(House of Representatives - August 02, 1996)

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[Pages H9839-H9862]
From the Congressional Record Online through the Government Publishing Office []


  (Mr. SOLOMON. Mr. Speaker, by direction of the Committee on Rules, I 
call up House Resolution 503 and ask for its immediate consideration.
  The Clerk read the resolution, as follows:

                              H. Res. 503

       Resolved, That upon adoption of this resolution it shall be 
     in order to consider the conference report to accompany the 
     bill (H.R. 3448) to provide tax relief for small businesses, 
     to protect jobs, to create opportunities, to increase the 
     take home pay of workers, to amend the Portal-to-Portal Act 
     of 1947 relating to the payment of wages to employees who use 
     employer owned vehicles, and to amend the Fair Labor 
     Standards Act of 1938 to increase the minimum wage rate and 
     to prevent job loss by providing flexibility to employers in 
     complying with minimum wage and overtime requirements under 
     that Act. All points of order against the conference report 
     and against its consideration are waived. The conference 
     report shall be considered as read.

  The SPEAKER pro tempore (Mr. Collins of Georgia). The gentleman from 
New York [Mr. Solomon] is recognized for 1 hour.
  Mr. SOLOMON. Mr. Speaker, I see the distinguished gentleman from 
Boston, MA [Mr. Moakley] sitting over there. It seems like only 
yesterday that we spent all day together, and all night too. I yield 
him the customary 30 minutes, pending which I yield myself such time as 
I may consume. During consideration of this resolution, all time 
yielded is for debate purposes only.
  Mr. Speaker, House Resolution 503 is a typical rule for a conference 
report. It waives all points of order against the conference report, 
and it provides that the conference report shall be considered as read 
as usual.
  Mr. Speaker, I am so pleased that the House and Senate conferees were 
able to put together this bipartisan bill. They put partisanship behind 
them and reported a bill that raises the minimum wage in a responsible 
way by offsetting the additional costs to small business through tax 
relief, and is so important.
  As one who ran a small business before coming to this body, I am 
particularly pleased that we are making a much needed effort to give 
some tax relief to hard working people who run these small businesses 
and provide most of the new jobs.
  The small business provisions included in the conference report 
include an increase in the amount small businesses can expense, which 
will make it easier to start up and expand a small business. The 
provisions also include modifications of the rules governing subchapter 
S corporations, which is the way that many small businesses get along, 
and raise capital.
  For example, it will increase from 35 to 75 the number of 
shareholders an S corporation may have, and the bill would permit S 
corporations to have wholly owned subsidiaries as well.
  The small business relief also include much-needed pension 
simplification provisions, which are intended to strengthen and to 
encourage retirement plans for employees of small businesses. There are 
several other provisions designed to encourage and protect jobs as 
  Mr. Speaker, I represent a rural district that has many, many small 
businesses. They are an important part of the economy in my district 
just like some of the large Fortune 500's are an important part of the 
economy of the country. I know how difficult it is to start up and 
maintain a small business. Many small businesses fail before the first 
year is even over, and that is why they need to be able to utilize all 
of their operating capital early.

  But even with all the difficulties, small businesses create more jobs 
than any other type of business in America.

[[Page H9840]]

In fact, small businesses account for almost 75 percent of all new jobs 
created every single year in this country. That means jobs for kids 
coming out of high school, and for young men and women coming out of 
college. So, Mr. Speaker, these tax provisions do not just help small 
businesses, they help everyone by encouraging job growth.
  But, Mr. Speaker, that is not all. This conference report also 
includes provisions that increase the availability of spousal IRA's to 
help families plan for their retirement. And the bill includes needed 
extensions of several expiring tax provisions. One of those provisions 
is the employer-provided educational assistance tax credit, which 
allows employers to deduct up to $5,250 for educational expenses for 
their employees. This is a tax credit that helps the employer, and it 
certainly helps those employees that are struggling to advance up the 
promotion ladder in life.
  This conference report also would replace the expired targeted tax 
job credit with a new work opportunity tax credit. This credit will 
encourage businesses to hire individuals who are long-term welfare 
recipients that might otherwise not be employed. It is going to help 
them. It is going to help lift them up by the bootstraps. Certain 
disabled workers are going to have the same opportunity. That is why 
this is such an important bill.
  Finally, Mr. Speaker, this bill contains something I have advocated 
and encouraged for so long: An adoption tax credit. The conference 
report provides a tax credit for up to $5,000 of qualified adoption 
expenses. The gentlewoman from Ohio [Ms. Pryce] is going to speak about 
this in a few minutes because this includes her language, and I commend 
her for the great job she has done in getting this written into this 
bill, which is going to become the law of the land.
  Now, I know that this provision is not germane to a bill that raises 
the minimum wage and offers small business tax deductions to protect 
jobs, but the adoption tax credit has gotten bogged down in politics in 
the Senate and probably would not have passed Congress this year unless 
the gentlewoman from Ohio [Ms. Pryce] and others had not been able to 
work it into this legislation. So I feel that this provision is so 
important that I am very glad that the conferees decided to include it.
  In conclusion, Mr. Speaker, I would urge support of the rule we are 
considering now, and I urge support of the conference report so that 
the President can sign this important piece of legislation.
  Mr. Speaker, I reserve the balance of my time.
  Mr. MOAKLEY. Mr. Speaker, I yield myself such time as I may consume 
and I thank my colleague and dear friend from New York, Mr. Solomon, 
the honorable chairman of the Committee on Rules, for yielding me this 
  (Mr. MOAKLEY asked and was given permission to revise and extend his 
  Mr. MOAKLEY. Mr. Speaker, on behalf of the 4.2 million Americans who 
work for the minimum wage, I want to say: it's about time.
  The minimum wage in the United States has not been raised in more 
than 6 years.
  For that reason, I congratulate my Republican colleagues for 
recognizing the importance of this increase today and I am proud to 
stand in support of this rule, making the bill in order.
  Mr. Speaker, the value of minimum wage is at a 40-year low. A 40-year 
  Today, people who work for minimum wage, people who work very hard to 
support their families and try to stay off of welfare, earn only $8,500 
a year. That is not enough, Mr. Speaker, to support a family.
  In fact it is $3,800 below the poverty line for a family of three. 
That's right, Mr. Speaker. People who work very hard in full time 
minimum wage jobs earn almost $4,000 less than people at the poverty 
  Yesterday we voted on a Republican welfare bill which President 
Clinton has said he will sign. That bill made significant changes in 
our Nation's welfare system. But I would argue, Mr. Speaker, that this 
bill we are doing today is the real of welfare reform.
  Because, Mr. Speaker, instead of haggling over which benefits the 
Federal Government should provide to support children, as we were 
yesterday, we are working on making it easier for parents to support 
children themselves without the Federal Government. And that's the way 
it should be.
  With this increase in the minimum wage, working parents will come 
closer to having jobs that enable them to support their families.
  Instead of working full time for only $8,500 a year, these parents 
will get a 90-cent-an-hour raise. It may not sound like much but to 
these 4.2 million people, it's a very good start.

