[Congressional Record Volume 141, Number 165 (Tuesday, October 24, 1995)]
[House]
[Pages H10711-H10719]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                    ANNIVERSARY OF THE MINIMUM WAGE

  The SPEAKER pro tempore. Under the Speaker's announced policy of May 
12, 1995, the gentleman from New York [Mr.Owens] is recognized for 60 
minutes as the designee of the minority leader.
  Mr. OWENS. Mr. Speaker, I would like to begin on a note of agreement 
tonight. The previous speakers have talked about the great need for the 


[[Page H 10712]]
American middle class, and I will include the working class, to have a 
tax cut. They are 100 percent right. We need a tax cut for families and 
individuals. The way to get the tax cut for families and individuals, 
and at the same time not increase the deficit and balance the budget, 
all in one, is to take a look at this chart, the discrepancies here, 
why the taxes have greatly increased on individuals since 1943 and 
greatly decreased on corporations.
  The red is the corporation, the blue is families and individuals. In 
1943, corporations were paying 39.8 percent of the total tax burden, 
39.8 percent, while individuals and families were paying 27.1 percent. 
Now, in 1995, individuals and families are paying 43.7 percent, and 
corporation are paying 11.2 percent. At one point it went haywire and 
it was even a worse ratio. Individuals and families were paying 48.1 
percent in 1983 under Ronald Reagan and corporations went down as low 
as 6.2 percent.
  I would like to begin on a note of agreement, that the gentlemen who 
were here before exclaiming that we need a tax cut, I agree, we need a 
tax cut for families and for individuals. You can have that tax cut and 
still balance the budget if you will deal with this inequity. The 
corporations should be paying a greater percentage of the overall tax 
burden. We should get rid of corporate welfare. The loopholes, a recent 
study shows that if the cuts you made on individuals and poor people, 
the percentage cut that was made in the Republican budget, if that same 
percentage cut was applied to corporations, corporations would be 
losing $124 billion over a 7-year period, if it were just equal in the 
application of the cuts and you cut corporate welfare as much as you 
cut low income programs.
  I hope we will bear in mind that Democrats and Republicans should 
agree that families and individuals are due for a tax cut. They should 
have it, and they can have it, and you can have it without increasing 
the deficit and you can have it even with a balanced budget. We do not 
have to rush the balanced budget in 7 years; we can do it in 10 years 
and not make devastating draconian cuts. Just balance the tax burden 
and you can balanced the budget and do it without a deficit.
  I agree with my colleagues, every American family ought to be angry 
at this kind of ratio, where the swindle has taken place, corporations 
have gone down, down, down in their portion of the tax burden, while 
individuals have gone up.
  It is appropriate that we begin this discussion, I think, on the day 
where we are, I hope, celebrating, a will use the word celebrating, the 
anniversary of the institution of the first minimum wage law. Today, 57 
years ago, the first minimum wage law was passed. Twenty-five cents per 
hour was set as the minimum wage, the first passed in this Nation. 
Today we have gone from 25 cents an hour to $4.25 an hour, and 
according to leading economists, including Nobel Prize winning 
economists, we are in worse shape in terms of the relative value, the 
purchasing power of that $4.25 an hour. It is down almost as low as it 
was, or lower, than it was in 1955. The purchasing power is at an all-
time low. It is time to increase the minimum wage.
  If you want to help working class families, then one of the first 
things we should do is increase the minimum wage, because even under 
the minimum wage, a family wage earner, working full-time, a 40-hour 
week, will earn less than $9,000. A family of four needs about $14,000 
in this Nation not to plunge into poverty. But if you earn every 
working day of the year, earn the minimum wage, you will be way below 
that $14,000. So there are a number of problems that would be solved if 
we were just to move forward with an increase in the minimum wage.
  There are reasons why that is not a bipartisan policy anymore, and we 
are going to talk about that.
  I will be joined today by a number of my colleagues. We are going to 
talk about the anniversary of the minimum wage and the implications of 
it, where does it fit into the whole scheme of the budget 
reconciliation, into the whole insistence we must have a tax cut at the 
same time. Are we going to make draconian cuts in Medicare and Medicaid 
and cut school lunches? Where does it all fit in here? Where does it 
fit with welfare reform where they say people should go to work?
  One Governor was recently quoted and saying people do not need job 
training, they need alarm clocks. Get them up and there is work out 
there. There is very little work out there in some places. An article 
in the New York Times today on the front page talks about the great 
Michigan experiment where the Governor of Michigan proclaimed he solved 
the welfare problem and put people to work. What they found is people 
have been put to work and remained on welfare because they are going to 
work making minimum wage and not making enough to live on. They still 
need help from the government. So you are going to replace a long cycle 
of people being on welfare who were not working with a new kind of 
person who is working and also on welfare, because the minimum wage is 
not high enough to allow them to take care of a family and meet basic 
needs.
  Joining me immediately is my colleague on the Committee on Economic 
and Educational Opportunities. She knows quite a bit about all this. 
She has been on welfare and knows all about the minimum wage, and I am 
proud to have here join me today, the gentlewoman from California [Ms. 
Woolsey].
  (Ms. WOOLSEY asked and was given permission to revise and extend here 
remarks.)
  Ms. WOOLSEY. Mr. Speaker, I would like to compliment my colleague 
from New York for having this special order tonight on the anniversary 
of the minimum wage.
  Mr. Speaker, 28 years ago I was a single, working mother with three 
small children receiving no child support and earning minimum wage. 
Even though I was working, I was earning so little, I was forced to go 
on welfare to provide my children with the child care; health care; and 
food they needed. Even though I was educated and had good job skills, I 
still wasn't making enough to fully support my kids.
  My story bears repeating tonight, because too many families today are 
in the same predicament I was in 28 years ago. If this Congress is 
truly serious about reducing dependence on welfare, then let's increase 
the minimum wage and pay working parents enough to support their 
families and take care of their kids.
  The minimum wage has not kept up with increases in the cost-of-
living. Workers these days can put in a full day of work, 40 hours a 
week, at minimum wage and still live below the poverty line. The new 
majority in Congress wants to cut the earned income tax credit; kick 
single moms and their children off welfare; and reduce health benefits 
for low-income families, but they won't even hold a hearing on 
increasing the minimum wage.
  If we want to reduce reliance on public assistance, doesn't it make 
sense to make work pay? Shouldn't entry level jobs pay more than public 
subsidies? Doesn't that make sense?
  In addition to making good sense, a minimum wage increase is also a 
matter of basic fairness for millions of working Americans. In 1960, 
the average pay for CEO's of the largest U.S. corporations was 12 times 
greater than the average wage of a factory worker. Today, those CEO's 
receive salaries and compensation worth more than 135 times those, 
wages and benefits, of the average employee at the same corporation. 
That's not fair.
  And it's not fair that 80 percent of minimum wage employees are 
women. It's not fair that from 1973 to 1993, real income for working 
men with high school diplomas dropped by 30 percent.
  It's not as if businesses aren't doing well. Private business 
productivity has been increasing and profits are up. But wages are 
stagnant--there's something unfair and wrong with this picture.
  Isn't it time to let American workers share the fruits of their 
labor?
  Speaker Gingrich and his allies say they support traditional American 
values. Well, let's return to the traditional American value of paying 
an honest wage for an honest day's work. Let's raise the minimum wage.

