[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.
____________________