  It used to be, Mr. Speaker, that only one parent had to work to 
support a family. A father could go to work and earn a good living 
which would provide food and shelter and clothing for his family. But 
not anymore.
  The earning power of a lower income worker in the United States has 
declined to the point that a person working full time for the minimum 
wage earns below the poverty level.
  A lot of families chose welfare over work because it is absolutely 
impossible to make ends meet otherwise.
  That's why this bill, this small increase in the minimum wage, is so 
important. Because it will make it just a little bit easier for lower 
income families to make those ends meet.
  It will bring the minimum wage closer to what it should be: A safety 
net for primary earners and the best kind of welfare reform this 
Congress can enact.
  I want to add, Mr. Speaker, that my home State of Massachusetts 
already has a minimum wage of $4.75. I think we did the right thing by 
raising the minimum wage in Massachusetts and we are doing the right 
thing today by raising it even further for the entire country.
  Mr. Speaker, for the last year and a half my Democratic colleagues 
and I have been fighting for a minimum wage increase--if my Republican 
colleagues had listened to us earlier--12 million Americans would have 
gotten a raise by now.
  But Mr. Speaker, they have joined us now. I am pleased to welcome 
them to this side of the issue and I urge my colleagues to support this 
rule to give hard working Americans a long overdue raise.
  Mr. Speaker, I reserve the balance of my time.
  Mr. SOLOMON. Mr. Speaker, I yield such time as she may consume to the 
gentlewoman from Columbus, OH. [Ms. Pryce], one of the very, very 
valuable members of the Committee on Rules. She has a major role in 
this legislation.
  Ms. PRYCE. Mr. Speaker, I thank the gentleman from New York [Mr. 
Solomon], my friend and the distinguished chairman of the Committee on 
Rules, for yielding me this time, and I appreciate having the 
opportunity to work with him on some of the underlying legislation and 
in managing this important rule.
  Mr. Speaker, as the chairman described, House Resolution 503 has the 
customary 1 hour granted for debating conference rules in the House, 
and I urge all my colleagues to give it their full support.
  Mr. Speaker, the conference report on the Small Business Job 
Protection Act contains many very important elements. First, we provide 
for an increase in the minimum wage, a provision fought so hard and 
passionately for by the gentleman from New York, Mr. Quinn, my 
Republican colleague from New York, Mr. Quinn.
  The report also provides for a series of tax incentives designed to 
make it easier to start up and then expand small businesses, and also 
the numerous provisions outlined by the gentleman from New York [Mr. 
Solomon] at the outset of his remarks.
  Our Nation's economic health depends in large part on the success of 
America's small businesses. They are the engine of economic growth, 
creating nearly 75 percent of all new jobs in the United States in any 
given year, but we cannot expect them to survive, much less prosper 
given the regulatory and tax burdens imposed on them under current 
laws. That is why the tax incentives contained in the conference 
agreement are so important to the future of small business and jobs in 
this country. Together, they will provide small business owners and 
entrepreneurs alike with the financial tools they need to grow and 
compete and to create the kind of stable and lasting jobs that the 
American people need.
  Mr. Speaker, the third, and to me the most personally significant, 
element of

[[Page H9841]]

the bill is made up of the provisions designed to remove barriers that 
currently discourage hundreds and hundreds of caring families each year 
from seeking to adopt children.

