To change the enactment date.

FAIR MINIMUM WAGE ACT OF 2007

The PRESIDING OFFICER. Under the previous order, the Senate will
resume consideration of H.R. 2, which the clerk will report.
The legislative clerk read as follows:

A bill (H.R. 2) to amend the Fair Labor Standards Act of
1938 to provide for an increase in the Federal minimum wage.

Pending:

Reid (for Baucus) amendment No. 100, in the nature of a
substitute.
McConnell (for Gregg) amendment No. 101 (to amendment No.
100), to provide Congress a second look at wasteful spending
by establishing enhanced rescission authority under fast-
track procedures.
Kyl amendment No. 115 (to amendment No. 100), to extend
through December 31, 2008, the depreciation treatment of
leasehold, restaurant, and retail space improvements.
Enzi (for Ensign/Inhofe) amendment No. 152 (to amendment
No. 100), to reduce document fraud, prevent identity theft,
and preserve the integrity of the Social Security system.
Enzi (for Ensign) amendment No. 153 (to amendment No. 100),
to preserve and protect Social Security benefits of American
workers, including those making minimum wage, and to help
ensure greater Congressional oversight of the Social Security
system by requiring that both Houses of Congress approve a
totalization agreement before the agreement, giving foreign
workers Social Security benefits, can go into effect.
Vitter/Voinovich amendment No. 110 (to amendment No. 100),
to amend title 44 of the United States Code, to provide for
the suspension of fines under certain circumstances for
first-time paperwork violations by small business concerns.
DeMint amendment No. 155 (to amendment No. 100), to amend
the Public Health Service Act to provide for cooperative
governing of individual health insurance coverage offered in
interstate commerce, and to amend the Internal Revenue Code
of 1986 regarding the disposition of unused health benefits
in cafeteria plans and flexible spending arrangements and the
use of health savings accounts for the payment of health
insurance premiums for high deductible health plans purchased
in the individual market.
DeMint amendment No. 156 (to amendment No. 100), to amend
the Internal Revenue Code of 1986 regarding the disposition
of unused health benefits in cafeteria plans and flexible
spending arrangements.
DeMint amendment No. 157 (to the language proposed to be
stricken by amendment No. 100), to increase the Federal
minimum wage by an amount that is based on applicable State
minimum wages.
DeMint amendment No. 159 (to amendment No. 100), to protect
individuals from having their money involuntarily collected
and used for lobbying by a labor organization.
DeMint amendment No. 160 (to amendment No. 100), to amend
the Internal Revenue Code of 1986 to allow certain small
businesses to defer payment of tax.
DeMint amendment No. 161 (to amendment No. 100), to
prohibit the use of flexible schedules by Federal employees
unless such flexible schedule benefits are made available to
private sector employees not later than 1 year after the date
of enactment of the Fair Minimum Wage Act of 2007.
DeMint amendment No. 162 (to amendment No. 100), to amend
the Fair Labor Standards Act of 1938 regarding the minimum
wage.
Kennedy (for Kerry) amendment No. 128 (to amendment No.
100), to direct the Administrator of the Small Business
Administration to establish a pilot program to provide
regulatory compliance assistance to small business concerns.
Martinez amendment No. 105 (to amendment No. 100), to
clarify the house parent exemption to certain wage and hour
requirements.
Sanders amendment No. 201 (to amendment No. 100), to
express the sense of the Senate concerning poverty.
Gregg amendment No. 203 (to amendment No. 100), to enable
employees to use employee option time.
Burr amendment No. 195 (to amendment No. 100), to provide
for an exemption to a minimum wage increase for certain
employers who contribute to their employees health benefit
expenses.
Chambliss amendment No. 118 (to amendment No. 100), to
provide minimum wage rates for agricultural workers.
Kennedy (for Feinstein) amendment No. 167 (to amendment No.
118), to improve agricultural job opportunities, benefits,
and security for aliens in the United States.
Enzi (for Allard) amendment No. 169 (to amendment No. 100),
to prevent identity theft by allowing the sharing of Social
Security data among government agencies for immigration
enforcement purposes.
Enzi (for Cornyn) amendment No. 135 (to amendment No. 100),
to amend the Internal Revenue Code of 1986 to repeal the
Federal unemployment surtax.
Enzi (for Cornyn) amendment No. 138 (to amendment No. 100),
to amend the Internal Revenue Code of 1986 to expand
workplace health incentives by equalizing the tax
consequences of employee athletic facility use.
Sessions (for Kyl) amendment No. 209 (to amendment No.
100), to extend through December 31, 2012, the increased
expensing for small businesses.
Division I of Sessions (for Kyl) amendment No. 210 (to
amendment No. 100), to provided for the permanent extension
of increasing expensing for small businesses, the
depreciation treatment of leasehold, restaurant, and retail
space improvements, and the work opportunity tax credit.
Division II of Sessions (for Kyl) amendment No. 210 (to
amendment No. 100), to provided for the permanent extension
of increasing expensing for small businesses, the
depreciation treatment of leasehold, restaurant, and retail
space improvements, and the work opportunity tax credit.
Division III of Sessions (for Kyl) amendment No. 210 (to
amendment No. 100), to provided for the permanent extension
of increasing expensing for small businesses, the
depreciation treatment of leasehold, restaurant, and retail
space improvements, and the work opportunity tax credit.
Division IV of Sessions (for Kyl) amendment No. 210 (to
amendment No. 100), to provided for the permanent extension
of increasing expensing for small businesses, the
depreciation treatment of leasehold, restaurant, and retail
space improvements, and the work opportunity tax credit.
Division V of Sessions (for Kyl) amendment No. 210 (to
amendment No. 100), to provided for the permanent extension
of increasing expensing for small businesses, the
depreciation treatment of leasehold, restaurant, and retail
space improvements, and the work opportunity tax credit.
Mr. KENNEDY. Mr. President, it has been a week now that the Senate
has had on its agenda and before the Senate legislation to increase the
minimum wage from $5.15 to $7.25. In that week, every Member of
Congress has effectively earned $3,200, but we have not acted on an
increase in the minimum wage for hard-working American people who are
earning $5.15, to raise their minimum wage to $7.25. We have had 1 week
of talking here on the floor of the Senate without action.
It looks to me as if we are going to have, thankfully, as a result of
the action of the majority leader, a vote at least on cloture to try to
terminate the debate. But there will be additional procedural issues
that will mean that those who are opposed to an increase in the minimum
wage will be able to delay the increase in the minimum wage for another
week.
As the parliamentary situation is playing its way out, there will be
the possibility of 60 hours after the vote on cloture, which will take
us effectively through the end of this week. So that will be 2 weeks
where the Members of the Senate have then earned $6,400, but we have
been unwilling to either vote up or down on the increase of the minimum
wage from $5.15 an hour to $7.25 an hour.
For the millions of people at the lower end of the economic ladder--
men and women of dignity who work hard, those who are assistants to our
teachers and work in the schools of this country, those who work in
some of the nursing homes and look after the elderly, many of those of
the great generation that fought in World War II and brought the
country out of the time of the Depression--they are still earning $5.15
an hour. They work in many of the hotels and motels that dot the
countryside and the great buildings of American commerce--these people
are working at $5.15. They will work for that tomorrow, and they worked
for that the day before. And now, because our Republican friends refuse
to permit us a vote, they are going to continue to work at $5.15 an
hour. It has been 10 years.
I went back and looked at the number of days we have tried to get an
increase in the minimum wage since our last increase, and that was 16
days. So we have effectively been debating an

