Statement by Sen. Bernard Sanders on Minimum Wage

Mr. President, I rise today in strong support of the Fair Minimum Wage Act of 2007, and I would like to commend Senator Kennedy for his leadership on this issue. This important legislation would increase the federal minimum wage from the abysmal $5.15 an hour to $7.25 an hour over two years. Mr. President, make no mistake about it: this bill will benefit millions of workers and their families. It is long-overdue. Anyone who works 40 hours a week in the United States of America, should not be living in abject poverty. It is a moral disgrace that Congress hasn’t increased the minimum wage since 1997. Today’s minimum wage workers have less buying power than minimum wage workers did back in 1955 when Dwight Eisenhower was president. Simply put, a job should keep you out of poverty, not keep you in it. At the current federal minimum wage of $5.15 an hour, a person working full-time makes only $10,712 per year before taxes, which is approximately $6,000 below the federal poverty line for a family of three. Moreover, while the cost of living has skyrocketed, the value of the minimum wage has eroded by over 20 percent since the last increase. An increase in the minimum wage to $7.25 would add nearly $4,400 to a minimum wage workers income. In some areas, this additional money would be enough to cover 15 months of groceries, 19 months of utilities, 8 months of rent, over two years of health care, 20 months of child care, or 30 months of college tuition at a public, 2 year college for a low-income family of three. Nearly 13 million workers, 10 percent of the U.S. workforce, would directly or indirectly benefit from a raise in the minimum wage to $7.25 per hour.”5.5 million workers would benefit directly. “7.4 million would benefit indirectly. “More than 60 percent of those who would benefit are women. In addition to workers, millions of American families would benefit from a raise in the minimum wage, including nearly 6 million children who would see their parents earnings increase. But, Mr. President, some will argue that an increase in the minimum wage will primarily benefit teenagers. Wrong. The vast majority of those who would benefit from a raise in the minimum wage are adults working full-time. In fact, nearly 80 percent are adults, not teenagers. In addition, a raise in the federal minimum wage would not harm the economy or employment. In the four years after the last increase, the economy experienced its strongest growth in decades, more than 12 million new jobs were added (at a pace of 248,000 per month), and inflation was stable. Recently, over 650 economists, including Nobel Prize winners and past presidents of the American Economics Association, released a statement calling for a raise in the minimum wage. They confirmed that, a modest increase in the minimum wage would improve the well-being of low-wage workers and would not have the adverse effects that critics have claimed. . . . [T]he weight of the evidence suggests that modest increases in the minimum wage have very little or no effect on employment. Moreover, a recent Gallup Poll revealed that 86 percent of small business owners surveyed do not believe that an increase in the minimum wage would hurt their business. Three-fourths of small business owners thought that a 10 percent increase would have no affect on them. In fact, nearly half of those polled thought that the minimum wage should be increased. Beyond Minimum Wage: Mr. President, while I believe that it is important to raise the minimum wage to $7.25 an hour, much more needs to be done to improve the economic situation of millions of Americans. Since President Bush has been in office, 5.4 million middle class Americans have slipped into poverty; median income for working-age families has declined each and every year; and median household debt has increased by 34%. Wages and salaries today make up the lowest share of the nations gross domestic product since 1947, while corporate profits have climbed to their highest share since the 1960s. Despite huge increases in worker productivity, many Americans are working longer hours for lower wages than was the case 25 years ago. While productivity has risen by 17% over the past five years, median family income has actually gone down by nearly 3% after adjusting for inflation. Many Americans are working two and three jobs, just to make ends meet, and even the two week vacation is a thing of the past for millions of Americans. In the midst of all of this, the Presidents trickle-down economic policies have made a bad situation even worse. The President has given away hundreds of billions of dollars in tax breaks to the wealthiest one percent causing our record-breaking $8.6 trillion national debt to explode and widening the inequality gap. The President has provided billions of dollars in corporate welfare and tax breaks to companies that are outsourcing our jobs overseas and big oil companies that are ripping off consumers at the pump. And, he has signed trade agreements that have contributed to the loss of decent-paying jobs. If we don’t change our current trickle-down economic policies, our kids and grandkids will likely have a lower standard of living than we do for the first time in modern American history. We must not let that happen. Beyond increasing the minimum wage, what else can be done? Trade Policy: First, in my view, we must tackle the forces of globalization head-on and reverse our extremely harmful unfettered free trade policy which has led to the loss of 3 million manufacturing jobs over the past 6 years, including over 10,000 in my State of Vermont. Not only is the manufacturing sector in a state of collapse, we are also on the cusp of losing our information technology sector in this country, thanks in large part to unfettered free trade. Mr. President, you may know that over the past five years, we have lost 17% of our factory jobs, including about 1 in 5 in my State of Vermont. But, over this same time period, we have also lost about 16% of our information sector jobs as well. This is a disgrace. Unfettered free trade has led to a race to the bottom. It has forced American workers to compete against desperate workers in Communist China who are paid thirty cents an hour and are thrown in jail if they speak out against their government or try to form a union. It has led to a record-breaking $800 billion trade deficit, including a $200 billion deficit with China. According to the National Association of Manufacturers, if we do not change these policies, our trade deficit with China alone will swell to $330 billion by 2008. Mr. President, the time is long-overdue for us to reverse our unfettered free trade policies and re-write our trade agreements to benefit American workers and lift living standards throughout the world. In addition, we must also ask the following fundamental questions: Why is it that the United States has the highest rate of childhood poverty in the industrialized world? Why is it that the United States is the only major industrialized country that does not guarantee healthcare as a right of citizenship? These are just a few questions we must delve into. The bottom-line is that we must be doing everything we can to improve the lives of the large majority of Americans, not just the wealthy few. We can start by increasing the minimum wage. But, that must only be the beginning.