Fair Minimum Wage Act of 2007

FAIR MINIMUM WAGE ACT OF 2007 -- (Senate - January 25, 2007)

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Mr. CORNYN. Mr. President, I rise to express my appreciation for my colleagues' efforts to do what, in their view, would help promote a better quality of life for the people of this great country. We are here to debate specifically a proposal to increase the minimum wage, but, in my view, we should aspire to more than a minimum wage for the workers across this country. Instead, we should work to provide the training and educational opportunities that will allow individuals across this great Nation to enter the workforce at perhaps minimum wage but, more importantly, to then move up the economic ladder.

When we put ourselves in the position of Government rather than the market dictating wages, we will most certainly see some unintended effects of less opportunity for some of the very American workers whom we are attempting to help.

Let's put this proposal in perspective. Research reveals that the negative effects of raising the minimum wage would, in fact, fall most heavily on the shoulders of the most vulnerable workers. Let me say that again. Research shows that the effects of raising the minimum wage--that is, of the Federal Government rather than the market dictating the wages at which employers must pay workers--that the burden would actually fall most heavily on the most vulnerable workers.

When employers are forced to raise their costs in order to comply with a government mandate, they are most likely going to reduce the hours their workers can work or perhaps even lay people off in order to meet their bottom line. Of course, they will also choose, if costs go up because government has increased the wages which an employer must pay, to retain their most skilled and experienced and productive employees, not the less skilled or lower wage earners. That is important because teenagers and those who are working on a part-time basis or who are just entering the workforce are the ones who predominantly receive the minimum wage under the status quo.

So why in the world would government decide to put people out of work, presumably the very people whom this amendment is designed to help? We need to ask ourselves that question and come up with a better answer than I have heard so far.

I saw a cartoon, which was really not funny, distributed a couple of days ago where an employer is talking to an employee. He says: I have good news and bad news. The good news is that the minimum wage has been increased, so you are going to get a pay raise. The bad news is you are fired.

The point of the cartoon is--as I said, it is really not funny--that if fixed costs of employers go up, something has to give. And where that give actually impacts the workers is going to be, I am afraid, on the most vulnerable workers, the less educated, the less trained, and unfortunately, more often, on minorities and women, the very groups the advocates of this bill have said they want to help.

Consider this statistic: Of the 75.6 million Americans who are paid by the hour, 1.9 million workers earn wages at or below the minimum wage. In other words, that is 2.5 percent of all hourly paid workers. So the debate we are having this week--and, presumably, will carry over to next week--will affect 2.5 percent of all hourly paid workers. The largest share of minimum wage earners include teenagers and young adults who have only entered the workforce. Based on the most recent data available, approximately one-fourth of minimum wage earners are teenagers between the ages of 16 and 19, and about one-half are between the ages of 16 and 24.

Over the past few weeks, in anticipation of this debate, there have been a number of articles in national and State publications addressing this topic. Many of them have been very thoughtful and informative. One article that demonstrates the complexity of this issue, that there is actually more than meets the eye on this topic, was published by the Valley Morning Star in Brownsville, TX, a story about Belinda Campirano. Ms. Campirano, along with her sister, is an owner of Media Luna, a small restaurant in Brownsville, TX. Ms. Campirano has only one employee, whom she pays $6 an hour. And while she understands, from the standpoint of simple human compassion, the difficulty of getting by on $5.15 an hour, she also realizes that a government-mandated wage increase would put a significant dent into her operating budget, literally in her ability to keep the doors open and keep this individual, her single employee, on the payroll.

There was also another great series of articles in the Washington Post, one on January 10 entitled ``Life at $7.25 an Hour, As House Prepares to Vote on Minimum Wage Increase, Issue is Complex for Those Who Earn or Pay That Amount.' That article does an excellent job of cutting through the rhetoric and exposing the reality of what it is we are debating.

I ask unanimous consent that both articles be printed in the RECORD following my remarks.

