Senate Rejects Minimum-Wage Increase

Two competing measures had been proposed as amendments to a bankruptcy bill that may be approved as early as today.
Stephen TaubMarch 8, 2005

Yesterday the Senate turned back two efforts to raise the minimum wage for the first time since 1996.

Both measures were offered as amendments to a bankruptcy bill that has long been sought by lenders including banks and credit-card companies, and that would grant less relief to many individuals who file for bankruptcy protection. Under an agreement between Republicans and Democrats, according to The New York Times, neither minimum-wage amendment was given much chance of approval, since each would have required 60 votes to pass.

The Republican-controlled chamber first defeated a measure sponsored by Edward Kennedy (D-Mass.) that would have increased the minimum wage by $2.10 in three steps, to $7.20 per hour from the current $5.10, over the next 26 months. That amendment was defeated, 49 to 46, reported the Times, which also noted Kennedy’s anger that “this institution voted themselves a $28,500 pay increase over the last five years” but that “minimum wage has been flat.”

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The Senate then defeated a measure offered by Rick Santorum (R-Pa.) that offered a smaller increase — $1.10 in two steps, to $6.25, over 18 months — that Republican senators suggested would help workers without inhibiting the creation of additional jobs. “Wages do not cause sales. Sales are needed to provide wages. Wages do not cause revenue. Revenue drives wages,” said Mike Enzi (R-Wyo.), according to the Associated Press.

The amendment also included a number of pro-business provisions, noted the AP, that would have required employees to work up to 80 hours over two weeks before qualifying for overtime; made it tougher for individual states to raise the minimum wage for restaurant workers; and removed wage and overtime constraints for some small businesses. The Republican measure also included $4.2 billion in tax relief largely intended for the restaurant industry, according to the wire service. Santorum’s proposed amendment was defeated, 61 to 38.

Should the bankruptcy bill clear a few final hurdles in the Senate today, the Republican-controlled House of Representatives is expected to approve it quickly. President Bush supports the measure, noted the Times.