Paper: The Fair Minimum Wage Act of 2007 (H.R. 2)

For my US Congress class, we had to analyze the path of a specific bill as it passed through both houses of Congress to become a law. I chose the Fair Minimum Wage Act of 2007.

Paper

When the Democrats won over Congress they prepared a “first 100 hours” agenda of legislative priorities the House swore to pass within their first 100 working hours. One of these: an increase in the minimum wage, embodied as The Fair Minimum Wage Act of 2007 (H.R. 2). President Bush eventually signed the measure into law as part of an omnibus supplemental spending bill, but many political maneuvers were required for the bill to make it that far.

The bill’s life started easily. The Democrats, with their wide majority in the House, simply rolled the bill through under closed rules without even taking it to the Rules Committee. Democrats soundly defeated the one Republican-based vote on the bill, and passed this first form of the bill 315 to 116 (Sandler 2007a). Every Democrat and 82 Republicans voted for it (Tauberer 2007a). In general, the less conservative the Republican the more likely they were to support the bill, but no defining interests determined a legislator’s stance.

The Senate had other ideas. With a 51-49 majority, Democrats needed Republican support to pass the bill. So Majority Leader Harry Reid, cooperating with Republican Senate leaders, added an $8.3 billion tax cut for small businesses to the minimum wage bill written by Finance Chairman Max Baucus (D-MT) (Ota 2007a). This measure attracted broad bipartisan support from Senate leaders, but illustrating that “the Republicans are the opposition; the Senate is the enemy,” House Democrats immediately began insisting that the Senate pass the clean minimum-wage bill they’d been sent. Charlie Rangel, House Ways and Means Chairman, threatened to blue-slip the Senate’s combined version of the bill as a revenue measure unconstitutionally originating in the Senate (Ota 2007a).

Despite House objections, Senate leaders went forward with the combined tax-break/minimum-wage bill. They didn’t really have a choice — a cloture vote on the minimum-wage-only bill failed 54-43 and Republicans refused to allow a straight vote on the bill (Sandler 2007b). When the combined bill was voted on February 1st, though, it passed 94-3 (Sandler 2007c). The three Republicans who opposed it were given voice by Senator Tom Coburn (R-OK), who claimed that the bill would harm those it intended to help and violated principles of federalism (Coburn 2007); all three opponents of the bill are ranked as “radical Republicans” by GovTrack (Tauberer 2007b).

Despite the high “yea” count on the vote, Republicans did not provide easy passage for the bill. It took two separate cloture votes — one on the Baucus amendment and one on the amended bill — and consideration of additional amendments which took the full time allowed under the cloture vote before the final vote was called. The delay was apparently motivated by a desire to push back the next agenda item — a debate on Iraq resolutions — to the following week (Sandler 2007c). The House was not in town by the time the Senate finished the vote on February 1st, but Rangel had agreed not to press Constitutional issues immediately.

The House leadership’s eventual response was introduced on February 9th by Rangel as a separate set of small-business tax cuts valued at a relatively small $1.3 billion. While the size disparity created obvious issues for the conference committee, Rangel and House leaders hoped that House Republicans would back them against the Senate because of distasteful offsets in the Senate version of the tax cuts, included because of new House rules requiring that all budget increases and tax cuts be balanced by program cuts or tax increases in other areas (Ota 2007b). The House bill passed 360-45, again under closed rules, on February 16th and gained “tepid” support from the White House and stronger support from business groups due to its different offsets (Ota 2007c).

From there, the bill floundered as the House and Senate tax-writing committees negotiated until early March, when House Speaker Nancy Pelosi (D-CA) added it onto supplemental spending bill H.R. 1591, initially requested by President Bush to pay for military operations in Iraq. The purpose behind the move was twofold. First, Pelosi wanted the minimum-wage bill to get into committee so that it could be sent to the President and signed into law. Second, she wanted to bring liberal anti-war Democrats, unhappy that they were providing war money without immediately withdrawing troops, onboard the supplemental bill (Ota/Allen 2007). The bill passed the House on March 23rd 218-212 in a largely party-line vote motivated more by the Iraq provisions than the minimum wage (Donnelly/Higa 2007). 14 Democrats voted against the bill — some because of their far-left anti-war positions, others because they opposed such detailed military guidelines and the pork-barrel spending that was added. Two Republicans voted for the bill; Wayne Gilchrest of Maryland and Walter Jones of South Carolina. Neither Congressman is in danger of losing their seat; Gilchrest explained that the bill provided necessary funding for the war and establishes benchmarks proposed by President Bush that send a message to Iraqis that “the onus is shifting to them” (Gilchrest 2007).