The PRESIDING OFFICER. Without objection, it is so ordered.

(See exhibits 1 and 2.)

Mr. CORNYN. I appreciate the numerous ways in which many of our colleagues have worked to improve this bill; significantly, the bipartisan work of the Finance Committee, Senators GRASSLEY and BAUCUS, certainly the good work of the minority manager of the bill, Senator Enzi, and numerous others to try to improve it, to try to ameliorate some of the unintended consequences of government-mandated wages. I support the small business package which is part of what we are attempting to do to provide a better bill, one that rounds out the provisions of the bill and one that actually produces intended effects, which are not to hurt small businesses, the primary engine of our economy.

The fact is, small businesses employ about 70 percent of the workers in America today. Why would this body do anything that would actually put more people out of work? Well, the provisions of the legislation that came out of the Finance Committee, as modest as they are, represent a real attempt to try to round out and improve the bill in order to reduce the unintended impact, which would be to put people out of work, and to provide some regulatory and tax relief for small businesses, the employers that employ 70 percent of the people in the American workforce.

Small business expensing allows mom-and-pop shops and entrepreneurs to reinvest in their businesses and grow and, in so growing, hire more people and create jobs, not just in my State of Texas but across the country. It will help locally owned businesses and other small enterprises make much needed improvements in their infrastructure, which will help them compete and improve their productivity. I have concerns, however, that while the minimum wage increase in this legislation is permanent, the regulatory and tax relief that is part of the package is only temporary and not permanent as well. Nevertheless, these fixes are necessary.

But don't take it from me. Take it from people like Jonathan Meller who e-mailed me recently. Mr. Meller is the owner of Papa Murphy's pizza restaurant in Burleson, TX. He talked about the economics of a wage increase and what it would mean for his small business. Like a majority of employees slated to earn the minimum wage, Mr. Meller's employees are, true to the statistic I mentioned a moment ago, under 20 years of age. Like many business owners, Mr. Meller operates in a free market. He believes in free enterprise. He believes in competition. Frankly, he doesn't appreciate the fact that government sticks its big finger right in the middle of his business and mandates that he pay wages that are above the market. Any government-mandated wage hike will have a dramatic impact on how he is able to do business and on the number of employees he is able to hire.

Then there is William Goodman, the owner of Scooters in El Paso. Mr. Goodman has only one employee. If the minimum

wage is raised, where does that leave him? Mr. Goodman says he will have no employees, if the government, rather than the market, forces him to increase the wages he pays his one employee. He says--and I take him as his word--he will not be able to absorb the additional cost that would go along with this legislation.

My point is this: Raising the minimum wage and the taxes that come with it will similarly leave many employees without jobs. We need to think long and hard before we choose to impose this sort of regulation on small businesses. In the end, my hope is that we can come together with a sensible package that will enjoy bipartisan support; that will, according to the intentions of the authors, increase the minimum wage but also soften the blow on small business and thus protect the jobs of many workers who might otherwise be laid off.

The important point, though, that this legislation misses is that the best way to increase the quality of life for workers in America is not just to raise the minimum wage. That puts a patch or a Band-Aid on what is a much more serious and larger problem. Education and workforce training are the best ways to increase the quality of life for America's workers instead of a wage increase that could hurt small businesses and consumers and, indeed, some of the very employees we are trying to help.

We all understand--it is a given--that every American should receive a good-quality education. We must continue to pursue policies to ensure that this is not merely a dream but a reality. No one, though, should end their education just when they receive a diploma or degree. Indeed, the world has become so complex, competition has become so globalized, that we need to think of education as a lifelong learning experience. In that vein, I emphasize the importance of providing workers with the kinds of skills and talent and training they need, not only to earn the minimum wage but to earn good living wages much higher than the minimum wage and the important role our universities, community colleges, trade schools, and workforce development centers play in providing the training and education necessary for thousands and thousands of people across this great country to improve their standard of living and to achieve their dreams.

