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Public Statements

Fair Minimum Wage Act of 2007

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Location: Washington, DC


FAIR MINIMUM WAGE ACT OF 2007 -- (Senate - January 29, 2007)

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Mr. KENNEDY. Mr. President, it has been a week now that the Senate has had on its agenda and before the Senate legislation to increase the minimum wage from $5.15 to $7.25. In that week, every Member of Congress has effectively earned $3,200, but we have not acted on an increase in the minimum wage for hard-working American people who are earning $5.15, to raise their minimum wage to $7.25. We have had 1 week of talking here on the floor of the Senate without action.

It looks to me as if we are going to have, thankfully, as a result of the action of the majority leader, a vote at least on cloture to try to terminate the debate. But there will be additional procedural issues that will mean that those who are opposed to an increase in the minimum wage will be able to delay the increase in the minimum wage for another week.

As the parliamentary situation is playing its way out, there will be the possibility of 60 hours after the vote on cloture, which will take us effectively through the end of this week. So that will be 2 weeks where the Members of the Senate have then earned $6,400, but we have been unwilling to either vote up or down on the increase of the minimum wage from $5.15 an hour to $7.25 an hour.

For the millions of people at the lower end of the economic ladder--men and women of dignity who work hard, those who are assistants to our teachers and work in the schools of this country, those who work in some of the nursing homes and look after the elderly, many of those of the great generation that fought in World War II and brought the country out of the time of the Depression--they are still earning $5.15 an hour. They work in many of the hotels and motels that dot the countryside and the great buildings of American commerce--these people are working at $5.15. They will work for that tomorrow, and they worked for that the day before. And now, because our Republican friends refuse to permit us a vote, they are going to continue to work at $5.15 an hour. It has been 10 years.

I went back and looked at the number of days we have tried to get an increase in the minimum wage since our last increase, and that was 16 days. So we have effectively been debating an increase in the minimum wage for 23 days since the last increase in the minimum wage, and there has been opposition from our Republican friends.

It is true that we have disposed of some 21 amendments, but there are almost 100 left from that side. We don't have any. We will have some if they insist on some amendments. But our side is prepared to vote now. I daresay the majority leader would come out here, if the minority leader would agree, and set a time--I bet even for this afternoon, in an hour, 2 hours, perhaps even less. Perhaps some colleagues have been notified that we would not have votes today, so in fairness to them we could start the vote at the start of business tomorrow morning. There would not be any objection here. There are no amendments on our side. Still, there are 90 amendments on the other side, and they are exercising parliamentary procedures in order to get to delay the consideration of the minimum wage, including $200 billion in changes in Social Security--that was an amendment offered from that side--$35 billion in tax reductions and areas of education, some of which I support, but certainly with no offsets. They were never considered. They didn't include offsets, for example, with IDEA, the legislation that looks after the disabled children, or didn't increase the Pell grants. We didn't even have a chance to look at it. But no, no, let's do that, use this vehicle for that measure. Let's get those Members on your side and the Democratic side lined up to vote against providing additional assistance on education. Maybe we can use that in the next campaign.

What about health savings accounts--that wonderful idea that benefits the medium income; the people it benefits are those making $133,000 a year. That is the medium income of the people who benefit from the health savings accounts. We are talking about raising the minimum wage to $7.25. They are talking about giving additional tax benefits to individuals in the health savings accounts of hundreds of thousands of dollars.

The list goes on, Mr. President. These are matters which have absolutely nothing to do with the minimum wage. It is a delay, and it is to politicize these issues. We all know what is going on. The Republican leadership is opposed to the increase in the minimum wage. When they had the majority of the Senate, they constantly opposed any effort. Even though a majority of the Members of this body and the House of Representatives favored an increase, they refused to permit us to get a vote on it, and the President indicated he would veto it if we had.

So that is where we are as we start off this week on the issue of the minimum wage. We find out our side--the Democratic side--follows the leadership that took place in the House of Representatives with Nancy Pelosi. They had 4 hours of debate, and 80 members of the Republican Party voted for an increase in the minimum wage. But here it is a different story. For the millions of Americans who say: My goodness, here is the House of Representatives; look, in 4 hours, it looks as if hope is on the way--and they didn't understand the strength of the Republican opposition to an increase in the minimum wage. I have seen it at other times. We have seen it at other times.