                              {time}  2100

  Mr. OWENS. Mr. Speaker, I thank the gentlewoman from California [Mrs. 
Woolsey], and reclaiming my time, I would like to note at this point 
that another of my colleagues intended to be here but could not make 
it. The gentleman from Puerto Rico Carlos Romero-Barcelo, another 
Member of the 

[[Page H 10713]]
Committee on Economic and Educational Opportunities, also would like to 
submit his statement for the Record.
  Mr. Speaker, I think we should understand the difficulty with the 
minimum wage and the ability to achieve a bipartisan consensus on 
taking this very simple step that has been proposed. We are proposing 
we increase the minimum wage by a mere 90 cents over a 2-year period in 
a two-step operation. We want to increase it by 45 cents one year and 
45 cents another year. A mere 90 cents increase. We will still be 
behind the inflation curve but that very meager effort is being opposed 
by the Republican majority in this House.
   A statement has been made by the Republican majority that they will 
not entertain even 1 cent, even a 1 cent increase in the minimum wage. 
The Committee on Economic and Educational Opportunities, as pointed out 
before by my colleague from California, will not hold hearings to even 
discuss the matter of raising the minimum wage.
  Mr. Speaker, what is the problem? Let us go back to the chart. These 
simple bars tell a great story about what is happening in America. 
These simple bars here tell a greater story about how power is being 
used to shape the American economy and to keep a large percentage of 
Americans in poverty and another large group of Americans in a state of 
perpetual insecurity. This is a story of greed and power. A story of 
greed and power.
  The power resides in the corporations. Corporations are able to 
manipulate economy. Corporations are able to manipulate contributions 
to Congressmen and all other levels of political officials. 
Corporations are able to lobby endlessly and get a swindle situation 
like the one we see here, where in 1943 corporations were paying 39.8 
percent of the taxes, and in 1983 it went down as low as 6.2 percent 
under Ronald Reagan's regime, and in 1995 we still have a situation 
where they are only paying 11.2 percent while individuals and families 
are paying 43.7 percent.
  The power of the corporation is such that the corporations have sent 
down an edict as powerful as any totalitarian dictator that we do not 
want the minimum wage increased. Corporate power has said that, and the 
servants of corporate power, the Republican majority in this House, 
have said we will not entertain an increase in the minimum wage by even 
1 cent.
  Mr. Speaker, they want to have the lowest possible wage rates. They 
want to have a class of people that are paid the lowest amount of 
moneys in order to be competitive with the global marketplace. They 
want to have our workers slowly be pushed down to the level of the 
poorest people in Bangladesh or down to the level of the prisoners in 
China. Prisoners in China are forced to work for almost nothing. At 
least Bangladesh people get some kind of wages. They want that kind of 
condition.
  They want the Mexican phenomenon to begin to operate here, where we 
begin to measure our wage rates against the wage rates across the board 
order in Mexico. And right away, every time we talk about wage 
increases, they say, well, we are getting further and further away from 
being able to be competitive with the Mexican labor market.
  Today is the 57th anniversary of the date the minimum wage first took 
effect in this country. On October 24, 1938. I was only 2 years old. 
American employees were first guaranteed a minimum wage of 25 cents an 
hour to protect them from exploitation and ensure that their work would 
be fairly compensated.
  Six years ago President Bush signed into law the last increase in the 
minimum wage. That increase was 90 cents over 2 years and enjoyed a 
broad bipartisan support in the Congress. The vote in this House of 
Representatives was 382 to 37. Only 37 Members of the House of 
Representatives voted against that increase in the minimum wage which 
took place under the Bush administration just 6 years ago. I was here. 
I remember that very well.
  This year the real value of the minimum wage is at its lowest level 
since the early 1950's. While an increase in the minimum wage is 
clearly long overdue, and although we have a proposal from President 
Clinton to increase the minimum wage to $5.15 per hour over a 2-year 
period, there is no sign of that bipartisan effort that characterized 
the last increase.
  The proposal has languished here in Congress while the leadership has 
refused to even schedule hearings. In fact, even the Committee on 
Economic and Educational Opportunities, which has jurisdiction over the 
bill, will not hold a hearing on the issue. How times have changed. How 
times have changed from the date when only 37 Members of the House of 
Representatives voted against an increase in the minimum wage to a time 
now where only a little more than half the Democrats in the House of 
Representatives are cosponsors of the minimum wage increase bill.
  There is a bill, Mr. Speaker, and the primary sponsor is the Minority 
Leader, Mr. Gephardt. The President has endorsed the bill, yet only a 
little more than half the Democrats in the House of Representatives 
have signed onto that bill as cosponsors. Is it any wonder that the 
Republicans who are in the majority treat the effort with contempt if 
we cannot get most of the Democrats in the House to get on board.
  If ever there was a clear issue which defined the differences between 
the two parties it ought to be an increase in the minimum wage. What is 
wrong with the Democrats who propose to represent the working people? 
Why can we not unite and fight for an increase in the minimum wage?

  A chief argument against raising the minimum wage among both 
economists and some politicians, Democrats as well as Republicans, is 
the fear of job losses. The threat is that employers will dismiss 
thousands of workers on the grounds they lack the skills to be worth 
more than the minimum wage. Nearly all of these estimates of job losses 
have shrunk as the research has taken place.
  Every time we have increased the minimum wage this argument has been 
made that we are going to decrease the number of jobs available because 
the employers will choose to employ fewer people. Every time that 
argument is made there have been studies done, and studies on top of 
studies, and they all conclude that it does not happen. There is a need 
for workers out there and they do not get thrown aside or laid off as a 
result of increases in the minimum wage.
  Mr. Speaker, earlier this month 101 eminent economists effectively 
challenged this theory. These are economists whose lives it is to study 
the economy, all aspects of it, including minimum wage. They issued a 
strong and unprecedented call for an increase in the Federal minimum 
wage to help raise the living standards of families who rely on incomes 
of low-wage workers. These diverse and respected economists, including 
three recipients of the Nobel Prize in economics, and seven past 
presidents of the American Economics Association, endorsed President 
Clinton's proposed two-step 90-cent increase in the minimum wage.
  Mr. Speaker, these economists noted that recent studies found that 
the last several increases in the minimum wage had ``Negligible or 
small'' effects on employment. A Nobel Prize laureate Robert Solow has 
said, ``The fact that the evidence on job loss is weak suggests that 
the impact on jobs is small.''
  However, for some reason the leadership in this Congress seems 
obsessed with gutting the wages of hard working Americans. American 
citizens should ask their Congressmen, ask their Congressmen why he 
disagrees with 100 of the leading economists in the country. Why he 
disagrees with Nobel Prize winning economists that we need a minimum 
wage increase in this country. They should ask their Congressman. He 
may be a Democrat. Ask him, too.
  Mr. Speaker, we have seen the Republican leadership attempt to 
destroy wages in other ways. In the construction industry they are 
seeking to repeal the Davis-Bacon Act. The Davis-Bacon Act requires 
that all jobs that are federally funded construction jobs must have a 
situation where the prevailing wages in that area are paid. I have 
looked very closely at what that means and I find in many States the 
prevailing wage level is quite low, and yet there is this tremendous 
drive to destroy the Davis-Bacon Act and not allow it to pay the 
prevailing wages in a given area.