I strongly believe that joint workforce-education projects are critical to our efforts as our economy continues its upswing and as competition increases on a global scale. It is imperative that we focus our efforts not only on setting a wage that may be out of sync with market forces but literally on liberating people to achieve their dreams by giving them the skills necessary to earn higher wages which will allow them to enjoy the American dream. It is imperative that we do everything we can to provide this training through our colleges and universities, working with the private sector to try to develop programs relevant to the local economy and, hence, jobs that are available in the local economy, and thus increase our competitiveness.

This is not just a temporary or passing interest of mine. I have traveled across my State, as have many of my colleagues, to community colleges and have seen some of the effective partnerships that community colleges have entered into with local employers. Frankly, employers are wanting for lack of trained employees to fill job vacancies at much higher than the minimum wage. One stands out in my mind--a young woman I met at the Bell Helicopter plant in Amarillo, TX, by the name of Jeanette Hudson Gibbs. The reason I remember Ms. Gibbs is because she works on the assembly line for the V-22 tilt rotor at Bell Helicopter at their Amarillo plant. This is a young Hispanic woman, a single mother with a special needs child, who, before she went to work at Bell Helicopter on the assembly line for the V-22 tilt rotor, was a prison guard, a single mom. You can imagine the concerns her family had, not just about the fact that she was earning much lower wages but, in fact, the dangers associated with that job. Thanks to the great partnership Bell Helicopter had entered into with Amarillo Community College, Ms. Gibbs is now earning $16 an hour, and that was the last time I heard from her. It could be she is even doing better now because of the job skills she acquired through this partnership between Bell Helicopter and Amarillo Community College. This is a great success story of which I am proud. I know she must be proud of her accomplishments. And it is exactly the sort of emphasis we ought to be placing through legislation we pass on the floor.

I worry that by looking at mandating minimum wages rather than focusing on workforce development and the kind of job training that is going to be able to produce more people like her, somehow we have not set our sights high enough.

Last April, I hosted an event back in my home of Austin, TX. It is something we call the Texas Workforce Summit. This was a gathering of community college leaders from all across the State. The purpose of that was to learn more about Federal grant opportunities and to learn more about the successes of partnerships such as the one I just mentioned between Amarillo Community College and Bell Helicopter. Because of this initiative, Del Mar College in Corpus Christi applied for and received a grant of nearly $2 million to improve employment opportunities for technical employees in the aerospace industry. This is an even better story because Del Mar College has the same kind of workforce training partnership that I described a moment ago in Amarillo but this time in Corpus Christi. This is a workforce development program which Del Mar has entered into at the Corpus Christi Depot. The Corpus Christi Depot, for those who don't know, is the place where the military refurbishes and refits the military helicopters that are damaged through use in the conflicts in Afghanistan and Iraq. We have a wonderful training program there through the same kind of partnership I mentioned a moment ago, which is creating a better way of life and a better opportunity for many workers there--and also, in a patriotic fashion, supporting our effort in the global war on terror.

As you can tell, I have been a long advocate of these initiatives. I have taken the opportunity to visit these community colleges all across my State, in cities such as Austin, Houston, Pasadena, Laredo, Beaumont, Sherman, El Paso, Lubbock, and Victoria, to highlight the very thing I am talking about here on the floor of the Senate today. So I hope that as we move forward, we will not forget about the great promises community colleges hold in terms of workforce training and look to maybe setting our sights a little bit higher than we have been last week and this week in talking about minimum wage, when we ought to talk about how we can prepare people to earn much higher wages and, frankly, wages and jobs that go wanting for lack of a trained workforce.

Just this last week, the National Journal highlighted community colleges as a true American success story. They have offered occupational skills training for decades and will continue to lead the effort to stimulate industry and job growth. This article says:

Bridging the gaps between high schools and four-year institutions and between employers and workers, two-year community colleges will help determine how America fares in the global economic competition.

