[Congressional Record Volume 144, Number 96 (Friday, July 17, 1998)]
[House]
[Pages H5850-H5857]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




          SHARE THE PROSPERITY BY INCREASING THE MINIMUM WAGE

  The SPEAKER pro tempore. Under the Speaker's announced policy of 
January 7, 1997, the gentleman from New York (Mr. Owens) is recognized 
for 60 minutes.
  Mr. OWENS. Mr. Speaker, the House is galloping toward recess and 
adjournment. The Republicans have had a very clever strategy this year. 
We have spent a lot of time in recess and very little time in 
deliberations. That is not by accident, it is a way to guarantee that 
important things are done rapidly, that there is a minimum of 
deliberation, that the party and the minority does not have an 
opportunity to bring issues to the public. It has worked very well. You 
know, we have had a lot of very extreme things accomplished in a few 
days using this technique of minimizing deliberations and maximizing 
action while we are here.
  So, I suspect the process of galloping is going to continue between 
now and the time we go out on the August recess, and, once we return 
from the August recess, of course the galloping is even going to even 
move faster.
  The Republican schedule is part of the whole strategy, and what it 
does is it turns our democracy into a form of distorted law making, 
which is not

[[Page H5851]]

good for the country. It means that a handful of people in conference 
committees will be making the biggest and most important decisions 
while the rest of us, the other Members of the 435, are forced to just 
vote up or down, yes or no, on important matters. It gives maximum 
power to the smoke-filled room the way the Republican majority is 
conducting the House. It is most unfortunate, but it is important that 
we understand that process, that there will not be the usual 
deliberative process long enough for even the Members of the House to 
understand the issues, certainly not long enough for the members of the 
public to understand what we are deliberating on.
  I want to speak today about one of the casualties of this process. 
One of the casualties is the working family.
  We should share our great prosperity now with working families. You 
know we are enjoying unprecedented prosperity in America. Never before 
have we had this kind of stock market boom. At every level you feel the 
surge of the economy. People who are rich and who have some investments 
are getting richer at a faster and faster rate. It has even produced a 
surplus in the government. The amount of revenue being collected now 
greatly exceeds the planned expenditures for the coming budget year. So 
we are going to have a surplus; it is almost guaranteed, but we are not 
sharing this prosperity with working families.
  And I want to make a case for sharing the prosperity with working 
families, and the way we begin to share the prosperity with working 
families is to begin with an increase in the minimum wage. We need an 
increase in the minimum wage. You know, the increase of the minimum 
wage will not cost the taxpayers one penny. An increase in the minimum 
wage is not a budget and appropriations item. It is a matter of public 
policy which takes into consideration the fact that we have a very 
prosperous economy, and one way to share the benefits of that economy 
with the working family is to increase the minimum wage.
  If you want to help families, and everybody professes to want to help 
families, both the Republicans and the Democrats argue that they are 
pro-family. What is wrong with America is that there is assault on the 
families; we all agree. What is wrong with America is that as families 
are falling apart. You know it has greatly impacted on our young 
people. The best you can do, the first thing you can do, for families 
is to give them more money, more income. More income needs to go to 
those people out there who are making minimum wage, and it is a large 
number. More than one-third of our working force is making the present 
minimum wage.
  Present minimum wage is $5.15 an hour, $5.15 is the present minimum 
wage. We need to take steps immediately to raise the minimum wage. It 
has fallen behind over the years. The cost of living has increased far 
faster than the minimum wage, so the minimum wage has never caught up 
and is still far behind the cost of living, and I am going to talk 
about that in more detail in a few minutes.
  This 105th Session of Congress, instead of the majority consistently 
taking actions which are hostile toward working families should take 
actions which are going to help working families. You know we should 
share the prosperity instead of at every step limiting the amount of 
help that the poorest people get starting with the fact that we have a 
surplus. You know we are faced with an unprecedented situation. For the 
last three decades we have not had the kind of surplus that we have 
now, and the only discussion we hear about the surplus is that it 
should be utilized to give a tax cut to the rich.
  Now I am in favor of tax cuts. I am not sure where my party stands at 
this point. The Democrats last year produced a very good proposal and 
went to the floor with an alternative to the Republican tax cut which I 
think is still applicable. I have not heard much talk about it lately, 
so I am not sure why we do not have it out front. That tax cut was 
skewed so that the people on the bottom, those who need the help most 
would get the first and the biggest tax cut. So we should have a tax 
cut, but it should be aimed at helping working families. The 
combination of a raise in the minimum wage and a tax cut to working 
families is a kind of action needed to share the prosperity with those 
who are not at this point sharing that prosperity.
  The democratic message is there. We have in our platform, as we go 
toward the November elections, a share-the-prosperity message. We have 
a message that includes the raising of the minimum wage. Raising the 
minimum wage is one of the priorities of the democratic package at this 
point. The problem is it seems to fall off the radar screen with 
respect to media attention. Members of my party are not saying much 
about the raising of the minimum wage. It is there, it is part of our 
platform, it is part of our set of priorities, but not much is being 
said about it, and that is most unfortunate. We ought to talk about the 
minimum wage. We ought to make a drive between now and the time the 
Congress closes to take advantage of this great window of opportunity 
we have in terms of prosperity.
  We have the prosperity now. We should share the prosperity by 
increasing the minimum wage. We should share the prosperity with 
working families by jointly, in a bipartisan agreement, supporting a 
tax cut for families who make less than $50,000. Let us have a tax cut. 
We have already given a tax cut to the richest Americans. Just before 
we went on recess for the Fourth of July holiday we passed a bill which 
gave benefits, capital gains benefits, to the people who were fortunate 
enough to have big capital items that they want to divest. You know the 
capital gains tax was altered in a way which allowed them to take 
advantage of faster movement of their capital gain assets. That is a 
brake for the rich. Now let us have one for the poor, maybe 1 or 2 or 
3, so that the poor can catch up. We need a tax cut, I support the idea 
of a tax cut, and I think, if the Democratic Party in this House goes 
back to where we were last year, we had a proposal for an alternative 
tax cut which made a lot of sense and gave the help to the working 
families.
  We need also to help working families by investing heavily in 
education and job training. We need to move away from the present 
Republican majority position that we do not want to invest any more in 
education except really want to invest more; that is one item. We want 
to take the money we have now and move it around so that instead of 
title I money going to the poorest schools to improve public schools, 
title I money should be used for vouchers to go to private school. So 
we are not only not willing to invest more in education for working 
families, we are also ready to take away from the working families a 
program that exists already.

