Harkin & Miller introduce bill to raise federal minimum wage to $10.10 an hour

Democratic Sen. Tom Harkin and Rep. George Miller today introduced a bill that would raise the federal minimum wage from $7.25 an hour to $10.10 an hour in three years.

The Fair Minimum Wage Act would also raise the minimum wage of tipped workers from $2.13 an hour to 70% of the regular minimum wage. The minimum wage would then be indexed to inflation every year after 2016.

If approved by Congress, the increases for regular wages would be phased in gradually.

Regular wages would grow at a rate of $0.95 per year, from $7.25 an hour to $8.20 an hour in the first year; to $9.15 an hour in the second year; and then to $10.10 an hour by 2016.

Tipped wages would grow at a rate of $0.85 a year, from $2.13 per hour to $2.98 per hour in the first year, until wages reach 70% – or $7.07 – of the regular minimum wage.

Read more: House Democrats seek to force vote on minimum wage

The minimum wage increase would benefit about 30 million workers, including 17 million women, and 17.5 million children who have at least one parent who is a minimum wage earner, according to Miller

At press conference on Capitol Hill, Harkin and Miller pointed out that an individual working full-time earning the minimum wage would receive $15,000 a year, which is about $3,000 below the poverty level for a family of three. But with an increase to $10.10 an hour, the annual income would grow to $21,000 and lift the individual and his or her family out of poverty.

“The harsh truth is that the minimum wage has become a poverty wage – a poverty wage – for tens of millions of workers and…their families. This shouldn’t happen in the richest nation on earth. No one who works hard for a living should have to live in poverty,” said Harkin (D-Iowa).

Both Harkin and Miller were adamant that $10.10 is the lowest minimum wage required to lift minimum wage workers out of poverty.

“$10.10 matters when it comes to indexing the minimum wage. If we tie the minimum wage to inflation, we must not start when the inflation adjustment is too low. Otherwise, workers will get stuck below the poverty line in perpetuity. We will be sentencing them to a sub-minimum wage in perpetuity. That’s why $10.10 matters,” said Miller.

Not only is the current minimum wage a “poverty wage”, Miller noted that the minimum wage now has a lot less purchasing power than the minimum wage in 1968.

While wages have stagnated in recent decades, the cost of living has grown, leaving minimum wage earners, as Harkin said, “further and further behind”.

“Today, 40% of Americans make less that the minimum wage was worth in 1968 and that is immoral and it is economically dangerous,” said Miller. “Income inequality threatens the economic security of working families and the strength of our nation.”

Gregory Reynoso, a Domino’s pizza delivery driver from Brooklyn, New York, said his $7.25 an hour wage, even with tips, has not been enough to make ends meet and that sometimes he’s had to resort to using food stamps to feed his wife and two-year-old daughter.

“I work hard to provide for my family,” said Reynoso. “We are struggling because the cost of living keeps going up but my wages stay the same. The rent has gone up. The cost of gas is going up. Sometimes if I pay one bill, I can’t pay the others.”

According to Harkin, raising the minimum wage to $10.10 an hour would restore the wage to about 90% of the 1968 level of purchasing power. With more money in workers’ pockets, Harkin said consumer demand would also grow, thereby stimulating the U.S. economy.

“Raising the minimum wage is also about growing our own economy. With an increase in minimum wage, workers have more money to spend, and…they spend it locally, not overseas. This is just basic economics. Increase demand means increased economic activity. They will spend their money in their local economy, giving a boost to Main Street,” said Harkin.

Read more: CBO projects $10.10 hourly minimum wage increase will lift 900K Americans out of poverty but cost at least 500K jobs

Margo Dorfman, the CEO of the U.S. Women’s Chamber of Commerce, said lifting the minimum wage would help small businesses.

“The biggest problem I hear from my members is that the economic recovery is slow because sales are still weak. Too many people forget that workers are also consumers, and wages are at the heart of consumer demand,” Dorfman explained. “Raising the minimum wage puts dollars in the pockets of people who by necessity [are] most likely [to] spend them immediately at the grocery store, the child care provider, the auto repair shop, and other local businesses. Raising the minimum wage boosts the economy from the bottom up, which is exactly what we need to re-power our economy and create lasting jobs.”

Dorfman also argued that it is unfair for big businesses and global chains to continue to pay poverty wages and expect to taxpayers and small businesses to bear the burden of subsidizing food stamps for low-wage workers.

“Big corporations that pay poverty wages count on small businesses and taxpayers to subsidize them by providing food stamps and other forms of public assistance to workers and their families who can’t make ends meet, and that’s just not right,” said Dorfman. “It is an unsustainable and dangerous downward spiral to push American workers into poverty and expect taxpayers to pick up the bill for the consequences. Raising the minimum wage would assure taxpayers that businesses are playing fair and compensating workers at responsible levels.”

Andy Shallal, who owns several D.C. restaurants including the popular Busboys and Poets, said raising the minimum will help the restaurant industry thrive by “professionalizing” the workforce.

“I am living proof that you can actually do this and still be successful,” Shallal said. “I want to be in a business that’s not just a default place where go to because they can’t find any other work. I want to be in a business where people really do look for as a career opportunity.”

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