[[Page H 10714]]


  There have been some efforts now to compromise that. People who 
wanted to destroy Davis-Bacon are willing to reconsider. After all, 
Davis-Bacon was primarily a Republican conceived act, both Davis and 
Bacon were Republicans. This is an act which very much helps middle 
class people. The people who are in those jobs in construction are 
middle class people. When they can find the jobs and are paid, they end 
up being a part of our basic middle class. So we have begun to get some 
kind of compromise on the Davis-Bacon Act.
  The same people are insisting that the companion act, the Service 
Contract Act, which says that in situations where the Federal 
Government is involved, janitors and other service employees of that 
kind, also must be paid prevailing wages. Efforts are still underway to 
destroy the wages that are undergirded and supported by the Service 
Contract Act. Janitors and other service employees of that kind are 
involved here. Janitors at Federal facilities, who are working full 
time, are often paid wages which are below the poverty level. Working 
for Federal facilities they are paid wages below the poverty level. Yet 
the Republican leadership in this Congress believes that janitors are 
making too much money as a result of the Service Contract Act.
  Who cares about working people? Who cares about families? They talk 
about $500 per child tax credit. Are they really sincere if they will 
not provide a decent wage for the average working person out there and 
allow them to earn enough money to be able to qualify for that tax 
credit? Most of them will file taxes but will not be able to get a tax 
credit because they are making such small amounts of money on minimum 
wage, less than $9,000 for a family of four. They will not have to pay 
any taxes. They will not be able to take advantage of a tax credit.
   Mr. Speaker, let us bring all the people up as far as possible 
through the long-term, time honored device of paying a decent wage.

                              {time}  2115

  Let us make work pay. We have just destroyed much of the welfare 
program. We have just taken away the entitlement for young children. 
Poor children, since the beginning of the New Deal, have been 
guaranteed that if their family qualifies, if they are really poor, if 
they are means tested and found to be really poor, they qualify for Aid 
to Families with Dependent Children.
  That is an entitlement. It is a right. Everybody who meets it is 
supposed to get it. They get it at different levels in different 
States, but the States do it and the Federal Government stands behind 
them. No matter how much money is needed in a given year, the Federal 
Government will make certain that the money is available, because it is 
an entitlement.
  That entitlement for poor children has been taken away. There is 
still an entitlement, by the way. Social Security provides an 
entitlement for the children of deceased members of Social Security. 
People who were enrolled in Social Security, their children are 
eligible if they should die, and they are eligible at much higher 
rates.
  Fortunately, the Social Security Act does provide a more humane face 
and it provides it even without a means test. Let us not let them 
destroy the Social Security provision which takes care of orphans; yet, 
it is gone for those who are not fortunate enough to be covered by 
Social Security.
  In another demonstration of their utter disdain for working people, 
the Republican reconciliation bill proposes to obliterate, greatly 
reduce, the earned income tax credit. The earned income tax credit 
provides much-needed tax relief for working families, those working 
poor.
  Here is where some of the people earning those minimum wages are 
given some benefits and some incentives by their government to keep 
working. If you are earning minimum wage, and you have a family of 
four, or even a family of three, under present qualifications even no 
children under some circumstances, you are able to collect additional 
money as a result of your having earned money. The earned income tax 
credit rewards those who are working.
  It is a small amount of money, but it is important and it adds up to 
quite a bit proportionately when you are poor. But now the Republicans 
will not stand for that. Do not reward the working poor. Do not be 
consistent.
  They say they want to help families. We have heard long speeches 
tonight about helping families by providing a $500 tax credit. Why are 
they providing a $500 tax credit for those who are earning enough money 
to be able to qualify for a tax credit, while they refuse to provide 
help for those who are much poorer, but also working and in a lower 
bracket, needing some help through the earned income tax credit? Why 
are they getting rid of the earned income tax credit and providing a 
tax credit for people at a higher level?
  I am not against a tax credit for people with children at a higher 
level. That is one of those tax cuts that ought to be given. When we 
get at much higher levels and we are dealing with capital gains being 
treated as if capital gains were some kind of privilege, versus wages, 
we have a higher rate of taxes on wages, people's sweat that go to work 
every day. The amount of money they earn through wages is very low and 
we tax those at a higher rate than capital gains, where nobody sweats. 
They are gains made on investments.
  Why should capital gains be in a different category? And when you put 
capital gains on the table, we are rewarding the richest people. Who 
owns the property? Five percent of the people in America own 90 percent 
of the wealth in this country. So capital gains rewards that 5 percent, 
or the top 20 percent.
  The tax decrease that is being proposed by the Republican majority is 
a tax decrease for the rich. We need a tax decrease. Families and 
individuals, rich or poor, deserve a better break than they have been 
getting under this construct here where corporations have been allowed 
to get off the hook, not bear their share of the burden, in order to 
pay for the fact that they are paying so little.
  This was done under the Democrats. We cannot blame the Republicans 
solely for this. Ronald Reagan, with his trickle-down economics, 
accelerated it. It got to the worst point under Ronald Reagan in 1983, 
when corporations went as low as 6.2 percent of the tax burden.
  And notice, as the corporations dropped low, individuals have to make 
up the difference. Always the individual taxes rise when the 
corporations' taxes drop. The highest points of individual and 
family taxes was 48.1 percent in 1983, at the same time that the 
corporations reached their lowest point of 6.2 percent.

  This is where the deficit started too. A combination of the 6.2 
percent and the 48.1 percent was not great enough to pay for the 
Government's expenses, so we were borrowing more money. Here is where 
the deficit started under Ronald Reagan where the deficit leaped 
geometrically in terms of its increase, and the problem we are trying 
to correct with the deficit-reduction policies now took off with a 
vengeance following this kind of situation where corporations were 
allowed to swindle the American people.
  This swindle should not be allowed to go on. Here is the atmosphere 
that dictates that there shall be no increase in the minimum wage. 
These corporations in 1995 are making higher profits than ever before. 
They are booming. Technology, science, the peace of the world that all 
of us helped to make. The peace of the world that young men went off 
and died for in Vietnam and Korea, on the Normandy beaches. Everybody 
contributed to what is happening in the world today.
  The technology and the science that American taxpayers paid for, a 
large base of it was paid for in Government research and military 
research, radar, computerization, a number of things that are really 
driving this economy and allowing corporations to make great amounts of 
money.
  All of that is being taken advantage of by the corporate sector and 
they are not sharing it. The taxes are still too high for individuals 
and families. At the same time, these corporations are laying off 
people and not only will they refuse to pay an increase in the minimum 
wage, those who have jobs are less and less secure.
  I grew up in a family which was very poor. My father, I think he was 
a genius but he only had a sixth grade education. I think he was a 
genius, because with his sixth grade education, 

[[Page H 10715]]
any problem that I took home in my math book, those word problems that 
most kids could not work in school, my father never failed to solve 
those problems.
  He did that until I reached algebra, where the X's and the Y's 
confused him. He could not deal with that. The basic intelligence was 
there. My father was very intelligent. My father was hard-working. He 
was a heavy drinker of Coca-Colas and RC Colas and Dr. Peppers. That is 
all he drank; nothing stronger.
  My father always had a garden, no matter where we lived. Memphis was 
a big city, a big city in the South, there are always places where we 
could have a garden and he always grew things. But my father never made 
anything more than the minimum wage. There was never a time when he was 
working that he made more than the minimum wage.
  The minimum wage was quite low at that time, but we were happy with 
the minimum wage as long as he had a job. Our fear was always that he 
was going to get laid off. We were struggling to make do on the minimum 
wage. My mother, who was smarter than my father, my mother knew the 
price of pinto beans in those little packages, and the northern beans, 
neck bones and spaghetti on Sundays. She could take a budget, a minimum 
wage budget, and feed us effectively.
  I never went hungry when my father had a job. But there were 
oftentimes that he was laid off at the factory. Oftentimes. And there 
were times when they were on strike, and those were times we feared. 
The minimum wage, as low as it was, was a Godsend. We had security as 
long as he had the job. We could survive on the minimum wage.