[[Page S1268]]

increase in the minimum wage for 23 days since the last increase in the
minimum wage, and there has been opposition from our Republican
friends.
It is true that we have disposed of some 21 amendments, but there are
almost 100 left from that side. We don't have any. We will have some if
they insist on some amendments. But our side is prepared to vote now. I
daresay the majority leader would come out here, if the minority leader
would agree, and set a time--I bet even for this afternoon, in an hour,
2 hours, perhaps even less. Perhaps some colleagues have been notified
that we would not have votes today, so in fairness to them we could
start the vote at the start of business tomorrow morning. There would
not be any objection here. There are no amendments on our side. Still,
there are 90 amendments on the other side, and they are exercising
parliamentary procedures in order to get to delay the consideration of
the minimum wage, including $200 billion in changes in Social
Security--that was an amendment offered from that side--$35 billion in
tax reductions and areas of education, some of which I support, but
certainly with no offsets. They were never considered. They didn't
include offsets, for example, with IDEA, the legislation that looks
after the disabled children, or didn't increase the Pell grants. We
didn't even have a chance to look at it. But no, no, let's do that, use
this vehicle for that measure. Let's get those Members on your side and
the Democratic side lined up to vote against providing additional
assistance on education. Maybe we can use that in the next campaign.
What about health savings accounts--that wonderful idea that benefits
the medium income; the people it benefits are those making $133,000 a
year. That is the medium income of the people who benefit from the
health savings accounts. We are talking about raising the minimum wage
to $7.25. They are talking about giving additional tax benefits to
individuals in the health savings accounts of hundreds of thousands of
dollars.
The list goes on, Mr. President. These are matters which have
absolutely nothing to do with the minimum wage. It is a delay, and it
is to politicize these issues. We all know what is going on. The
Republican leadership is opposed to the increase in the minimum wage.
When they had the majority of the Senate, they constantly opposed any
effort. Even though a majority of the Members of this body and the
House of Representatives favored an increase, they refused to permit us
to get a vote on it, and the President indicated he would veto it if we
had.
So that is where we are as we start off this week on the issue of the
minimum wage. We find out our side--the Democratic side--follows the
leadership that took place in the House of Representatives with Nancy
Pelosi. They had 4 hours of debate, and 80 members of the Republican
Party voted for an increase in the minimum wage. But here it is a
different story. For the millions of Americans who say: My goodness,
here is the House of Representatives; look, in 4 hours, it looks as if
hope is on the way--and they didn't understand the strength of the
Republican opposition to an increase in the minimum wage. I have seen
it at other times. We have seen it at other times.
It is always baffling to me, what the Republicans have against hard-
working Americans. What do they have against minimum wage workers? We
don't hear about it. They don't debate it. They will debate other
matters, but what do they have against them? What possibly do they have
against these hard-working Americans? They are trying to provide for
families, play by the rules, and work 40 hours a week, and in so many
instances they are trying to bring up children. What is so outrageous?
Some say that if we raise the minimum wage, we are going to have the
problem of increasing unemployment. We have heard that argument out
here on the floor. Let me, first of all, show what has happened
historically with the minimum wage.
Until recent times, we have had Republicans and Democrats who
supported an increase in the minimum wage, starting with Franklin D.
Roosevelt, Harry Truman, then Dwight Eisenhower. They raised it $1 in
1955. Then President Kennedy increased it, Lyndon Johnson, Richard
Nixon supported an increase, Jimmy Carter, George Bush I, and William
Clinton. That was the last increase. We voted on it in 1996, and it
became effective in the fall of 1997. There were two different phases
to it.
First, people say: When you raise the minimum wage, look what is
going to happen in terms of unemployment. Unemployment will rise.
If we look at what has happened with unemployment at the time we
passed the last increase in the minimum wage to $5.15 an hour in 1997,
we can see there have been small increases, but the whole trend has
been down. So much for the argument of unemployment.
They say: That chart really doesn't show it because it doesn't
reflect what is happening in the economy in terms of job growth. Look
at what happened when we raised the minimum wage from $4.25 an hour to
$4.75 an hour, and then we raised it again to $5.15 an hour. Look at
that red line showing steady and constant job growth after an increase
in the minimum wage.
Look at what percent the minimum wage is. Increasing the minimum wage
to $7.25 is vital to workers, but it is a drop in the bucket to the
national payroll. All Americans combined earn $5.4 trillion a year. A
minimum wage increase to $7.25 is less than one-fifth of 1 percent of
this national payroll. It is less than one-fifth of 1 percent of this
national payroll. And we have heard from those who oppose the minimum
wage about all of these economic calamities. These are the facts in
terms of the national payroll. It isn't even a drop in the bucket. It
isn't even a piece of sand on the beach it is so little. Yet they say
the economic indicators say this.
Look what has happened to States that have a higher minimum wage than
the national minimum wage, and see what has happened in terms of job
growth. This chart shows 11 States plus the District of Columbia with
wages higher than $5.15 an hour. Overall employment growth has been 9.7
percent; 39 States with a minimum wage at $5.15, 7.5 percent. Those
States that have had an increase in the minimum wage have had more job
growth, and it is understandable. The economic reports and studies show
that if workers are treated fairly, there will be increased
productivity. They are going to stay around longer and work. There will
be less absenteeism, less turnover, more productivity, and you are
going to increase your output. And this is all reflected in various
studies.
Look at small business. They say that is good for the Nation, but it
doesn't really reflect what is happening to small businesses.
This chart states that higher minimum wages create more small
businesses. The overall growth in number of small businesses from 1998
to 2003 is 5.4 percent and 4.2 percent. These are the small businesses
about which we heard a great deal. We have the small business exemption
that exempts 3.6 million workers who are working for the real mom-and-
pop stores, where their gross income is less than $500,000.
This gives us some idea of the nature of the economic arguments. They
don't hold water. They didn't hold water previously. We have seen a
decline in the purchasing power of the minimum wage over this period of
time. This chart is in real dollars. We can see where it was in 1960,
1965, 1970, 1975, going to 1980 and then a gradual decline. Starting in
1980, under President Reagan, it is going down. And we see the
increases that came in the nineties under President Clinton. The
purchasing power of $5.15, as this chart shows, was probably the lowest
it had ever been. Its purchasing power has lost 20 percent. All we are
asking is to get it back to $7.25 and to get the purchasing power back
to where it was when we went to $5.15. Isn't that outrageous?
What have we done in taxes for all the others? We are trying to
restore the purchasing power. Let's look in the meantime at what we
have done for companies and corporations. Let me go to this, Mr.
President. Look at what has happened. Productivity and profits
skyrocket while minimum wage plummets. Look at the profits. From 1997
to 2006 profits were up 45 percent, productivity was up 29 percent, and
the minimum wage was down 20 percent.
Historically, in the sixties, seventies, all the way up to 1980, when
we saw an

[[Page S1269]]

increase in productivity, that was shared with the workers. Companies,
corporations shared the increase in productivity with the workers. No
longer. That doesn't exist any longer. They take all of that
productivity, and it is now an increase in profits.
This chart indicates what has happened to the real minimum wage and
what has happened to productivity. See, going back to the sixties, 1960
to 1965, even into the seventies, closer productivity, workers working
harder, increasing productivity. They shared in the increasing
productivity with wages. Not anymore. All of that productivity has been
turned into profits.
I want to spend my last few minutes--now that we have had the
economic argument--reviewing quickly the most powerful argument, and
that is what has happened in terms of these figures, how they translate
into real people's lives. The charts reflect the growth of poverty in
America. We are the strongest economic country in the world, and we
find that between 2000 and 2005, we see that the number of people who
are living in poverty in the United States of America has increased by
over 5 million--5 million in the United States of America--during this
period of the economy.
I listened to the President talk the other night about how the
economy is just going like gangbusters. Talk about the number of
bankruptcies, talk about the growth of poverty--5 million. Let's look
at what happened with regard to the number of children who are living
in poverty. There were 11 million in 2000 and 1.3 million more at the
present time.
This country, of all the industrial nations in the world, has the
highest child poverty in the world. Look at the chart and look at the
end. Look at the red line. It is not even close. The United States of
America has the highest child poverty in the world. That means the loss
of hopes and dreams for these children, increasing pressures in terms
of children dropping out of school because they are living in poverty
and are not being fed in the morning. They are not getting good quality
health care or any kind of health care. Their parents have two or three
jobs and they are not getting the attention they need. The basic
abandonment of so many children in our society.

