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Public Statements

Minimum Wage Fairness Act

Floor Speech

By:
Date:
Location: Washington, DC

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Mr. BEGICH. Before the Senator leaves I would like to ask him a quick question if I could. I know he talked toward the end of his comments--and I am going to speak on minimum wage also--but he mentioned President Reagan. I think the last time minimum wage passed was under President Bush, again a bipartisan approach; is that correct? I wasn't here during those times, but I know the Senator has served in Congress a long time.

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Mr. BEGICH. The $10.10 wage is just getting to the poverty level. That is what I understand and why I cosponsored this legislation.

Mr. DURBIN. It basically does for some, but what I found though is if you are a family with two kids, for example, you have to make almost $15 an hour to get beyond the poverty level. We are talking about $10.10 phased in, and many of those people will still qualify for a helping hand from the government because they are still in very low-income categories.

Mr. BEGICH. Thank you for giving me a moment to ask those questions.

I rise to address an important issue--just as we were asking some questions back and forth--that would help 49,000 Alaskans, raising the minimum wage. The bill before us would increase the minimum wage to $10.10 an hour.

The minimum wage, as mentioned by my colleagues a little earlier, has lost its purchasing power by one-third over my lifetime. The increase will lift millions of Americans out of poverty, reduce their reliance on the safety net, and literally pump billions more into the economy.

I know I look at this a little differently. I come from the business world. I come from the small business world. My first business was at the age of 14. I have been in it ever since in some form or another. You can probably name the business--retail, real estate. I have been a publisher. I have owned different companies, and I have even owned a small, very small, percentage of a restaurant. I felt like I was a 100-percent owner at one point because it is a tough business. I was in there moving the slop buckets and doing a remodel to the kitchen on a Saturday night. I am there like everyone else working double time and trying to make sure we get the job done.

My wife is a small retailer. Her business is selling smoked salmon on a counter or a cart--no bigger than two of these desks--and building her business now to 5 retail stores, 30-some employees. I might note none of our employees are paid minimum wage. They are paid above minimum wage.

I know some people are concerned minimum wage will cut into their business. There is no question in my mind what it does; that is, when we increase the minimum wage, it is actually good for business because we help consumers have more resources to put into the economy that then churn back into the business world.

Along with this bill another provision a lot of people don't realize is the minimum wage is one piece, a pretty significant piece but also a provision that I requested be put in this bill, what they call a 179. It is a business tax deduction, something that is important for businesses that are growing, expanding, building new business, small businesses mostly.

This is the No. 1 priority of the business community that I talk to, not the politically driven business communities but the ones that actually do business and actually work with small businesses, the ones that look at their local communities and try to figure out what is important in legislation. One is to make sure they can write off some of their improvements in an expedited way which, in turn, puts more money into the business for reinvestment. That is another piece of this bill.

So it not only has an important part for the hard-working folks who are making minimum wage to raise that amount, but it also helps the hard-working small businesses ensure that they can continue to put money back in their business, grow their business, expand their business, and then receive some benefit from that.

As we know, we look at the whole issue in Alaska a little differently. Our minimum wage is 50 cents higher than the Federal level, $7.75. There is a reason: Because it is very expensive, similar to the Presiding Officer's State. It is not cheap in our two States, Hawaii and Alaska. The cost of living is much greater. In order for folks to have a decent living, we pay a little bit more, and we play it off of the Federal legislation, but still it is a problem in keeping the wage competitive to the cost of living.

When we look at Alaska and we look at the cost of living in Alaska--Anchorage specifically is 30 percent higher than the average cost of living in this country and Fairbanks is 40 percent higher. Again, having this higher ratio for us is very important.

It doesn't mean all the time that a dollar still goes far. When we look at the whole country, in terms of buying power, what you can buy for the dollar you earn, Alaska has 3 of the cities in the bottom 11. When you look at the whole list, there are 11 at the bottom. Alaska has three of them: Juneau, Kodiak, and Fairbanks, because their dollar can't go far enough. That is why raising the minimum wage will help them be able to purchase more and enjoy a better quality of life.