It is always baffling to me, what the Republicans have against hard-working Americans. What do they have against minimum wage workers? We don't hear about it. They don't debate it. They will debate other matters, but what do they have against them? What possibly do they have against these hard-working Americans? They are trying to provide for families, play by the rules, and work 40 hours a week, and in so many instances they are trying to bring up children. What is so outrageous?

Some say that if we raise the minimum wage, we are going to have the problem of increasing unemployment. We have heard that argument out here on the floor. Let me, first of all, show what has happened historically with the minimum wage.

Until recent times, we have had Republicans and Democrats who supported an increase in the minimum wage, starting with Franklin D. Roosevelt, Harry Truman, then Dwight Eisenhower. They raised it $1 in 1955. Then President Kennedy increased it, Lyndon Johnson, Richard Nixon supported an increase, Jimmy Carter, George Bush I, and William Clinton. That was the last increase. We voted on it in 1996, and it became effective in the fall of 1997. There were two different phases to it.

First, people say: When you raise the minimum wage, look what is going to happen in terms of unemployment. Unemployment will rise.

If we look at what has happened with unemployment at the time we passed the last increase in the minimum wage to $5.15 an hour in 1997, we can see there have been small increases, but the whole trend has been down. So much for the argument of unemployment.

They say: That chart really doesn't show it because it doesn't reflect what is happening in the economy in terms of job growth. Look at what happened when we raised the minimum wage from $4.25 an hour to $4.75 an hour, and then we raised it again to $5.15 an hour. Look at that red line showing steady and constant job growth after an increase in the minimum wage.

Look at what percent the minimum wage is. Increasing the minimum wage to $7.25 is vital to workers, but it is a drop in the bucket to the national payroll. All Americans combined earn $5.4 trillion a year. A minimum wage increase to $7.25 is less than one-fifth of 1 percent of this national payroll. It is less than one-fifth of 1 percent of this national payroll. And we have heard from those who oppose the minimum wage about all of these economic calamities. These are the facts in terms of the national payroll. It isn't even a drop in the bucket. It isn't even a piece of sand on the beach it is so little. Yet they say the economic indicators say this.

Look what has happened to States that have a higher minimum wage than the national minimum wage, and see what has happened in terms of job growth. This chart shows 11 States plus the District of Columbia with wages higher than $5.15 an hour. Overall employment growth has been 9.7 percent; 39 States with a minimum wage at $5.15, 7.5 percent. Those States that have had an increase in the minimum wage have had more job growth, and it is understandable. The economic reports and studies show that if workers are treated fairly, there will be increased productivity. They are going to stay around longer and work. There will be less absenteeism, less turnover, more productivity, and you are going to increase your output. And this is all reflected in various studies.

Look at small business. They say that is good for the Nation, but it doesn't really reflect what is happening to small businesses.

This chart states that higher minimum wages create more small businesses. The overall growth in number of small businesses from 1998 to 2003 is 5.4 percent and 4.2 percent. These are the small businesses about which we heard a great deal. We have the small business exemption that exempts 3.6 million workers who are working for the real mom-and-pop stores, where their gross income is less than $500,000.

This gives us some idea of the nature of the economic arguments. They don't hold water. They didn't hold water previously. We have seen a decline in the purchasing power of the minimum wage over this period of time. This chart is in real dollars. We can see where it was in 1960, 1965, 1970, 1975, going to 1980 and then a gradual decline. Starting in 1980, under President Reagan, it is going down. And we see the increases that came in the nineties under President Clinton. The purchasing power of $5.15, as this chart shows, was probably the lowest it had ever been. Its purchasing power has lost 20 percent. All we are asking is to get it back to $7.25 and to get the purchasing power back to where it was when we went to $5.15. Isn't that outrageous?

What have we done in taxes for all the others? We are trying to restore the purchasing power. Let's look in the meantime at what we have done for companies and corporations. Let me go to this, Mr. President. Look at what has happened. Productivity and profits skyrocket while minimum wage plummets. Look at the profits. From 1997 to 2006 profits were up 45 percent, productivity was up 29 percent, and the minimum wage was down 20 percent.

Historically, in the sixties, seventies, all the way up to 1980, when we saw an increase in productivity, that was shared with the workers. Companies, corporations shared the increase in productivity with the workers. No longer. That doesn't exist any longer. They take all of that productivity, and it is now an increase in profits.