We read last week into the Record the New York Times article about
the burden that is going to be on the American economy. That may get
the attention of some of our friends on the other side. They expect
that increased child poverty in this Nation is going to cost another
$500 billion just because of what is happening to children in our
society.
Let me show what happens to child poverty in States which have a
higher minimum wage. This isn't an accident. If the minimum wage is
raised, it has an impact on child poverty. Alaska, Connecticut--all the
way, the States that are listed here--New Jersey, Oregon, Rhode Island,
Vermont, the State of Washington--are above the national average
poverty rate. They have higher economic growth, higher small business
growth, less child poverty. That is what we have seen. National average
child poverty, again, the high minimum wage States, again, have lower
child poverty rates.
Very quickly, we have seen two nations of the world that have made
child poverty a particular issue--Great Britain and Ireland. Now the
minimum wage is $9.58 an hour in Great Britain. They brought 2,000,000
children out of poverty. They are a very strong economy in Europe.
In Ireland, they have reduced child poverty by 40 percent. They are
also a very strong economy.
What we know is that the economic arguments don't hold water, and the
adverse impact is particularly harsh on children.
All during this time, we have seen this extraordinary explosion of
tax breaks that have been given to large companies and small companies.
They say these can't do it unless they get help. Over the last 10
years, there have been $276 billion in tax breaks for corporations and
$36 billion in tax breaks for small businesses, and our Republican
friends are insisting that we add more tax breaks if we want any hope
of getting an increase in the minimum wage.
Americans understand fairness, and this is not fair. Trying to hold
up an increase in the minimum wage for hard-working Americans, who are
working and playing by the rules, is not fair. Americans understand
fairness. There are no economic arguments. We have been out here now
for 7 days. I haven't heard them. I have been willing to debate any of
those arguments. No, no, we don't get into the economic arguments. We
used to years ago. Now we don't get into them. We just have to use this
vehicle for all these other add-ons in order to basically frustrate
this body from getting an increase in the minimum wage.
As I said before, I don't understand what it is that our Republican
friends find so obnoxious about hard-working men and women who are
working at the minimum wage, but evidently there is something because
they will not let the Senate of the United States act on this
legislation.
This is about fairness. This is about the hopes and dreams of
children. It is about decency and fairness to women because women are
the primary recipients of the minimum wage. So many of them have
children. Eighty percent of those who receive the minimum wage are
adults; 40 percent of those who receive the minimum wage have been
receiving it for 3 years.
This is an issue that women are concerned about, that has an enormous
impact on children, that is basically a civil rights issue because
minimum wage jobs so often are the entry jobs for men and women of
color. But it comes back to fairness. It is basically the issue of
fairness, whether we are going to be fair to hard-working Americans.
Our Republican friends refuse--absolutely refuse--they refuse to let us
get a vote on this minimum wage, and they have basically filibustered
by amendment.
As I said, we have over 90 amendments remaining. Democrats on this
side are prepared, ready, and willing to vote. We thank our leader for
bringing up this legislation. We are going to continue to battle on.
We give assurance to those who are looking to us to represent them,
to speak for them in the Senate, that we will speak for them. We will
stand for them. They should know that we are on their side, and we
don't intend to fail.
Mr. President, I yield the floor.
The PRESIDING OFFICER. The Senator from Arizona.
Mr. KYL. Mr. President, I ask unanimous consent to speak as in
morning business.
The PRESIDING OFFICER. Without objection, it is so ordered.

Iraq

Mr. KYL. Mr. President, I, too, am anxious to get on to the debate
about the resolutions that deal with Iraq. I will speak to that for 10
minutes.
My position is clear. I think we ought to give the President's
strategy a chance to work. We asked him to come up with a new strategy.
He has done so, and it seems to me that it is our responsibility as a
Senate to give that a chance to work or to provide an alternative--not
an alternative to leave but an alternative to win. There are plenty of
ways to leave. We can begin leaving now and have it done in a year. We
can leave in 6 months. We can leave to the border but not beyond. There
are a lot of different ideas about how to leave, but an alternative is
not how to leave but how to win.
The President has presented such a strategy and I believe we ought to
give it a chance to work.
Resolutions that are nonbinding nevertheless have consequences. They
can't change the policy that is already being effected, the strategy in
Iraq, but what they can do is send very powerful messages. First, they
can send a message to our enemies. It seems to me the last message we
want to send to the enemy is that the Congress does not support the
mission in Iraq. Obviously that emboldens the enemy. That is what GEN
David Petraeus said in his testimony before the Armed Services
Committee last week. It sends a message to our allies that we are not
in it to the end, and they begin to wonder whether they should start
hedging their bets.
By the way, it sends a message to a country such as Iran, which is
already beginning to offer, now, to in effect take our place in Iraq:
They will do the training of troops, they will do the reconstruction if
the Iraqis will simply invite them in. That obviously would not be in
our best interests, not to mention the Iraqis' best interests.

[[Page S1270]]

Most importantly, a resolution such as this sends a message to our
troops. It is a very powerful message and a very negative one. It is a
message that in effect says we support you, but we don't support your
mission. We are sending you into a place where you could well die, but
we don't support the cause for which you are dying. We don't think you
can win. As a matter of fact, I have more respect for those who
advocate voting on whether we should continue to support the effort
monetarily--the legitimate function of the Congress, to cut off the
funds if we don't like the war--than I do for those who simply want to
``send a message.'' At least the others would be willing to have the
courage of their convictions, that if this is not a winnable war, we
better stop it now as opposed to simply trying to send a message.
Let me tell you what this message does. Last Friday night I was
watching the NBC ``Nightly News.'' Brian Williams was the broadcaster,
and he called on Richard Engel, reporting from Iraq, to talk about what
was going on there. Richard Engel talked about the Stryker Brigade,
Apache Company, setting out on a mission to find bases for U.S. troops.
I will quote what he said in the report.
He said:

It's not just the new mission the soldiers are adjusting
to. They have something else on their minds: The growing
debate at home about the war. Troops here say they are
increasingly frustrated by American criticism of the war.
Many take it personally, believing it is also criticism of
what they've been fighting for.

He goes on to say:

Twenty-one-year-old Specialist Tyler Johnson is on his
first tour in Iraq. He thinks skeptics should come over and
see what it's like firsthand before criticizing.

And here is what Specialist Tyler Johnson said:

Those people are dying. You know what I'm saying? You may
support--``oh we support the troops,'' but you're not
supporting what they do, what they share and sweat for, what
they believe for, what we die for. It just don't make sense
to me.

Back to Richard Engel:

Staff Sergeant Manuel Sahagun has served in Afghanistan and
is now on his second tour in Iraq. He says people back home
can't have it both ways.

And then Staff Sergeant Manuel Sahagun says the following:

One thing I don't like is when people back home say they
support the troops but they don't support the war. If they're
going to support us, support us all the way.

Engel then says:

Specialist Peter Manna thinks people have forgotten the
toll the war has taken.

And Specialist Peter Manna says:

If they don't think we are doing a good job, everything we
have done here is all in vain.

Engel concludes the report by saying:

Apache Company has lost two soldiers and now worries their
country may be abandoning the mission they died for.

Richard Engel, ABC News, Baghdad.
That report struck me. I immediately talked to my wife about it, and
I said those three soldiers have said more eloquently than I and my
colleagues have, than we have, in making the point that you can't have
it both ways. You can't both support the troops and oppose the mission
we are sending them on, putting them in harm's way. And can we say that
their colleagues who died did not die in vain if the Senate goes on
record saying we don't support your mission?
This is the conflict that has to be in the minds of the families of
those who are putting their lives on the line and the very soldiers and
marines who are doing the same.
Last Friday, this Senate confirmed GEN David Petraeus to take command
of that theater, and there were all kinds of expressions of support for
him. He is, indeed, one of the finest military officers ever to come
before the Senate for confirmation. No one said otherwise. Yet at the
same time we are talking about passing a resolution that would say to
him: We don't believe in the mission we have just sent you on.
He testified he needed more troops in order to carry out the mission
and that he supported the President's new strategy, one component of
which is to add some troops so that he has the capability, in
conjunction with the new Iraqi troops, to stabilize and pacify the city
of Baghdad as well as the Al Anbar Province, which is currently being
threatened by al-Qaida terrorists. He said he needs those new troops.
Yet Congress would go on record as saying we do not believe you should
have those new troops.
Again, at least some number of my colleagues, maybe half or
thereabouts on the other side of the aisle, would cut off the funding
for the troops in order not just to send a message but to end the
involvement. At least that is a position that has action attached to
it. I disagree with it, but simply sending the message by sending David
Petraeus on the way, patting him on the back, saying, ``Go do a good
job but, by the way, we don't believe in the mission,'' it seems to me
is starting off on the wrong foot.
He said something else in his testimony that I thought was telling.
He said: Wars are all about your will, your will and your enemy's will.
When asked a question by Senator Lieberman, he said passage of these
resolutions would not be helpful, among other things, because you need
to break the enemy's will in a conflict, in a war. This kind of
resolution would inhibit his ability, General Petraeus's ability, with
our great military, to break the enemy's will to fight. How can you
break the enemy's will to fight when the people who are allegedly
running the war back home have already signaled that they think it is
lost and it is simply a matter of bringing the troops home, and that
the mission is not supported by a majority of the Senate?

