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Archive for Tuesday, August 29, 2000

House GOP offers plan to raise minimum wage

August 29, 2000

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— House Speaker Dennis Hastert offered Monday to push legislation boosting the minimum wage by $1 throughout two years without making the increase contingent on two key tax cuts that drew objections from President Clinton. Democrats expressed cautious optimism that a deal could be struck.

Hastert, R-Ill., said in a letter to the president that Republicans still wanted a $76 billion package of business tax breaks to accompany the wage measure but would remove proposals to abolish the estate tax and to change pension laws, including increased contribution limits for 401(k) plans. Both are subjects of separate bills.

Democrats have long sought in these prosperous economic times to increase the $5.15-an-hour federal minimum wage, but Republicans have said tax breaks are needed to cushion the higher costs that would fall on businesses. The Senate and House have passed different versions of such legislation, but efforts at compromise have been bogged down for months.

"It is very clear that a vast majority of congressional Democrats and Republicans would like to see a balanced approach achieved before we adjourn," Hastert said in the letter to Clinton. "I believe that we can work together to pass this legislation when we return in September with strong bipartisan majorities in the House and Senate."

According to Clinton administration estimates, about 10 million workers earning between $5.15 and $6.14 an hour would be directly helped by a $1 minimum wage increase. For a full-time worker now earning minimum wage, it would amount to a $2,000 annual raise.

House Minority Whip David Bonior, D-Mich., called Hastert's offer a "bona fide effort and an attempt to reach a positive solution." He predicted a minimum wage increase and tax package would pass before lawmakers finally leave Capitol Hill this year.

"We definitely want a bill to help working people," Bonior said in an interview.

Gene Sperling, the president's chief economic adviser, said the White House would "take a fresh look" at the tax package now that "the most objectionable poison pills" were removed.

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