January 28th, 2014
06:00 AM ET
6 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. Johnny

    What a freaking idiot this POTUS is ! Raising the minimum wage is not going to create jobs any more than his stupid ObamaCare did.

    January 28, 2014 07:49 am at 7:49 am |
  2. jkeys

    Whether or not a minimum wage increase is a good thing, our president should not be stomping his feet like a spoiled brat and bypassing our legislative system when he doesn't get what he wants. It is a two party system meant to have compromise and balance, it is not a dictatorship meant to be lead by executive orders.

    January 28, 2014 07:50 am at 7:50 am |
  3. Ryan C

    So now government workers make more than the private sector?! Bad things coming...

    January 28, 2014 07:52 am at 7:52 am |
  4. Mike

    Want to give people a better standard of living, and giv ethem the ability to have more money in their bank accounts? Well, let's look at the cost of fuel. once the cost of fuel rose to over three dollars a gallon, food costs, energy costs and all of the other costs associated with high fuel prices rose dramatically. Want to give those workers that earn minimum wage a better chance? Lower the cost of fuel for this contry and see their lives improve. Mandate that once the cost of fuel lowers, the price of food, transportation and utilities decrease with respect to the lower cost of fuel.

    Who remembers when gas cost 85 cents a gallon? I do, and I remember that bread also cost $1.10 a loaf and milk was $1.10 as well. I had more money in my bank account then than I do now.

    January 28, 2014 07:53 am at 7:53 am |
  5. Mike

    Just what we need. Bigger Government. Also, hold up! Is this the same Fed Government that can't pay its bills? Let's call it what it is. It's a gimmick by a failure of a President. Obama was and is unqualified for the job. Considering he followed another week President (W), we're in trouble if we don't put some strong 'NOT COOL' this time.

    January 28, 2014 07:54 am at 7:54 am |
  6. John, PA

    Another bad decision from the worst president in the history of the United States. Obama just keeps piling on Failures after Failure after Failure.

    Oh and the State of the Union under Obama; no surprise a Failure on every level.

    January 28, 2014 07:55 am at 7:55 am |
  7. John Williams

    I cant think of any government contracting positions that pay $10 an hour.

    What is the net effect of this move?

    Sorry $10.10 – cant forget the dime.

    January 28, 2014 07:55 am at 7:55 am |
  8. srcactus

    Proof that the man has no leadership skills or no desire to lead, you be the judge. The failed agenda is stalled because it is not who we are and would eventually fail even in the hands of an experienced manager capable of obtaining consensus.

    January 28, 2014 07:55 am at 7:55 am |
  9. DESMOND.

    America is a modern capital of the world.

    January 28, 2014 07:57 am at 7:57 am |
  10. Dan

    If the minimum wage goes up, its going to drive up prices on just about all consumer products...

    January 28, 2014 08:00 am at 8:00 am |
  11. Dutch/Bad Newz, VA -aka- Where's Our $24 Billion?

    Oh no! The dictator is actually doing the will of the people without congressional approval.

    January 28, 2014 08:00 am at 8:00 am |
  12. Madison

    If congress refuses to enact legislation completely and solely out of hatred for the president, then the president needs to act in accordance with his powers and the will of the people who put him in office. The republicons are so blinded by hatred of Obama that he could propose the ryan budget tomorrow and they would oppose it.

    January 28, 2014 08:01 am at 8:01 am |
  13. Brian in DC

    Yay, higher taxes to pay for Obama's follies.

    January 28, 2014 08:01 am at 8:01 am |
  14. Uncle Bryce

    I hope the republicans begin to bend a little.
    Some act like they were elected by the American debt and not the people.
    We ran this debt up with tax cuts, two long wars and bailouts.
    We don't have to keep destroying families to balance the books.

    January 28, 2014 08:02 am at 8:02 am |
  15. Brian in DC

    I expect a lot of talk in the SOTU and no matching actions, more like contradictory actions

    January 28, 2014 08:02 am at 8:02 am |
  16. DP

    And I suppose he is going to pay for the increase with the millions he has in the bank?

    January 28, 2014 08:03 am at 8:03 am |
  17. oldbones24

    I support this 100%. I read an article that reported that working families on food stamps have increased by 32%, while corporations are making record profits. Many of these are government contracts. That tells me we have stepped back a hundred years, when fat businesses were paying children a dollar a to work a 72 hour week. How soon we forget our own history and why we have the "minimum wage" in the first place. So at $10.10 an hour it's $20,000 a year, without vacation. That's just a drop in the bucket.

    January 28, 2014 08:03 am at 8:03 am |
  18. Hey Buddy

    don't forget about the working poor-man!!!!!!!

    January 28, 2014 08:06 am at 8:06 am |
  19. BeenThereDoneThat

    President Obama will NOT allow obstructionist Congress to shortchange the American people & torch his presidency! Bravo!

    January 28, 2014 08:07 am at 8:07 am |
  20. sww

    So, freeze government worker pay for three years then furlough them. Take 1% away from cost of living increases for retired veterans, then give contractors more money...

    January 28, 2014 08:07 am at 8:07 am |
  21. S Banister

    I am sick of Presidents who govern by Executive Orders and refuse to be leaders by bringing all to the table to find a viable solution. This latest news confirms to me that we need a lot more business leaders in the government rather than lawyers who clearly understand very little about economics. Raising minimum wage is only going to make it worse for the middle and lower economic class as inflation hits.

    January 28, 2014 08:08 am at 8:08 am |
  22. BO

    Bill Gates created more jobs than Obama can even dream of. Gates says increasing minimum wage is WRONG.

    January 28, 2014 08:08 am at 8:08 am |
  23. John

    Interesting ... but I'd hate to point out to our President that the way checks and balances work, the pile of money to pay for that doesn't grow because of his executive order. Only Congress, specifically the House, can do that so almost by definition, the US government will have to hire fewer people. Wonder how that will make his unemployment numbers look?

    January 28, 2014 08:11 am at 8:11 am |
  24. Erok

    Nice job, Mr. President! Congress has become a joke and it's "Action, not words" time. Now we can hear all of the GOP "clowns" call you a Dictator. It's nice to trickle something down on them once in a while.

    January 28, 2014 08:12 am at 8:12 am |
  25. MickinMD

    Anyone opposed to raising the minimum wage is FOR taxpayer subsidized aid to wealthy businesses, because of the food stamps, free school lunches, Medicaid, etc. that the taxpayer provides when the business skims off more of the profits from worker pay than the worker needs to live.

    Anyone who thinks "these are teenagers jobs" should be reminded that, since WW2, the minimum wage has been a trial wage that was usually increased within 6 months. As a 17 year-old part-time high school kid working fast food in 1967, I started at the minimum wage of $1.25 and within 9 months had raises that brought me up to $1.55 hr, which is $10.40 to $12.75/hr now, depending on which calculator you use.

    January 28, 2014 08:13 am at 8:13 am |
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