The Politics of Poverty

Ideas and analysis from Oxfam America's policy experts

Obama to Congress: What’ll it take to raise the minimum wage?

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A waiter clears a table at Lafayette Coney Island restaurant in Detroit, Michigan, February 24, 2013. Photo: J.D. Pooley / Getty Images A waiter clears a table at Lafayette Coney Island restaurant in Detroit, Michigan, February 24, 2013. Photo: J.D. Pooley / Getty Images

The President made the case in SOTU2014.

It was a breath of fresh air to see the President come out so forcefully and so unrepentantly for people living in poverty in the US on Tuesday night.

The 2014 State of the Union (SOTU) was a big night for the millions of hardworking, low-wage workers and their families across the country who all too often seem invisible to our lawmakers here in Washington, but who make up a growing part of our workforce.

After President Obama focused his previous five SOTUs’ policies and rhetoric almost entirely on the middle class (referred to as a from-the-middle-out approach), I wondered whether 2014 was the year Congress would tackle America’s growing working poor crisis. In his speech, President Obama forcefully made the case for doing so. He not only articulated the challenges facing the working poor in America, but proposed common-sense solutions. Facing a grim economic reality and future—decades of stagnant wages and a recovery based on low-wage job creation—the President focused on economic inequality and the working poor, and sounded a strong note on the evening’s biggest policy proposal: an increase in the federal minimum wage.

Americans overwhelmingly agree that no one who works full-time should ever have to raise a family in poverty,” said the President while endorsing legislation to raise the minimum wage to $10.10, sponsored by Senator Tom Harkin (IA) and Representative George Miller (CA). Research shows that this increase in the minimum wage could bring 6.8 million people out of poverty and increase family incomes of one in every four children in America.

The President presented the business case for raising the minimum wage on Tuesday; he pointed to a local pizzeria in Minnesota and mega-retailer Costco as examples of how higher wages can reduce financial stress on workers and their families, create a more productive workplace, and strengthen the bottom line of businesses large and small. A survey by Small Business Majority shows that two thirds of small business owners support an increase in the minimum wage. Many business owners and economists also say that a higher minimum wage will stimulate the economy by putting more dollars into Americans’ pockets to spend.

Furthermore, poll after poll shows strong majorities of Republicans, Democrats, and Independents support increasing the minimum wage. Support for a raise is gathering steam even on the most conservative end of the spectrum. In recent weeks, publisher Ron Unz, family activist Phyllis Schafly and Fox News’ Bill O’Reilly have spoken out in support of a raise in the minimum wage.

There is history here. In years past, the debate about the minimum wage had a much more bipartisan flavor in the Congress. In fact 65 of the Republican Senators and Republican Representatives attending last night’s speech had supported a minimum wage increase back in 2007.

With that, the President served the ball into Congress’s court, urging them to:

“Join the rest of the country. Give America a raise.”

In perhaps the most surprising move of the day, the President announced he would sign an executive order to require all federal contractors to pay a minimum wage of $10.10. This executive order sends a clear message to Congress: the President will continue to address the poverty-level wages facing millions of workers. It could impact many of the estimated 560,000 Americans who work for federal contractors but make less than $12 an hour, as well as the US’ growing income inequality being fueled by the decreasing real value of the minimum wage.

Today, the federal minimum wage is worth about 20 percent less than it was when Ronald Reagan first stood here,” noted the President.

Due to inflation this past year alone, a full-time minimum wage worker would lose the equivalent of $200, roughly a month of groceries.

On Tuesday night, the President announced a number of other efforts “…to make sure our economy honors the dignity of work, and hard work pays off for every single American.”

Every day Congress fails to listen to their constituents impacts the incomes of millions of families. The President put strengthening job training, beefing up tax policies like the Earned Income Tax Credit endorsed by Senator Marco Rubio (R-FL), addressing the gender wage gap, and paid sick and family leave on the table—policy proposals that line up with the ideas favored by low-wage workers themselves. (See Oxfam’s landmark survey “Hard Work, Hard Lives).

So Congress, are you ready to join the rest of the country?

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