January 28th, 2014
06:00 AM ET
7 months ago

Obama to raise minimum wage for federal contractors

(CNN) - While President Barack Obama’s attempts to increase the nation’s minimum wage through legislation have stalled in Congress, the White House announced plans on Tuesday to use the president’s executive powers to partially address the problem.

Just hours before the President is scheduled to deliver his fifth State of the Union address, the White House revealed that Obama will issue an executive order to increase the minimum wage for new federal contract workers.

The action will cover all workers employed under future government contracts, ensuring that none is paid less than $10.10 an hour. In a fact sheet announcing the action, the White House highlighted several occupations that will be helped by the move, including kitchen and laundry workers on military bases, as well as janitors at federal buildings and construction workers at government building sites.

“The President has embraced the idea in the past that he can use his authority as President and the powers available to the President to advance his agenda on behalf of the American people,” White House Press Secretary Jay Carney said at his briefing on Monday. “What we have said is that he views 2014 as a year of action and that he has tasked his team to come up with new ways in which we can - he can - advance that agenda.”

An administration official confirmed the action will only apply to new contracts, and the White House believes contractors will have time to factor the new wage requirements into future bids.

Included in Tuesday’s announcement was a call for Congress to pass an increase in the minimum wage nationwide and an endorsement of a proposal put forward by two senior Democrats, Sen. Tom Harkin of Iowa and Rep. George Miller of California. The proposal would raise the minimum wage for all workers in stages, ultimately reaching $10.10 an hour, while also indexing the wage floor to inflation going forward.

Tuesday morning, House Speaker John Boehner pushed back against the executive action by the President.

"This idea that he's just going to go it alone, I have to remind him we do have a constitution. And the Congress writes the laws, and the President's job is to execute the laws faithfully. And if he tries to ignore this he's going to run into a brick wall," the top Republican in the House told reporters.

"Were just not going to sit here and let the President trample all over us," Boehner added.

The White House says the President has the authority to make the move.

Cecilia Muñoz, director of the White House Domestic Policy Council, said in an interview Tuesday with CNN Senior White House Correspondent Jim Acosta that the President "clearly has the authority" to raise the minimum wage for federal contract workers.

Obama has made wages and economic inequality a central theme of his second term in office, raising the issue repeatedly, including during a call for an extension of emergency unemployment benefits in his first public event of 2014.

“America is getting stronger, and we've made progress,” the President said. “And the economy is growing, and we've got to do more to make sure that all Americans share in that growth. We've got to help our businesses create more jobs. We've got to make sure those jobs offer the wages and benefits that let families rebuild a little security. In other words, we've got to make sure that this recovery leaves nobody behind. And we've got a lot of work to do on that front.”

Two national polls conducted in the past two weeks both indicate widespread support for raising the minimum wage to $10.10 an hour. Seventy-two percent of those questioned in a CBS News survey and 73% of those questioned in a Pew Research Center poll said they favor the move. Both surveys indicated a partisan divide, with around nine in ten Democrats and seven in ten independents in support of raising the minimum wage to $10.10 an hour, and Republicans divided.

CNN's Jim Acosta, Brianna Keilar, Dana Bash and Paul Steinhauser contributed to this report.

soundoff (545 Responses)
  1. SWRealTruth

    Advice to the President of the United States regarding how to get people working. First, to anyone receiving unemployment, have them meet at the department of labor every weekday at 9am. The community, local government, or charitable organization can use them for labor for 1/2 the day,. The other half, they can be looking for a job. This way, the unemployed do not feel ashamed to get unemployment benefits or federal assistance because they earn it. However, they really do not enjoy getting up and going to the local department of labor everyday, so they are incentivized in finding and taking a job. Regardless if your atheist, agnostic, or a born again religious fanatic; there is one scripture in the Bible worth reading. I paraphrase, "you do not work, you do not eat". There are exceptions, such as handicap, elderly, widows, and orphans. The citizens of American look at a minimum wage increase as something great; the poor are paid fairly and the evil rich person get less. These are real facts; the increase in minimum wage does not affect Bill Gates or Warren Buffet because if you work for them, you are an educated highly skilled worker. It primarily affects the small business person who is working 70 hours a week and creating 50 plus jobs. The increase is enough that he is unable to make a living so he has to close his business, and 50 less jobs are gone. America do the math; he is giving the least educated, least skilled worker a mandated 39% raise. Do you think small business owner's can take that type of hit to labor cost? Greece went this route and know if the Germans do not give them handouts, their whole economy collapses. The Germans get to demand the terms of how Greece will run it government. They have taken over the country and not fired a shot. We are so indebted to the Chinese, if we continue on this path, they will be dictating to us how we run ours. It has gone from being funny watching an unqualified man be President, to being a horror movie.