Resolutions, even if they are nonbinding, have consequences. In this
case the consequences are detrimental, to our enemy, to our allies, and
to our soldiers and their families.
We have some solemn responsibility here, but none is more serious
than putting our young men and women in harm's way. All of us want to
bring them home safe and sound. We all understand when we vote for
that, people are going to die. Everyone who does that does so with a
solemn responsibility. We are all looking for a way also to end the
conflict so no more have to die. But the reason we authorized this in
the first place was because we understood there was a mission to
perform. Even those who disagree with the reasons to begin with
appreciate the fact that we cannot leave Iraq a failed state. I think
virtually everybody in this body would agree with that proposition. We
cannot leave Iraq a failed state. The consequences, not just to the
Iraqis and to the other people in the region but to United States
security, would be devastating.
Something else on which most people agree is that the Iraqis are not
currently in a position to pacify Baghdad and Al Anbar Province all by
themselves. They need our help. That is what the testimony before the
committees was last week.
If they need our help, if we all agree we can't leave Iraq a failed
state, if General Petraeus is saying we need some time and some troops
to get this job done in conjunction with a significant change in the
way the Iraqis are approaching the war--finally backing us up now when
we say we want to go into these areas and not just clear them but hold
them, keep the bad guys in jail, the ones who have not been killed, for
example--if we agree with all those things, then it seems to me the
last thing the Senate should be doing is considering a resolution which
would say we disagree with the mission, we disagree with the
President's strategy, we don't think we should be sending any more
troops, and we want to begin a process of withdrawing from Iraq.
When the debate time comes, I am anxious to have it. The American
people deserve a debate. I heard a message yesterday that the American
people had spoken. Indeed they did. I had an opponent who said we
should withdraw from Iraq. Yet I won the last election, saying we
needed to stay there until the mission was completed, and I even
supported the addition of more troops if that were necessary. In the
case of Arizona, I think people have spoken.
The reality is, however, I think it is a mixed message. They would
all like to get out as quickly as possible, but if you ask them, Do you
think we should leave before the mission is accomplished, do you think
we should leave even though there is the strong probability of a failed
Iraqi state, do you think we can say we support the American troops but
we don't support the mission, I think we would disagree with that
proposition.

[[Page S1271]]

It is up to us as leaders to lead. That means to let them know we
support not just them but their mission, that we want to see it
accomplished, and we will not undercut that mission or their support by
passing a resolution that disapproves of the new strategy.
I hope my colleagues will agree we have to give this strategy a
chance to work.
The PRESIDING OFFICER. The Senator from Texas.
Mr. CORNYN. I ask unanimous consent to speak for up to 8 minutes, and
following that, the Senator from Alabama to speak for up to an hour.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. CORNYN. Mr. President, I have two amendments before the body I
would like to explain briefly. Then I am impelled to respond to some of
the argument we have heard from the distinguished Senator from
Massachusetts. I guess the question he put was what do Republicans have
against hard-working Americans? I will respond to that in a moment.

Amendment No. 135

My first amendment has to do with the Federal unemployment surtax. In
the 1970s, the Unemployment Trust Fund faced financial strains, so
Congress imposed a surtax to bring money into the unemployment system,
the unemployment compensation system, in order to meet its obligations.
That debt was paid off in the 1980s. Congress has continued, however,
to collect the unemployment surtax, proving the maxim once stated by
Ronald Reagan that the closest thing to eternal life here on Earth is a
temporary government program. I think this proves that.
The Federal unemployment surtax should have expired 20 years ago.
Since 1987, the surtax has taken approximately $28 billion out of the
pockets of U.S. businesses. Is that $28 billion over 20 years worth the
broken promise to eliminate it? I think not. Elimination of the surtax,
which this amendment will do, will save businesses across the country--
and in my particular State, $135 million--but it will save businesses
across the country proportionate amounts.
This is an easy and logical way to trim payroll taxes. The FUTA tax
without the surtax is sufficient to fund State and Federal unemployment
administrations. Without the surtax, the Federal unemployment tax
generates nearly $6 billion a year, and all accounts associated with
the Federal Unemployment Trust Fund have ample balances.
It is simply a matter of keeping the faith with the American people,
when we tell them we have a temporary program and that program runs its
course and serves its purpose, to eliminate it. That is what this
amendment would do, and I ask the support of my colleagues for that
amendment.

Amendment No. 138

My second amendment addresses the issue of preventive health care.
You might ask what does that have to do with regulatory and tax relief
to small businesses and the minimum wage? Well, this amendment, which
asks for the adoption of a stand-alone bill called the Workforce Health
Improvement Program Act, would put small businesses on a level playing
field with big businesses to provide health benefits to their employees
that they can deduct but for which small businesses cannot deduct the
same benefits they might want to give by outsourcing those to health
clubs, for example.

Let me explain where I am coming from. Public health experts
unanimously agree that people who maintain active and healthy
lifestyles dramatically reduce the risk of contracting chronic
diseases. A physically fit population helps decrease health care costs,
50 percent of which, by the way, are borne by the Federal taxpayer. A
physically fit population reduces Federal Government spending, reduces
illnesses, and improves worker productivity.
The costs, though, are not just measured in dollars. According to the
Surgeon General's ``Call to Action to Prevent and Decrease Overweight
and Obesity'' published in 2001, 300,000 deaths per year in America are
associated with being overweight or obese. Regular physical activity
reduces the risk of developing or dying from some of the leading causes
of illness and death in the United States.
Additionally, Medicare and Medicaid programs currently spend $84
billion annually on five major chronic diseases: diabetes, heart
disease, depression, cancer, and arthritis. It is important we not only
treat these diseases once they are manifested but that we also explore
ways to prevent them in the first place. Consider this statistic--the
numbers are staggering. This is from the American Diabetes Association:

The total annual economic cost of diabetes in 2002 in the
United States of America was $132 billion. Direct medical
expenditures totaled $92 billion and $23.2 billion of that
was for diabetes care, $24.6 billion was for chronic
diabetes-related complications, and $44.1 billion was for
excess prevalence of general medical conditions related to
diabetes. Indirect costs resulting to lost work days,
restricted activity days, mortality, and permanent disability
due to diabetes totaled $40.8 billion.

One NIH study reported in the New England Journal of Medicine showed
that modest changes in exercise and diet can prevent diabetes in 58
percent of the people at high risk for the disease. What is more, the
trial showed that participants over 60 years of age benefited the most,
preventing the onset of diabetes by 71 percent. Even assuming that
intervention with modest changes in exercise and diet is only half that
effective, they estimated the possible 10-year savings to the health
care system would be $344 billion.
I think it makes enormous sense, as we look to try and level the
playing field for small businesses as part of this comprehensive
package, that we seriously consider leveling the playing field by
providing an ability to prevent the occurrence--the incidence, I should
say--of obesity-related diseases, namely diabetes, which causes so much
human misery and so much unnecessary expense that could be avoided if
we could encourage more Americans to a more active lifestyle and a
better diet.
So I ask my colleagues for their consideration of this amendment as
well.
Mr. President, could I ask how much time I have remaining?
The PRESIDING OFFICER (Mr. Durbin). The Senator from Texas has 1
minute remaining.
Mr. CORNYN. Mr. President, if I may ask unanimous consent for an
additional 2 minutes, for a total of 3 minutes, I would appreciate it.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. CORNYN. Mr. President, the Senator from Massachusetts a moment
ago asked--because Republicans have asked for additional tax and
regulatory relief for small businesses that employ 70 percent of the
American people--what it is that Republicans have against hard-working
Americans because of our desire to pass not just a minimum wage of
$7.25 an hour, up from the $5.15 an hour. He said that this was an
effort to politicize the issue.
So I would have to ask the Senator, when the minimum wage affects 2.5
percent of the workforce in America, mainly teenagers and part-time
workers, people entering the workforce, is this the way to address the
needs of hard-working Americans? Why is it we are so focused on a
minimum wage, when what we ought to be focused on is maximizing the
wages of American workers primarily, I believe, through increased
training, workforce initiatives, working through community colleges
with the private sector to train people for good wages, much higher
than minimum wage, that exist in this country but go wanting for lack
of trained workers. These programs exist in our communities in my State
and throughout the country, and I think we would do better to focus our
efforts to try to improve the standard of living for people across
America.
I simply disagree with the Senator from Massachusetts, if he says by
focusing on 2.5 percent of the workforce and by trying to ameliorate
some of the harm to small businesses that generate 70 percent of the
jobs, we are doing anything that would harm hard-working Americans. To
the contrary, what we are trying to do is make sure those hard-working
Americans have jobs, not that they are put out of work by well-
intentioned but unsuccessful attempts for Government to mandate wages
without taking into account the impact on small businesses, the primary
employers in our country.
Mr. President, I appreciate the courtesy of the Senator from Alabama,
who

[[Page S1272]]

was supposed to start speaking at 4 o'clock, allowing a couple of us to
speak, and I yield the floor.
The PRESIDING OFFICER. The Senator from Alabama is recognized.

