Chamber of Congress & the Minimum Wage (7/29/06)

The dapper dude in the photo is U.S. Chamber vice president for labor, immigration and employee benefits, a highlighted speaker at the anti-liberal Federalist Society ‘s 2005 National Lawyers Convention. The next convention is in November–place as yet unannounced.

Johnson joined the Chamber in 1997 and he’s the go-to man on legislation and government programs regarding the minimum wage. According to a bio I found at the publications page of the Chicago Council on Foreign Relations ,

Prior to joining the chamber, he was the Republican labor coordinator for the House Committee on Education and the Workforce.

The House of Representatives closed shop for its recess today after after passing two measures I’ve been writing about for the past several days.

The first measure chained an increase in the minimum wage to a huge reduction in the estate tax. Looks to me like the Republicans are getting ready for the election and want to rebut the Democrats criticism that they are responsible for no increase in the minimum wage during the last 10 years. With the Senate opposition to the estate tax reductions at this level, I’ve got to wonder if they are making that issue a poison pill for the increase.

After all, many of their constituents–including Chambers of Commerce–have opposed increases in the minimum wage for years. The Chamber ran a feature, “U.S. Chamber Opposes Raising Minimum Wage” in its magazine as recently as May 2006, although, interestingly, this is one of the few articles on its website available only to members .

Publicly available are the news releases the Chamber sent out. June 18 2004  its railing against Senator Kerry featured comments by Johnson:

While the political appeal of this proposal is obvious, the fact remains businesses and workers will be losers under this proposal….The majority of economists agree that raising the minimum wage kills job creation. Placing this burden on small businesses will stifle our economic growth….Small businesses cannot simply wave a magic wand to create more revenue when lawmakers pass these types of bills. It is these businesses, the backbone of our economy, which will be hurt the most by this proposal. Some politicians may view initiatives such as these as a painless way to appeal to voters. But in reality, there is no such thing as a free lunch.
Johnson pointed to a study by the Employment Policies Institute, “Job Loss in a Booming Economy, 2nd Edition” saying that it suggested the 1996 minimum wage increase of only 50 cents per hour destroyed approximately 645,000 entry-level jobs.
According to Sourcewatch.org,
The Employment Policies Institute is one of several front groups created by Berman & Co., a Washington, DC public affairs firm owned by Rick Berman, who lobbies for the restaurant, hotel, alcoholic beverage and tobacco industries. EPI, registered as a 501(c)(3) tax-exempt organization, has has been widely quoted in news stories regarding minimum wage issues, and although a few of those stories have correctly described it as a “think tank financed by business,” most stories fail to provide any identification that would enable readers to identify the vested interests behind its pronouncements. Instead, it is usually described exactly the way it describes itself, as a “non-profit research organization dedicated to studying public policy issues surrounding employment growth” that “focuses on issues that affect entry-level employment.” In reality, EPI’s mission is to keep the minimum wage low so Berman’s clients can continue to pay their workers as little as possible.
EPI also owns the internet domain names to MinimumWage.com (http://www.minimumwage.com) and LivingWage.com (http://www.livingwage.com), a website that attempts to portray the idea of a living wage for workers as some kind of insidious conspiracy. “Living wage activists want nothing less than a national living wage,” it warns (as though there is something wrong with paying employees enough that they can afford to eat and pay rent).
By the way, I’m presuming minimum-wage/estate tax bill is the still-unavailable-as-of 3:34 p.m.  H.R. 4. At that time, Associated Press tax writer Mary Dalrymple had posted her story on the bill which would:
  • increase the minimum wage from $5.15 to $7.25 an hour, phased in over three years.
  • lower estate taxes by exempting $5 million of an individual’s estate, and $10 million of a couple’s, from estate taxes by 2015.
  • tax estates worth up to $25 million at capital gains rates, currently 15 percent and scheduled to rise to 20 percent.
  • trim rates on the remainder of larger estates to 30 percent by 2015.

The other bill passed was the pension measure.  More to come.

UPDATE:  The minimum wage measure is H.R. 5970:  See:  “Stealthy Poison: Minimum Wage Raise Linked Estate Tax Cut, Backdoor CUT for Tipped Workers.”  The pension measure is HR. 4.  which Democrats complain the measure favors some industries and doesn’t do enough to prevent employers from eliminating defined-benefit plans, according to the AP’s Jim Abrams.

 

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