I will say Alaskans, similar to Hawaiians, know challenges, and we have tough jobs because we are kind of isolated lots of times and sometimes forgotten that we actually exist in the Union. And we have to make that point more than once. But it doesn't matter if we are doing the drilling in the Arctic, which is a great challenge, or fishing for crab in the Bering Sea, which is an unbelievable test of someone's capacity and ability, but we know how to overcome challenges. We just don't want more challenges.

A minimum wage increase will help reduce some of those challenges. The minimum wage is truly, at the rate it is today, an obstacle to try to get people moved forward because we don't have it at the rate it should be. The $10.10, in a lot of minds, is an easy step over a 2- to 3-year period, and it is honestly one we can fix. We can fix it tomorrow. We just need a bipartisan approach as it happened under the Reagan administration, it happened under the Bush administration. Again, to remind folks who may not be familiar with those two Presidents, they were Republicans. We did it, and I wasn't here, but Democrats and Republicans sat down and said: Let's figure this out because it is important for the working people of this country who are working hard every day.

Another group it impacts in my State of 49,000 Alaskans is 1,700 veterans--veterans in our country, veterans in my State who will get a boost.

What does that mean? When you calculate by family members, it is about 3,000 families of veterans will benefit from raising the minimum wage. As I said earlier, it is 49,000 Alaskans, and this is one subset. More than half of the Alaskans are women. About 5,000 Alaskans will be boosted right out of poverty with this change, and it means they will be on less government programs such as food stamps.

I would think we are all here to try to make government run more efficiently, improve the economy, and create jobs. That is what we do every day, we attempt to do every day, and we do every day. If we can get people above poverty, that means fewer government programs, which means fewer government tax dollars, which means they are living on their own and they have their own capacity to make it in this world.

One would think this is a unique opportunity for Democrats and Republicans to be joined together. Why wouldn't we want fewer people on food stamps because they are making a living now and able to take care of themselves? That is what we all work toward, to have the American dream to buy that home or live that quality of life, have that great education, all the pieces to the equation.

Again, I cannot believe we are having a struggle trying to get just a few votes. We don't want them all. We get there are some who are opposed to anything about the Federal Government, but why not support this effort to raise people up as President Reagan thought about and President Bush thought about.

It is this moment, giving these people a fair shot, a fair shot to have their American dream come true; $10.10 doesn't seem like a big stretch, but it seems today it is by some politicians.

In fact, when we look at this--and I know the complaint on the other side is this will hurt business. Again, as I said earlier, this is good. You are talking to someone who is a small businessperson, who pays above minimum wage. I understand the value of making sure my employees, my wife's employees, have a good, decent wage, because when they leave the workplace, when they get their paycheck, they will spend it in the economy. That will help grow the economy.

I know some will talk about the CBO report and all of these government reports, but let me put it this way. The last two times the minimum wage has been raised, the economy didn't collapse, people weren't fired--actually, the economy grew. So I don't understand that comment and debate.

I know they will whip out these reports, and I am appreciative of those and the work CBO does, but I can only go by history and what has happened. If we raise the minimum wage, jobs are great, economy grows, and the next issue is businesses are reinvesting because they have more customers, which means more customers more profit. More profit means more investment. This is not only a fair shot for the people working, it gives an opportunity for small businesses and businesses across this country.

To put it in perspective for my colleagues who have never been in small business or have not run a business, the reason you hire people is because you have demand. Demand is created by expenditures, expenditures by consumers.

The reason you lay off people is because demand has gone down because there are not expenditures by consumers. Raising the minimum wage gives more opportunity, more investment, more people making money, and more return.

Let me give some national statistics. Again, this is about making sure we give every American, especially those making a minimum wage today--a raise in their minimum wage, to give them a fair shot to be part of the American dream.

The bill will help 30 million Americans earning an additional $51 billion to put back into the economy over the next 3 years by this raise--huge. The family who today can't afford the new car can now maybe look at a new car or maybe they are choosing between groceries and paying their heating bill. Now because you are raising the minimum wage they have an opportunity to pay these bills and enjoy life a little bit more.