                              {time}  0930

  As many of my colleagues know, I am an adoptive parent myself. Since 
coming to this body, I have worked hard to find ways to make it easier 
for parents to adopt, especially young parents with moderate incomes. 
While progress is being made, the high costs associated with the 
adoption process, which can be as much as $15,000 or more in many 
cases, still pose very significant obstacles.
  To help families defray these costs, the conference report provides a 
valuable tax credit of up to $5,000 for qualified adoption expenses, 
and it recommends the necessary offsets to pay for the credit.
  In addition, the conference report seeks to remove barriers to 
interracial adoptions by prohibiting a State or any other entity that 
receives Federal assistance from denying or delaying a child's adoption 
because of the race, color, or national origin of the child or the 
prospective parents.
  Hopefully, this change will make it possible for more children to 
find their way into loving, permanent homes regardless of the race of 
the family seeking to adopt.
  Mr. Speaker, these pro-adoption provisions were originally included 
in legislation passed by the House earlier this year, but unfortunately 
the other body has not acted as quickly on this important measure. I 
congratulate the gentleman from Texas, Chairman Archer, and the 
conferees for ensuring that these beneficial pro-family provisions are 
enacted into law this year.
  Mr. Speaker, this week we have passed major legislation to reform 
welfare and to expand access to affordable health care coverage. With 
this legislation, we will add to those victories by easing the 
financial burden on small businesses, by lifting the barriers that 
discourage more families from seeking to adopt. I urge my colleagues to 
support this fair rule and to vote for the conference report.
  Mr. MOAKLEY. Mr. Speaker, I yield 2 minutes to the gentleman from New 
Jersey [Mr. Pallone], a very active Member dealing with this matter.
  Mr. PALLONE. Mr. Speaker, once again I want to point out that the 
Democrats can truly declare victory this morning with this minimum wage 
bill finally being brought to the floor. But two points need to be 
made. One is that the Republicans consistently over the last 2 years 
have opposed this minimum wage increase and, second, that this really 
does impact a lot of real people. It is not something that is pie in 
the sky that we are just talking about here that does not mean anything 
to the average Americans.
  Democrats have been trying to pass this minimum wage increase since 
February 1995, when President Clinton first proposed the bill and 
Democratic leader Gephardt introduced it into the House. But it took 
over a year to force the Republicans into acting. The Republican 
leadership remained strongly opposed to the minimum wage bill, and 
Republicans marched in lockstep behind them voting five separate times 
to kill Democratic efforts to bring it up.
  Many of us were here many times trying to bring this up but we were 
opposed by the Republican leadership. Even when the moderate 
Republicans finally started to cave in, faced with polls showing that 
over 80 percent of the Americans supported this bill, Republican 
leaders continued to try to kill the bill. They offered amendments that 
would have gutted the bill in a failed attempt to appease the business 
lobby and blunt the Democratic initiative.
  Mr. Speaker, let me just say we are talking about real people, over 
10 million Americans that are going to be positively impacted by this 
legislation. Most minimum wage earners are not teenage children of the 
affluent. According to the Bureau of Labor Statistics, of current 
minimum wage earners, two-thirds are adults, with over 50 percent being 
26 or older, while 62 percent are women.
  These workers have to work almost twice as many hours just to live 
near the poverty level for a family of four. They work hard, they 
provide what they can for their family and they deserve the opportunity 
to earn a livable wage.
  Mr. Speaker, yesterday and this past week both parties have been 
talking about welfare reform. We passed a good welfare bill. But reform 
is useless if we do not do something to improve wages. We need to 
reward hard work and make it less enticing to collect welfare. This 
bill will accomplish that. I urge support for the conference report.
  Mr. SOLOMON. Mr. Speaker, I yield myself such time as I may consume.
  I have been around here a long time. It is not that politics is 
wonderful. It is no wonder that the American people hold us in such low 
esteem when they see that in every other speech we get up here and 
engage in partisan attacks. I long for the old days when maybe there 
was no television coverage, and we came on this floor and we hammered 
out the issues and we did not have this partisan bickering.
  The man I am going to introduce right now is a man I have never heard 
utter one single partisan word on this floor. He is a standup 
Congressman. If it were not for him, this legislation would not be on 
the floor today. His name is Jack Quinn from Buffalo, NY.
  Mr. Speaker, I yield such time as he may consume to the gentleman 
from New York [Mr. Quinn].
  Mr. QUINN. Mr. Speaker, I thank the gentleman for yielding time to me 
  Mr. Speaker, I rise in support today of the rule and also rise in 
support of the Small Business Job Protection Act. I also rise as a 
Republican Member of this body for almost 2 terms now who has never 
opposed the minimum wage and was pleased to join a number of Republican 
colleagues of mine to finally get this bill to a vote on the floor.
  This has been a historic week in our House and in Congress. On 
Wednesday, the House voted to end welfare as we know it, and just last 
night we passed legislation to make health insurance more accessible to 
Americans who get sick or lose their jobs.
  Today the House is considering legislation to raise the minimum wage 
and at the same time provide necessary tax incentives to small 
businesses. Mr. Speaker, in April, about the middle of April, I was 
proud to begin this process by submitting the bringing a bill to the 
floor that would have raised the minimum wage. Today, now as we take 
another historic step in raising the minimum wage for over 4 million 
Americans, it is an opportunity for me to thank the people who worked 
so hard in this effort.
  I want to thank those sometimes-courageous 23 other Republican 
Members who joined me in my minimum wage increase bill. I also wanted 
to thank the Republican leadership who continued to meet with me and 
the others, who continued to work with us, our group, as we found ways 
to bring the bill in an acceptable manner to this floor.
  Time after time during that often heated debate, there were times 
when it was not acceptable to one group or another; but in the end, 
leadership worked with Members who felt a need to bring this bill to a 
vote and we did. What we found out was that we thought was going to 
happen all along, the minimum wage increase in the House passed 
overwhelmingly with bipartisan support.
  Mr. Speaker, it is also an opportunity for me today to thank my 
Democrat colleagues on the other side of the aisle who also, once we 
had the bill in acceptable form on the floor, joined in that bipartisan 
fashion to pass the bill and, at the same time, I believe, sent a 
message to the Senate, our colleagues across the building, that this 
was important legislation and that the House was prepared to act in a 
bipartisan way to get them a bill, to get a bill that the American 
people needed, the American people who had not seen the minimum wage 
increase in almost 7 years. I think we need to thank all of those 
Members who helped us get to this day today.
  I believe, Mr. Speaker, that Americans who work a 40-hour work week 
ought to make a wage that they can live on. A lot of rhetoric has taken 
place in the well, a lot of rhetoric has taken place back and forth in 
these past 3 months since my bill was introduced. I think we are here 
today, again, on an historic event, to say that we are going to give 
those workers, the men and women of this country, a

