[Congressional Record (Bound Edition), Volume 159 (2013), Part 9]
[Senate]
[Pages 12320-12321]
[From the U.S. Government Publishing Office, www.gpo.gov]




                            THE MINIMUM WAGE

  Mr. DURBIN. Mr. President, 4 years ago today, the Federal minimum 
wage increased to $7.25 per hour. That was the final phase of a minimum 
wage increase that Congress passed in 2007. After 4 years, it is time 
to evaluate where wages stand.
  Since 1967, the Federal minimum wage has increased from $1.40 to 
$7.25. While at first glance this seems like significant progress, when 
adjusted to current dollars the value of the minimum wage has actually 
declined by 12.1 percent. Had the minimum wage kept pace with 
inflation, it would be $10.74 an hour today.
  But the minimum wage for tipped workers is even worse. The current 
minimum wage for tipped workers is $2.13, and that has not gone up 
since 1991. Employers paying the tipped minimum wage now pay just 21 
percent of what that employee would make at minimum wage. This forces 
workers to use more and more of their tips simply to make up the 
difference between the tipped minimum wage and the standard minimum 
wage.
  Working 40 hours per week at $7.25 per hour translates to just 
$15,080 per year. That's about $400 less than the Federal poverty level 
guidelines for a family of two. Last week, The Atlantic ran an article 
that showed a budget chart produced by McDonald's to help its employees 
better manage their finances. And while I commend McDonald's for trying 
to help workers better manage money, the budget tells a sad story.
  According to the chart, someone making the minimum wage and working 
40 hours a week at McDonald's would have to work a second job to make 
ends meet. But to be clear for this budget to be accurate, a worker 
must hold nearly two full time jobs. According to the Washington Post's 
Wonkblog, a worker making the minimum wage would to have work 75 hours 
a week to have the after-tax income in the McDonalds sample budget. 
Working 75 hours a week at minimum wage with no vacation days and 
limited benefits--if any--one can make $24,720 a year, after tax.
  How does a person do that if they are a single parent? They can't. 
There are not enough hours in the day to raise a family working that 
many hours. And there certainly aren't enough dollars in the income to 
provide child care.
  The sample budget drawn up for McDonald's employees might as well 
include a line for Federal and State assistance. Families living on the 
minimum wage have few alternatives but to turn to programs such as 
SNAP, housings assistance, and Medicaid to survive. These are the same 
programs that are regularly attacked by the ultra-conservative for 
growing too quickly. For those who insist that working be a requirement 
for receiving public assistance, shouldn't they also insist that if you 
are working full time you shouldn't need public assistance? Wouldn't 
that be a good definition of a minimum wage?
  If we increase the minimum wage to $10.10, more than 30 million 
workers would receive a raise. And while some of these workers are 
teenagers, 88 percent are adults. For many of those adults, these are 
not part time jobs or stepping stones to their next job, but the full 
time job they rely on for a living.
  That is why 4 years after the last minimum wage increase, it is time 
to act again. I am a cosponsor of the Fair Minimum Wage Act introduced 
by Senator Harkin in the Senate and Representative George Miller in the 
House. The Fair Minimum Wage Act will increase the minimum wage from 
$7.25 to $10.10 per hour in three, 95-cent annual increments, and index 
it to inflation annually thereafter. The bill will also gradually raise 
the minimum wage for tipped workers from the current $2.13 per hour to 
a level that is 70% of the regular minimum wage.
  If we pass the Fair Minimum Wage Act that same full-time worker being 
paid minimum wage I mentioned earlier that makes $15,080 a year--will 
make $21,000. That can be the difference for a family that is getting 
by and one that is living in poverty. I hope my colleagues on both 
sides of the aisle will join me in cosponsoring the Fair Minimum Wage 
Act.
  Mr. HARKIN. Mr. President, 4 years ago today, July 24, 2009, was the 
last time the minimum wage was increased. It rose from $6.55 an hour to 
$7.25 an hour. And it has been stuck there ever since. Four years is 
too long. It is time to raise the minimum wage.
  To that end, I have introduced legislation along with Rep. George 
Miller in the House. The Fair Minimum Wage Act will gradually increase 
the minimum wage to $10.10 an hour in three annual steps. Our bill will 
also link future increases in the minimum wage to the cost of living, 
using the Consumer Price Index, so that people who are trying to get 
ahead don't fall behind as our economy grows. Finally, our bill--for 
the first time in more than 20 years--will raise the minimum wage for 
workers who earn tips, from a paltry $2.13 per hour, today, to a level 
that is 70 percent of the regular minimum wage. This will be gradually 
phased in over the course of 6 years, which will give businesses time 
to adjust while providing more fairness for hardworking people in 
tipped industries.
  While millions of workers have been without a raise these past 4 
years, costs have continued to climb. Between 2009 and 2012, rent has 
gone up 4%, auto repair costs have climbed 6%, food is 8% more 
expensive, child care costs 9% more, and public transportation takes a 
13% bigger bite out of workers' wallets.
  I do not need to tell you that when you are taking in $1,000 a month, 
even a few dollars more at the grocery checkout line is a hardship. The 
tens of millions of working poor and low-wage Americans and their 
families know this. They know that the minimum wage, for many, is a 
poverty wage; it pays $3,000 less per year than what is needed to lift 
a family of three above the poverty line. They know they can not 
survive on such meager wages. They know it because they live it.
  Unfortunately, the McDonald's corporation does not seem to 
understand. Last week, a budgeting brochure that McDonald's provides 
its workers went viral on the Internet. It seems that, as the folks at 
The Atlantic said, ``McDonald's can't figure out how its workers 
survive on minimum wage.'' Let's talk about McDonald's.
  McDonald's is the third-largest employer of low-wage workers in the 
country, with 860,000 U.S. workers. According to Glassdoor, the average 
wage for a cashier is $7.72 and for a crew member is $7.68. That is 
just pennies above the minimum. Even managers only make around $9.50 
per hour, sometimes less.
  The McDonald's budget brochure shows workers how to add up their 
monthly expenses to determine their monthly household budget. But wages 
at McDonald's are so paltry that its sample budget had to assume that 
its employees work two full-time jobs to earn $2,000 a month. Never 
mind that most fast food jobs are part-time, and finding two jobs would 
be very difficult in today's economy with so many unemployed and part-
time workers looking for full-time jobs.
  On top of requiring two jobs, this budget's estimated costs are 
either out of sync with reality or simply missing. It estimated rent at 
$600 a month, when in reality rent costs $783 for a one-bedroom 
apartment and $977 for a two-bedroom, according to the National Low-
Income Housing Coalition. Those are national figures; rent is much 
higher in many parts of the country. The McDonald's budget also doesn't 
include necessities like child care or food. And I don't know where 
someone is going to get health insurance for $20 a month. Even 
McDonald's charges $54 a month for its most basic plan for one employee 
with no dependents, and that is after a year of working there. With 
just one dependent, it is $140 a month. And that basic plan still has 
deductibles and copays on top of the premium.
  This just shows how difficult it is for tens of millions of people--
folks who do

