollin takes issue with.
While there has been some job loss, he said, it has not been "significant." "Businesses that have workers they like tend to keep them."
Moreover, he says, these wage hikes, at least in small part, reduce workers' dependence on government subsidies.
"The living-wage movement is important because it is an initiative to address to the growing gap … between rich and poor. It may not be the best and most-efficient policy to do it." But, he said, it's a start.
Moreover, he said, these measures don't just address the very lowest incomes, he said. They also tend to increase the wages of jobs above them, something large service-sector employers are well aware of.
"This is about where the American economy is going. It's a line-in-the-sand issue," Kern said.
Business repellent?
In Chicago, the city council is trying to draw that line in the sand with the largest retailers, who pay some of the lowest wages. Lawmakers there are trying to pass a resolution that would make big-box stores subject to a minimum wage of $10 per hour, plus $3 in benefits.
Wal-Mart officials say they oppose the ordinance because it only applies to a "narrow band" of retailers, not every establishment in the city.
"We think all boats should rise with the tide," said John Bisio, Wal-Mart spokesman. The ordinance "sets a lousy precedent and is probably unconstitutional."
Starting pay at Wal-Mart's other stores surrounding Chicago is several dollars less per hour than the $10 proposed. Moreover, new clerks at Wal-Mart must wait six months before receiving health insurance, Bisio said.
If the proposed ordinance is enacted, Bisio said, Wal-Mart, which is opening its first store in a low-income Chicago neighborhood this summer, will have to think about opening stores in outlying suburban neighborhoods instead. Employment Policies Institute spokesman Doyle said these higher minimum wages are already keeping some restaurant and retail chains out of San Francisco and other areas.
"Any mandate that will make labor more expensive is going to have an economic consequence," Doyle said.
Doyle and other pro-business groups support earned income tax credits to prop up the personal incomes of low-wage workers, rather than wage hikes.
Businesses, he said, "don't have a moral obligation to take care of unskilled adults when society won't."
A modest beginning
But increasingly, Americans see the living wage as a moral issue, and are voting in living-wage ordinances to address the widening gap between rich and poor.
"You can't tell people who are watching the value of wages in their cities and states fall to wait for Congress" to raise the federal minim wage, Kern said.
However, it's fair to say that many of the battles won in minimum wage have been largely symbolic, and hardly enough to support a better, more comfortable life. A $6.15 minimum wage in Florida and Nevada, for instance, probably won't allow most individuals to pay down debt or to buy a house or a car.
Kern, however, sees it as a start, and a wage that is "winnable."
"It's modest," she acknowledges. "We are trying to promote things that are a step in the right direction. These are moving towards the actual cost of a living wage."
ACORN hopes these wins will set a precedent for future wage hikes and perhaps put pressure on the federal government to raise the $5.15 minimum wage, which has lingered even as Congress has raised its own pay.
For Riley, who received a more-sizable bump in minimum wage, the extra pay will likely mean a new home. After watching one of her co-workers and her family move out of the projects in Buffalo and into her own home, she believes she and her husband can, too. But most importantly, she says, getting a full-time paycheck of more than $360 in gross pay has meant a new sense of pride.
"I don't feel like I'm a nobody. I feel like I have something to offer," she said, including taxes, when she and her husband buy their house. "I have become someone who is contributing to the city," she said.
Arnjolt wrote:If you would've taken a simple macro or micro economics class you would understand this. When you raise the minimum wage you decrease the amount of people that companies are willing to hire. It's supply and demand. Employers have a supply curve. They're willing to hire so many people at a certain wage. When they are forced to raise the wage, the number of people they are willing to employee and hire goes down. More people enter the work force for more money, but less people are hiring. To raise the minimum wage actually hurts the economy.
ToBoGgAn wrote:we are gonna take it in the ass and like it, cause thats what america does.
Slo2pt2 (Projekt Unknown?) wrote:One my SON is ADHD N.O.S and Autistic Spectrum Disorder. I will nto medicate him he will battle throught this himself and learn to control it.
JimmyZ wrote:The point that everyone seems to be missing is that minimum wage IS NOT and NEVER WAS INTENDED TO BE a living wage. If someine is trying to support a family and they have a skill set that precludes them from anything but a minimum wage job....well I'm sorry but THAT IS NOT MY PROBLEM. Bitch about it all you want, but supporting THEIR family is not MY responsibility. In the end I know I'll end up supporting them anyway...either through higher taxes to pay their welfare (election year liberal giveaway #1), or through higher retail prices to re-pay the higher minimum wage and mandated benefits for people with no skills (what's behind liberal give-away door #2).