                              {time}  1445

  We recognize that there is a great need for information technology 
workers, yet the Republican proposal on the table which already passed 
the other body states that we are going to solve the problem of the 
shortage of high-tech workers by bringing in more foreign 
professionals. Foreign professionals will come in and take the jobs we 
ought to be training our American citizens for. That is the answer of 
the Republican majority at this time. The President said he might veto 
such a bill, and I hope he definitely will, and put the emphasis on 
solving the shortage of workers in the area of high-tech, on the area 
of training the people in the country right now who need the training.
  The Republicans have also proposed to cut the Summer Youth Employment 
Program. They have zeroed out this program in the appropriations bill 
that will be coming before the House next week.
  The Labor-HHS appropriations bill has zero in it for the Summer Youth 
Employment Program. I think the program is up at about the level of 
$600 million. You are going to take $600 million away from the poorest 
young people in America, at a time when the Nation is prosperous, at a 
time there will be a surplus in the budget.
  The Republicans are also proposing to cut LIHEAP. LIHEAP is a program 
which provides heat for people who do not have enough money to heat 
their homes in the winter. Mostly elderly people benefit from the 
LIHEAP program. It also provides air conditioning, by the way, in 
certain areas of the country where there is extreme heat

[[Page H5852]]

and they need air conditioning for the protection of mostly elderly 
people or sick people. In fact, in some parts of the country now there 
is a great heat wave on, and public action is being taken to protect 
certain categories of people from the heat.
  But the biggest problem is the cold in the winter. LIHEAP has been 
around for a long time, but the bill that will be before us next week, 
pushed by the Republican majority, which cuts the Summer Youth 
Employment Program and cuts LIHEAP.
  The majority Republicans in the 105th Congress are very hostile 
toward working families. They say they care about families, but most of 
the families in America are working families. The overwhelming majority 
of families are working families.
  I am going to make an appeal to the religious right, and I apologize, 
because it is putting a lot of people under the umbrella in a kind of 
crude way, but I want to make an appeal to those people who say they 
care about families and say they should join us. We could make a great 
caring majority. Join us in calling for a tax cut for working families. 
Join us in calling for an item that will not cost the government one 
penny, and that is an increase in the minimum wage.
  The religious right, the religious left, the religious center, let us 
have a caring majority movement toward bringing relief to working 
families, because the best way you can help families, of course, is to 
give them more money. There is no complicated bureaucracy needed. 
Increase the minimum wage. The employers out there will have to pay a 
higher minimum wage, and the families that need it most will benefit 
from that increase.
  There is nothing complicated involved in a tax cut for the working 
poor. We probably should look at Social Security payments, the payroll 
taxes. That is the area where taxes have gone up most for working 
people. The great increase has been in the payroll taxes that everybody 
pays, regardless of income.
  There are some people that say now that the surplus is primarily a 
surplus generated by Social Security revenue. If you take away the 
amount of money generated by the extra Social Security revenue, you 
would have a deficit, they say.
  That is a little late, that argument, because we have been 
calculating our budget and discussing the national budget for years now 
on the basis of the fact that the Social Security revenue was included 
in the budget. To suddenly now say, well, we really do not have a 
surplus because most of that money is Social Security, if you do that, 
then you are wiping out the possibility of using the surplus in some 
type of constructive way, which I will propose later on.
  I think the surplus is real. It is primarily generated by Social 
Security revenue. So if we have a tax cut, then let us recognize the 
fact that the extra revenue comes from Social Security, the payroll 
taxes. Let us reduce first the payroll taxes of the poor when we give a 
tax cut.
  So I want to again repeat that what I am talking about is an agenda 
that we ought to follow as we move toward the close of this session, 
right now, as we gallop forward, instead of the backroom deals being 
made on the Committee on Appropriations, which lately has taken to 
making legislation, authorizing legislation more and more, violating 
the rules.
  The rules do not exist anymore. We had a tax package that came back 
from conference, the IRS reform package. It was IRS reform when it left 
the House, it was IRS reform when it left the Senate. Neither the House 
nor Senate had any item in there related to changing the capital gains 
tax computation. Yet it came back with that change in it, and some 
other changes in it, written by the conference committee.
  Neither House had included certain items related to tax reform, yet 
they got in the IRS reform bill. We were left on the floor with no 
alternative: Vote for it or vote against it. Who wanted to vote against 
a tax cut without an alternative? So most of us voted for it, of 
course. We would like to have had a chance to deliberate. We would like 
to have had a chance to make some alternative proposals. We would like 
to have had a tax package not written by 10 people.
  The children of America out there think that they have a democracy, 
that we have representatives who are elected, and those representatives 
have an opportunity to make the laws. We have this little booklet we 
give out to the classes that come to visit us that says we have a bill 
introduced, a bill goes through committee, the committee passes it to 
the floor, the floor deliberates on it and votes, the floor sends it to 
the other body, the floor of the House and the floor of the Senate, 
there is a conference committee, the conference committee deliberates, 
the conference committee sends it back to the floor, the floor votes. 
It sounds as it if it is a great democracy and we always do it that 
way.
  More and more, the strategy in this House, the Republican-controlled 
House of Representatives, is that we want to do as little democracy as 
possible. When you have the conference committee writing the 
legislation, it means the rest of us are puppets, rubber stamps, or 
something worse than that.
  I think all the Members of the House of Representatives are very 
talented people. You do not get here without being very talented and 
competent. We might disagree on policies and ideology, but I respect 
every member. You do not get here unless you have a lot to offer.
  I think we should be utilized. We should not be a parts of a fraud or 
a sham with respect to our constituencies. Our constituencies want us 
to participate and make laws. We should not sit still and allow the 
rules to be violated and a handful of people to make the laws, whether 
you are dealing with tax cuts for the rich or education policies for 
public schools.