So I say it again, Mr. President: We should aspire to much more for the workforce in America, for the American worker, than just the minimum wage. Education and workforce training are the way forward to both increase the quality of life for more workers and provide a way for them to achieve their dreams.

Mr. President, I yield the floor.

Exhibit 1

Raising Questions

MANY EMPLOYERS UNSURE ABOUT POSSIBLE RISE IN MINIMUM WAGE
(By Matt Whittaker)

BROWNSVILLE.--Restaurant owner Belinda Campirano is torn when asked to weigh in on what Congress should do about raising the minimum wage to $7.25 an hour from $5.15, where it has been for a decade.

She has only one $6-an-hour employee at Media Luna, the Brownsville eatery I she and her sister own. Still, a mandated wage increase would put a dent in her budget, she said.

But she empathizes with those supporting their families on service industry wages. Her employee, who has a child and is married to a waitress, sometimes works an extra job at another restaurant to help make ends meet.

``I'm kind of sitting on the fence on it,' Campirano said of the minimum wage. ``I do believe we need to up it, but it is going to impact small businesses. As an employer, it would be tough for me if I had more employees.'

Of 5.5 million hourly workers in Texas, 176,000 earned at or below $5.15 an hour in 2005, according to Labor Department data. The liberal Economic Policy Institute, a Washington, D.C., think tank in favor of increasing the nation's base pay, estimates 863,000 Texas workers would be directly affected by a federal minimum wage increase to $7.25 an hour.

More workers would be affected in the Rio Grande Valley than in other parts of the country because the area has lower wages, said José A. Pagán, a labor economist at the University of Texas-Pan American in Edinburg. In the second quarter of 2006, Cameron County had the lowest average weekly wages in the nation, at $484. Hidalgo County followed at $494 a week.

On Jan. 10, the U.S. House passed a measure that would increase the minimum wage to $7.25 in three stages over more than two years. Passage of a companion bill introduced in the Senate could hinge on tax breaks for businesses.

The bill is expected to be brought up in the Senate this week, and U.S. Sens. Kay Bailey Hutchison and John Cornyn, both Texas Republicans, support an increase if it is coupled with tax help for small businesses.

Proponents of the increase say it is a long overdue raise for U.S. workers. A memorandum from the Economic Policy Institute said business owners have received tax cuts since 1997 (when the last minimum wage increase took effect), ``while minimum wage workers have been kept waiting at the back of the line.'

Opponents of a minimum wage increase say it would hurt small businesses and the working poor alike and increase unemployment.

``It's a bad thing for any area,' said Jill Jenkins, chief economist at the conservative Employment Policies Institute, a Washington, D.C., think tank that opposes a minimum wage increase.

EVERY LITTLE BIT HELPS

Jenkins says only a fraction of the benefits of such a boost would go to the working poor. And if they earned more, some could lose benefits like the earned income tax credit, food stamps and housing.

In extreme cases, some people could be worse off earning $7.25 an hour than earning $5.15 an hour and getting the tax credit, she said.

``It does cause job losses,' Jenkins said. ``The unemployment rates will go up.'

That's because some firms will not hire as many workers as labor costs go up, said Pagán, the UTPA labor economist. Higher wages will attract more people to look for jobs, also contributing to higher unemployment rates.

Raising the minimum wage could, in theory, make undocumented workers more attractive hires for employers looking to save on labor costs, Pagán said. But many illegal workers already are in formal sectors, getting paid the same as everyone else.

Some politicians and business owners are not strenuously opposing a minimum wage increase, he said; salaries for most workers already are higher than $5.15 an hour because it has been so long since the last national raise.

``The impact of all of this is fairly minimal,' Pagán said. ``It's mostly symbolic or political more than anything else.'

Past increases in the minimum wage affected more workers, he said.

The last time the minimum wage went up, some businesses feared it would hurt, said Dalia Rodriguez, director for corporate communications at Edinburg-based WorkFORCE Solutions, which is funded by the state's employer and labor agency.