[[Page H9842]]

raise. Today America will get the raise it deserves.
  It is through the hard work of a lot of Members in this Chamber and 
in the Senate. I stand here before all of our colleagues today asking 
support for the rule, support for the conference report and also urge 
the President to sign this bill as quickly as possible to give 
Americans the raise they deserve.
  Mr. MOAKLEY. Mr. Speaker, I yield 3 minutes to the gentleman from 
Ohio [Mr. Traficant], the Garrison Keillor of the House of 
  (Mr. TRAFICANT asked and was given permission to revise and extend 
his remarks.)
  Mr. TRAFICANT. Mr. Speaker, everybody is declaring victory. I would 
like to declare a few facts today.
  I am bipartisan, nonpartisan type of guy. I rise to indict both 
parties for subsidizing China and Japan, Mexico, and Canada with 
another continuing record trade deficit. Japan is over 60 million; 
China is approaching 40. And the analysts say in 5 years China will 
surpass Japan.
  Anyway, I do not know, I do not think anybody is listening, but there 
is an old saying, God loves poor people. They say God must love poor 
people, he made so many poor people, and there are so many working poor 
people. They deserve a minimum wage increase. I support the rule. I 
support the bill. I want to commend Mr. Moakley and Mr. Solomon, great 
job they have done over the years. Mr. Quinn fought hard from the 
Republican side. I want to commend him.
  I just want to remind Members, between 1991 and 1993, 13 million 
Americans lost their jobs. As I speak today, 36 percent are still 
unemployed; 18 percent took pay cuts less than 50 percent of what they 
previously made; 10 percent are working for 75 percent less pay than 
they mad 5 years ago. If you do your math, 60 percent of those 13 
million people, 7.8 million people are worse off today than they were 5 
years ago. So, yes, I support a minimum wage increase. But my 
colleagues, a minimum wage job is still the bottom rung of the ladder.
  If we do not resolve our trade deficits, we will not balance our 
budget deficits. By God, we are going to have a Communist party fund 
raiser on the east lawn of this White House.
  I thank the gentleman for the time.
  Mr. SOLOMON. Mr. Speaker, I yield 3 minutes to the gentleman from 
Illinois [Mr. Fawell].
  (Mr. FAWELL asked and was given permission to revise and extend his 
  Mr. FAWELL. Mr. Speaker, I thank the gentleman for yielding me the 
  I rise in support of the rule and I rise in support of the 
legislation, although with some doubts in reference to the minimum wage 
question. I have supported it before. I plan to support it again. There 
are many other fine provision in the bill: the portal-to-portal 
provisions, for instance; a lot of tax matters that are of importance 
to small business people.
  I do, however, want to also apprise my colleagues of the fact that 
unfortunately there was a provision that was added in the Senate 
involving a Supreme Court case called the Harris Trust case back in 
December 1993, which involves the ERISA statute, involves pensions and 
indeed is, I think, one of the bad features of this bill.
  As editorial in the Chicago Tribune of last week, entitled Reckless 
Attack on Pension Plans, tells the story. There are about anywhere from 
$300 to $700 billion held by the life insurance industry in this Nation 
for the benefit of pension plans. That is, they are deemed to be under 
the ERISA statute.
  That statute requires that those assets are held exclusively for the 
benefit of the private pensions of America. But there has been a big 
argument about this and the life insurance industry has said they have 
a right to commingle those funds with their own assets so they did so 
for 20 years. Then the Supreme Court said, no, you are wrong. You 
cannot do that. You have to have separate accounts for these funds that 
belong to the pension plans.