  Mr. Speaker, I want to go into greater detail on the minimum wage, 
because I am saying in essence that at the heart of the process of 
sharing prosperity with working families is the increase in the minimum 
wage. The good news about the minimum wage and the irony of it is it 
will not cost the taxpayers a single penny. So can we not move to 
increase the minimum wage between now and the time the 105th Congress 
adjourns?
  Let us put it on the radar screen. Democrats, I call on you to cease 
the silence. It is on our list, but we need more activity. We need to 
put it on the radar screen, we need to put it on the television 
screens, the radio and the press. The poor, the working families of 
America, need an increase in the minimum wage.
  A lot of people say, who makes the minimum wage anymore? Most people 
are above the minimum wage. No, that is not true. More than a third of 
the workforce is still making the minimum wage.
  The people who are working out there, the bread winners for working 
families, are affected by the minimum wage, even if they are making 
more. The minimum wage has become the starting point, the bargaining 
point, for many negotiated collective bargaining agreements. When the 
minimum wage goes up, everybody else's wage rises. All tides rise when 
the minimum wage rises. In terms of income, everywhere it goes up.
  So we need people making more than the minimum wage at this time of 
prosperity. They need more money and should have more money, because 
the negotiated wages ought to go up as the minimum wages go up.
  The minimum wage has stagnated, as I said before, for a long time. We 
started out in the New Deal with Franklin Roosevelt and the first 
enactment of the Fair Labor Standards Act. It was 25 cents an hour, 25 
cents an hour in 1938. Well, that was like a godsend, because you went 
from zero to 25 cents an hour. That was a great increase. Before that 
the employers of America had the working families at their mercy. They 
could pay what they wanted to pay, and there was no way to make them 
pay more, because the labor market was full, plenty of people. If you 
did not like the pennies you were being paid, you just would step aside 
and somebody else would take the job. So we were undercutting and 
eroding the basis of family life.
  There were people who worked all night and all day, on the weekend, 
kids who never saw their fathers, yet they were making very little 
money because the hourly wages were so small.
  Twenty-five cents an hour was passed October 24, 1938. We have come a 
long

[[Page H5853]]

way since 25 cents an hour was passed. By January of 1976, we had a law 
which raised it. We had gone step-by-step all the way to $2.30 per 
hour. In January 1976 we increased it to $2.30. Now it is at $5.15 an 
hour. You might say, what a great march forward over 25 cents. It 
started at 25 cents, and now we are up to $5.15 an hour.
  But here is what the facts show. The working families have lost 
ground because the increase in prices, the cost of living, has gone so 
much faster than these increases in the minimum wage.
  I cite a booklet here that all of us receive as Members of Congress, 
it is called Minimum Wage and Overtime Hours under the Fair Labor 
Standards Act. It is a report to the Congress required by the Fair 
Labor Standards Act from the Secretary of Labor.
  It is a booklet that every member of Congress should scan, if not 
have his staff read, and understand the dynamics of the minimum wage. 
It is great that we have a law. It is great we have a Fair Labor 
Standards Act. But the facts are not good at all.
  In spite of the recent minimum wage increases, the real value of the 
minimum wage remains below the 1960s and 1970s level. I am reading from 
a page of the booklet that I just cited. By the way, this booklet was 
issued on the occasion of the 60th anniversary of the Fair Labor 
Standards Act which established the minimum wage, so for 60 years we 
have at least had government policy involved with the hourly wage of 
working families.
  But in spite of the recent increases and the fact it has gone to 
$5.15 an hour, between 1966 and 1997 the real value of the minimum wage 
declined by 17 percent. Between 1966 and 1997 the real value of the 
minimum wage went down by 17 percent. Workers ended up making 17 
percent less per hour when you calculate the value of wages as computed 
in terms of the cost of living. When you consider how high the cost of 
living has gone compared to the wages, then we have suffered a 
decrease, a decline of 17 percent.
  The family size supportable by the minimum wage at the poverty 
threshold fell, went down, from close to four in 1968 to just over two 
in 1997. Listen carefully. The family size supportable by the minimum 
wage, the number of people who can be supported on a $5.15 an hour 
minimum wage, dropped by half. The old minimum wage could support in 
1968 four people. The present minimum wage in 1998 supports only two 
people at the poverty level.

