House Leaders Jockey Over Wage Increase Proposal

By Jim Burns | July 7, 2008 | 8:26 PM EDT

( - House Democratic Leader Richard Gephardt said Tuesday he will "study" Speaker Dennis Hastert's plan to raise the minimum wage by $1 over two years.

Gephardt said in a statement released from Capitol Hill, "I am pleased that the Republican leadership has finally decided to stop holding up a pay raise for America's working families, the same pay raise Democrats have been calling for since the early days of this Congress. We will study Speaker Hastert's offer and hope to work with the GOP."

In a letter to President Clinton, Hastert said he can agree to a demand by House Democrats to spread the $1 increase over two years. However, in exchange, Hastert wants $76 billion in tax cuts for small business over 10 years to help businesses defray the cost of the increase.

Hastert also agreed to drop his demand that the minimum wage bill include provisions lowering the death tax and expanding pension coverage to more small business employees. Congress passed these provisions before adjourning for their summer recess but the president has threatened to veto them.

If an agreement can be reached, the minimum wage would be raised in two 50-cent increments to $6.15 an hour by 2002.

"It is very clear that a vast majority of congressional Democrats and Republicans would like to see a balanced approach before we adjourn," Hastert said in his letter to Clinton.

Gephardt is taking a wait and see attitude about the Republican offer because of the upcoming fall elections.

"This is not the first time we have heard lofty promises from the other side of the aisle. . . . I am hopeful that perhaps now, in the face of upcoming Congressional elections, they will finally allow us to send the President an unfettered, clean minimum wage bill," Gephardt said.

The Clinton White House reacted cautiously because they want to see more details.

"There are still problems with their offer, but we hope this recent movement our way will reflect further willingness to work out any remaining obstacles to passing a bill the President can sign. Republicans are coming to acknowledge public support for an increase," said Gene Sperling.