Iraq

Mr. SESSIONS. Mr. President, I thank the Chair and I thank Senator
Cornyn and Senator Kyl for their remarks. I share with Senator Kyl his
concern over the resolution that we will be apparently addressing later
this week or next week. He quoted an NBC News report in which soldiers
in Iraq in harm's way said that, in their view, you can't support the
soldiers without supporting the policy we sent them on, and that is a
troubling thing.
Today I talked to a businessman from Alabama--quite a fine,
upstanding leader in the community. His son is in Iraq right now. They
already heard about the Senate Foreign Relations Committee resolution.
It was very troubling to them. They didn't know how to read it,
according to him, or what it meant to them. I talked to a lady not long
ago, within the last week, and she told me her son was in his second
tour there, and he believed in what he was doing. He was proud to
serve, but he didn't know what we were doing here. He said he: ``Didn't
want to be the last soldier to die if we weren't going to follow
through on a policy that we have set here.''
So we are in a difficult time, and we need to remember those things
as we set about our policy. I don't know all of the answers. I don't
disrespect people who would disagree with me on this. I know there are
a lot of people with a lot of different ideas about what to do in Iraq.
But my observation is and my thought is that we, as a Congress, ought
to affirm the policies we are asking our soldiers to execute. They say
we are not asking them, but the President is, and the President speaks
for us, until Congress withdraws that power by reducing his funding.
The President executes the policies as Commander in Chief. So it is a
big deal and we need to be careful about what we do and I am
disappointed we will be dealing with those resolutions.
Mr. President, I remember during the immigration debate last fall,
last summer and spring, Senator Kennedy and I were on the floor one
night, and I talked about how I believe the large amount of immigration
we are seeing today, much of it illegal, was adversely affecting the
wages of American workers. Senator Kennedy didn't object to that, but
he stood up and in response basically said: Well, we are going to offer
a minimum wage bill, and that is going to take care of it. If anyone
heard Senator Lamar Alexander's speech on Friday--and not many people
did; it was after the vote had been cast--but he went into some detail
and with great care explained how the minimum wage is not reaching poor
working people in this country in the ways most people think it is but
that most people making minimum wage are part of a household whose
income exceeds $40,000 a year, I believe was the figure he cited, and
there are a number of studies on that. The point being that usually it
is a transition period for young people or others--maybe they are part
time and that kind of thing.
I am not saying people would not like an increase in the minimum
wage, but the working poor, the people who are every day out giving
their best to try to raise their families and who need to have a higher
income, people who have been out there for years and working, they are
already above $7 an hour, for the most part. If they show up on time
and are reliable and give an honest day's work, as almost all of them
do, then they are going to be above $7 an hour now. Do you follow me?
So this is not the panacea we are concerned about. What we want and
what we care about, fellow citizens and Members of the Senate, is
having better wages for working Americans, having all the people be
able to go out and get a better wage they can take home and take care
of their families with. That includes how much taxes are taken out, how
much insurance is taken out.
President Bush has a great proposal that is going to help a lot of
people. I assure my colleagues a lot of people will feel a substantial
benefit from this health care tax credit plan he has proposed. That is
a way to help working people, a real significant way.
Senator Alexander mentioned the earned-income tax credit, and he went
into some detail about it. Economists and experts are quite clear: The
earned-income tax credit more appropriately benefits working Americans
than a minimum wage at much less cost. We spend $40 billion a year on
the earned-income tax credit. That is what the credit amounts to in
terms of benefits to working Americans. Their wages are lower, and, at
certain levels, they don't qualify for other benefits. And as a result,
they do qualify for the earned-income tax credit. So I would like to
talk about that.
I offered an amendment that would have required the earned-income tax
credit to be paid on individual's paychecks, when they get their
paycheck each payday. That is correct, in my view, as a matter of
policy. It is a complex thing. Some are concerned about the mechanics
of it. So I offered another amendment that was accepted by the
Democratic leadership and the Republican leadership that required the
Department of the Treasury to review what would happen and how it could
be done if we allowed people to get their earned-income tax credit on
their weekly or biweekly paycheck. It can be done now. In fact, a
little less than 2 percent of the people get their earned-income tax
credit, or at least a portion of it, on their check each week.
So we would like to talk about that because as we debate the minimum
wage, the real debate is how to help working Americans, middle-class
Americans, lower income Americans get more legitimate pay for the work
they do.
Now, that is what we are all about; not some fetish with having an
increase in the minimum wage, particularly when it is not going to be
as effective in meeting the needs of the working poor, as is being sold
to this Congress and the American people.
In 2004, more than 22 million Americans--get this--more than 22
million Americans claimed the earned-income tax credit, putting $40.7
billion into the pockets of the working poor. This is a very large
program. It is a very large shift of resources to the working poor. The
amount of the credit for each recipient depends on several factors,
such as the worker's income and the number of dependent children they
claim.
Nonetheless, a low-income worker with one child will be eligible to
claim up to $2,853 for tax year 2007, while a worker with two or more
children could receive $4,718 on a 2,200-hour work year. The average
earned-income tax credit for a beneficiary with a qualifying child was
$1,728 in 2004. That is almost $1 an hour on average.
Many have criticized the earned-income tax credit over the years,
saying it is another welfare handout and it has far too much fraud in
it. Some numbers have shown fraud as high as over 30 percent, but the
tax credit is here to stay. I don't see any real movement to eliminate
it. Why don't we see if we can make it work better?
The idea is to reward work. It is a benefit of the Government, an
earned tax credit, earned by working. That was the purpose of the
earned-income tax credit from the beginning, to encourage welfare
recipients and others who were not in the workforce to decide that it
was beneficial for them to work. Some of this came from Milton
Friedman, the great free market economist who recently died, calling
for a negative income tax. That is sort of what inspired this.
All is not perfect. The earned-income tax credit has provided real
money for low-income Americans working hard to pull their family out of
poverty. As Senator Alexander demonstrated in some detail, remarkably
and ably, it gets to the working poor far better than an increase in
the minimum wage.
An important feature added to the earned-income tax credit occurred
in 1978, a few years after the law was passed. That allows the credit
recipients to receive the benefit on their paychecks rather than as a
one-time lump sum tax refund. Now, you work all year. Most people have
no idea if they are earning any earned-income tax credit. They are not
receiving extra money for their work. And next year, they file for a
tax refund and get a big check, disconnecting, in their minds, the
receipt of that check with the work they did the year before.
Therefore, it ceases to be the kind of incentive to work we want it to
be.
Receiving an advanced payment under the law is simple. Workers
believing they will be eligible can fill out

[[Page S1273]]

a form or W-5 with their employer, and once completed workers will
receive part of their EITC benefit on their paycheck based on the
amount they are expected to receive over the year based on their
income. So despite a number of campaigns by the IRS to increase the
number that sign up for this advance payment, only a few do, less than
2 percent. The majority, unaware they can receive the credit in
advance, receive it in the form of a tax refund in the spring of the
next year.
Recipients earn the tax credit by working throughout the year. Yet
they do not receive the benefit until months after when they file their
tax returns. For most workers who receive the EITC as a lump sum at the
end of the year, they never make that connection between the increased
work and the increased paycheck, as they simply receive a fat check.
How can it encourage work if there is no correlation for most
recipients between the work they do and the money they receive?
An amendment, which the Senate has already accepted, challenges the
Secretary of the Treasury, the Department of the Treasury, to get us a
report on how we can do this effectively. It is important. It will
ensure the taxpayers who are giving this benefit to working Americans
get the second part of the benefit that the taxpayers intended them to
receive.
The first part, of course, is helping the working poor have more
money for their families. We want to help them. The second benefit we
want to occur is for the overall economy and health of America to
encourage people to work, to make work more rewarding. If you are
making $7 an hour and you get $1 an hour pay raise as a result of the
earned-income tax credit, you have received a substantial increase,
well over 10 percent increase in your take home pay, especially since
there are no taxes taken out of that part that has accrued as a result
of the earned-income tax credit.
That encourages work. That makes work more attractive. That helps
meet the needs of America today. That is what this is about. A worker
who is making $6 an hour would be making closer to $7. Workers making
$8 would be making closer to $9. It adds up to real money as the years
go by.
We can do a much better job of utilizing the existing program without
any cost beyond what we are already expending, but in a way that gets
money to people when they need it, right then on their paycheck. They
may have a tire blow out and they need a new tire. The transmission may
have broken in their car. A child may need to go on a trip at school.
They need the money as they earn it so they can apply it in a sound way
to their family's budgetary needs instead of one big fat check sometime
in the spring of the next year. That is a suggestion I have for
improving the quality of life for American workers.
Another sense-of-the-Senate amendment I offered, that was accepted,
we voted on 98 to 0, was to call on Congress to state that it is a
sense of the Senate that we should do a better job in Congress of
establishing a uniform savings plan for Americans. We in the Government
have a wonderful plan called the thrift plan. It allows every Federal
worker, in any department or agency, to put money in the thrift plan
and the Federal Government would match up to 5 percent of their
contributions.
Many young people starting to work for the Government today, if they
contribute 5 percent each paycheck, with the Government matching it,
will retire with $1 million in the bank--trust me on that--with the
power of compound interest. It is an exciting program.
Many private companies have similar programs, 401(k)-type programs,
but many don't. Half of the workers in America today work for a company
that does not have such a retirement plan. A chunk of those, even if
they do, don't take advantage of it. This is particularly concerning to
me because I have learned from Secretary of Labor Elaine Chao that the
average American has nine jobs by the time they are 35. What does that
say to the practical men and women of the Senate? It says they are
bouncing around a lot. They may go to a company that has a plan and
they may invest in it a little bit, then they go to a company that
doesn't. Or they go to a company that says they have to work for 6
months or a year before they can participate in their plan, or they
decide not to put into that plan. Or, if they put in some money and
they change jobs and the account is $500, $2,000, $1,500--we have
statistics that show that over 40 percent of them cash in those
accounts paying the penalties--they think it is not enough money to
worry about.