                              {time}  1500

  That means that they do not eat steak, I assure my colleagues. They 
have minimum housing, minimum clothing, minimum food. Only two people 
can now be supported on the minimum wage. We have gone backwards by 50 
percent.
  In the 1950s and the 1960s, the minimum wage averaged 51 percent of 
average hourly earnings. That measure fell to 46 percent in the 1970s 
and to an average of 40 percent thus far in the 1980s and 1990s. 
Average hourly earnings means that when you calculate the earnings of 
people that are not making minimum wage, making above that amount, and 
figure it in with the people that are making minimum wage, the average 
has gone up, and the minimum wage workers have not kept pace, a 40 
percent drop in the 1990s.
  With regard to the Fair Labor Standards Act's requirement to measure 
the ability of employers, with regard to the requirement of the Fair 
Labor Standards Act, which is the act of Congress which created the 
minimum wage, along with a number of other conditions under which the 
minimum wage is administered. With regard to the Fair Labor Standards 
Act requirement to measure the ability of employers to absorb wage 
increases, since 1966, annual percent gains in business sector 
productivity, productivity, output per hour, has outpaced increases in 
real hourly compensation three-fourths of the time and for each of the 
past 10 years. Over the entire period, the change in output per hour 
grew by two-thirds, while compensation grew by only one-third. In other 
words, we are getting two-thirds more out of a worker now than we got 
in terms of productivity.
  It is no wonder the profits are so high, that prosperity is so good 
for the owners of the factories and the owners and investors in the 
various enterprises, because the productivity of each worker is so much 
greater, while the amount of money paid to the worker has gone down a 
little more than one-third, gone down instead of up. The ratio has only 
increased by one-third, which means that the pace is way off for the 
wage increase versus the productivity.
  Real corporate profits per hours worked have recovered from a 
recession low in the 1980s. Profits per hour in 1997 exceeded the 
previous peak level recorded over the last three decades, while average 
profits per hour over the past 3 years is the highest such average in 
30 years. Average profits for each hour worked is greater now than it 
has ever been in the last, than it has been in the last 30 years. This 
is why we have such a tremendous boom on Wall Street, great earnings by 
corporations, because the profit for each hour of work is so much 
greater than it has ever been.
  Average real retail industry profits per hour worked over the past 5 
years have been the highest in 25 years. In 1996, 79 million wage and 
salary workers were covered by the minimum wage provisions of the Fair 
Labor Standards Act. Overtime protections applied to 74 million 
workers.
  Mr. Speaker, this is a great majority of our work force is covered by 
this act, so we are not talking about a handful of people when we talk 
about increase in the minimum wage and the resulting additional raise 
in wages that is caused by the increase in the minimum wage. The 
majority of workers not protected by minimum wage, and overtime 
provisions were classified as executive, administrative and 
professional.
  Let me just conclude this section of the booklet by saying that the 
Small Business Act that Congress passed, the Small Business Job 
Protection Act, which was passed on August 2, 1996, under the 
Republican majority in the last Congress, it was signed into law by 
President Clinton, provided two minimum wage increases over the 2-year 
period. An initial increase from $4.25 an hour to $4.75 an hour, went 
into effect on October 1, 1996. That was the first minimum wage gain 
since April 1 of 1991. The second increase was effective on September 
1, 1997, and that took us to the level where we are now, $5.15 an hour.
  One barometer of the adequacy of the minimum wage over time is the 
degree to which the purchasing power, the wage law has changed. A 
declining real value of the minimum wage suggests that minimum wage 
workers are worse off, while a rising real value of the minimum wage 
signifies improvement in the status of these workers.
  In order to gauge the relationship between prices and the minimum 
wage, three indices were constructed. Over the 3-year period, the 
minimum wage increased 312 percent, while the implicit price deflator 
and the Consumer Price Index, we know more about the Consumer Price 
Index than we do the other one, the Consumer Price Index rose 338 
percent to 395 percent respectively.
  Using the Consumer Price Index, the real value of the minimum wage 
per hour in 1997 dollars has declined from a high of $7.38 per hour; 
the real value of the minimum wage in 1968 was $7.38 per hour. When we 
compare the minimum wage with the cost of living, a worker was earning 
as much as $7.38 an hour, but now, with $5.15 in 1997, they are earning 
much less per hour in real value.
  Another indicator of inadequacy of the minimum wage is the extent to 
which it allows workers to live above established poverty thresholds. I 
just mentioned that a few minutes ago. For individuals, those not 
supporting families, the minimum wage has consistently exceeded poverty 
level incomes. On the other hand, for an individual trying to support a 
family, the minimum wage has lost some of its ability to generate a 
standard of living above the poverty line. In other words, there are 
people that go to work every day, and there is no way they are ever 
going to get out of poverty earning the minimum wage.
  In 1968, a full-time worker earning the minimum wage was able to 
support a family of four slightly below the poverty threshold. In 1968, 
though, they could support a family of four at the level of the 
threshold of poverty, which means that they at least could provide the 
basics, food, clothing and shelter.