    January 28, 2014 12:38 pm at 12:38 pm |
  2. smith

    @Malory- Those people aren`t being sent as much as they would if the min, wage jumps 3-4$ an hour. Simply, they can afford to pay them and make profit as well. If you throw in the increase in min wage that eats into profit. Simple logic. Btw, Iniment danger pay has been cut to military personnel as well length of time you can use the post 911 gi bill. Also, every branch is down sizing which mean people are being forced out of the military.

    January 28, 2014 12:41 pm at 12:41 pm |
  3. The REAL Truth...

    @smith – @The Real truth...You don`t support or protest capitalism, you accept it and live with it. If you don`t like it that`s your issue.
    ------------------------–
    I have no issues with capitalism.. you probably have never lived under true socialism (not the BS the GOP labels as socialism), dictatorships (not the BS the GOP labels as Obama's Presidency) or communism, as I have before settling here, you'd have a clue.
    I have a problem with unrestrained capitalism.. the Ayn Rand dialect that so many extremists on the right tout. The fact is that with so many people in the US (300 million and growing), there WILL ALWAYS BE some who game and abuse the system, who don't want to work, are lazy and want hand outs. That doesn't make them liberals or Democrats BTW.
    If one conducts some basic research, it's not hard to determine that the wealth gap has increased dramatically since Reagan. 85 people control more wealth on this planet than to the remaining 5 BILLION. It's not about income distribution, taking from the 1% and giving it to slackers (not that many of them would miss it, and they'd have it all back in 10yrs anyway).. it's about equal opportunity to succeed. Have you ever tried to live on minimum wage? No? Of course not.. you can't.. and when the greed corporations sit on HUGE amounts of cash and will not create jobs here.. it will eventually come tumbling down. There are times when one has to focus on the greater good – for the long term benefit of the country – and not the pocketbooks of the wealthy..

    January 28, 2014 12:43 pm at 12:43 pm |
  4. Bob

    I object to anyone who says says minimum wage was never meant to be a living wage. That's why are system is broken. We have no issue paying athletes, celebrities, entertainers, and CEOs millions upon millions of dollars that make it off the backs of those who may have had no other choice. Accidents, trauma victims, handicapped people, mentally disabled, injuries, broken homes, unstable parents, uneducated parents, etc. are just but a handful of examples. Sure a handful of people overcome it depending on their circumstance and lucky enough to get the support but the reality of it is, most people can not. I read an article the other day on how "pretty" you are makes a difference in life from when you start school all the way through life. How is that fair and how does that account for how smart you are? How do you prove it? We can't but what we can do is take into consideration of these examples and many others and treat employees right, no matter what job they do, and understand that hard work is relative to the life you were put into. For everyone who says minimum wage jobs are not hard, I believe you are the issue. They are hard work, just in their own way. Hard work is no less important than brain work. I've seen university graduates that sit at desks all day that couldn't hack many minimum wage jobs. It's time to re evaluate our system. Jobs are jobs in my opinion.

    January 28, 2014 12:44 pm at 12:44 pm |
  5. Mateo

    I'm an independent. Anyone who supports Republicans should be asked is the eroding middle class good for America, "yes" or "no" with no bs.

    January 28, 2014 12:44 pm at 12:44 pm |
  6. Sniffit

    "This country was built by men and women who started with nothing but because they could prosper through hard work did so. "

    Please explain to the class how working hard for wages that are insufficient to cover even the most basic of necessities for your family is "prospering."

    January 28, 2014 12:45 pm at 12:45 pm |
  7. petecocker

    Spoken like a true dictator. Do what I want or I'll do anyway. I know best!!!