Whereas, if they set aside a small amount of money from the day they
start working at age 18, or out of college, every day, every paycheck,
a small amount of money set aside as is done by most of the thrift
account savers, they could retire with hundreds of thousands in the
bank, which would allow for an annuity, if they purchased it at age 65,
to pay someone $2,000 a month for the rest of their life, easy. Those
things are realistically possible.
It is a great tragedy, it is a tremendous national tragedy, that in a
time where we have relatively low unemployment--in my State it is not
much over 3 percent, maybe 3.6 percent in Alabama--and most people are
working, the wages have gone up, although not as much as we would like,
but our wages are beginning to edge back up, that most Americans are
not saving. They could be setting aside even a small amount that would
transform their retirement years from retirement years that depend
solely on Social Security, the retirement years can be supplemented by
a substantial flow of money.
Finally, I talk about another subject, our general concern that wages
have not kept up in America. I share that concern. I have heard the
economists make the argument--many in the business community are people
I respect--make the argument that wages tend to lag behind. Gross
domestic production growth goes up for a while and wages do not go up,
but they catch up, and there is some truth to that. I don't deny that.
But if you look at the numbers and how middle-class and lower income
workers are getting along today, you cannot be pleased with what is
occurring, particularly in certain areas and certain fields. It is from
that perspective I say, as part of this debate over minimum wage which
we are told is designed to help people have more money to take home, to
take care of their families, and if you think this is not the right way
to do it, you don't love families and you don't want to help poor
people; that is not correct.
I hope to be able to vote for this minimum wage bill. I voted for
several to increase the minimum wage. I am just saying the minimum wage
has been demonstrated by analysis, by top-flight econometric firms,
that it does not reach the poor people in a way that most people think
it does. It oftentimes helps young people who are children of some
corporate executive who may be working.
Our motivation, and I think it is universal in the Senate, through
the legislation moving through the Senate now, is designed to improve
the take-home pay of Americans so they can more ably benefit from the
great American dream and take care of their families effectively.
Significant economic evidence indicates the presence of large amounts
of illegal labor in low-skilled job sectors is depressing the wages of
American workers. That is an important statement if it is true, right?
If that is true, isn't that important? First of all, we are a nation of
laws. We think the laws ought to be enforced.
Overwhelmingly the American people agree with that. But if it also is
depressing the wages of working Americans, that is a double concern,
particularly as we are asking ourselves in this debate: How can we help
low-wage workers do better? I will talk about that. We have to talk
about this.
Harvard economist George Borjas, who testified before the Senate
Health, Education, Labor and Pensions Committee, and Lawrence Katz,
also of Harvard, estimate that the influx of low-skilled, low-wage
immigration into our country from 1980 to 2000 has resulted in a 3-
percent decrease in wages for the average American worker--that is all
workers--and has cut wages to native-born high school dropouts--those
who have not obtained a high school degree; unfortunately, we have
quite a number of those in our country--who make up the poorest 10
percent of our workforce, by some 8 percent. Eight percent, if you
figure that

[[Page S1274]]

out on a yearly basis, amounts to $1,200 a year. That is $100 a month.

Now, for some people in America today, $100 a month is not a lot. But
if you are making near the minimum wage, $100 a month is a lot of
money.
Alan Tonelson, a research fellow at the U.S. Business and Industry
Council Educational Foundation, says:

[T]he most important statistics available show conclusively
that, far from easing shortages--

Shortages of labor--

illegal immigrants are adding to labor gluts in America.
Specifically, wages in sectors highly dependent on illegals,
when adjusted for inflation, are either stagnant or have
actually fallen.

Now, he is referring to Labor Department data and information from
the Pew Hispanic Center. For example, he cites data from the U.S.
Bureau of Labor Statistics that indicates the following: inflation-
adjusted wages for the broad Food and Services and Drinking
Establishments category--they have a category for that: the broad Food
and Services and Drinking Establishments category; and they monitor the
wages for it--between the years 2000 to 2005 fell 1.65 percent.
The Pew Hispanic Center estimates that illegal immigrants comprise 17
percent of food preparation workers, 20 percent of cooks, and 23
percent of dishwashers, about a fifth of those workers; three-fifths,
four-fifths being legal native citizens. But contrary to what we have
been told, that you cannot get workers at the wages they are paying,
and paying fair wages, it looks as though the wages have fallen, which
is a matter of interest.
Inflation-adjusted wages for the food manufacturing industry--the Pew
Hispanic Center estimates that illegal immigrants comprise 14 percent
of that workforce--fell 2.4 percent between 2000 and 2005.
Inflation-adjusted wages for hotel workers--the Pew Hispanic Center
estimates illegal immigrants make up 10 percent of that workforce--fell
1 percent from 2000 to 2005.
Inflation-adjusted wages in the construction industry--Pew estimates
that illegal immigrants make up 12 percent of the workforce there--fell
1.59 percent between 2000 and 2005.
Inflation-adjusted wages in the animal processing and slaughtering
subcategory--and Pew estimates that illegal immigrants comprise 27
percent of that workforce, the highest percentage--fell 1.41 percent
between 2000 and 2005.
So if these numbers are correct--and they come from the objective BLS
and are supposed to be accurate, and we rely on them for our business
around here--something is amiss if people say they cannot get workers,
yet they are getting the work done, and they are paying less in 2005
than they were in 2000.
Now, you tell me.
Others studying the same issue have found similar trends. According
to a recent City Journal article by Steven Malanga, a senior fellow at
the Manhattan Institute:

. . . low-wage immigration has produced such a labor surplus
that many of these workers are willing to take jobs without
benefits and with salaries far below industry norms. . . .

Well, let me go on. Day laborers--these are people who gather at
certain known locations within areas, and they hang out until somebody
comes out and hires them--who work in construction in urban areas
``like New York and Los Angeles . . . sell their labor by the hour or
the day, for $7 to $11 an hour . . . far below what full time
construction workers earn.''
You see, we want Americans to be able to have a job that has some
permanency to it, that pays a decent wage, that has retirement
benefits, and has health care benefits. But our workers who might be
interested in construction--and more are than most people think--are
having to compete against people who will work by the day for $7 and
$11 an hour and do not demand any benefits.
Robert Samuelson, a contributing editor of Newsweek, has written a
column for the Washington Post since 1977. In his column last spring he
summed up the impact of illegal immigration on the unskilled American
worker this way:

Poor immigrant workers hurt the wages of unskilled
Americans. The only question is how much. Studies suggest a
range ``from negligible to an earnings reduction of almost 10
percent,'' according to the [Congressional Budget Office].

That is a lot: 10 percent. Five percent is a lot.
To put this impact into a larger perspective, one might ask how much
native workers have lost as a whole due to competition with low-skilled
immigrant laborers. Although only a few studies have ever looked at
this issue, a 2002 National Bureau of Economic Research paper written
by Columbia University economics professors Donald R. Davis and David
E. Weinstein is on point.
Using complex methodology, they aggregated the total loss to the U.S.
native workers and found that the magnitude of losses for U.S. native
workers equates roughly to $72 billion a year, or .8 percent of GDP.
Now, I don't know if that figure is correct, but the earned income tax
credit is just $40 billion a year, and they say it amounts to $72
billion a year. The economics professors at Columbia University also
said immigration is as costly to the United States as all trade
protections.
When wages are suppressed, people drop out of the workforce. In
addition to the evidence that low-skilled American workers--and
particularly African-American workers--are suffering wage suppression
due to the competition they face from illegal alien labor, we also know
competition is causing some Americans to drop out of the labor force.
Steven Camorota, last spring, of the Center for Immigration Studies,
analyzed the steady decline in the share of less-educated adult natives
in the workforce between March 2000 and March 2005.
Prior to Hurricane Katrina, there were 4 million unemployed natives--
those looking for jobs who were unable to find them--with high school
degrees or less in the workforce. An additional 19 million natives with
high school degrees or less existed but were not actively looking for
jobs.
Between 2000 and 2005, the number of adult immigrants--legal land
illegal--with only a high school degree or less in the labor force
increased by 1.6 million.