The Senate responded four days later by adding the minimum wage and tax breaks to their own supplemental spending bill — but in order to increase leverage in committee, the Senate increased the tax break plan from $8.3 billion to $12.2 billion. Interestingly, Finance Chairman Max Baucus supported the expansion as a means of leverage, despite earlier statements that he wished a clean minimum-wage bill could be passed (Sandler 2007c) — probably because he considers Montana a “small-business state” and legislatively focuses on tax breaks for that constituency (Ota 2007a).

Baucus’ ploy didn’t pay off too well for him when the bill went to conference. He bargained Rangel and the House well up from their $1.3 billion plan, but eventual settled at only $4.84 billion in tax cuts — about half his original plan size and a third of his expanded plan with (Rubin2007a). Nonetheless, the bill was approved at these numbers and on May 1st sent off to President Bush…who vetoed it for the Iraq timeline it contained (Clarke 2007). Maneuvering ensued over the Iraq timeline language, and eventually H.R. 2206 was signed into law by President Bush, containing the minimum-wage provisions, $4.3 billion small-business tax cut, no timeline for withdrawal, and some slightly different (and smaller) domestic appropriations.

Reference List

Clarke, David. “Search for a Supplemental Compromise.” CQ Weekly, May 7, 2007.

Coburn, Tom. “Dr. Coburn remarks on the proposed federal minimum wage increase.” Tom Coburn, M.D. Senator for Oklahoma, January 30, 2007. http://coburn.senate.gov/public/index.cfm?FuseAction=LatestNews.FloorStatements&ContentRecord_id=73c369e8-802a-23ad-429b-37b58274ee42&Issue_id=.

Donnelly, John M. and Lirial Higa. “Supplemental Squeaks Through.” CQ Weekly, March 26, 2007.

Gilchrest, Wayne. “Gilchrest Statement on his vote Friday on the Emergency Supplemental Appropriations Bill.” Congressman Wayne Gilchrest, March 23, 2007. http://gilchrest.house.gov/News.asp?FormMode=Detail&ID=333.

Higa, Lirial. “A Withdrawal-Free Supplemental.” CQ Weekly, May 28, 2007.

Ota, Alan K. “Senate Backs Small-Business Tax Cuts.” CQ Weekly, January 22, 2007.

Ota, Alan K. “Small-Business Tax Package Sets Stage for Minimum Wage.” CQ Weekly, February 12, 2007.

Ota, Alan K. “House Keeps Wage Increase on Track.” CQ Weekly, February 19, 2007.

Ota, Alan K and Jonathan Allen. “Wage Hike, Tax Breaks Added to Supplemental.” CQ Weekly, March 12, 2007.

Rubin, Richard, and Alan K. Ota. “Boosted Tax Breaks Further Strain Accord.” CQ Weekly, April 2, 2007.

Rubin, Richard. “The Intersection of War And Domestic Policy.” CQ Weekly, April 30, 2007.

Rubin, Richard. “Democrats Victorious on Wage Hike, Tax Breaks.” CQ Weekly, May 28, 2007.

Sandler, Michael. “$2.10 Wage Increase Passes House.” CQ Weekly, January 15, 2007.

Sandler, Michael. “Senate Closer to Passing Wage Bill.” CQ Weekly, January 29, 2007.

Sandler, Michael. “Senate Adds Tax Cuts to Wage Raise.” CQ Weekly, February 5, 2007.

Sandler, Michael. “2007 Legislative Summary: Employment and Labor: Minimum Wage Increase.” CQ Weekly, January 7, 2008.

Sandler, Michael and Alan K. Ota. “Provisions of the Senate Wage Bill.” CQ Weekly, February 5, 2007.

Tauberer, Joshua. “GovTrack: H.R. 2: Fair Minimum Wage Act of 2007 (Vote On Passage).” GovTrack, January 10, 2007. http://www.govtrack.us/congress/vote.xpd?vote=h2007-18&sort=party.

Tauberer, Joshua. “GovTrack: H.R. 2: Fair Minimum Wage Act of 2007 (Vote On Senate Passage).” GovTrack, February 1, 2007. http://www.govtrack.us/congress/vote.xpd?vote=s2007-42&sort=vote.