``There was some effect but not what we thought it was going to be,' she said.

Nationally, there are some concerns about labor costs from the small business community, said Sofia Hernandez, chief executive of the Southwest Community Investment Corp., which oversees the Small Business Administration-funded Women's Business Center in McAllen. But she hasn't heard of any such fears locally.

``It's important to the economy to have people earning more, but I know on the business side it's a cost,' she said. ``So you have to balance those two issues.'

As far as students at the University of Texas-Brownsville/Texas Southmost College who are paying for an education with minimum wage work-study jobs are concerned, Congress should raise the Nation's base pay.

One, Ilianna Garza, a 19-year-old freshman biology student, has been working 20 hours a week at the university's news and information department since October. She earns $5.15 an hour and says a raise would help her pay for books, gas and clothes and save for the next semester.

``Every little bit helps, especially when you have to put yourself through school,' she said.

At Media Luna restaurant in Brownsville, Campirano contemplates how a higher Federal minimum wage would affect her business and sole employee. Depending on whether tax breaks are included in the proposed wage increase bill, paying her worker more might mean taking money from her advertising budget or upping the cost of a sandwich 20 cents.

``You don't want to raise prices because that's going to deter people from coming to your establishment, but it's got to come from somewhere,' she said.

On the other hand, ``There's no way anyone can live on $5.15.'

Exhibit 2
[From the Washington Post, Jan. 10, 2007]

Life at $7.25 an Hour

AS HOUSE PREPARES TO VOTE ON MINIMUM-WAGE INCREASE, ISSUE IS COMPLEX FOR THOSE WHO EARN, OR PAY, THAT AMOUNT
(By David Finkel)

Atchison, Kan.--It was payday. Money, at last. Twenty-two-year-old Robert Iles wanted to celebrate. ``Tonight, chimichangas!' he announced.

He was on his way out of the store where his full-time job pays him $7.25 an hour--the rate that is likely to become the nation's new minimum wage. Life at $7.25: This is the life of Robert Iles, and with $70 in a wallet that had been empty that morning, he headed to a grocery store where for $4.98 he bought not only 10 chimichangas but two burritos as well.

From there he stopped at a convenience store, where for $16.70 he filled the gas tank of the car he purchased when he got his raise to $7.25; then he went to another grocery store, where he got a $21.78 money order to pay down some bills, including $8,000 in medical bills from the day he accidentally sliced open several fingers with a knife while trying to cut a tomato; and then he headed toward the family trailer 19 miles away, where his parents were waiting for dinner.

Today in Washington, the House is scheduled to vote on whether to increase the federal minimum wage from $5.15 to $7.25. Passage is expected, with Senate approval soon to follow, and if President Bush signs the resulting bill into law, as he indicated he would, the U.S. minimum wage would rise for the first time since 1997, ending a debate about whether such a raise would be good or bad for the economy.

But even if the matter is settled in Congress, it isn't settled at all in Atchison, and Robert Iles's drive home is proof. Every stop he made on his ride home revealed a different facet of how complicated the minimum wage can be in the parts of America where, instead of a debatable issue, it is a way of life.

At the store where Iles works, for instance, the owner thinks the minimum wage should be increased as a moral issue but worries about which employees' hours he will have to cut to compensate.

At the store where he bought the chimichangas, the cashier who makes $6.25 worries that a raise will force her out of her subsidized apartment and onto the street.

At the convenience store where he bought gas, the owner worries that he will have to either raise prices, angering his customers, or make less money, ``and why would I want to make less money?'

At the store where he got the money order, the worries are about Wal-Mart, which not only supports an increase but also built a Supercenter on the edge of town that has been sucking up customers since it opened three years ago.

As for Iles--who keeps $70 out of every paycheck to cover two weeks' worth of food and gas and in a matter of minutes was already down to $26.54--his worry was as basic as how fast to drive home.

