House Passes Minimum Wage Legislation

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The New York Sun

WASHINGTON — The House of Representatives approved raising the American minimum wage by $2.10 an hour as Congress moves toward passing the first federal increase in a decade for the country’s lowest-earning workers.

The Democratic-led House voted 315 to 116 yesterday to boost the national minimum wage to $7.25 an hour from $5.15 over about two years. The 41% increase, which still must be approved by the Senate, wouldn’t affect all workers because at least a half dozen states including California and Massachusetts, have, or are set to have, minimum wages above the proposed federal level.

House Democratic leaders are urging the Senate to pass the bill quickly without adding tax breaks for small businesses, which President Bush, Republican lawmakers, and some Democrats say must be part of any wage boost. Backers of a raise say it is long overdue, particularly in light of record high bonuses awarded to some corporate chief executive officers.

“The average CEO earns more before lunchtime than a minimum wage worker earns all year,” Rep. George Miller of California, the head of the House Education and Labor Committee, said yesterday during House debate on the measure. “It is time to pass a clean bill, without any add-ons, without any delay.”

Still, Mr. Bush opposes the House measure “because it fails to provide tax relief to small businesses,” a statement from the White House said.

A minimum wage boost is part of the legislation that the House speaker, Rep. Nancy Pelosi of California, is trying to push through in the first 100 hours of Democratic control of the House. Congress and Mr. Bush face increased pressure to approve an increase following the passage of minimum-wage increases in six states in November.

Some Republicans, such as Rep. Jeb Hensarling of Texas, said a government-mandated raise in the minimum wage hurts workers by putting their jobs or chances of getting employment at risk.

“Minimum wage increases effectively cut off the bottom rung of the economic ladder,” Mr. Hensarling said in a statement yesterday.

The AFL-CIO, the largest American federation of labor unions, says research shows that increasing the minimum wage doesn’t crimp job growth and can help companies.

“There’s a growing body of evidence that a modest boost doesn’t hurt small business employment or growth,” Bill Samuel, chief lobbyist for the AFL-CIO said in an interview. “There’s evidence that it holds down turnover, lowers training costs, and allows people to put more money into the local economy.”

In October, a group of economists that included five Nobel Prize winners said a boost in the federal minimum wage wouldn’t stunt job growth as some opponents claim. The value of the current wage, when adjusted for inflation, is the lowest since 1951, the economists said.

Wal-Mart Stores Inc., the world’s largest retailer and frequent target of labor unions critical of the company’s practices, also supports a wage increase, saying it would be good for the company’s customers.

“This increase will help many working families, and we believe the Congress is doing the right thing in passing this important legislation,” the Bentonville, Arkansas-based company said in a statement yesterday.

Supervalu Inc., the second-largest American supermarket chain and owner of Albertson’s grocery stores, said a raise would affect certain markets without hurting overall profits.

“We don’t believe it is material from an earnings standpoint,” Jeffrey Noddle, chief executive of the Eden Prairie, Minn.-based company, told financial analysts yesterday. “Many of the states that we operate in already have higher minimum wages than what is proposed by the current Congress.”

Democrats such as the House Ways and Means Committee chairman, Rep. Charles Rangel of New York, and the head of the Senate Labor Committee, Senator Kennedy of Massachusetts, are pushing Congress to send Mr. Bush a bill without adding tax provisions.

“We shouldn’t have to do that. It’s totally unnecessary,” Mr. Rangel said in an interview yesterday.

The Senate majority leader, Senator Reid of Nevada, said last week that he’s willing to consider adding tax breaks to a Senate version of the minimum wage measure. The Senate minority leader, Senator McConnell, a Republican of Kentucky, said he’s working with Mr. Reid on a measure that would include tax relief.

“The package, we think, has bipartisan support,” Mr. McConnell said last week.

Senators Baucus of Montana and Snowe of Maine introduced a measure yesterday to provide tax breaks to small businesses along with the minimum wage increase.


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