[[Page H5854]]

  However, by 1980, the falling real value of the minimum wage reduced 
the family size supportable at the poverty threshold to three, only 
three people, and then by 1984, the family size that could be 
maintained was reduced to two persons. I just cited that before. At 
present, the minimum wage will support a family of two instead of a 
family of four.
  We need to share the prosperity that we are enjoying in America with 
working families. We need to share the prosperity, and the way to begin 
sharing the prosperity is to increase the minimum wage.
  It is a simple step; that is, a simple public policy process. We do 
not need to raise taxes on anybody, we do not need to take away from 
one program to give to another; none of the problems that we find in 
the regular budget and appropriations process is necessary in a public 
policy change which says, raise the minimum wage. That is the law. We 
have to raise the minimum wage.
  I want to congratulate my colleagues who are concerned about this. 
Democrats have introduced several bills this year on the raising of the 
minimum wage.
  The gentleman from Illinois (Mr. Gutierrez) has introduced H.R. 182, 
a bill to provide a minimum wage for employees on the Federal contracts 
worth more than $10,000. A full-time worker would be paid either the 
amount of the official poverty level income for a family of four, or he 
would be paid $7.50 an hour, whichever is greater. This is what we call 
a living wage, which is different from the minimum wage, and some 
cities and States have enacted laws which require that living wages be 
paid to workers who are working for companies that have government 
contracts. The living wage in this case that the gentleman from 
Illinois (Mr. Gutierrez) advocates is $7.50 an hour.
  The gentleman from Minnesota (Mr. Vento) has a bill, H.R. 370, which 
provides for the wages paid under a Federal contract in a business that 
has more than 15 employees, and it requires that the wages must be 
greater than the local poverty line, which means that from one part of 
the country to the other, one would have a different minimum wage. One 
starts with the minimum wage, but in areas where the poverty line, the 
cost of living is calculated as below the poverty line, we would have 
differences. It would go up above the minimum wage.
  The gentleman from Massachusetts (Mr. Olver) has H.R. 685, a bill to 
raise the minimum wage in steps that would take it up to $6.50 an hour 
by July 1 of the year 2000.
  The gentleman from California, (Mr. Dellums), before he left, had a 
bill to establish a living wage for all jobs. The gentleman from 
Michigan (Mr. Bonior) has a bill to amend the Fair Labor Standards Act 
to raise the minimum wage in steps to $7.25 per hour by September 1 in 
the year 2002.
  The gentleman from Vermont (Mr. Sanders) has a bill which would raise 
the minimum wage in one step, just one step. Immediately he wants to 
raise it to $6.50 an hour. The gentleman from Michigan (Mr. Bonior) has 
another bill to raise the minimum wage in steps to $6.65 an hour, to 
reach $6.65 an hour, by September 1, 2000.
  Many of these bills have an indexing provision, which means every 
year automatically, as the cost of living is going up, the wages would 
go up, too, and you reach these levels. Of course, we have the 
gentleman from Michigan's (Mr. Bonior) bill, which is in harmony with 
the President's proposal, and that is a bill to increase the minimum 
wage by 50 cents in two steps, 50 cents in two steps would mean a 
dollar increase, to bring up the minimum wage level to $6.15 by January 
1 in the year 2000.
  All of these, by the way, would still mean that the minimum wage is 
behind the cost of living. We would never catch up even if any one of 
these generous bills were enacted.
  Senator Kennedy, in the other body, has similar legislation. The 
legislation that all Democrats have subscribed to as a party, of 
course, is the President's proposal to increase the minimum wage by 50 
cents in two steps, fifty cents in two steps, to take it to $6.15 by 
the year 2000.
  It is a simple proposition, but why is it not enacted? Because the 
Republican majority is hostile to working people. Working families are 
viewed with hostility. It is not a matter that they want to save money. 
Money is not the problem. Money becomes a problem in their hostility in 
other areas.
  In the area of education, they are hostile toward working families so 
they do not want to improve public schools by even giving decent places 
for children to study.
  Construction, new school construction, the wiring of schools for 
technology, a basic investment in the school system is not supported by 
the Republican majority.
  They do not want to give a tax cut. They want to give a tax cut, but 
not to the working poor.
  So we have money. The hostility of the Republicans toward the poor 
people is reflected in money issues, and the policies related to 
budgets and appropriations, but the minimum wage is not a budget 
appropriations issue. It is a matter of public policy which says we are 
in charge. We want a public policy which says that the present 
prosperity of America, where the Dow Jones average is above 9,000, 
where people who have investments are realizing 20 and 25 percent on 
their investments, it is unprecedented and we are all proud of it. It 
is wonderful.
  The riches of America and the kind of empower we have economically 
now would make the Roman Empire look like a village. We have 
unprecedented wealth, and the wealth is getting greater, and probably 
it is going to go on for a little while longer because as the economies 
shrink in other parts of the world, instead of them dragging down the 
economy of the United States, most people have not thought about the 
fact that the economy of the United States will go up, because every 
rich person in every country that is having economic difficulty will 
want to invest their money in America. They will want to come to the 
stock market here and invest their money.
  So you are going to have a boom for quite a while as the people who 
have capital to invest run away from the difficult problems of other 
nations and they run to this country. So we have prosperity that is 
probably going to continue for some time.
  We want working families to share in that prosperity.
  Mr. Speaker, I want to shift gears at this point and say that the 
working families should be included in the deal that is going to be 
made at the end of this session. I have talked about public policy 
first, raising the minimum wage, and public policy as reflected through 
the budget and appropriations process means that you invest in 
education, public education, because that is where working families get 
their education. You invest in the summer youth employment program. You 
invest in LIHEAP because you keep poor working families alive during 
the wintertime when they need money. Certain families do not have 
enough money to buy fuel for their homes, and we established this a 
long time ago, so why is Republican majority going to take heat away 
from elderly families in the wintertime; why at a time when we have a 
budget surplus that is going to be quite a significant amount of money?