[[Page 12321]]

some of the most demanding work in our country--to make ends meet. But 
it's not just low-wage workers who are hurt when they can't keep up 
with costs. This hurts our communities and our local businesses as 
well. When our neighbors can't afford to go to the grocery store or the 
auto repair shop or the hardware store, all of those businesses suffer. 
They lose customers and sales.
  But imagine if the lowest wage workers all got raises. They would 
take their car in for that long-needed repair. They would pick up a few 
extra items at the store. They would buy a new pair of shoes for their 
growing son or daughter. And those local stores would all benefit.
  And when we see that 30 million people across the country will get a 
raise thanks to the Fair Minimum Wage Act, all that extra spending 
really adds up. The local grocery might even have to hire new people to 
keep up with rising demand. In total, my bill will add $33 billion to 
our GDP over its 3 years of implementation. And it will create 140,000 
new jobs over that same period.
  It's simple: more money in consumers' pockets means more spending, 
which means more economic activity, which means more jobs.
  In fact, the financial and economic experts know this already. I have 
seen article after article, interview after interview from financial 
experts saying that we need more consumer spending in order to get our 
economy really going. Just last month, the Wall Street Journal 
interviewed the president of Naroff Economic Advisors. He analyzed a 
recent consumer spending report and said, ``We're in a situation where 
we need much stronger increases in wages and salaries if households are 
going to have the money to spend and the economy's going to grow 
faster.'' He added:

       We need wages to grow significantly faster. They're coming 
     up from where they have been, but we need them to really 
     begin to pick up. We need stronger job growth, but more 
     importantly we also need average salaries and hourly wages to 
     grow faster. Those have been largely flat and that's the 
     problem. Right now, income's growing because we're creating 
     more jobs, not because people are making more money. We need 
     the average person to see their salaries go up before they 
     can spend more and drive this economy forward.

  Well, we can raise wages in this country, and we can provide those 
raises to the people who need it most--not to CEOs but to the people 
serving our food, watching our children, helping us when we call 
customer service, and assisting us at our local stores. These are the 
people who are earning wages so low, they work two jobs and still can't 
make ends meet. And these are people who will go out and spend just 
about every dime in their local stores, boosting their local economies.
  Minimum wage workers want to support themselves. Ninety percent of 
the people who would benefit from my legislation are adults, not 
teenagers. They are often parents. In fact, one in five working parents 
in this country will get a raise under my bill, and a third of single 
parents. A total of 18 million children have parents who would get a 
raise. Think about that. All of those millions of families with a 
little more money to spend. What a help that will be to those growing 
kids.
  We owe it to millions of low-wage families struggling to just have a 
glimpse of the American Dream, to make sure that they get a raise and 
can support their families. But we also owe it to ourselves, to our 
economy. Our system works best when everyone has the opportunity to 
support themselves, to be productive, and to participate in our larger 
economy.
  Raising the minimum wage is a simple and effective way to do this. 
And we know we can do it in a responsible way, with no unintended 
consequences. My bill would phase in an increase in three steps, giving 
businesses time to adapt. And because the minimum wage will apply to 
all businesses, no single business will be at a competitive 
disadvantage.
  Also, my proposal is in line percentage wise with previous increases 
in the minimum wage. Decades of solid economic research shows us that 
these increases have not caused job losses. In fact, businesses stand 
to benefit from increased wages, because raises result in significantly 
lower turnover rates, which in turn saves those businesses money.
  Four years without a raise is 3 years too many. We have to make sure 
that working families can keep up with the economy. That is why linking 
future increases in the minimum wage to the cost of living is so 
crucial. Small annual increases will be easy to absorb, but will make a 
big difference to American families. And it will help our businesses on 
Main Street as well as our national economy.
  Mr. President, it is time to raise the minimum wage and link it to 
inflation for the future. It is the right thing to do, and it is the 
responsible thing to do. And it will give a much needed boost to both 
local economies and our national economy. I urge my colleagues to 
support this long-overdue legislation.

                          ____________________