    January 28, 2014 12:47 pm at 12:47 pm |
  8. Sniffit

    "Read Ayn Rand's book, Atlas Shrugged, and it paints a pretty accurate picture of what this type of government leads to."

    LOL...one of the worst and most delusional work of overrated trash ever to grace a book store. Read a history book instead. Turn to the pages about the French Revolution and you'll see a wonderful account of what happens with the kind of plutocratic policies the GOP/Teatrolls are pushing once the wealth inequality reaches critical mass.

    January 28, 2014 12:48 pm at 12:48 pm |
  9. Fair is Fair

    "The Center for Union Facts analyzed collective-bargaining agreements obtained from the Department of Labor's Office of Labor-Management Standards. The data indicate that a number of unions in the service, retail and hospitality industries peg their base-line wages to the minimum wage."
    -------–
    Hmmmmm... interesting.

    January 28, 2014 12:49 pm at 12:49 pm |
  10. christineattheyknownot

    I see so much misinformation in these threads it's horrible.

    Lets start with the doctor making $150,000 with large student loans. Really? I live in a rural town with a small community hospital. The doctors all make over $200,000 and they get their student loans paid off with employment. Even if they didn't the student loans would decrease their taxable income which would lower the amount they pay in taxes. There take home will always be many multiples of someone making minimum.

    Next, we talk about all the government assistance that poor people are getting as a reason not to raise minimum wage. That's stupid. People that work full time shouldn't need assistance. Their employers are effectively getting off not having to pay something essential for them to live. That's crazy. So what's happening is I as a taxpayer am then tasked with paying them that money. That is wrong. Pay them fair.

    Now some people are saying well if we pay them fair then what's the point of working hard and getting a college degree...well if employers want people trained/educated well then they will pay more to get them. Now everyone that works for a living gets a bump even though that's not mandated.

    We need to stop saying "that's not fair to me" and start asking what's right.

    I heard this morning that a Republican leader is saying $200 Billion / year can be saved in government benefits by raising the minimum wage.

    Look, the bottom line here is if Walmart and McDonalds are using minimum wage jobs to keep their prices artificially low by offloading the real costs to taxpayers it really is reasonable to expect those shopping there to pay the increased costs. If that helps mom and pop stores and restraunts good.

    January 28, 2014 12:53 pm at 12:53 pm |
  11. smith

    @Rudy- Chris is speaking the cold hard truth. If you can`t afford to raise a child, don`t make babies. If you do, your simply making your life harder. Our problem in this country people trying to keep up with the jones`s instead being responsible adults.

    January 28, 2014 12:55 pm at 12:55 pm |
  12. Juan Jiminez

    How many federal contractors make less than $10.10 an hour? Very very few. So once again it's all smoke n mirrors from this complete failure of a president

    January 28, 2014 12:58 pm at 12:58 pm |
  13. Me

    Paul

    What is the point of even having a House and Senate if Emperor Obama can make whatever decision he wants through these so-called executive powers ?
    --------

    Executive order was used by EVERY president.

    Obama – 168 times
    GW Bush – 291
    Clinton – 364
    HW Bush – 166
    Reagan – 381

    Even George washington used it 8 times.
    ___________
    That is interesting cause a poster posted the same thing earlier with numbers about half of what you posted, liberals can't even keep their lies straight!!!! No one is saying other presidents didn't use executive orders, some things are ok to use it for others like this are not!!

    January 28, 2014 01:00 pm at 1:00 pm |
  14. Rudy NYC

    Fair is Fair wrote:

    "The Center for Union Facts analyzed collective-bargaining agreements obtained from the Department of Labor's Office of Labor-Management Standards. The data indicate that a number of unions in the service, retail and hospitality industries peg their base-line wages to the minimum wage."

    Hmmmmm... interesting.
    -------------------–
    It doesn't take a degree in rocket science to notice that CFO's peg their bottom line profits to minimum wage, either.

    January 28, 2014 01:06 pm at 1:06 pm |
  15. Malory Archer

    smith

    @Malory- Those people aren`t being sent as much as they would if the min, wage jumps 3-4$ an hour.