                              {time}  1515

  By the way, the budget surplus, according to the latest 
pronouncements of the Congressional Budget Office, on July 15, 1998, a 
couple days ago, the Congressional Budget Office projects that the 
Federal budget for fiscal year 1998 will record a total surplus of $63 
billion. They were very conservative at the beginning of the year, when 
the President made his State of the Union address. There was a 
conservative estimate that we may have an $8 billion surplus, there may 
be $8 billion more revenue than projected expenditures. Now we have 
gone from $8 billion to $63 billion. That is what we are looking at 
now.
  These are still conservative estimates. As I said before, they point 
out that a large part of this surplus is due to the Social Security 
fund, that people paying into Social Security have increased that fund 
greatly, and that is why I said that the first tax cut ought to be a 
cut in payroll taxes for poor people. But this is clearly established, 
the Congressional Budget Office figures have to be accepted by both 
Democrats and Republicans. The President and the White House must 
accept it. The

[[Page H5855]]

majority in the Senate and the House, the minority, we are talking 
about $63 billion.
  Working families must be included in the coming end-of-the-session 
deal where they decide how they are going to handle that $63 billion. 
There is a lot of sham taking place right now. People are saying, well, 
that money should not be touched. Some people are saying it should not 
be touched because Social Security needs the money in the future so we 
should hold it as a contingency fund for Social Security. We should see 
what is going to happen with Social Security.
  We have a lot of things to work out. There is a commission. The 
commission has come up with a proposal that we extend the retirement 
date, instead of people retiring at 67, used to retire at 65, in a few 
years 67 is going to go into effect, they want to extend it to 70. That 
is the worst thing that could happen.
  A lot of poor people who work all their lives and pay into Social 
Security, you will not ever see your Social Security. Certainly in the 
African American community, the statistics show that a large percentage 
of our workers never reach 65. They never get a chance to enjoy their 
Social Security right now. If you move it to 67 and then 70, you are 
taking away from the people who need it the most.
  I am not in favor of that proposal that I hear out there on its way 
to move the date, the age for which you are eligible for your Social 
Security back to age 70. I think it outrageous. That is more hostility 
toward working families.
  Let us come closer to home. There is going to be a deal made before 
this session ends, before we leave here, there is going to be a deal 
made between the White House and the majority in the Congress in the 
House and Senate, it is a pattern now, you do not have to be a genius 
to figure out what is going to happen. We have a situation where now 
there are disagreements between the Democrats and the Republicans. The 
Democrats have some power because we have the White House controlled by 
a Democratic President. He has veto power. The Republicans, of course, 
control both the Senate and the House.
  They are going to pass these very regressive bills which penalize 
working families. They have already started. I just gave some examples. 
We are not going to be able to stop them from passing a bill next week 
which cuts the summer youth employment program. We will not be able to 
stop the majority from passing a bill which cuts the LIHEAP program, 
takes away the fuel for elderly people in the winter. We will not be 
able to stop them from passing a bill which refuses to appropriate any 
money for school construction or to lower the school class sizes.
  They have a hokey report that just came out which accuses schools of 
wasting money, and they want to consolidate it with a flat grant, a 
block grant. They are ignoring the public on matters of education. The 
Republicans have chosen just to ignore the public completely.
  The public opinion polls, which we take under consideration for so 
many other issues, the public opinion polls clearly show that the top 
priority of Americans is Federal involvement in education. The Federal 
Government they want to set, they want to set education as a top 
priority. They want participation by the Federal Government.
  They have these problems that they recognize in public education, 
private education, too, higher education, elementary, secondary 
education, these are problems which affect the whole Nation, and the 
voters are already much wiser than the Members of Congress. They are 
wiser than the leadership of either party, because neither party is 
really proposing the kind of education reform that is needed.
  The education system that we ought to have is not on either agenda. 
Democrats have a better agenda and that is all we have at this point so 
let us get behind it. But we need a massive program to revamp 
education. Massive program to take the first step and guarantee that 
every child has a physical facility that is safe, free of hazards and 
conducive to learning. Just construction, a one-time expenditure does 
not mean you put a local school board on the dole and they will be 
always looking for the Federal Government. You make a one-time 
expenditure to build a new school or to enlarge a school, to modernize 
a school, to get rid of the asbestos that threatens the health of the 
kids, to take out the coal burning furnaces. We have 285 coal burning 
furnaces. I think they reduced it now, coal burning furnaces in the 
schools of New York. Those furnaces are health hazards. Let us take 
them out. It is a one-time expenditure.
  So we need to make that expenditure, and voters out there are saying, 
when you take a poll, yes, the Federal Government should do this. We 
are not afraid of the Federal Government controlling our schools. We 
want more Federal participation to solve problems. They are saying 
this, but we are responding as Democrats, in my opinion, with a Mickey 
Mouse response. We are not emphasizing enough the President's $22 
billion construction proposal. We are ready to settle for less. That is 
a fraud.
  To settle for less means that you are saying we want to increase the 
number of teachers so that the ratio of teachers to students will be 
better. One teacher will not have to have so many students. We want to 
improve reading. We want to do a lot of things step one, two, three.
  But if you do not have new construction, modernization in New York 
and some other big cities, you cannot decrease the teacher/student 
ratio. You cannot make a better ratio. There is no-where for the 
classes to go. In order to have smaller classes, you need classrooms. 
You need to build some more classrooms. Overcrowding is a major problem 
in the big cities and in some rural areas the schools are literally 
tumbling down. They are unsafe. We have problems which a one-time 
expenditure on the order of what President Clinton has proposed, I 
would like to see it be more, $22 billion, that is really a loan 
program.
  I think we need a grant program to go along with that loan program. 
And between now and the time the deal is made in October, we ought to 
really raise the level of the voice of the voters so that they will 
hear us. The voters are saying it, but they are not saying it loud 
enough.
  The voters are saying they want education assistance of great 
significance, but the message does not seem to be coming through our 
elected officials who are on this floor and the other body. We must all 
unite behind an effort to make certain that when the deal is made, when 
the President vetoes the appropriations bills that are hostile to 
working families, they come back to the House, they do not have enough 
votes to override the vetos, there will be negotiations. This pattern 
has taken place for the last 10 years, when President Bush was in the 
White House and President Reagan, you had Democrats controlling the 
Congress and you had a Republican President the under Bush and Reagan. 
Now we have Republicans controlling Congress, and you have a Democrat 
in the White House. The only way to resolve the differences will be 
negotiations where the President and the White House, leaders of the 
Congress, the elected minority leaders, too, but sometimes they do not, 
they will be there negotiating. The deal will be made about differences 
in the appropriations bills.
  There is another deal that is going to be made at the same time. What 
we do with the $63 billion surplus. Here is a window of opportunity, 
$63 billion. Let us talk now to the President and to the leaders of 
Congress about how we want the deal to go down.
  We do not want a deal made in a smoke-filled room at the last minute 
and working families end up being left out. We must all unite behind an 
effort to make sure that when the deal is made as to how to spend this 
$63 billion, and it is going to be done, the Republicans have made it 
quite clear, they want a tax cut. They want a large part of that to go 
for tax cuts. They are not saying they want it out of the surplus. They 
just imply it.
  The President has said most of the money should go to Social 
Security. I agree. If you had only $8 billion, Mr. President, if you 
had only 8 billion, then let the $8 billion that you have projected in 
the State of the Union address go toward continued support for Social 
Security. But we have more than $8 billion. We have almost eight times 
that much. So if you have $63 billion, why can we not follow a formula?