  This legislation unfortunately, which is a part of this minimum wage 
bill that is not germane at all, basically eliminates the U.S. Supreme 
Court case entirely and immunizes, the life insurance industry for all 
past misconduct in violation of ERISA going back to 1975. If that is 
not bad enough, it also goes into the future, and immunizes the life 
insurance industry for any wrongs it may do, including even civil fraud 
and self-dealing up to July 1, 1999.
  Then, on the basis of some changes that we were able to effect in 
conference, then the traditional fiduciary standards of ERISA will be 
reinstituted but only in the future, on July 1, 1999. So, this is still 
a very, very unfortunate piece of legislation. I think a lot of us are 
going to consider that we will have to introduce legislation to rectify 
it, to repeal it.

                              {time}  0945

  We cannot allow something like this, when you are talking about 
something like $700 billion of pension funds which are going to be 
continually commingled in the assets of the life insurance industry in 
this Nation. That is not right. I simply wanted my colleagues to know 
about this.
  Mr. Speaker, I rise to support this legislation overall. I support 
raising the minimum wage, with the conditions included in the 
legislation, and I support the small business simplification provisions 
of the bill. Thus, I will vote ``yes'' on the conference report, and, 
as a House conferee on the bill, I signed the conference report on 
title II.
  I, however, continue to object to one provision that was originally 
added to title I by the Senate which will shield the insurance industry 
from suits arising from the Supreme Court Harris trust case, and 
seriously weaken the integrity of ERISA which has protected pension for 
more than 20 years. While through intense negotiations, Mr. Goodling 
and I were able to make some improvements to the Senate-passed Harris 
Trust language--and our amendment was adopted by the conference--I 
still must object to this language being included in this bill. For the 
record, I would like to explain why this provision should not be 
included in this bill.
  Those who manage and invest retirement funds have been subject to the 
wise fiduciary standards of ERISA--the Employee Retirement Income 
Security Act--for more than two decades. ERISA overhauled Federal 
pension law in 1973 after Congress found many loyal, long-term 
employees weren't getting the retirement money they were promised under 
their pension plans. Most important, ERISA makes sure those in control 
of your money are held to the highest standard of conduct--that they 
manage and invest your money under a duty of complete loyalty to you.
  Incredibly, this crucial standard of conduct--the backbone of our 
pension system--would be eroded by the legislation we are passing today 
as it applies to hundreds of billions of retirement dollars held by 
insurance companies. When the Senate passed their version of the 
minimum wage and small business tax bill, tucked within the bill was a 
provision exempting from ERISA's fiduciary standards the at least $300 
billion the industry holds in its general account contracts sold to 
pension plans. I can only assume the Senate, in passing this 
legislation, did not understand the implications for our retirement 
  The Senate bill overturns a 1993 Supreme Court decision, John Hancock 
Mutual Life Insurance versus Harris Trust, which conformed what the 
insurance industry has known for hears--that these fund are in fact 
subject to the ERISA fiduciary standards put in place to protect 
America's retirees. Before the Court's decision, insurance companies 
had mistakenly relied upon an unrelated Department of Labor 
pronouncement which they claimed exempted these general account 
contracts from the traditional protections of ERISA. The insurance 
industry has been lobbying Congress for 20 years for the sort of change 
they're getting--clear evidence they knew ERISA applies to these 
  Not only would this bill give the insurance industry a retroactive 
pardon for all past misconduct in handling these retirement dollars--
even willful violations--it would create a new, prospective, until 
1999, fiduciary standard weaker than ERISA, and prevent pension plans 
and participants--you--from suing under Federal law to recover your 
  As chairman of the employer-employee relations subcommittee with 
responsibility for ERISA matters, I strongly opposite letting this 
provision become law. As groups outside Congress become aware of this 
bill, opposition and outraged gelled.
  The American Association of Retired Persons, acting on behalf of the 
Nation's retirees, voiced its opposition, as has the Financial 
Executives Institute, a group of pension plan sponsors with more than 
$900 billion in assets--including BellSouth, Coca-Cola, Ford Motor Co., 
Motorola, and Procter & Gamble. Significantly, both the AFL-CIO and the 
Teamsters have also sent letters to Congress opposing this insurance 
industry bailout.
  Ironically, President Clinton is out campaigning telling you how much 
he wants to improve

