Six bills in Indiana legislature proposed raising minimum wage

By Kirk Johannesen, The Republic

johannesen@therepublic.com

 Last of a four-part series

    Workers in low-wage jobs across the country have the possibility of receiving higher paychecks if a majority of politicians get their wish.
   The minimum wage has been a significant issue in the state Legislature and Congress this session.
   In Indiana, three House bills and three Senate bills propose increasing the wage.
   A proposed federal minimum wage hike has gained support in the U.S. House and Senate, but is being shaped to include tax breaks that President Bush wants.
State issue
   The bills in the state Legislature propose increases ranging from $6 on Sept. 1 to $9 on July 1, 2009.
   Some bills included provisions for workers under ages 18 and 20. One bill would have eliminated the training wage and increased the wages of tipped employees.
   House Bill 1027 has received the strongest support. It passed the House 71-29 Jan. 30 and was sent to the Senate, where it was assigned to the Pensions and Labor Committee.
   HB 1027 proposes raising the minimum wage to:
   

   "People need an adjustment in their wages every so often to keep up with inflation," said state Rep. David Cheatham, D-North Vernon, who voted for the bill.
   "If the marketplace took care of the wage by itself there still would be inequities in the way people are paid. Government needs to set minimum standards for society and help the neediest whenever it can."
   If the bill passes the Senate and becomes a law, Indiana would join 29 other states and the District of Columbia with minimum wages greater than the federal standard.
   Indiana is one of 15 states at the federal minimum wage of $5.15.
   State Sen. Greg Walker, R-Columbus opposes HB 1027.
   He believes wage hikes increase competition for entrylevel jobs, reduce the number of minimum wage positions or do both.
   "As more wages are pushed upward artificially, these increases across the board create inflationary pressures which are a disincentive to save and invest," Walker said.
   He said if it were easy to mandate wealth, governments would continue to raise the minimum wage. Walker said supply and demand of labor won't permit that, though.
   State Rep. Eric Koch, R-Bedford, said there are better ways to raise the wage level for workers at the minimum wage.
   He stressed raising their skill levels through education and training, and fostering the creation of higher paying jobs.
National action
   House Resolution 2, the Fair Minimum Wage Act of 2007, proposes raising the federal rate from $5.15 to $7.25.
   The wage would rise to $5.85 60 days after enactment, to $6.55 about a year later and to $7.25 about a year after that.
   The resolution passed the House 315-116 on Jan. 10. However, it encountered trouble in the Senate because it did not include tax cuts for small businesses, something President Bush favors.
Going down
   HR 2 received 54 votes in favor during a Jan. 24 vote in the Senate, but the 43 votes against caused it to fail because a three-fifths majority was needed for passage. The bill passed 94-3 Feb. 1 when it included tax breaks for small businesses.
   Sen. Richard Lugar, R-Ind., supports increasing the federal minimum wage, because it has not been raised in a decade and is at its lowest real value in many years.
   Also, the prices of gas, food, housing and health care have risen while the wage has remained the same.
   However, Lugar voted against the bill on the first vote, because it didn't include the tax breaks.
   "It's a case where small businesses are most affected by the increase and would take the biggest hit," said Mark Hayes, Lugar's deputy press secretary. "You don't want to adversely affect small businesses."
   HR 2 returned to the House, where a $1.4 billion package of tax cuts for small businesses passed 360-45.
   The House and Senate will try to work together to write a bill that will pass both chambers and signed by the president.