[[Page H5856]]

 Why can we not have a deal in October and talk to the American people 
about the deal now, where one-fourth of the surplus goes toward a 
contingency fund for Social Security. After all, Social Security 
revenue is generating most of the money, one-fourth goes toward a 
contingency fund for Social Security, one-fourth goes toward a tax cut, 
and the tax cut should start with a tax cut for the people who make 
$50,000 or less, families that make $50,000 or less, a cut in the 
payroll taxes. Then one-fourth can go toward school construction and 
related matters like technology, wiring the schools. And one-fourth can 
go for other education purposes, including higher education, because in 
the higher education bill that we passed, there is no modernization for 
the infrastructure of college campuses, the E rate which we have at 
least come up with as a concept. It has not been implemented fully yet, 
but the E rate which discounts telecommunications fees for elementary 
and secondary schools and libraries does not apply to colleges.
  Colleges need to have help in training our workers for the future in 
information technology. So let us unite behind a four-way split, a deal 
which we will call the caring majority of appropriations priorities for 
working families. That deal means, first, I said one part does not cost 
it anything, an increase in the minimum wage. The rest of the deal is a 
tax cut for families that are working, an insurance marker for Social 
Security, school construction program, an investment. School 
construction will help us to provide the classrooms which will enable 
us to have smaller class sizes, and part of that school construction 
program should be in grants, not just loans, $22 billion in loans. The 
Federal Government paying an interest rate is a good deal for 
localities and States, but not good enough.
  Big cities, places where you have emergency situations ought to also 
be recipients of some grants, and those grants should be right away.
  So we have a package which we can call the caring majority 
appropriations priorities package for working families. I call on the 
black caucus, I call on the Hispanic caucus, the women's caucus, the 
blue dogs, I call on all of the Members who care about people to take a 
look at this appropriations priorities package for working families.
  Between now and the time the deal is made, let us push in the 
appropriations bills to get a high visibility for these expenditures 
that are needed. And when that fails and the vetoes take place and the 
deals are being negotiated at the White House, let us keep up a steady 
drumbeat with the public so that the deals are deals which help working 
families. When they come out of the negotiations, we will have an 
agenda, a set of expenditures in this year of 1998, 105th Congress, 
that benefits working families.
  We will not have this opportunity in the future very soon. We will 
not have a surplus like this for a long time. We will not have our 
chance to make the investments now in education that are needed now. We 
need to jump start the education reform process by giving some real 
Federal aid and stop playing games with it.
  Last time the Committee on Appropriations came up with $145 million 
for a school reform package, $145 million. Now, even if that school 
reform package was successful, it is still a drop in the bucket. It 
will not do very much in terms of reforming education. The $145 million 
is being accused by the Republican majority as if it was a $50 billion 
program. The same criticisms, the same attention has been focused on 
it.
  So we do not need, appropriations committee members, the message to 
them is, we do not need another whimpish little piece, bone, crumb 
thrown to education. We need a significant effort to reform education, 
and that requires Federal dollars.
  Look at the voters, look at what the voters are saying, and you will 
find that I am not standing here as a New York left wing radical or 
somebody who is way out of touch with the people. I am in touch with 
the voters.