During the same time period, unemployment among high school graduates
and less educated native Americans increased by nearly 1 million--so
unemployment among our high school graduates or high school dropouts
increased by nearly 1 million--and an additional 1.5 million left the
workforce altogether.
Although jobs grew in the United States from 2000 to 2005, natives
only benefited from 9 percent of the total net job increase. That is an
important factor. Although jobs grew in the U.S. from 2000 to 2005,
natives only benefited from 9 percent of that total. The number of
adult natives holding a job grew by only 303,000, while the number of
adult immigrants holding a job increased by 2.9 million. So it is
303,000 compared to 2.9 million among high school graduates or high
school dropouts.
Steven Malanga, a senior fellow at the Manhattan Institute, recently
explained:

[M]any of the unskilled, uneducated workers now journeying
here labor . . . in shrinking industries, where they force
out native workers, and many others work in industries where
the availability of cheap workers has led businesses to
suspend investment in new technologies that would make them
less labor-intensive. . . . [T]he unemployment rate among
native-born ``unskilled workers is high--about 30 percent.''

The unemployment rate among native-born, unskilled workers is about
30 percent, I repeat.
To me, those numbers do indicate a significant problem. It is a
problem we need to talk about as we talk about how to help working
Americans get a better wage.
Mr. President, I will note a few more points before I wrap up.
Professor Richard Freeman--the Herbert S. Ascherman Professor of
Economics at Harvard--testified before the Senate Judiciary Committee.
I participated in that hearing last spring. He said:

If you're a poor Mexican, your income in the U.S. will be
six to eight times what it is in Mexico.

Robert Samuelson explained in a March 2006 column in the Washington
Post:

They're drawn here by wage differences, not labor
``shortages.''

[[Page S1275]]

American workers, I think it is fair to say, cannot compete with the
wage gap between their country and other countries. I was in South
America last May with Senator Specter. We visited Peru, and we saw a
poll that had just been published in Nicaragua while we were there that
said 60 percent of the people in Nicaragua would come to the United
States if they could. I mentioned that to the State Department team
there in Peru, and they told me that a poll in Peru had recently shown,
just about this time last year, that 70 percent of the people in Peru
would come to the United States if they could.
So I guess what I am saying to my colleagues is, we need an
immigration policy that allows immigration and that is consistent with
our historic values as a nation that welcomes immigrants, but the
numbers and the skill sets that they bring ought to be such that they
do not depress wages of our lower income people because we cannot
accept everybody in the world who would like to come here. It is not
physically possible to any degree that we could accept that.
We have a lottery section that does not have any requirements of
skills in it. You apply to it if you want to come to America. It allows
for 50,000 to be drawn out of a hat each year. And those who are drawn
get to come to America on a random basis. We had 5 million people,
according to Professor Borjas at Harvard, who applied for those 50,000
slots. I do not blame people who want to come here. I am not demeaning
them. Most of them are good and decent people who want to get ahead.
But we have such a higher wage base that we could attract people from
all over the world in virtually unlimited numbers, and it does have the
impact, if allowed to be too great and too concentrated in certain
industries, to pull down American wages.
While we are thinking about how to increase the wages of American
workers, we need to think about that. That is all I am saying. And we
are going to talk about that if we talk about immigration this year, as
I expect we will. We can have immigration, but it needs to be done
right.
How do we level the playing field? Let's consider the advice given by
Dr. Barry Chiswick. He is the head of the Department of Economics at
the University of Illinois in Chicago. He testified before the Senate
Judiciary Committee last spring, stating:

[T]he large increase in low-skilled immigration . . . has
had the effect of decreasing the wages and employment
opportunities of low-skilled workers who are currently
residing in the United States.
He goes on to say:

Over the past two decades . . . The real earnings of low
skilled workers have either stagnated or decreased somewhat.
[W]e . . . need to . . . provide greater assistance to low-
skilled Americans in their quest for better jobs and higher
wages. [O]ne of the best ways we can help them in this regard
is by reducing the very substantial competition that they are
facing from this very large and uncontrolled low-skilled
immigration that is the result of both our legal immigration
system and the absence of enforcement of immigration law.

That is pretty much indisputable. I haven't heard a professor who
would dispute that yet, or anybody who can seriously object to those
numbers.
Professor Harry Holzer, associate dean and professor of public policy
at Georgetown University, a great university here, also testified at
that same hearing. He believes American workers do want jobs currently
being held by illegal laborers.
I don't agree with this idea that these are jobs Americans want to
take. Americans are not interested in a job that is only going to last
for 3 months, that pays the minimum wage and has no health care and no
retirement benefits. I will say that. And neither do we want them to
take those jobs.
Professor Holzer believes that absent illegal immigrant competition,
employers would raise wages and improve working conditions to attract
the American worker:

I believe that when immigrants are illegal, they do more to
undercut the wages of native-born workers, because the
playing field isn't level and employers don't have to pay
them market wages.
. . . [T]here are jobs in industries like construction
that I think are more appealing to native-born workers, and
many native-born low-income men might be interested in more
of those jobs. . . . Absent the immigrants, the employer
might need to raise those wages and improve those conditions
of work to entice native-born workers into those jobs.

That is true. That is all I am saying. As we discuss the minimum
wage--and I am confident somehow we will work our way through this, but
there are some amendments and votes that need to be taken--it should be
done only as part of a serious evaluation of what is happening to the
wages of low-skilled workers and middle-class workers. If we do that
and think it through, we will see we ought to reform the earned income
tax credit so people can receive that benefit while they work. We will
conclude we ought to create a savings program every American worker can
put money into throughout their working career, from the first paycheck
they get until the day of their retirement. It would transform the
retirement years of those people. We have that in our capability.
As we craft an immigration policy, we cannot craft that policy in
such a way that it only benefits corporate profits. It must be done in
a way that considers the impact that is occurring on our own low-
skilled workers. If we do a good lawful system of immigration that is
in harmony with our history of immigration in America but at the same
time provides protection to the least of our American workers, we will
have done something worthwhile.
Unfortunately, I have to say the bill that passed the Senate last
year would have been a disaster. It would have increased legal
immigration in this country, skewed mostly to low-skilled workers, by
almost three times the current rate. How can that have done anything
other than hurt our workers?
Those are some thoughts. I appreciate the opportunity of sharing
them.
I ask unanimous consent that the pending amendment be set aside and
that amendment No. 147, which I have offered, which deals with
increased fines for employers who hire illegal immigrants, be called
up. That fine currently is $250. I think that is too low. I ask that
that be called up.
The PRESIDING OFFICER (Ms. Klobuchar). Is there objection?
Mr. DURBIN. I object.
The PRESIDING OFFICER. Objection is heard.
Mr. SESSIONS. I thank the Chair.
I think that is relevant to the issue we are talking about: How to
help people get more take-home pay for their labor. One of the reasons
that is not happening to the degree we would like is the large flow of
illegal labor. One of the problems we have is that enforcement in the
workplace is not adequate. Most employers want to do the right thing,
but a $250 fine is too low. We will be dealing with that again later
on.
I yield the floor.
The PRESIDING OFFICER. The Senator from Illinois.

Amendment No. 221 to Amendment No. 157

Mr. DURBIN. Madam President, I call for the regular order with
respect to amendment No. 157 and send a second-degree amendment to the
desk.
The PRESIDING OFFICER. The clerk will report.
The assistant legislative clerk read as follows:

The Senator from Illinois [Mr. Durbin] proposes an
amendment numbered 221 to amendment No. 157.

Mr. DURBIN. I ask unanimous consent that reading of the amendment be
dispensed with.
The PRESIDING OFFICER. Without objection, it is so ordered.
The amendment is as follows:

At the end of the amendment add the following:
Section 2 of the bill shall take effect one day after date
of enactment.