[[Page H9843]]

your pension system while his Department of Labor is at the same time 
supporting this serious weakening of pension protection. Is the 
President unaware that this bill would excuse any misconduct, however 
egregious, that's taken place over the past two decades, and would 
weaken the protections retirees have under ERISA? And the Department of 
Labor, which is supposed to be America's pension watchdog, is selling 
out the retirement security of American workers. That anyone who cares 
about the integrity of our retirement system could support his 
unprecedented move to excuse past and future abuses to retirees defies 
  Perhaps most disturbing is the fact this provision has been attached 
to the unrelated minimum wage bill and is being passed without a single 
legislative hearing in the House or Senate. It has never been voted on 
by any Member of the House and was not included in the House-passed 
  Mr. MOAKLEY. Mr. Speaker, I yield 2 minutes to the gentleman from 
Texas, Mr. Gene Green.
  Mr. GENE GREEN of Texas. Mr. Speaker, I rise in support of the rule 
and the bill.
  Mr. Speaker, today is a good day for our Nation's working people, 
both men and women. What a difference a year makes. This Republican 
majority Congress passes a minimum wage increase. The world has 
definitely turned upside down. With the passage of this conference 
committee report, working Americans will finally see an increase in 
their wages. To again quote the late Senator from Texas, U.S. Senator 
Ralph Yarborough, we are putting the jam on the lower shelf for the 
little people to reach it. This is a day to celebrate.
  But we should not forget the Republican attempts to stonewall, 
derail, and defeat the increase. The American people brought the 
Republican majority to this point, in some cases kicking and screaming, 
with a few exceptions. My colleague, the gentleman from New York [Mr. 
Jack Quinn], is to be commended for his leadership on this effort.
  The credit should go to the American people, who made it absolutely 
clear to the Republican leadership that they expected an increase in 
the minimum wage. Eighty percent expected that. American workers 
understand that the purchasing power of the minimum wage will soon be 
the lowest in 40 years, and now they will make an additional $1,800 a 
year in their pocket to spend. Let us stop talking about it. Let us 
give the American people what they want and deserve, an increase in the 
minimum wage. The best welfare reform is a job that pays a decent wage.
  Mr. MOAKLEY. Mr. Speaker, it gives me great pleasure to yield 2 
minutes to the gentleman from California [Mr. Miller], ranking minority 
member of the Committee on Resources.
  (Mr. MILLER of California asked and was given permission to revise 
and extend his remarks.)
  Mr. MILLER of California. Mr. Speaker, I thank the gentleman for 
yielding time to me.
  Mr. Speaker, I rise in strong support of this legislation. It has 
been a long time coming, Mr. Speaker, to give the people of this 
country a minimum wage increase, to give those who work so very hard, 
sometimes at the lowest wages, with long hours and in difficult jobs, 
to finally give them a pay raise.
  Let us remember, though, that this minimum wage increase has been 
fought tooth and nail by the Republican leadership. We had to have over 
a dozen procedural votes before we could finally get the attention of 
the Republican leadership on this legislation.
  In the Senate they did everything they could to stifle the 
consideration of this legislation. It was only because of the tenacious 
nature of Senator Kennedy and Senator Daschle to bring the Senate to a 
stall, to a stop, to a complete ending of business, before they could 
get consideration. Only after the Senate did that did we see the 
Republican leadership here concede that America was entitled to a 
minimum wage increase.
  Mr. Speaker, the fact is, these Americans have been entitled to this 
minimum wage increase for many years. I want to commend our colleague, 
the gentleman from Michigan [Dave Bonior], who came to this floor on 
one vote after another and tried to force this issue. I want to commend 
our colleague, the gentleman from New York [Jack Quinn], who finally 
showed courage and separated from that leadership, and recognized the 
need of people to have this increase in the minimum wage.

  I also want to remember the gentleman from Texas [Mr. Armey], the 
majority leader, who said he would fight this with every fiber of his 
body, he would fight this and never allow this to happen. The American 
people are about to win, and because of the persistence of the 
Democratic leadership in the House and Senate, an increase is going to 
happen for the minimum wage.
  This is going to be an improvement for people's lives. This is going 
to allow people to leave welfare. This is going to reduce our food 
stamp contributions, our housing contributions, our other welfare 
payments, because now employers will have to start paying people a 
liveable wage and no longer have to subsidize unemployment.
  Mr. MOAKLEY. Mr. Speaker, I yield 2 minutes to the gentleman from 
West Virginia [Mr. Wise].
  Mr. WISE. Mr. Speaker, let me just say hallelujah, because when this 
Congress started a year and a half ago, I would not have predicted this 
day. There are a lot of things that I would have predicted would have 
happened in this session of Congress, but an increase in the minimum 
wage, the first legislated increase since 1989, I would not have 
  The good news is that miracles do happen. The good news is that those 
who say that they are going to fight a minimum wage increase with every 
fiber of their being can often be proved wrong. This is a very 
important day for West Virginians as well as Americans.
  There are 112,000 payroll jobs in West Virginia that will see an 
increase because of this minimum wage increase, going from $4.25 to 
$5.15. That is roughly 17 percent of the payroll jobs in our State. It 
means that the delay that people have been facing, in which $2 million 
a week in payroll has been lost because there has not been a minimum 
wage increase, that will no longer take place.
  Yes, Mr. Speaker, I have heard the complaints of small business. I 
appreciate them. I know many of our small businesses are struggling. 
But there are also tax provisions that will assist them and that will 
prove beneficial.
  Additionally, Mr. Speaker, I think it has to be recognized that while 
the minimum wage has stayed the same since 1991, the last increase, all 
other costs of business have gone up. What about that minimum wage 
recipient? Nobody has said anything at the grocery store about keeping 
prices low because their wages have not gone up. Nobody said anything 
at the utility about keeping prices low because their wages have not 
gone up. Nobody said anything, when they have to go out and try and 
find an automobile to get to work, about keeping the price low because 
their minimum wage has not gone up.
  The fact of the matter is, if we want people to be able to make it in 
today's society, we have to occasionally give them a minimum wage 
increase. This House yesterday passed a welfare reform bill. It 
stresses work. I supported that bill. If we are going to stress work, 
we have to make sure that people can make a livable wage when they get 
that work. The minimum wage increase today brings that a little closer 
to reality.
  Mr. MOAKLEY. Mr. Speaker, it gives me great pleasure to yield 2 
minutes to the gentleman from New Jersey [Mr. Andrews].
  (Mr. ANDREWS asked and was given permission to revise and extend his 
  Mr. ANDREWS. Mr. Speaker, I thank the gentleman from Massachusetts 
[Mr. Moakley] for yielding time to me.
  Mr. Speaker, sometimes the measure of a legislative body is who it 
listens to. The majority this year listened to a certain elite group of 
citizens who said they wanted to renounce their citizenship in order to 
avoid paying taxes, and they got what they wanted.
  The majority this year listened to corporate America that wanted to 
continue to flood our campaigns with political contributions, and they 
got what they wanted. The majority this year listened to the huge 
argribusiness that get billions and billions of dollars of welfare 
checks from the public Treasury, and they got what they wanted.
  Today a bipartisan majority of Republicans and Democrats is going to