                              {time}  1530

  The voters say education comes first. This year, this 105th Congress 
has an unprecedented window of opportunity. Before we adjourn we should 
act to share the prosperity with working families. We have a Dow Jones 
average which is above 9,000. Unprecedented. We have unprecedented 
money being made, returns on investments. Let us take advantage of 
that.
  In education we can create a partnership with the States to address 
the crumbling and overcrowded schools. We can help communities reduce 
class size by hiring and training new teachers. We can help schools 
integrate technology into the classroom and train teachers in using 
that technology effectively. And we can assist high poverty, urban, and 
rural school districts that are serious about carrying out standards-
based reform plans to improve student achievement levels.
  We can also refund the summer youth employment program so that summer 
youth will have employment opportunities, those who need it most. This 
is only for low-income youth. The working families out there need some 
help in terms of their kids getting summer jobs.
  We should refund the LIHEAP program for our poor elderly people in 
the wintertime, who are members of working families also and should be 
included in the benefits of our prosperity.
  There is something called earned income versus unearned income, and 
we ought to take a look at that. That phrase was coined by economists a 
long time ago. Earned income is the income that people get from wages 
and salaries. So most of the working families in America, they have 
what we call earned income.
  Do my colleagues know that earned income is taxed at a greater rate 
than unearned income? Again, these are not my terms. Economists have 
been using these terms for years. Taxes on earned income, wages, 
salaries and retirement pay, produce 85 percent of all personal income 
taxes, but only 15 percent brought in by taxes of unearned income. What 
is unearned income? That is the taxes on the income that we earn with 
our stocks and bonds, investments, especially capital gains.
  Capital gains stocks have skyrocketed from $5 trillion in 1994 to $12 
trillion in capital gains, and most of those capital gains, that $12 
trillion, will never be taxed unless the tax laws are changed. So the 
unearned income out there is not being taxed, but we are still taxing 
earned income.
  That is why I said one of the pieces in this package, the Caring 
Majority Appropriations Priorities Package for Working Families, has to 
be a tax cut for the poor. Taxes on earned income, income and Social 
Security is what I call earned income, brings in over 70 percent of all 
Federal tax revenue compared with only 9 percent for unearned income. 
For every dollar of tax revenue produced by earned income, unearned 
income, income from investments and stocks and bonds, et cetera, brings 
in only about 13 cents. Why? Because every dollar of earned income goes 
on the tax return and it is fully taxed. It goes on our returns and we 
cannot escape having the tax. The only exceptions, of course, are some 
low-income people who are given an earned income tax credit.
  By contrast, there are all kinds of huge loopholes, exceptions and 
special provisions for unearned income, especially for huge capital 
gains being made in the stock market right now. If we eliminated or cut 
back these huge loopholes that favor unearned income, especially 
capital gains, then we could cut everybody else's taxes. We could cut 
the working families' taxes by taking a bigger bite out of the unearned 
income taxes.
  I want to conclude, Mr. Speaker, by saying that we only have a few 
days left. Let me start where I began. Between now and the end of the 
first week in August, when we go in recess, there will be numerous 
appropriations bills passed. Most of those appropriations bills 
indicate great hostility toward working families. One item after 
another.
  We are debating right now the HUD-VA bill. Public housing over the 
last 5 years under the Republican majority has suffered more than any 
other Federal program. Public housing has been devastated by the 
Republican majority. They have no mercy with respect to housing, and 
housing is where our family begins. If a family does not have a decent 
house, a decent home, they are in serious trouble.
  Housing is one of the problems with education. Many of the teachers 
complain that the poor families are constantly moving because they are 
seeking better housing. They have problems

[[Page H5857]]

with the housing that they have. So housing is bedrock to families. If 
we care about families, then we have to care about housing. And what we 
are doing right now on the floor, and we will continue next week when 
we come back, is to continue to devastate the supply of housing for the 
poor.
  We will follow that with education. Next week I understand the Labor 
and HHS appropriation bill will be on the floor, and that is where we 
have the denial of the opportunity to invest in education. We must all 
unite now behind a Caring Majority Appropriations Priorities Package 
for Working Families.
  Every Member of the House who cares about families, and everybody 
says they care about families, I hope they will open their eyes and see 
what helps families and what hurts families. It hurts families not to 
have a decent minimum wage. It hurts families not to have as much help 
as possible from the government to guarantee that their children get an 
education which would allow them to move out of poverty. It hurts 
families when emergency help from programs like LIHEAP, the provision 
of fuel for the elderly, is denied, because that means that the family 
somewhere else has to make some sacrifices to take care of the elderly 
people.
  We must all unite behind the Caring Majority Appropriations 
Priorities Package for working families. End the hostility and let us 
promote working families.

                          ____________________