This chart indicates what has happened to the real minimum wage and what has happened to productivity. See, going back to the sixties, 1960 to 1965, even into the seventies, closer productivity, workers working harder, increasing productivity. They shared in the increasing productivity with wages. Not anymore. All of that productivity has been turned into profits.

I want to spend my last few minutes--now that we have had the economic argument--reviewing quickly the most powerful argument, and that is what has happened in terms of these figures, how they translate into real people's lives. The charts reflect the growth of poverty in America. We are the strongest economic country in the world, and we find that between 2000 and 2005, we see that the number of people who are living in poverty in the United States of America has increased by over 5 million--5 million in the United States of America--during this period of the economy.

I listened to the President talk the other night about how the economy is just going like gangbusters. Talk about the number of bankruptcies, talk about the growth of poverty--5 million. Let's look at what happened with regard to the number of children who are living in poverty. There were 11 million in 2000 and 1.3 million more at the present time.

This country, of all the industrial nations in the world, has the highest child poverty in the world. Look at the chart and look at the end. Look at the red line. It is not even close. The United States of America has the highest child poverty in the world. That means the loss of hopes and dreams for these children, increasing pressures in terms of children dropping out of school because they are living in poverty and are not being fed in the morning.

They are not getting good quality health care or any kind of health care. Their parents have two or three jobs and they are not getting the attention they need. The basic abandonment of so many children in our society.

We read last week into the RECORD the New York Times article about the burden that is going to be on the American economy. That may get the attention of some of our friends on the other side. They expect that increased child poverty in this Nation is going to cost another $500 billion just because of what is happening to children in our society.

Let me show what happens to child poverty in States which have a higher minimum wage. This isn't an accident. If the minimum wage is raised, it has an impact on child poverty. Alaska, Connecticut--all the way, the States that are listed here--New Jersey, Oregon, Rhode Island, Vermont, the State of Washington--are above the national average poverty rate. They have higher economic growth, higher small business growth, less child poverty. That is what we have seen. National average child poverty, again, the high minimum wage States, again, have lower child poverty rates.

Very quickly, we have seen two nations of the world that have made child poverty a particular issue--Great Britain and Ireland. Now the minimum wage is $9.58 an hour in Great Britain. They brought 2,000,000 children out of poverty. They are a very strong economy in Europe.

In Ireland, they have reduced child poverty by 40 percent. They are also a very strong economy.

What we know is that the economic arguments don't hold water, and the adverse impact is particularly harsh on children.

All during this time, we have seen this extraordinary explosion of tax breaks that have been given to large companies and small companies. They say these can't do it unless they get help. Over the last 10 years, there have been $276 billion in tax breaks for corporations and $36 billion in tax breaks for small businesses, and our Republican friends are insisting that we add more tax breaks if we want any hope of getting an increase in the minimum wage.

Americans understand fairness, and this is not fair. Trying to hold up an increase in the minimum wage for hard-working Americans, who are working and playing by the rules, is not fair. Americans understand fairness. There are no economic arguments. We have been out here now for 7 days. I haven't heard them. I have been willing to debate any of those arguments. No, no, we don't get into the economic arguments. We used to years ago. Now we don't get into them. We just have to use this vehicle for all these other add-ons in order to basically frustrate this body from getting an increase in the minimum wage.

As I said before, I don't understand what it is that our Republican friends find so obnoxious about hard-working men and women who are working at the minimum wage, but evidently there is something because they will not let the Senate of the United States act on this legislation.

This is about fairness. This is about the hopes and dreams of children. It is about decency and fairness to women because women are the primary recipients of the minimum wage. So many of them have children. Eighty percent of those who receive the minimum wage are adults; 40 percent of those who receive the minimum wage have been receiving it for 3 years.

This is an issue that women are concerned about, that has an enormous impact on children, that is basically a civil rights issue because minimum wage jobs so often are the entry jobs for men and women of color. But it comes back to fairness. It is basically the issue of fairness, whether we are going to be fair to hard-working Americans. Our Republican friends refuse--absolutely refuse--they refuse to let us get a vote on this minimum wage, and they have basically filibustered by amendment.

As I said, we have over 90 amendments remaining. Democrats on this side are prepared, ready, and willing to vote. We thank our leader for bringing up this legislation. We are going to continue to battle on.

We give assurance to those who are looking to us to represent them, to speak for them in the Senate, that we will speak for them. We will stand for them. They should know that we are on their side, and we don't intend to fail.

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