  But so many Americans right now who are earning above the minimum 
wage, as a result of this corporate greed atmosphere, the corporate 
greed era that we are in now, they are insecure about how long they are 
going to keep their jobs. Many of them were making much higher hourly 
wages and have been forced to take less. Many of them are changing jobs 
and are forced to start a whole new career as a result of the kinds of 
dislocations taking place in this era where the corporations are 
driving the economy, and they are doing it in a spirit of greed. Far 
more extreme measures are being taken than need to be taken.
  The case for increasing the minimum wage is abundantly clear within 
this situation. It is a tiny step. It is a microactivity that would 
help individuals and families a great deal, but there will be no great 
dislocation in the economy. The case for increasing the minimum wage is 
abundantly clear and the overwhelming majority of Americans agree.
  This is not something that the economists, the Nobel prize winners 
only understand. It is a general, common sense understanding. The 
minimum wage that was increased 6 years ago, as inflation as moved on 
and costs have increased, is obsolete and the purchasing power is far 
less than it was in 1955.
  We need an increase. Eighty percent of the American people support an 
increase in the minimum wage. It is said that politicians are always 
responsive to their constituencies. Well, here is where the corporate 
dictators have said, ``No, we do not want an increase,'' and the 
Republicans in the majority here, and a large number of Democrats also, 
are saying, ``We will listen to the corporate dictators. We will not 
listen to the American people, our constituency.''
  Eighty percent of the people support an increase in the minimum wage. 
That is a sizable portion of the people in every congressional district 
who support an increase in the minimum wage. We heard a lot of talk on 
the House floor about surveys that have been done about taxes. Why not 
ask the American people and the people in your district what they think 
of the minimum wage. Should we increase it by a mere 45 cents this year 
and 45 cents a year later? Ninety cents? Why not ask the question of 
your constituents and hear what they have to say, Members of Congress 
and Members of the Senate. Ask the question and listen to the American 
people.
  Opinion polls tell us that 80 percent of the people want an increase 
in the minimum wage. The people recognize that there is something wrong 
when a full-time worker making the minimum wage earns $8,500, far below 
the poverty level for a family of four, which as I said before is 
$14,754.
  Consider these facts: The average minimum wage earner brings in at 
least half of the family's income. One-third of minimum wage earners 
are the sole breadwinners in their families. Over 4 million American 
workers are paid the minimum wage at this point. There is some notion 
of: Who works for the minimum wage anymore? That is too low. Over 4 
million American workers are still working for the minimum wage, as low 
as it is.
  No union goes out to bargain for the minimum wage, of course. They 
are far above minimum wage. But the minimum wage is a bargaining tool 
for all levels of workers. Because when you have that as a floor, it 
allows the bargaining process to move upwards. As long as the minimum 
wage is stagnant, all other wages are going to be stagnant too, and 
they are.
  Two-thirds of the minimum wage earners are adults. There is this 
notion that only kids are earning minimum wage, and who cares whether 
kids earn 90 cents an hour more or not? What difference does it make? 
They are kids. They are in a family where somebody else is the 
breadwinner or head of the household. Let us not pay kids minimum wage.
  Two out of three minimum wage earners are adults. Almost three-fifths 
of the minimum wage earners are women, including many women who are the 
heads of their households, single parents.
  The minimum wage was originally enacted to help provide workers with 
a fair day's pay for a fair day's work. In today's economy, $8,500 a 
year falls way short of the mark of providing a fair day's work for a 
fair day's pay, or a fair year's work for a fair year's pay.

                              {time}  2130

  We have proposed an increase from $4.25 to $5.15. Like the adjustment 
to the minimum wage enacted 6 years ago, this 90-cent increase is 
phased in over a 2-year period.
  Contrary to claims of opponents, most economists agree that a modest 
increase such as this will have no significant effect on job creation. 
This is an issue of simple fairness. Workers deserve to be compensated 
for their efforts. Everybody deserves to be compensated for their 
effort at a reasonable level. Why can we not pay workers a mere $5.15 
an hour?
  In this corporate era, the corporations dictate what happens in the 
economy. They dictate who wins and who loses. The corporations create a 
situation where taxpayers are footing a disproportionate share of the 
tax burden. Corporations decide the policies in this Congress. They 
write the bills for the Republican majority.
  Corporations are going along with a balanced budget scenario, but 
they are not going to make any sacrifices. If corporations were cut as 
much as the social programs, they would be contributing $124 billion 
over a 7-year period, would be the cuts in corporate welfare and 
corporate loopholes, et cetera, but that is not the case.
  These same corporations have chief executive officers who make 
enormous salaries, some above $20 million a year, salaries and other 
compensation reach more than $20 million a year for the corporate chief 
executive officers of many corporations. So many earn more than $1 
million a year that bills have been proposed.
  Even the President supported at one time a bill which would limit the 
deduction in terms of business expenses. The salary of a chief 
executive would be limited in that business deduction situation when 
the corporate taxes are filed to no more than $1 million a year. After 
$1 million a year, the corporation would not be able to take the 
compensation for the chief executive officer off the taxes. That has, 
of course, not passed.
  But when you compare the chief executive officers in America, in our 
economy, with the chief executive officers in Japan, which is a high-
technology, booming economy like ours, or in Germany, another high-
technology, booming economy, or most of the other industrialized 
nations, the compensation for chief executives is far below the 
compensation for chief executives in the United States.
  Japanese tycoons at the head of huge corporations make as little as 
$300,000 