Mr. DURBIN. I thank the Chair.
The PRESIDING OFFICER. The Senator from Oklahoma.
Mr. COBURN. Madam President, I want to speak a few minutes about what
we are doing. I also have several things I would like the American
people to see. I have spent a lot of time thinking about the minimum
wage and kind of the farce of what we are doing here. If we tell people
we want them to have a real minimum wage, the debate ought to be about
$13 an hour. If we, as the Government, are going to tell the States and
the employers what they ought to be paying, giving them a real minimum
wage, then surely they deserve to earn $28,000 a year. That is a
livable wage. You can make it on that. The fact that nobody wants to do
that and it will be voted down proves they

[[Page S1276]]

know how onerous that would be on the economy. Nobody wants to do that.
Nobody wants to so disrupt wages. But it is OK to do it in a small
amount. That is what we are talking about.
The first poster I have shows that 29 States and the District of
Columbia have a minimum wage that is higher than the Federal minimum
wage.
Mr. SESSIONS. Mr. President, will the Senator yield for a question?
Mr. COBURN. I am happy to yield.
Mr. SESSIONS. Dr. Coburn is such a thoughtful commentator on many
issues, but he is an expert and has done a lot of work on the health
care issue. I know he has some of his own ideas. But one of the ways
you could help low-income workers would be to reduce the health care
burden they pay in terms of health insurance. For example, the
President's proposal of tax deductibility that he made in his State of
the Union Address would be a rather sizable benefit to a lot of low-
income workers, if it were passed, would it not?
Mr. COBURN. It will be a benefit but not to the extent a direct tax
credit to them would be. Right now the average American, if you are in
the upper income scale, gets $2,700 worth of tax benefit from our
income tax code. And if you are on the lower scale, you get $103 worth
of tax benefit.
Mr. SESSIONS. This is for health insurance deductibility.
Mr. COBURN. Under the President's proposal, that would be narrowed. I
believe it ought to be the same for every American. Every American
ought to get the same tax benefit. I also believe every American ought
to be covered. There ought to be access for anybody with disease. There
are ways to do that, and I will be introducing a global health care
bill within the next month that attacks every aspect of health care and
what we need to do about it.
Mr. SESSIONS. Madam President, I wanted to say I am interested in the
earned income tax credit, immigration, and in savings. The Senator has
mentioned health care. All of those are ways, apart from mandating a
salary or minimum wage increase, to help workers. The bill the
President proposed would not go as far as Senator Coburn would like to
see--and I am impressed with his analysis--but it would, in fact,
provide a good benefit for working Americans.
Mr. COBURN. The Senator from Alabama is correct.
You can see from this chart that 29 States currently have a minimum
wage higher than the Federal minimum wage, and you can also see from
the next chart that 14 other States are in their legislature right now
considering increasing their own minimum wage. One of the things our
Founders thought and planned and hoped we would stick with is having
the States be laboratories of experimentation with respect to our
democracy. So if you have 14 plus 29, you have 43 States out of 50 and
the District of Columbia that have already answered this question. We
are going to go through and answer it for them again.
There are a lot of problems associated with this. I want to put up
another slide that shows what has happened since 1998 as far as the
number of people on the minimum wage. It is a precipitous decline from
over 4 million to less than 1.9 million workers presently. You need to
break that down. When you break that down, when we say we want to help
single moms with kids or four-person families, those working at the
minimum wage, what happens is, when you run the numbers, in many
instances we are going to hurt people who are making the minimum wage.
Let me prove my point.
In Oklahoma today, if you are earning the minimum wage, you have
access to the following benefits: A State tax credit--I am talking
about families with children on the minimum wage, and there are 40,000
of those in Oklahoma--a school lunch program, which is federally
sponsored; temporary assistance to needy families; childcare subsidies;
Medicaid, which is called SoonerCare in our State; the earned income
tax credit, which is over $4,400 per year; food stamps; housing
vouchers; plus what they earn on the minimum wage.
What happens is, if you are a family of four in Oklahoma today
earning the minimum wage, your aftertax net benefits, taking advantage
of what we are supplying supporting people making the minimum wage, is
$36,438 per year. The median household income is only $38,000 and that
is pretax. So the average person receiving the benefits we have offered
for people who have less means in Oklahoma today actually has more
benefit than the average Oklahoma family. What is going to happen when
we pass this minimum wage for that person in Oklahoma? What is going to
happen is, on the childcare, they are going to go from $22 a month
copay to $95 a month. That is what is going to happen to families in
Oklahoma. TANF, they are going to go from $3,500 a year to $2,600 a
year, based on this minimum wage bill. On food stamps, they are going
to go from $3,588 a year to $2,808 a year. Under this very bill, that
is what is going to happen to families earning the minimum wage in
Oklahoma. Their housing subsidy is going to go from $4,140 a year to
$3,096, a 25-percent reduction. Their Medicaid, if they are a family of
four, they are not going to qualify for the whole family anymore; only
their children will be qualified. So, in essence, what they are going
to lose is $4,600 a year in aftertax benefits.
Net net, when you think about the median household income in Oklahoma
being $38,000 and they are paying a State income tax of less than 6
percent, and an average Federal income tax of about 18 percent, what
you are going to see is they are going to lose.
In the name of helping them, they are going to lose. The vast
majority of the people we want to help, which is not the vast majority
of the people on minimum wage anywhere in this country--the people who
we really want to help the most, not the teenagers or the kids living
in a family who have a minimum wage job as a first job, but those in
Oklahoma and in 19 other States--you are going to actually decrease
their income with this bill. It is not going to have any effect.
Put Massachusetts up there on the chart. The Senator from
Massachusetts wants Oklahoma to have his minimum wage bill. The median
household income in Massachusetts is $52,354 a year. The total income
for somebody making the Massachusetts minimum wage, they are making
$45,416 if they take advantage of the benefits available to them in
Massachusetts. So his State won't be impacted because he is already
above the minimum wage which is being proposed in the minimum wage
bill.
How smart is it for us to decide that we want to take away from the
families of 19 States--those people who we say we really want to help
but, in essence, we are going to cut their aftertax income by about
$1,000, a net/net loss for them? Is that what we intend to do? That is
the unexpected consequence of what we are going to do. Nobody is
considering the fact that the 19 States that have lower minimum wages
which will be impacted by this bill--their needy families, single moms
with kids, are going to lose under this bill in the name of them
winning. It is because we didn't think it out.
The reason we didn't think it out is because this isn't about minimum
wage; this is about wage compression. This is about raising the wages
of those people above minimum wage. It is not about minimum wage. We
come down here and say it is, but it is not. It is designed to raise
the wages of anybody under $15 an hour. That is what it is going to do.
We know wage compression. If you have 100 people working and the
highest is making $12 and the lowest is now making $6, and you say they
are going to have to make $7.25 or $7.50, what is going to happen to
the other wages? They are going to have to be bumped up. The minimum
wage is no longer designed to protect people as far as their income.
You can see it from this chart and you can see it in California--and
I have it for every State--where the vast majority of the benefits
don't come from what we earn in terms of a salaried job; they come from
the other benefits the country put in as a social safety net. So in the
States in which we would raise the minimum wage that have not done it,
in 19 States what is going to happen is we are going to hurt the very
people we say we want to help.
How is it we can do that? Why is it we will do that? We will do it
because there is a very powerful interest group that is behind this
called the labor unions in this country. For every dollar increase in
labor rates paid through

[[Page S1277]]

the labor unions, what happens to the union's fees? More money. So is
it about helping those people who need our help or is there another
agenda here?
I have great respect for Senator Kennedy. He is very eloquent on the
floor. But when you see his charts, there are false questions asked. He
showed the increase in the level of income in this country since we
raised the minimum wage. It doesn't consider all of the other things
that have happened over the last 20 years that, through productivity
increases, have raised wages. Mandating a minimum wage in any market by
any economist will not increase the market. That is not the reason. It
looks good on a chart. But you don't consider all of the other benefits
and factors that might have considered that. You just say this must
have been it because it looks like it. I can show that on anything that
we do in the Senate.
Here is a chart for New York. The State of New York is another
example. The wage per-job average is $51,165. A single mom earning
minimum wage under New York's level, which is at $7.15 right now, and
taking advantage of all of the benefits there, aftertax income is
$49,000 a year in benefits. I am not saying cut the benefits; I am
saying don't do something that will cut the benefits to those people
you say you are going to help.
It is interesting when you look at this number, knowing that taxes--
if you look at New York City's tax, you pay a city income tax, a State
income tax, and a Federal income tax. Those people making minimum wage
have more aftertax income in terms of benefits and salary than the
average household in New York City. We have to ask the question, do we
want to help people?
The Senator from Alabama talked about making sure that the earned
income tax credit comes as a part of your wage every month instead of
at the end of the year. It is a great idea and ought to be something we
want to do. I want to show again what is going to happen to families
earning the minimum wage in Oklahoma. There is a net loss of $232, but
that doesn't include the taxes. So the net loss for Oklahoma families
who are on minimum wage under the new minimum wage, in essence, will be
about $1,200. Is that what we want to do to Oklahoma and 18 other
States? I don't think so. We have to take the lid off of this pressure
cooker. For us to pass a minimum wage that undermines the very people
we are saying we want to help does not, in the long run, do anything
except help organized labor, 1; No. 2, it makes certain jobs go away;
we know it will, No. 3, send more jobs out of this country.
I believe and I hope the Senator from Massachusetts will look at our
data. I hope he will try to amend his bill in such a way so that we
have either a safe harbor or some other mechanism so the people in
these 19 States don't lose the very benefits we say we want to give to
them. In fact, that is what will happen if this bill passes.
With that, I yield the floor.
Mr. ISAKSON. Madam President, I suggest the absence of a quorum.
The PRESIDING OFFICER. The clerk will call the roll.
The legislative clerk proceeded to call the roll.
Mr. REID. Madam President, I ask unanimous consent that the order for
the quorum call be rescinded.
The PRESIDING OFFICER. Without objection, it is so ordered.

____________________