The higher minimum wage will also help 12 million people in our country to get out of poverty. It could lift 4.6 million out of poverty immediately.

This is about empowering families, giving them a fair shot, a chance again to achieve the American dream, helping parents to make ends meet and to raise children in a healthy home and an opportunity for them. More than a one-fifth of all children in our country have a parent on minimum wage; 56 percent on a national level are women making the minimum wage.

Right now, thousands of Alaskans work full time--maybe extra work on the side--but still struggle to put food on the table. It is wrong. That is why raising the minimum wage will be helpful to those families. It saves the government money by helping people get off food stamps. Also, higher wages would cut, as I said, food stamps, they estimate by $4.6 billion a year. We have been very good at moving the deficit down--a $1.4 trillion deficit annually, down a little over $500 billion and continuing to go down. I think we all want to see that deficit go to zero.

The way we do that is with programs such as this that engage the private sector and their responsibility, at the same time lowering costs for the government. Also, an interesting statistic is that it also increases the wages, obviously, by the minimum wage going up. So it increases and strengthens Social Security because now they are paying into Social Security.

Social Security contributions from an extra $51 billion in wages would go right to the trust fund. Since benefits are tied to lifetime earnings, workers will earn larger checks when they retire. Right now an average minimum wage worker with 40 years of paying into the system receives only 900 bucks, give or take a few bucks, at the age of 65. That is well below the poverty line.

So why wouldn't we want to raise the minimum wage, move people out of poverty, get more people off of food stamps, save the government some money, and, by the way, help strengthen Social Security and give families and individuals a fair shot to meet and reach the American dream? Why wouldn't we want to do that? Again, under the Reagan administration and the Bush administration, they seemed to think it was a good idea.

I agree with the Senator from Illinois who was on the floor a little while ago. If we weren't in this toxic political environment where everything has to be politicized until the last man is standing, we would probably do this. We would be down here together talking about how it would help our folks in our different States and in our communities and in the country overall. Instead, everyone wants to just kind of even the scorecard. This is not about a scorecard; this is about giving a fair shot to Americans, to Alaskans, so they have a chance to make a living and meet and reach the American dream.

This is a simple thing for us to do, and we could do it tomorrow. I don't know what the House will do, but maybe if we act in a bipartisan way here, the House will see that. Maybe they will wake up and see this is a good thing to do because if we want to build the economy, if we want to make a difference, as I said--and I am talking as a small businessperson--if we grow the amount of money consumers spend by making sure they make a good living, the net result will be that every businessperson benefits because they have more consumers, more people buying products. In turn, everything from manufacturing, to shipping to the retailer, to the large business, the small business--all benefit.

Again, it is amazing to me that we debate this issue. Actually, I was not planning to come to the floor until last week because I thought this should be easy. Why are we not doing this? Republican Presidents saw it as a good idea. Now that it has been a long time coming, it is time.

I know some don't like the current President. I have my issues with him, I can tell you that. The list is long. But we should not get caught up in the personalities. I tell my staff all the time--when I get a piece of legislation a Member is proposing, I say: Don't look at who is sponsoring; look at the content of the bill. If we like the bill, we sign on. We participate. Too much time is spent here worrying about who is sponsoring what, who is on the list, who made the comment. Who cares? If it is a good piece of legislation, then we should do it.

In my State we will have raising the minimum wage on the November ballot because Alaskans signed an initiative--35,000 or 40,000 people--saying this is the right thing to do for Alaska. I think it is the right thing to do not only for Alaska but for this country. It is important that we do this because it is our obligation to make sure for Alaskans and for all Americans that we don't create obstacles in their ability to reach the American dream, that we make sure they have a fair shot at anything they want to do.

I hope tomorrow we will have a different outcome than the pundits are predicting. They think it will fail tomorrow. I hope not. But if we fail tomorrow and don't get enough votes from the other side, it is not that we lose the battle today but that the American people lose. Alaskans lose. The 49,000 Alaskans I mentioned will lose. The 1,700 veterans in my State will lose. Let's try to do something to make them winners and give them a shot.

Madam President, I yield the floor.

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