[[Page H 10716]]
a year--$300,000 to $500,000 a year is close to an average for some of 
the largest corporations in Japan. Even when you add in other parts of 
the compensation package, I assure you that they do not have anything 
like the compensation of the chief executive officers of American 
corporations.
  In this economy of greed, where the corporations dictate the 
policies, they cannot allow a simple 90-cent increase in the minimum 
wage while the chief executives walk off with millions.
  There is growing income inequality in this country that has been 
documented. Recent studies have shown that we have shifted place with 
Great Britain. Where the differences between the very rich and the very 
poor where once the greatest in Britain, now it is greatest in the 
United States. It if far worse in the United States than in any other 
place. The rich are far richer than the poor in this country for the 
first time in history. There is a growing income inequality.
  In this atmosphere of corporate greed, after-tax profits are the 
highest that they have been in 25 years. But corporate America is not 
sharing the bounty with the average workers who help to produce it. The 
after-tax rate of return to capital investment in 1994 was 7.5 percent. 
By comparison, it averaged just 3.8 percent between 1952 and 1979. 
These higher profits have not been reinvested in the economy.
  They claim that higher profits always lead to reinvestment. They have 
not been reinvested in the economy. Investment as a share of output, 
investment as a share of profit, has declined, instead of increased.
  Nor have these higher profits been returned to workers. Since 1989, 
average real wages for most of the work force have either remained 
stagnant or declined. The hourly wage of the median male worker has 
declined 1 percent per year since 1989.
  The gap between the wealthiest and poorest Americans is the widest it 
has been since the Census Bureau began collecting income statistics in 
1947: 44.6 percent of U.S. income is controlled by the top 20 percent 
of the wealthiest American families. The bottom 20 percent earn just 
4.4 percent of national income.
  According to the Census Bureau, since 1980 the income of the top 20 
percent of families has risen 16 percent over inflation. The income of 
the bottom 20 percent has fallen 7 percent below inflation in this 
period.
  In this era where the corporations are dictating the policies here in 
Congress, the corporations have perpetuated a great swindle and refused 
to let up. They will continue to swindle. In the reconciliation bill 
that will be on the floor starting tomorrow, you will find nothing done 
to correct this great injustice.
  Corporations have been cut, I understand, by about $6 billion in 
corporate welfare. But, in other ways, they have put back money which 
equals that $6 billion. So corporations will end up with a zero cut in 
corporate welfare after the reconciliation bill is passed in this 
House.
  Corporations benefit greatly by all of the activities in the overall 
American economy. They do not just go off and make the money by 
themselves. There is a whole complex economy that supports them. There 
are the American consumers that support them. There is the Federal 
deposit insurance of the banks that helps to hold up the economy.
  At a time when corporate leaders and banking leaders nearly wrecked 
the economy with the savings and loan swindle, it was the American 
taxpayer who had to step in to the tune of more than $300 billion to 
bail out the failing banks in order to keep the whole financial scheme 
of the economy from collapsing.
  So we are all in this together when it comes to making America work. 
But when it comes to sharing the results of the benefits of our overall 
society, corporations want it all for themselves. They will not even 
allow a 90-cent increase in the minimum wage.
  The ratio of average hourly pay of men in the top 10 percent of wage 
earners to those at the bottom 10 percent is 5.6 in the United States. 
In other words, the top 10 percent of people in our economy make 5.6 
more than the bottom 10 percent. That means for every $10 that you 
make, the top people make almost 6 times that amount. In Germany, the 
ratio is only 2.7. In France the ratio is 3.2, in Japan the ratio is 
2.8, in Britain the ratio is 3.4. But here in the United States the 
ratio of the earners at the top is 5.6, almost 6 times the earnings of 
the people at the bottom. Some of the highest paid chief executive 
officers in America are also the Nation's biggest job killers. The CEO 
of IBM earned $4.6 million last year. He has laid off 122,000 workers 
since 1992. The CEO of AT&T earned $3.5 million last year. He has laid 
off 83,000 workers since 1992. The CEO of General Motors earned $3.4 
million last year. He has laid off 74,000 workers since 1992.

  Some $122.5 billion of the Republican tax cut will go to Americans 
who are earning $100,000 or more. They will not help the people who 
need the minimum wage increase. Nearly all the Republican spending cuts 
are directed at the people who need the minimum wage increase. The 
Republican spending cuts are directed at low- and middle-income 
Americans, denying them access to quality health care, affordable 
housing and the opportunity to pursue the American dream through 
education.
  Here is the photo, the snapshot of America, the kind of America that 
is now being dominated and dictated to by corporate greed.
  Three Nobel Prize winners who are backing the minimum wage increase 
are Kenneth J. Arrow of Stanford University, Lawrence R. Klein of the 
University of Pennsylvania, and James Tobin of Yale. Many other former 
presidents of the American Economics Association also back the increase 
in the minimum wage.
  They put out a simple statement. I will not read the entire 
statement. I will enter into the Record the statement of support for a 
minimum wage increase by the 100 top American economists. Along with 
the statement, of course, will go the actual names of those 100 
economists who are responsible for this statement of support for 
minimum wage increase.
  Mr. Speaker, the document is as follows:

            Statement of Support for a Minimum Wage Increase

       As economists who are concerned about the erosion in the 
     living standards of households dependent on the earnings of 
     low-wage workers, we believe that the federal minimum wage 
     should be increased. The reasons underlying this conclusion 
     include:
       After adjusting for inflation, the value of the minimum 
     wage is at its second lowest annual level since 1955. The 
     purchasing power of the minimum wage is 26 percent below its 
     average level during the 1970s.
       Since the early 1970s, the benefits of economic growth have 
     been unevenly distributed among workers. Raising the minimum 
     wage would help ameliorate this trend. The positive effects 
     of the minimum wage are not felt solely by low-income 
     households, but minimum wage workers are overrepresented in 
     poor and moderate-income households.
       In setting the value of the minimum wage, it is of course 
     appropriate to assess potential adverse effects. On balance, 
     however, the evidence from recent economic studies of the 
     effects of increases in federal and state minimum wages at 
     the end of the 1980s and in the early 1990s--as well as 
     updates of the traditional time-series studies--suggests that 
     the employment effects were negligible or small. Economic 
     studies of the effects of the minimum wage on inflation 
     suggest that a higher minimum wage would affect prices 
     negligibly.
       Most policies to boost the incomes of low-wage workers have 
     both positive and negative features. And excessive reliance 
     on any one policy is likely to create distortions. The 
     minimum wage is an important component of the set of policies 
     to help low-wage workers. It has key advantages, including 
     that it produces positive work incentives and is 
     administratively simple. For these and other reasons, such as 
     its exceptionally low value today, there should be greater 
     reliance on the minimum wage to support the earnings of low-
     wage workers.
       We believe that the federal minimum wage can be increased 
     by a moderate amount without significantly jeopardizing 
     employment opportunities. A minimum wage increase would 
     provide a much-needed boost in the incomes of many low- and 
     moderate-income households. Specifically, the proposed 
     increase in the minimum wage of 90 cents over a two-year 
     period falls within the range of alternatives where the 
     overall effects on the labor market, affected workers, and 
     the economy would be positive.

   Signatories to Economists Statement of Support for a Minimum Wage 
                                Increase

       Aaron, Henry--Brookings Institution.
       Abramovitz, Moses--Stanford University.
       Allen, Steven G.--North Carolina State University.
       Altonji, Joseph G.--Northwestern University.
       Applebaum, Eileen--Economic Policy Institute.

[[Page H 10717]]