Rollin 24 wrote:I am glad you care about the people with jobs but you arent looking at the people that dont have a job. Arnjolt already explained it but I'm going to again. If you raise minimum wage the companies have less money (yes the workers get more money). Since the companies now have less money they cant hire more people which leaves more people jobless.
Rollin 24 wrote:
The less people that have jobs means less money being paid into tax's which means less programs for the U.S. citizens.
Rollin 24 wrote:
Yes minimum wage is low but what age group are the majority of minimum wage earners? Students, high school, college etc....Do they really absolutely need to be paid more while they are in high school or college when others could be getting jobs also?
AGuSTiN wrote:So what you're saying is that it's liberal to help people, and conservative to ram it up their a$$?Not at all. I'm saying it's liberal policy to say "it's not your fault, the government fix it for you"...whether it's by handing out more and more welfare entitlements every year, or by forcing employers to pay a higher and higher minimum wage to people that really shouldn't be in mminimum wage jobs to begin with. In the end, people who did the right thing, went to school, got the skills and worked hard to make the money they needed to survive and properly support a family will end up paying for those that don't.
AGuSTIN wrote:Everyone needs a fair chance to get ahead, and this country provides less and less of that.The country shouldn't have to "provide" you anything. If you're not willing to work and do what it takes to get what you need then you wind up being one of the people looking for minimum wage increases.
JimmyZ wrote:AGuSTiN wrote:So what you're saying is that it's liberal to help people, and conservative to ram it up their a$$?Not at all. I'm saying it's liberal policy to say "it's not your fault, the government fix it for you"...whether it's by handing out more and more welfare entitlements every year, or by forcing employers to pay a higher and higher minimum wage to people that really shouldn't be in mminimum wage jobs to begin with. In the end, people who did the right thing, went to school, got the skills and worked hard to make the money they needed to survive and properly support a family will end up paying for those that don't.
You can't give me that some old tired story of "fair chance". If you're trying to support a family and you have no skills and can't get anything but a minimum wage job, that's not about fair chances...that's about you making bad life decisions. It's not my job to be your safety net. Well, it SHOULDN'T be my job, but it becomes my job because welfare entitlements raise my taxes and higher minimum wages raise retail prices so I pay their way anyway.
Minimum wage laws should be looked at as a way to make sure that 15 and 16 year old kids at Burger King aren't taken advantage of. It's not a wage that you could or should EVER think about trying to live on, let alone trying to support a family on.AGuSTIN wrote:Everyone needs a fair chance to get ahead, and this country provides less and less of that.The country shouldn't have to "provide" you anything. If you're not willing to work and do what it takes to get what you need then you wind up being one of the people looking for minimum wage increases.
ToBoGgAn wrote:we are gonna take it in the ass and like it, cause thats what america does.
Slo2pt2 (Projekt Unknown?) wrote:One my SON is ADHD N.O.S and Autistic Spectrum Disorder. I will nto medicate him he will battle throught this himself and learn to control it.
Glace wrote:To lump all workers that are earning minimum wage as people who have made "bad life decisions" is dumb.I didn't lump "everyone" into that. I said that if you're not some teenager wokring at Burger King and you're expecting to support a family on minimum wage, that you screwed up somewhere along the line. Anyone that passed 3rd grade math can figure out that $5.15 an hour isn't going to go that far, yet politicians and unskilled workers want to act so surprised about it every time an Sorry...I worked my ass off to get the skills I have to have a job that pays the bills and then some. If someone else wants to settle for less along the way then that's their decision, but I shouldn't be expected to make any concessions to them to make up for it.
Glace wrote:And to raise the minimum wage, how does that affect you anyway? You pay $0.05 more for your burger? Like Agustin says, higher wage = less taxes for you because less welfare. You said you don't want to provide for anyone, then here's one way to do it, allow a greater chance for workers to support themselves. So from your arguments, you are FOR a raise in minimum wage?I shouldn't have to pay ANYTHING extra, in the form of taxes, higher prices or anything else, to support those that made conscious decisions to not support themselves. I made a decision a long time ago that I wanted to be successful, and I made it happen. I didn't get help from my parents, my community or my government (unless you count Pell Grants). I just did it. There's no reason why anyone else can't do the same.