[[Page H9844]]

listen to the people who sweep our floors, wash our dishes, take care 
of our children, and do the hard work of America, and finally they are 
going to get what they rightfully deserve, an increase in the minimum 
wage of this country.
  We have lad a lot of talk on this floor this week about the 
desirability of work. Talk is cheap. What is more important about the 
desirability of work is to say to someone who washes dishes or sweeps 
floors or works in a child care center, your work counts, too.
  By rising today in support of this rule and this bill, we are finally 
going to say to the Americans that no one ever listens to, thank you 
for a job well done. America does need a raise. Today the most 
deserving Americans are going to get one.
  Mr. SOLOMON. Mr. Speaker, yield 3 minutes to the distinguished 
gentleman from Stamford, CT, Chris Shays.
  Mr. SHAYS. Mr. Speaker, I thank the gentleman for yielding time to 
  Mr. Speaker, this is an historic day I am thrilled to be able to 
celebrate. This is, in fact, a bipartisan effort. Republicans wanted a 
tax cut, and some Democrats wanted a minimum wage, and some 
Republicans. We united in a common goal to do both. We have $8 billion 
of tax cuts for businesses who are going to hire the most unemployable 
in our society. We have a minimum wage for those who work for the least 
  As my colleagues, the gentleman from New York [Mr. Quinn], a leader 
in this effort pointed out, this is not just an historic day, it is an 
historic week, because we passed welfare reform. We want to get people 
off of welfare and onto work. It is very important that we have a 
minimum wage that is competitive with welfare.
  Welfare recipients will have a minimum wage that will not pay them 20 
percent more. In a 40-hour workweek they were making $8,000. They will 
now receive $10,000. This was an effort that would not have passed had 
it not been bipartisan.
  I might just express one slight concern with the bill. We are kind of 
distorting the concept of how we classify workers, and this is an issue 
we are going to have to find a way to address, because we have too many 
workers who work as outside consultants who then are not paid certain 
benefits. I just want to lay that on the table for the record. We have 
to find a way to make sure that workers are properly classified.
  But this bill does two things it needs to do. It provides tax cuts 
and it provides a livable minimum wage. No one can live, in my 
judgment, on a minimum wage if they only work 40 hours a week. But tell 
me, what people in society only work 40 hours a week and succeed? This, 
to me, is truly an historic day. I congratulate both Republicans and 
Democrats on their combined effort to provide a minimum wage and tax 
cut for those businesses that need it.
  Mr. MOAKLEY. Mr. Speaker, it gives me great pleasure to yield 1 
minute to my colleague, the gentleman from Massachusetts [Mr. Frank].
  Mr. FRANK of Massachusetts. Mr. Speaker, I congratulate all of those 
who helped bring forward this increase in the minimum wage, a small but 
important step toward social equity which we very much need.
  I also want to express my appreciation within this bill to the U.S. 
Treasury Department, to the Committee on Ways and Means, the chairman, 
the gentleman from Texas, and the ranking member. My colleague, the 
gentleman from Massachusetts, and I approached them on behalf of 
fishermen in the greater New Bedford area who were caught up unfairly 
in a tax dispute. They found themselves, in effect, retroactively 
taxes, I believe. We made our case. These are very hardworking people, 
already facing great difficulties because of conservation-imposed 
  I am very appreciative of the willingness of the Committee on Ways 
and Means, on a bipartisan basis, to entertain our requests; the 
Treasury Department, to make a rare exception and say retroactively 
would be acceptable in this case; and I am pleased that as part of this 
bill, some very hardworking people in the greater New Bedford area will 
get the tax relief they are entitled to. They are getting nothing they 
should not have had in the first place. They have been through a lot of 
expense and aggravation to get here, but at least from now on they will 
not have this burden.
  Mr. MOAKLEY. Mr. Speaker, I yield 1 minute to the gentleman from 
California [Mr. Martinez].
  (Mr. MARTINEZ asked and was given permission to revise and extend his 
  Mr. MARTINEZ. Mr. Speaker, I thank the gentleman very much for 
yielding time to me.
  Mr. Speaker, I rise, on a rare occasion that I take the well, to 
congratulate all those people whose persistence paid off in bringing us 
this minimum wage bill. It truly is a bipartisan bill. I know there 
were people in the leadership on one side of the aisle that had made 
comments, I think very drastic comments, about withholding this piece 
of legislation. Eventually, better minds prevailed and this is being 
brought to the floor now.
  On behalf of my constituents, I very sincerely thank you. I do not 
care whether you make $100,000 or $10,000, you actually want a raise, 
because the cost of living continues to go up. Finally, the people that 
were persisting in this made people realize that we need to have a 
minimum wage increase.
  Let me tell the Members that in California, though, we have an 
initiative on the ballot, and every poll has indicated that that 
particular ballot proposition will pass overwhelmingly. It will pass 
overwhelmingly, for the reason I just stated.
  If we need to be vindicated in what we do today, just watch that 
California vote, because I can guarantee the Members that it will be a 
landslide. It will be people from all walks of life, from both sides of 
the aisle, Republicans and Democrats alike, and even Libertarians, that 
will vote for that particular initiative. I guarantee the Members, we 
are in the right ball field in the right ball game.
  Mr. MOAKLEY. Mr. Speaker, I yield 2 minutes to the gentleman from 
Vermont, the Honorable Bernie Sanders.
  (Mr. SANDERS asked and was given permission to revise and extend his 
  Mr. SANDERS. Mr. Speaker, ever since my first day in Congress I have 
been fighting to raise the minimum wage. The simple truth is that the 
purchasing power of the minimum wage today is 26 percent less than it 
was in 1970, which means that our minimum wage workers today are much, 
much poorer and harder pressed than they were in the past.
  The fact of the matter is that millions and millions of American 
workers cannot survive, cannot live in dignity on $4.25 an hour, and I 
am glad now today, finally, we are going to be raising the minimum wage 
to $5.15 an hour, although in truth, we should be raising it higher 
than that.