       Arrow, Kenneth J.--Stanford University.
       Bartik, Timothy J.--Upjohn Intitute.
       Bator, Francis M.--Harvard University.
       Bergmann, Barbara--American University.
       Blanchard, Olivier--Massachusetts Institute of Technology.
       Blanchflower, David--Dartmouth College.
       Blank, Rebecca--Northwestern University.
       Bluestone, Barry--University of Massachusetts Boston.
       Bosworth, Barry--Brookings Institution.
       Briggs, Vernon M.--Cornell University.
       Brown, Clair--University of California at Berkeley.
       Browne, Robert S.--Howard University.
       Burtless, Gary--Brookings Institution.
       Burton, John--Rutgers University.
       Chimerine, Lawrence--Economic Strategy Institute.
       Danziger, Sheldon--University of Michigan.
       Darity, William Jr.--University of North Carolina.
       DeFreitas, Gregory--Hofstra University.
       Diamond, Peter A.--Massachusetts Institute of Technology.
       Duncan, Greg J.--Northwestern University.
       Ehrenberg, Ronald A.--Cornell University.
       Eisner, Robert--Northwestern University.
       Ferguson, Ronald F.--Harvard University.
       Faux, Jeff--Economic Policy Institute.
       Galbraith, James K.--University of Texas at Austin.
       Galbraith, John Kenneth--Harvard University.
       Garfinkel, Irv--Columbia University.
       Gibbons, Robert--Stanford University.
       Glickman, Norman--Rutgers University.
       Gordon, David M.--New School for Social Research.
       Gordon, Robert J.--Northwestern University.
       Gramlich, Edward--University of Michigan.
       Gray, Wayne--Clark University.
       Harrison, Bennett--Harvard University.
       Hartmann, Heidi--Institute for Women's Policy Research.
       Haveman, Robert H.--University of Wisconsin.
       Heibroner, Robert--New School for Social Research.
       Hirsch, Barry T.--Florida State University.
       Hirschman, Albert O.--Princeton University.
       Hollister, Robinson G.--Swarthmore College.
       Holzer, Harry J.--Michigan State University.
       Howell, David R.--New School for Social Research.
       Hurley, John--Jackson State University.
       Jacoby, Sanford M.--University of California at Los 
     Angeles.
       Kahn, Alfred E.--Cornell University.
       Kamerman, Sheila B.--Columbia University.
       Katz, Harry C.--Cornell University.
       Katz, Lawrence--Harvard University.
       Klein, Lawrence R.--University of Pennsylvania.
       Kleiner, Morris M.--University of Minnesota.
       Kochan, Thomas A.--Massachusetts Institute of Technology.
       Lang, Kevin--Boston University.
       Lester, Richard A.--Princeton University.
       Levy, Frank--Massachusetts Institute of Technology.
       Lindbloom, Charles E.--Yale University.
       Madden, Janice F.--University of Pennsylvania.
       Mangum, Garth--University of Utah.
       Margo, Robert--Vanderbilt University.
       Markusen, Ann--Rutgers University.
       Marshall, Ray--University of Texas at Austin.
       Medoff, James L.--Harvard University.
       Meyer, Bruce--Northwestern University.
       Minsky, Hyman P.--Bard College.
       Mishel, Lawrence--Economic Policy Institute.
       Montgomery, Edward B.--University of Maryland.
       Murnane, Richard J.--Harvard University.
       Musgrave, Peggy B.--University of California at Santa Cruz.
       Musgrave Richard A.--University of California at Santa 
     Cruz.
       Nichols, Donald--University of Wisconsin.
       Ooms, Van Doorn--Committee for Economic Development.
       Osterman, Paul--Massachusetts Institute of Technology.
       Packer, Arnold--Johns Hopkins University.
       Papadimitriou, Dimitri B.--Jerome Levy Economics Institute.
       Perry, George L.--Brookings Institution.
       Peterson, Wallace C.--University of Nebraska at Lincoln.
       Pfeifer, Karen--Smith College.
       Piore, Michael--Massachusetts Institute of Technology.
       Polenske, Karen--Massachusetts Institute of Technology.
       Quinn, Joseph--Boston College.
       Reich, Michael--University of California at Berkeley.
       Reynolds, Lloyd G.--Yale University.
       Scherer, F.M.--Harvard University.
       Schor, Juliet B.--Harvard University.
       Shaikh, Anwar--Jerome Levy Economics Institute.
       Smeeding, Tim--Center for Advanced Study in the Behavioral 
     Sciences.
       Smolensky, Eugene--University of California at Berkeley.
       Stromsdorfer, Ernst W.--Washington State University.
       Summers, Anita A.--University of Pennsylvania.
       Summers, Robert--University of Pennsylvania.
       Tobin, James--Yale University.
       Vickrey, William--Columbia University.
       Voos, Paula B.--University of Wisconsin.
       Vroman, Wayne--Urban Institute.
       Watts, Harold--Columbia University.
       Whalen, Charles J.--Jerome Levy Economics Institute.
       Wolff, Edward--New York University.

  Mr. OWENS. They end by saying, ``We believe that the Federal minimum 
wage can be increased by a moderate amount without significantly 
jeopardizing employment opportunities. A minimum wage increase would 
provide a much-needed boost in the incomes of many low and moderate 
income households. Specifically, the proposed increase in the minimum 
wage of 90 cents over a 2-year period falls within the range of 
alternatives where the overall effects on the labor market, affected 
workers, and the economy would be positive.''
  This is a conclusion of the 100 top economists in the United states.
  To bring a special perspective to this discussion, the gentlewoman 
from North Carolina would like to speak on the question of rural 
poverty and minimum wage is the way of life in most rural areas. People 
struggle to even make the minimum wage, so I am sure that whatever 
applies to rural situations and rural poverty is certainly involved in 
this whole discussion of the minimum wage.
  I yield to the gentlewoman from North Carolina [Mrs. Clayton].
  Mrs. CLAYTON. I thank the gentleman from New York for bringing the 
subject to our attention, to the attention of the American people and 
thank him for sharing the time for me to speak on the subject and 
others as it relates to rural America.
  It is true indeed that the minimum wage affects rural areas severely. 
Why? Because basically we earn about one-third of what everyone else in 
America earns. So already we are earning one-third as much as those in 
urban and other parts of this country are earning. The minimum wage in 
my State certainly is one that needs to be increased. There is a 
relationship between what everyone else earns in my area with the 
minimum wage. So as we celebrate this 57th anniversary of the minimum 
wage, those who are not making the minimum wage, are making 
considerably more, must recognize that as that minimum wage is 
remaining at the bottom so are other wages stagnant in rural America.
  Also, I would share with the gentleman from New York that in addition 
to the minimum wage issue, you are right that this Congress is bent on 
affecting the poor and rural America. They are also more active in the 
divide between rural and urban. They are also interested in the divide 
between the rich and the poor. So we see great divisions and the 
emphasis being focused on those who have a lot of money.
  I would also share that as a Nation how we spend our resources says a 
lot about who we are and who is important, which region of our Nation 
we favor, which region of our Nation we will ignore. To the extent that 
the budget reconciliation act that we are going to vote on this week 
ignores the plight of working families, ignores the plight of rural 
areas, it indeed will be very harmful. This budget will cause pain to 
many Americans, in inner cities as well, but it will cause particular 
pain to rural America.
  Rural North Carolina, including my congressional district, where we 
have a poverty rate about 25 percent, if you combine that with the low 
minimum wage and the poverty rate and understand what the budget 
reconciliation act will do, you begin to understand the devastation 
that will happen to rural America. The very basic essentials like 
shelter, clothing, housing provisions as well as food, as well as 
health care will greatly suffer in terms of that. Most rural hospitals 
and other rural facilities will suffer as a result of us not having an 
opportunity.
  I know that the gentleman has shared his time. I am going to ask to 
enter the remainder of my remarks into the Record, as follows:

  Mr. Speaker, how a nation spends its resources says volumes about who 
is important, who is not, which regions of our Nation are favored and 
which are ignored.
  When we vote on budget reconciliation this week, this Nation will 
know the winners and losers.