Drive too fast and he'd be wasting gas. But his family was waiting. And his chimichangas, best cooked frozen, were starting to thaw.

THE MEANING OF A DOLLAR

The debate about the minimum wage usually comes down to jobs. If Congress approves the increase, it will result in raises for an estimated 13 million Americans, or about 9 percent of the total workforce. That's a percentage that most economists agree would cause a modest increase in national unemployment. In Kansas, however, ``it would have a fairly significant impact,' said Beth Martino, a spokeswoman for the state Department of Labor. According to one independent analysis, 16 percent of the workforce, or 237,000 workers, would be affected--and that doesn't include the 20,000 whose wages aren't governed by the federal Fair Labor Standards Act and earn the state minimum wage of $2.65. That rate, the lowest in the nation and unchanged since 1988, hints at the prevailing wisdom in Kansas about the minimum wage, which is that the only way low-wage earners will make more is through congressional action.

This holds true from Topeka, where the powerful Kansas Chamber of Commerce has long opposed any raise, to rural Mulvane, home of Republican state legislator Ted Powers, who says his futile effort three years ago to raise the state minimum wage resulted in his being branded a ``dirty dog,' to Atchison, a working-class city of 11,000 where the stores that depend on low-wage workers include one called ``Wow Only $1.00!' This is the store where Robert Iles has worked for five years.

``Robert, would you help me a second?' Jack Bower, the owner, called to Iles soon after opening, as the line at the cash register grew. A onetime Wal-Mart vice president, Bower moved back to Atchison several years ago to teach and ended up buying the old J.C. Penney store, and now runs a business where the meaning of a dollar is displayed on shelf after shelf. The jar of Peter Piper's Hot Dog Relish? That's what a dollar is worth. The Wolfgang Puck Odor Eliminator that a customer was looking at as she said to a friend, ``I just don't know how I'm ever going to make it. My ex-husband's not paying his child support'? That's a dollar, too, as is the home pregnancy test, the most shoplifted item in the store.

``This is not a wealthy community,' Bower explained. ``The thing is, a lot of people depend on this store.'

Robert Iles has his own version of a dollar's meaning, learned last February when Bower took him aside and said he would be getting a pay raise to $7.25. ``Okay,' Iles remembers replying, wanting to seem businesslike. ``But inside I was doing the cha-cha-cha,' he said. ``It was like going from lower class to lower middle class.'

Soon after, he bought his car, a used 2005 Dodge Neon, and just about every workday since then he has spent his lunch break in the driver's seat, eating a bologna sandwich with the engine off to save gas, even in winter. An hour later, he was back behind the cash register, telling customers ``Thank you and have a nice day' again and again.

And meanwhile, Jack Bower wondered whose hours he will cut if he has to give his employees a raise.

It's not that he's against raising the minimum wage--``I don't think $5.15 is adequate,' he said, adding that $7.25 seems fair--but his profit margin is thin, and wages are his biggest controllable expense. So if wages go up, he said, hours will have to come down, and the question will become: Whose?

Will it be Neil Simpson, 66, who works six hours a day as a stockman, and then five more hours somewhere else cleaning floors, and takes care of a wife who is blind and arthritic?

Will it be Susan Irons, 57, who was infected with hepatitis C from a blood transfusion, is on a waiting list for a liver transplant and needs more hours rather than fewer?

Will it be Christina Lux, who is 22 years old and 13 weeks pregnant?

Will it be Iles?

``Attention, all shoppers,' he said into the microphone. ``We will be closing in 10 minutes. Please begin making your final selections.' Ten minutes later, he was clocked out and back in his Neon. ``My brand-new car,' he called it proudly, and he explained how he was able to afford it on $7.25 an hour: a no-money-down loan for which he will pay $313.13 a month until 2012.

