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. texasnotea

    You rock Mr President!!!! Show those republican juvenile delinquents how it's done.

    January 28, 2014 09:40 am at 9:40 am |
  2. glenview0818

    People are always complaining about income disparities greater today then ever, between the rich and poor. Here is a Wikipedia fact, Andrew Carnegie at one time controlled .6% of the entire GDP of the US. He was .4% from holding as much money as the entire 1%'ers to today. He hired a private army larger than the US military at the time to crush union strikes. People need to take a little history lesson before they start talking about "growing income disparities"

    January 28, 2014 09:40 am at 9:40 am |
  3. Lizzie

    The GOP Solution, it's very nice of you, that when you have no valid point to argue that you bring out the OLD democrats version, include OLD people, children and every group that you can think of, yet it's the democrats that want OLD people to die soon to save SS, it's democrats that want to control every minute of a women's life and make sure that as many people as possible are on government assistance and just to make it clear Buffett and Soros fight not to pay more taxes and use every loophole allowed, but then they are democrat supporters.

    January 28, 2014 09:42 am at 9:42 am |
  4. jrt1098

    If Obama wants to talk about Income Inequality ... maybe he can start by recognizing Tax Day ... which they now compute is the 5 months Americans have to pay every year to pay their aggregate Tax bill !!!

    Not enough Americans ask themselves: What right does the Gov't. have to take ANY of my money !

    January 28, 2014 09:44 am at 9:44 am |
  5. livingston

    What part of 'contractor' don't many people on here understand? Comparing federal workers pay to contract workers is the same as comparing the pay of people who work for a corporation to the people who work for the construction company that is building the building that they want built. Good grief. Talking about being willfully blind.

    January 28, 2014 09:45 am at 9:45 am |
  6. under the radar

    Problem with this whole thing is that companies will just increase the cost of their product to offset this eventual increase. While people already earning above minimum wage won't get any kind of wage adjustment.

    January 28, 2014 09:45 am at 9:45 am |
  7. sammy750

    I fully support the President using his Executive power to get his mission accomplished. Speaker Boehner has done NOTHING since 2010 in helping the people, whether it is jobs, wages equality, healthcare, immigration bill. Boehner has accomplished nothing. The Republicans seem to focus on social issues and not the real hard issue the American people are asking for. And BTW, we can see how divided the Republicans are, when 4 Republicans are speaking after Pres. Obama tonight. Republicans continue to be divide, thus nothing is getting done under Republicans. We can see what a Republican President could do under a divided party.

    January 28, 2014 09:46 am at 9:46 am |
  8. John

    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 ?

    January 28, 2014 09:46 am at 9:46 am |
  9. rs

    glenview0818

    People are always complaining about income disparities greater today then ever, between the rich and poor. Here is a Wikipedia fact, Andrew Carnegie at one time controlled .6% of the entire GDP of the US. He was .4% from holding as much money as the entire 1%'ers to today. He hired a private army larger than the US military at the time to crush union strikes. People need to take a little history lesson before they start talking about "growing income disparities"
    ____________________________
    Yes, but after a growing and healthy middle class through the 1950s and 1960s and later, today we have CEOs making 475 times the salaries of their lowest paid full-time employees- across the E.U. the average for CEOs is 12 times their lowest paid. Today, 3% of Americans own 93% of the wealth in our nation (which might imply instead of tax breaks, they should be paying, oh, 97% of the tax burden). Shoot the Walton family gave themselves raises of $1.3 billion.
    What happened after the "robber baron" period? That is where America is headed again.

    January 28, 2014 09:47 am at 9:47 am |
  10. Malory Archer

    John

    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 ?

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

    During the first five years of his reign of error, the previous occupant of 1600 Pennsylvania Avenue signed 174 executive orders.

    President Clinton signed 164 in his first five years.

    G. H. W. Bush signed 166 during his FOUR years in office, and rightwing god raygun singed 256 executive orders durning his first five years in office.

    To date, President Obama has signed 167 executive orders. He isn't doing anything his predecessors didn't do before him and in fact, with the exception of Bill Clinton, he's actually doing it less than them.

    January 28, 2014 09:50 am at 9:50 am |
  11. rs

    John

    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 ?
    ________________________________
    Indeed- the GOP has shown the House is the least productive ever in American History, and in the Senate, the GOP used the filibuster and secret hold so many times that they not only stopped the legislative process and appointment system- they set a record for the use of those tools- more in 5 years that for all of the history of Congress conbined.
    Read the Constitution and figure it out.
    Your question should be- "Why do we need the Republican Party?" They are just useless traitors.