[[Page H 10718]]

  This budget will cause pain to many in America, but we will cause 
substantial harm to most in rural America.
  Rural North Carolina, including my congressional district, like most 
of rural America, is struggling to provide a minimum quality of life 
for its citizens.
  These communities, however, lack high paying jobs and often lack the 
infrastructure necessary for economic expansion.
  The lack of basic resources and opportunities, such as employment, 
housing, education, and utility services, especially water and sewer, 
is compounded by limited access to quality health care and a shortage 
of health professional, especially primary and family physicians. Most 
of the rural hospitals in my congressional district, for example, 
depend on Medicare and Medicaid by as much as 65 percent of their 
budgets.
  As Congress goes through its cost cutting, deficit reducing, budget 
balancing exercise, there is a message that needs to be emphasized 
among our colleagues--farmers and rural communities have been important 
to this Nation's past, and farmers and rural communities are essential 
to this Nation's future--most notably, the small, family farmers.
  Ironically, this extreme and harmful budget cutting proposal comes at 
a time when my State is experiencing progress due to many of the very 
programs this Congress now seeks to restructure or eliminate, 
particularly those that encourage export activity and foreign trade.
  After years of feeding the State and feeding the Nation, North 
Carolina agribusiness is now postured to expand its exports and feed 
the new customers offered by the world's foreign markets.
  In short, as one recent magazine article noted, ``Exports are up down 
on the North Carolina farms.''
  North Carolina agriculture exports amounted to $2.3 billion last 
year. We exported $534.5 million in tobacco, $199.5 million poultry and 
poultry products, $90.5 million in soybeans, $61.5 million in cotton, 
$40.3 million in meat and meat products, $33 million in wheat, $19.4 
milion in peanuts, $14.4 million in fruits, $12.1 million in 
vegetables, and $38.6 million in all other products.
  Those exports translate into jobs. Jobs translate into revenue for 
the State. And, revenue for the State translates into programs and 
services for our citizens.
  In order to expand exports, create jobs, generate revenue and, 
thereby, provide programs and services to our citizens, agribusiness 
must have the support of our Government, and that support must be 
reliable, timely and, most of all, useful.
  For the past several weekends, I have been meeting with groups of 
farmers in my congressional district.
  One thing said to me, by them, has stayed with me. ``Farming is a 
gamble,'' they said, ``And, if you don't like to gamble, you should not 
be in farming.''
  That statement struck me because, while we can not control if it 
rains early, rains late, or if it rains at all, Government can have 
great influence over the resources that we make available to the 
farmer.
  We can remove some of the uncertainty, some of the doubt, some of the 
gamble, by insuring that when farmers make judgments about what to 
produce and what markets to target, they do so knowing that, when 
needed, government will be there to support them--in lean times.
  Unfortunately, however, despite the recent gains that have been made, 
because their important role has not been recognized, many rural 
communities in the United States are crumbling and decaying.
  It is important to recognize that the long-term economic health of 
rural America depends on a broad and diverse economic base which 
requires investment--not disinvestment--in rural America--investment in 
business, education, infrastructure, agribusiness, housing stock and 
community facilities.
  The major factors that inhibit rural economic development stem from 
the very characteristics that singularly define our rural areas--
isolation from metropolitan services, low population density, small 
economics of scale, dependence upon a single industry and limited 
municipal capacity. These factors leave many rural areas without the 
necessary resources not only to plan, but also to develop basic 
services that attract competitive and profitable industries.
  Those of us who are decisionmakers from rural areas are strongly 
committed to stimulating rural economic development by any and every 
means possible.
  But, our task is made nearly impossible by a Congress intent on 
cutting agriculture and nutrition programs, determined to cut 
education, bent on cutting medicare and medicaid and focused on unfair 
tax cuts for some and increases for others.
  And, so, Mr. Speaker, I must ask, when we vote on budget 
reconciliation this week, will we say to the small, family farmers, who 
literally work their fingers to the bone so that this Nation might be 
fed, that commodity and rural development programs must go because we 
are required to balance the budget--because we are giving the money to 
those with money? That will be the result if Congress continues on its 
current glide path and approves the Majority's budget resolution plan.
  This evening I want to discuss several of the areas affected by the 
Republican budget reconciliation legislation, and I will begin with 
agriculture programs.
  Mr. OWENS. I thank the gentlewoman from North Carolina for joining 
me. I will conclude now with a reading from the article that I have 
read sections from for the last 3 weeks.

                              {time}  2145

  That is the article that appeared in the New York Times on September 
3, the Sunday before Labor Day, by Lester Thurow. Lester Thurow is a 
professor of economics at the Massachusetts Institute of Technology, 
and his opening paragraph still applies as we go toward this budget 
reconciliation, this budget reconciliation which will corporatize the 
power of the corporations of America. The budget reconciliation will 
freeze us into situations where corporations are going to be paying 
even less of the percentage of the total tax burden than they pay 
already.
  The budget reconciliation is going to freeze us into a situation 
where nothing is being done or said about the more than $300 billion 
that we have already spent as taxpayers to bail out the savings and 
loans swindle. Nothing is said about trying to force the financial 
community to somehow repay some of those funds through some kind of tax 
policy, maybe a surcharge on banks and on accountants and lawyers, all 
of the people who were involved in that big swindle of the American 
taxpayers. Nothing is being said. The things that are not said are very 
important.
  Nothing is ever said on this floor about this great tax swindle, how 
over a period from 1943 to 1995, the tax burden of corporations dropped 
so dramatically in proportion to the tax burden borne by the families 
and the individuals out there.
  I agree with the Republicans. We need to tax cut. The tax cuts should 
come for individuals and families. At the same time, we need to get rid 
of the deficit and balance the budget by raising the taxes that are 
paid by corporations.
  That all takes place within an atmosphere that is described best by 
this paragraph from Lester Thurow's article in the New York Times. 
Again I quote:

       No country without a revolution or a military defeat and 
     subsequent occupation has ever experienced such a sharp shift 
     in the distributions of earnings as America has in the last 
     generation. At no other time have median wages of American 
     men fallen for more than two decades. Never before have the 
     majority of American workers suffered real wage reductions 
     while the per capita domestic product was advancing.

  I think that is a very profound statement. It very powerfully 
describes the situation that corporate America has generated in 
America.
  We can take some tiny steps toward correcting our economy, toward 
making our society more workable, by agreeing to increase the minimum 
wage by 90 cents from $4.25 per hour to $5.15 an hour. That is what is 
being proposed, and that is the bill before us sponsored by minority 
leader Gephardt. I am a cosponsor of that bill. The President has 
endorsed that bill.
  That simple step, I urge all Democrats to get on board and take that 
step. We only have a little more than half the Democrats who are now 
sponsoring that increase in the minimum wage.
  Is it any wonder that the Republicans are treating the increase in 
the minimum wage with great contempt? And they have stated that they 
will not allow a single, 1-cent increase, in the minimum wage. Justice 
demands that on this anniversary, 57th anniversary of the minimum wage 
law, that we go forward and understand that this is just a tiny step 
that every lawmaker, every decision maker in Washington can take, not 
only for working people but for our overall economy.
  Let us increase the minimum wage. Let us support the increase in the 
minimum wage bill now.
  Mr. ROMERO-BARCELO. Mr. Speaker, today as we celebrate the 57th 
anniversary of the minimum wage, it is increasingly obvious that we 
must take action to raise the minimum 

