[Congressional Record Volume 141, Number 126 (Tuesday, August 1, 1995)]
[House]
[Page H8148]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]


     A MODEST INCREASE IN THE MINIMUM WAGE WOULD BOOST THE ECONOMY

  The SPEAKER pro tempore (Mr. Metcalf). Under a previous order of the 
House, the gentlewoman from North Carolina [Mrs. Clayton] is recognized 
for 5 minutes.
  Mrs. CLAYTON. Mr. Speaker, I was troubled, although not surprised, 
recently when I learned of the plans of a company in my district to 
relocate certain of its production to other places and to eliminate or 
relocate about 1,000 jobs, over a 5-year period.
  The downsizing of this plant is part of a disturbing trend that is 
sweeping the Nation.
  According to recent, credible news reports, across America, corporate 
profits are soaring, while wages remain stagnant and consumer spending 
continues to slow. Despite profits that are at a 45-year high, 
Businessweek magazine reports that a ``hard-nosed, cost-cutting 
philosophy * * * has spread through executive suites in the 1990s.''
  Although the fine details surrounding the company in my district's 
decision have not been revealed, a press release from the company 
indicates that their goal is to ensure the ``supply of the highest 
quality medicines in the most cost-efficient manner.'' The press 
release also indicates that many of the operations at the plant ``will 
be transferred to other sites around the world.''
  Far too often these days, the need for greater efficiency and the 
consideration of other locations has meant that corporations have 
sought cheaper labor venues.
  The Businessweek article recounts the decision by a company, founded 
and based in Milwaukee since 1909, that decided to move 2,000 jobs to 
other States where lesser wages could be paid.
  The Washington Post made findings similar to Businessweek in a 
recent, published article. Citing data from the Bureau of Labor 
Statistics, the Post confirmed that productivity and profits are 
rising, but workers pay and benefits is the smallest since 1981.
  According to the Post, workers pay has ``been falling on an 
inflation-adjusted basis for nearly 20 years.'' It is understandable 
that business would seek to be more competitive by cutting costs and 
reducing payrolls. But, this approach can be short-sighted with other 
considerations.
  The Post article quotes Labor Secretary Robert B. Reich, who observed 
that, ``workers are also consumers, and at some point American workers 
won't have enough money in their pockets to buy all the goods and 
services they are producing.''
  Ultimately, the operations at the plant in my district and others 
that produce the various products, are financed by the very workers who 
now face job loss and relocation.
  The gap in income is growing between those who have a lot of money 
and those who have less or little money. That is unacceptable.
  According to an earlier article in Business Week, the income gap 
``hurts the economy.'' Almost half of the money in America is in the 
hands of just 20 percent of the people. That top 20 percent is made up 
of families with the highest incomes. The bottom 20 percent has less 
than 5 percent of the money in their hands. A modest increase in the 
minimum wage could help the bottom 20 percent, and, it will not hurt 
the top 20 percent.
  But, more importantly, a modest increase in the minimum wage will 
result in increases in other wages, and ultimately a lifting of the 
standard of living for all workers, a narrowing of the income gap 
between the very rich and other Americans and a boost to the economy.
  The Department of Labor's Bureau of Labor Statistics recently 
released a report entitled, ``A Profile of the Working Poor, 1993.'' In 
that report the Bureau found that in 1993, 1 in 5 or 8.2 million of the 
40 million people in poverty in this Nation, had a job.
  The study further pointed out that the poverty rate for the families 
of working people in America is 7.5 percent, a rate that has been 
increasing over the past 4 years.
  Most disturbing, children, according to the report, were present in 
85 percent of all poor families with at least one worker.
  Between 1980 and 1992, income for the top 20 percent increased by 16 
percent. During that same period, income for the bottom 20 percent 
declined by 7 percent. For the first 10 of those 12 years, between 1980 
and 1990, there were no votes to increase the minimum wage. Without an 
increase in the minimum wage, those with little money end up with less 
money. That is because the cost of living continues to rise.
  Mr. Speaker, that amount of money makes a big difference in the 
ability of families to buy food and shelter, to pay for energy to heat 
their homes, and to be able to clothe, care for and educate their 
children. That amount of money makes the difference between families 
with abundance and families in poverty. An increase in the minimum wage 
would not provide abundance, but I can raise working families out of 
poverty.
  An increase in the minimum wage can be the kind of spark the economy 
needs to get moving again.
  It makes little sense to discuss welfare reform when working full 
time does not make a family any better off than being on welfare full 
time. Work should be a benefit. It should not be a burden. Work is a 
burden when, despite an individuals best effort, living is an 
unrelenting, daily struggle. Work is a benefit when enough is earned to 
pay for essentials.
  In addition, a recent study indicates that job growth in America is 
lowest where the income gap is widest. Closing the gap helps create 
jobs rather than reduce jobs. Those who argue that an increase in the 
minimum wage will cause job losses, fail to look at the facts. The fact 
is that not increasing the minimum wage has caused job losses.
  Mr. Speaker, there are 117,000 minimum wage workers in North 
Carolina. Those workers are not just numbers. They are people, with 
families and children.
  They are farmers and food service workers, mechanics and machine 
operators. They are in construction work and sales, health and cleaning 
services, and a range of other occupations. Their families helped build 
this Nation, and they can help rebuild it.
  They do not need charity, they need a chance. A chance is a modest 
increase in the minimum wage. We should reward work, Mr. Speaker, 
stimulate the economy and and lift this Nation up. We have time for 
Waco and Whitewater, let us make time for wages.


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