    January 28, 2014 09:50 am at 9:50 am |
  12. American Worker

    Are there any government jobs that don't already pay more than $10 hour?

    January 28, 2014 09:51 am at 9:51 am |
  13. Matt

    Okay so let’s consider one thing. I am a conservative; however, I have always slightly agreed that the whole “trickledown economics” idea is absolutely baloney. So raising the minimum wage isn’t a half bad idea. However, supposing the overall minimum wage raises to $10.10 across the country...what are the immediate affects? Employers (the greedy people they are) will react to this by hiring less because they would have to pay more to get the work done. I would agree that raising the minimum wage is a great idea, but not when the overall economic health of the GLOBAL (not just American) Economy is in question. This will slow job growth and in the long run just lead to higher inflation. He should wait to do this.

    January 28, 2014 09:52 am at 9:52 am |
  14. John

    This sure as heck wont help the economy. Liberals are great at thinking about everything from the perspective of what they think is fair or not, but never think about the financial/economic ripple effect.

    January 28, 2014 09:53 am at 9:53 am |
  15. Rudy NYC

    Will-I-Am

    GS-1 employees make $9.77 an hour, that is MINIMUM WAGE for federal employees.
    --------------------------------
    Federal contractors, and their employees, are not regarded as federal employees. Federal contracts can specify a type of schedule in their specifications known as a "prevailing wage schedules" for specific types of job positions. During the Bush years the size of the federal government grew dramatically, but you wouldn't know it by merely looking at the size of the federal workforce.

    All of the job positions that were privatized to contractors are no longer part of the federal workforce. They're just a line item expense in the budget. Republicans grew the actual szie of federal workforce by close to a million workers through privatization, most particularly in the national security and defense industries. People like Edward Snowden don't show up in the roll call of the federal workforce.

    January 28, 2014 09:54 am at 9:54 am |
  16. Garrett from Texas

    So, first, he has a historic increase in federal employees (don't go citing countering arguments that Bush created more government employees – those weren't created by Bush as they were mostly at the state and local level) and now, to keep their loyalty, he's upping their pay grade for bottom end government workers from about $9.75 to $10.10 for an annual increase of $728 a year. That should just about pay for a GS-1s ObamaCare increases to their cost of Health Insurance. Maintaining the governing class.

    January 28, 2014 09:54 am at 9:54 am |
  17. TiredofSilly1

    As usual, when the spoiled child doesn't get his own way he stamps his feet and does something illegal. When are we going to file charges against this dictator-wannabe? I'm so sick of his ugly face I could scream.

    January 28, 2014 09:54 am at 9:54 am |
  18. don

    Lets print $10,000 for everybody!!

    January 28, 2014 09:55 am at 9:55 am |
  19. pragmatist

    Boehner said that Obama would "run into a brick wall". As if that would be in anyway different from the last 5 year's. Haha. Good ole house republicans....

    January 28, 2014 09:55 am at 9:55 am |
  20. Tumek

    The Republicans are always complaining about Obama overstepping his authority and doing things that are unconstitutional. Well, what the hell are those idiots going to do about it?

    January 28, 2014 09:56 am at 9:56 am |
  21. Truth Rules

    " ...including kitchen and laundry workers on military bases... " Say goodbye to jobs for civilian kitchen and laundry workers. Say hello to KP and details at Quartermaster Laundry again; All of that went away when it was determined that civilian workers were more cost effective. What a great and practical use of trained soldiers.

    January 28, 2014 09:57 am at 9:57 am |
  22. Chcuk88888

    Grounds for Impeachment?

    January 28, 2014 09:58 am at 9:58 am |
  23. smith

    @Malory- Your logic is flawed. A huge increase in the min. wage will result in hrs. being cut for hourly workers and labor being put on salary folks. Ever heard of profit and labor?

    January 28, 2014 09:58 am at 9:58 am |
  24. Human2

    Lets send the Republicans back to farmlands so they can get some education. They don't deserve to be in Washington DC. Way to go Mr. President.

    January 28, 2014 09:59 am at 9:59 am |
  25. rs

    smith

    @Malory- Your logic is flawed. A huge increase in the min. wage will result in hrs. being cut for hourly workers and labor being put on salary folks. Ever heard of profit and labor?
    __________________________
    Ever heard that has no basis in fact?

    January 28, 2014 10:00 am at 10:00 am |
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