SMALL BUSINESS ``AT BOTTOM'

Seven dollars and twenty-five cents an hour equals $15,080 per year, and out of that comes $313 for the car loan and $100 for car insurance, lies said, going over his monthly bills. An additional $90 for the 1995 car with 135,000 miles on it that he is buying from a friend for his mother, $150 for the family phone bills, $35 on his credit card, $100 for gas, $100 toward the mortgage on the trailer. ``That's about it. Oh yeah, $20 in doctors' bills,' he said, and totaled it up on fingers scarred by surgical stitches. Nine hundred and eight dollars. ``I bring home 900 a month,' he said. ``So I very rarely have any money for myself.'

He parked in front of a store called Always Low Prices, which has the cheapest chimichangas in town.

Once it was a full-service grocery store with 28 employees. Then came word that Wal-Mart was looking for land for a Supercenter, and now it has become a bare-bones operation where the starting pay for its few employees is $5.50, and the manager wonders how the store will survive if wages increase.

``We're at the bottom. If the minimum wage went up, I don't know how we would make the cuts to cover it,' Michelle Henry said. The lone salaried employee, she works 80 hours a week to make up for the lack of workers. ``I have mixed feelings,' she continued. ``I know that people can't afford to live on $5.15 an hour. But on the business side, small businesses can't afford to pay it.'

At the register, meanwhile, Shannon Wilk, 33, who makes $6.25 an hour, said that of course she would like to earn more money. It would help her. It would help her 18-month-old daughter. ``It would be good,' she said, ``but also, for me, I live in income-based housing, and if I get a raise, my rent would go up, and I would lose my assistance.' Even the tiniest raise would affect her, she said, and with nowhere to go, the last thing she can afford is a raise to $7.25.

In such an equation, the fact that she was working in Kansas was to her benefit. Atchison sits on the Kansas-Missouri border, and if Wilk worked a few hundred yards to the east, she would already be in jeopardy: In November, Missouri voters supported a ballot initiative increasing the state's minimum wage to $6.50, with an annual adjustment for inflation. Five other states had similar votes, with similar results, bringing to 29 the number that now require an hourly wage above the federal minimum. In the District the minimum is $7, in Maryland it's $6.15, and in Virginia it's $5.15.

Such is the arbitrariness of state-by-state minimum wage laws that Wilk feels lucky to be in Kansas making $6.25 an hour while inside at the first grocery store across the Missouri state line, the cashier was ecstatic that she was in a place where her pay was going from $6.20 to $6.50, explaining, ``That's 30 cents more I ain't got.'

Iles handed over a $10 bill for his 10 chimichangas and two burritos. He stuffed the change deep in his pocket, and headed next to a convenience store owned by a man named Bill Murphy, who said that if he had the chance to talk to new House Speaker Nancy Pelosi, he would ask one question. ``Where does she think the money will come from? And that is the question,' he said. ``My wages are going to go up 10 percent'

Unlike Jack Bower, who would compensate by cutting hours, Murphy said that in his two convenience stores there are no hours to cut. ``I'm going to have to raise my prices,' he said--not only because his workers who make less than the new minimum wage would get raises but also because those who earn more would insist on raises as well. Employees at $7.25 will want $8.25. Those at $8.25 will want $9.25.

Economists classify such workers as the ones who would be indirectly affected by a minimum-wage increase. Of the estimated 13 million workers expected to get raises, 7.4 million are in that category. ``You've created this entitlement,' Murphy said he would tell Pelosi.

And yet he will pay it, he said, and compensate with price increases, which he worries will be inflationary, even though most economists say that won't happen. He will raise prices, he continued, because the only other option would be to earn less money, which he doesn't want to do because he owes $1.5 million on his businesses and wouldn't want to default

``Now that might be a stretch in some people's minds, from giving a guy a raise to not being able to pay the bank, but that's the path I'm talking about,' he said. Against such a dire backdrop, Iles put $17 worth of gas in his car.

``That'll be $16.70,' the clerk said to him, and instead of correcting this, Iles gladly took the change.

Thirty cents, suddenly got.