    ++++++++++++++++++++++++++++++++++

    If more people have more money they're able to buy more things/pay for more services, and everyone's standard of living improves. Simple economics.

    January 28, 2014 01:14 pm at 1:14 pm |
  16. Rudy NYC

    smith

    @Rudy- Chris is speaking the cold hard truth. If you can`t afford to raise a child, don`t make babies. If you do, your simply making your life harder. Our problem in this country people trying to keep up with the jones`s instead being responsible adults.
    ----------------------
    I am not going to say where I think Chris is speaking from. What does a kid have to with the simple fact that not even a single person can afford to live off of the wages that places like Walmart pay? Nothing. Do you know how many thousands of people would be dropped from food stamps if Walmart paid people decent wages?

    January 28, 2014 01:15 pm at 1:15 pm |
  17. J Russ

    the real truth..........we haven't lived under capitalism either

    January 28, 2014 01:16 pm at 1:16 pm |
  18. Fair is Fair

    "It doesn't take a degree in rocket science to notice that CFO's peg their bottom line profits to minimum wage, either."
    ---------–
    It doesn't take a degree in rocket science to figure out that Obama's executive order would give all of his union buddies a pay raise, even though they make more than the minimum wage.

    January 28, 2014 01:18 pm at 1:18 pm |
  19. Name comment

    This is the greatest idea. Only liberals would believe raising minimum wage that high is good. The price of goods are now going to go up!!!!! Think about it. A co. Is not going to let their profit margin drop. It just raises the cost of doing business. Bread milk eggs will all go up. This pres. My pres. Our pres. Needs yo go back and be a communtty organizer. He does nothing to help our country in good faith. He just wants to look good to his base and blame everyone else for his failed policy. That is what all dems do. Blame someone else. Open your minds and truly listen to them blame everyone but themselves. By the way I am a business owner with one employee. I will be forced to let her go. Or I could cut my pay down. That means less for me and my kiddos. Liberals will hate me for letting her go. But it is my buisness and I'm the one taking the risk and paying all the bills

    January 28, 2014 01:18 pm at 1:18 pm |
  20. Joseph

    The Real Truth! None of it does any good if there are no jobs and no new jobs created!

    January 28, 2014 01:25 pm at 1:25 pm |
  21. M1

    How many Federal Employees do you really think earn minimum wage?
    C'mon, really?
    Are you kidding me?
    This only applies to the public union contracts that are tied to minimum wage, so guys making $25/hour now will make about $28/hour
    That should help the working poor
    NOT

    January 28, 2014 01:27 pm at 1:27 pm |
  22. Rudy NYC

    Fair is Fair wrote:

    It doesn't take a degree in rocket science to figure out that Obama's executive order would give all of his union buddies a pay raise, even though they make more than the minimum wage.
    --------------------------------–
    I agree, it doesn't. All it takes is an over active imagination and an a bad case of paranoia to reach that conclusion.

    January 28, 2014 01:27 pm at 1:27 pm |
  23. tom l

    @Rudy
    "Atlas Shrugged" is a complete and utter fantasy. Ayn Rand was an aetheist who admired, and was inspired by, the writings of Karl Marx
    ====

    Are you really trying to say that she was a communist? And I would think you would like the fact that she's an atheist and not bound by some mythical guy in the sky

    January 28, 2014 01:29 pm at 1:29 pm |
  24. The REAL Truth...

    @Name comment – By the way I am a business owner with one employee. I will be forced to let her go.
    ---------------------------------
    If you can't afford to pay her an extra $114 a week, or $456 each month... then maybe you reconsider the whole business?
    Besides, the increase doesn't apply to anyone other the Federal contract labor rates... sheeesh.. probably vote GOp too.

    January 28, 2014 01:29 pm at 1:29 pm |
  25. Jim

    I'm okay with raising the minimum wage, just show me which Federal government bureaucrats will take a pay reduction to maintain a balanced budget. President Obama and others in government practice writing checks without enough money in the account to pay the bill. They "hope" the money will appear, when it doesn't we all sink deeper in debt.

    January 28, 2014 01:31 pm at 1:31 pm |
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