[[Page H 10719]]
wage. Such action will benefit millions of American workers throughout 
the Nation.
  Earlier this year, I was pleased to join in sponsoring the 
legislation embodying the President's proposal for a moderate 90 cent 
increase in the minimum wage over 2 years. This is necessary because 
minimum wage workers have actually seen their real incomes decrease in 
the last decade. The minimum wage has not been raised since 1989, and 
its purchasing power has simply not kept pace with the rising cost of 
living.
  At a time when the majority in this Congress is drastically revamping 
our welfare system and slashing the social safety net, we must maintain 
the incentives that reward hard work. The minimum wage is one such 
incentive.
  When I was mayor of San Juan and later Governor of Puerto Rico, I 
took the innovative and unprecedented step of asking the Federal 
Government to extend the minimum wage laws to Puerto Rico where at the 
time they did not apply. Special interests and many corporations 
complained and objected to this move. They lobbied hard against it, 
predicting both economic havoc and job displacement.
  Such bleak scenarios did not materialize. In fact, the minimum wage 
has been a blessing for the 3.7 million American citizens of Puerto 
Rico. It raised the standard of living of thousands of working families 
and brought added dignity to their daily endeavors at their job sites.
  Let this experience serve as an illustration of the benefits of our 
making a commitment to improve the standard of living of ordinary, 
hard-working Americans by ensuring them a decent, living wage. Both 
sides of the aisle should be doing everything possible to promote and 
secure a decent standard of living for all Americans.
  Increasing the minimum wage is the right thing to do. It is a wise 
move and one which is based on both common sense and solid economic 
policy. Millions of hard-working Americans who deserve better economic 
opportunities will appreciate our leadership.
  Mr. STARK. Mr. Speaker, today, a minimum wage worker who work full-
time, year round, does not earn enough money to keep a family of two 
out of poverty. For decades prior to the late 1980s, that was not the 
case. Actually, until the early 1980s, the minimum wage was high enough 
to keep the average three-person family out of poverty.
  The staff of the Joint Economic Committee has taken a close look at 
the effects of raising the minimum wage. Their report convinces me that 
raising the minimum wage is the right thing to do, and will help low-
wage workers. Those most likely to be helped are women, because 
disproportionate shares of women are harmed by the low value of the 
minimum wage. I think that is important to note, given the majority's 
attacks on Medicaid, the earned income tax credit, and food stamps--all 
programs that help working-poor women.
  There is general agreement that there would be no job loss for adults 
who make up the majority of all minimum wage workers. The only debate 
is whether and how many teenagers would lose jobs if the minimum wage 
is hidden. During the Joint Economic Committee's two hearings on the 
minimum wage, witnesses confronted members with reports showing both 
negative and positive effects of increasing the minimum wage.
  The Employment Policies Institute Foundation supported most of the 
witnesses claiming a negative effect from raising the minimum wage. 
During the hearings, we uncovered the fact that, from the beginning, 
the institute has been headed by Richard Berman, who continued to serve 
as a registered lobbyist for the restaurant and fast-food industry 
until recently. The same man was a supporter of the Speaker's so-called 
college course only after winning apparent assurance of having an 
influence on the course's content favorable to low-wage jobs.
  However, I had a substantive problem with the witnesses from the 
Employment Policies Institute Foundation. No one argued that, when we 
increase the minimum wage, all those low wage teenagers making less 
than the new minimum wage would be thrown out of work. Instead, the 
debate was over whether a 10-percent increase in the minimum wage 
caused a 1 or 2 percent reduction in employment for teenagers.

  An economist invited by the Republicans, and who had done work for 
the Employment Policies Institute Foundation, wrote in a recent paper 
for an academic journal, that there were no significant net employment 
effects of increasing the minimum wage. So, the worse we were told was 
that 98 or 99 percent of teenage low-wage workers would not lose their 
jobs when they got a 10-percent pay increase.
  Why is that bad? Further, how is that possible? If those workers were 
not worth a 10-percent raise, why do only 1 percent of them lose their 
jobs? Could it be that their lower wage was unfair?
  The report of the Joint Economic Committee staff suggests that the 
low wage of minimum wage workers is much more the result of where they 
work, than the quality of their work. The study uses a set of jobs 
whose wages change with the minimum wage, more than with changes in 
other wages in the economy. Workers in those jobs are said to be on the 
minimum wage contour. The harm in holding down the value of the minimum 
wage is that the wages of those workers also are held down.
  By asking a different question than, ``Can we count job losses or job 
gains after the minimum wage is increased?'' the staff sought to answer 
the basic question of what would be a fair wage. By answering that 
question, they could show that workers on the minimum wage contour are 
not so low skilled that they could not hold other jobs.
  Unless we take as a matter of faith that the world always works just 
like the diagrams in an elementary economics textbook, the question of 
how changes in the minimum wage affect employment and earnings among 
low income workers is an empirical one. This study's major finding--
that workers whose skills and other characteristics seem similar to 
those in minimum wage contour jobs, but who have non-minimum wage jobs, 
make around 30 percent more--calls into question simple textbook 
analyses of low-wage labor markets.
  Why is that important? Because it means that there is some reason, 
not related to the ability to produce, that explains the lower wages of 
minimum wage contour workers. A reason could be that minimum wage 
workers have fewer options to give them bargaining power with their 
employers. Because the ranks of the minimum wage work force are 
disproportionately female, in an economy slanted by gender 
discrimination, seeing why these workers may have less bargaining power 
than workers in other jobs is easy. So when we raise the minimum wage, 
we are restoring some balance to the equation. The net effect would be 
to increase economic efficiency and make low-wage workers better off.

  We have heard those in the majority scoff at such a notion. They 
snicker that if raising the minimum wage helps the economy, why not set 
it at a really high level. However, that is not what this research 
suggests. It shows that the gap in the wages of minimum wage and other 
similar workers is larger than the proposed increase in the minimum 
wage. So a modest rise in the minimum wage can be helpful.
  The JEC staff study shows that when we increased the minimum wage 
from $3.35 in 1989 to $4.25 in 1991, the wage gap between minimum wage 
contour and nonminimum wage workers shrank. Also, the gap between the 
wages of women and men shrank.
  Further, the study showed that many young workers with a high school 
education, or less, suffered a substantial loss in relative wages 
between 1986 and 1991 because some of their earnings' history was in a 
minimum contour job.
  Most Americans agree on one way to approach falling wages. More than 
three-fourths of Americans in recent polls favor the raise in the 
minimum wage proposed by President Clinton. I might add that 64 percent 
of those who said they voted for Republican Members of Congress support 
the President on this. If we are going to listen to the voters, we must 
listen to the voters on this issue.
  Why do they favor raising the minimum wage? Because, most minimum 
wage workers are adults. Because, minimum wage workers provide an 
average of over half their family's weekly earnings. Because there is a 
direct relation between the minimum wage and keeping families out of 
poverty.
  In 1979, when the minimum wage was worth almost $6 an hour in today's 
terms, almost 1.4 million Americans were working full time, year round 
living below poverty. Today, during an economic recovery, with the 
minimum wage at $4.25, the number of full time, year round workers 
living below poverty is more than 2 million. Americans know that having 
an increase in the number of people working full-time year round living 
below poverty is not right. Americans know that having almost 20 
million workers being paid less today, in real terms than we legally 
allowed in 1979, is not right.
  Prof. Daniel Hamermesh was one of two economists the Republicans 
called as a witness who had not done research sponsored by the 
Employment Policies Institute Foundation. When I asked him whether we 
should raise the minimum wage, his answer was yes. Earlier this month, 
we learned that a large number of other economists agree with him.
  I thank the gentleman for yielding me this time. We should listen to 
voters. But we should also study proposals to best serve the public's 
needs. I think the JEC staff study helps us know that raising the 
minimum wage would be the right thing to do. So I am happy to support 
your efforts in getting this bill to the floor.

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