THE WAL-MART FACTOR

Iles drove past the Atchison Inn, where starting pay is $5.15, past Movie Gallery, where it's also $5.15, and stopped in front of Country Mart, the fanciest grocery store in town, where high school students start at $5.15 and, according to owner Dennis Garrett, ``some of them aren't worth that.'

A few days earlier, Garrett had gotten a letter from a lobbying consortium called the Coalition for Job Opportunities, urging him to write Congress to protest the minimum-wage increase. It came in the form of a letter already written, to which he merely had to add his congressman's name and send it off to Washington.

``We are very concerned,' the letter began, and it was signed by 25 organizations.

The most conspicuous signature, though, was the one that wasn't there, that of Wal-Mart, the nation's largest private employer, with 1.3 million workers. Wal-Mart won't say how many of those workers earn less than what the new minimum wage would be, but if the Atchison store is an example, starting pay is $6 an hour.

Nonetheless, in October 2005, Wal-Mart chief executive H. Lee Scott Jr. said in a speech that the ``U.S. minimum wage of $5.15 an hour has not been raised in nearly a decade, and we believe it is out of date with the times.' He went on to say, ``Our customers simply don't have the money to buy basic necessities between paychecks.'

When it comes to Wal-Mart, however, just about any announcement that affects public policy is greeted with suspicion, and that has been the case with the minimum wage. Some have said that Wal-Mart, in need of good publicity, is supporting an increase for public relations reasons; others have declared it an attempt to drive small, independently owned stores out of business.

These suspicions exist in Atchison as well. As in many small communities, Wal-Mart defines local retail, and just as Always Low Prices had to retool itself, Country Mart was significantly affected by Wal-Mart's new food-stocked Supercenter several miles away.

What is Wal-Mart up to? What are its true motives? Like many others, Dennis Garrett wonders. He imagines public relations is part of it, but he didn't want to speculate on whether this was an attempt to put him out of business, except to say that raising some wages wouldn't do that. He'd reduce some hours, he said. He'd manage.

Yes, Atchison businesses would be hurt initially, but in the long run, if unemployment increases, those hurt the most would be the very ones Wal-Mart insists would be helped--the customers, especially the younger ones, ``the people who don't advance their education and need a job between the ages of 16 and 21, 22, 23.'

In other words, many of the workers in Atchison, one of whom was now at Garrett's service counter buying a money order so he could pay bills. Even though Iles has a checking account, this is the method he prefers because if he were to pay by check, and the check were to bounce because of insufficient funds, the penalty would be devastating. A $25 fee would require more than three hours of work.

And where would those hours come from?

``It's Tough for Me'

So go the calculations of a $7.25 worker, now headed home.

``It's an old trailer,' he explained earlier in the day.

The heat doesn't work, he said, and the water heater works sporadically.

One of the bedroom ceilings is caving in. He sleeps in the other bedroom, and his parents sleep in the living room because his father, who has diabetes and had to have several inches of one of his feet amputated, can't really get around.

Also, his father has leukemia. And is legally blind. And his mother, who once made $6.50 an hour as an aide at a nursing home, quit to take care of her husband.

``We're pretty much living off my money,' Iles said, and in he went to cook them dinner, bring payday to an end and, the next morning, start the cycle again.

Life at $7.25. Should that be the minimum wage?

``Yes,' Iles said.

Even if it hurts job opportunities for people like him, as Dennis Garrett had suggested?

``Yes.'

Or causes price increases, as Bill Murphy had suggested?

``Yes.'

Or damages businesses such as Always Low Prices?

``I mean, it's tough for me, and I'm already making $7.25 an hour.'

Or causes Jack Bower to reduce hours for one of his employees? Perhaps for Iles himself?

``It's just so hard for people. I mean, it's hard,' Iles said, and then he went to work.

``I think it'll be bad today,' one of the workers suggested as the line at the Wow Only $1.00! cash register began to form.

``Well, it depends on your perspective,' Iles said.

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