                              {time}  1000

  The reality of the American economy is that more and more of the new 
jobs that are being created are low-wage jobs, they are part-time jobs, 
they are temporary jobs without benefits. Today we are saying to those 
workers that at least you are going to be getting $5.15 an hour and 
that is long overdue.
  The second part of this bill, which is also a positive step forward, 
is that we are saying to small businesses in Vermont and all over this 
country that we understand that you and not corporate America who are 
taking our jobs to China and Mexico but you, small businesses, are the 
people who are creating the new jobs in Vermont and in California and 
all over this country, and that you and not big business are entitled 
to the tax breaks that you desperately need so that you can reinvest in 
our communities and create more jobs.
  So this bill ultimately does two very important things: It says to 
every worker in America that you are going to make at least $5.15 an 
hour and it says to the small businesses of this country who are 
creating the new jobs that this Congress hears what your problems are 
and we are going to give you some tax breaks so you can reinvest and 
create more jobs.
  Mr. SOLOMON. Mr. Speaker, Addison, MI, is very fortunate to have an 
outstanding representative by the name of Nick Smith.
  I yield 2 minutes to the gentleman from Michigan [Mr. Smith].

[[Page H9845]]

  Mr. SMITH of Michigan. Mr. Speaker, I thank the chairman for yielding 
me this time and certainly for that introduction.
  It is so frustrating listening to the debate, pretending that 
Congress can somehow create more wealth by passing a law saying you 
increase wages. Do we think $5.15 an hour is that great of an income? 
Do we think that is the correct rate for people to survive? If anybody 
thought Congress could do it, why in the world are we not raising it to 
$10 or $12 or a respectable living for an American family of $14, $16? 
It is because Government cannot set prices. That is not the way our 
system works.
  Let me tell my colleagues how I think it works. I think competition 
is just as important in the labor force as it is in the total economy 
of this country. The free market with competition is what has made us 
so great.
  If we want to improve the chances of people to increase their 
salaries, then one thing we need is to have competition in the labor 
market with better mobility of labor. The bill that we passed yesterday 
that allows a person working to be assured that their health care can 
go with them as they go looking for a better job is a good step toward 
improving mobility of labor.
  Another area that needs attention if we really wanted to help 
mobility, to help assure the highest possible wage would be to allow 
accrued pension benefits earned to go with the worker to the next job. 
Another thing we could do would be to provide better information 
regarding jobs and job skills that are and will be in high demand.
  The pretense by liberals that we can somehow magically pass a law and 
set prices and wages to improve our standard of living is ridiculous, 
and is contrary to the economic system that made this country great.
  Mr. MOAKLEY. Mr. Speaker, I yield 2 minutes to the gentlewoman from 
North Carolina [Mrs. Clayton].
  Mrs. CLAYTON. Mr. Speaker, I thank the gentleman from Massachusetts 
for yielding me this time.
  We are going to do something for workers today, and I am delighted. I 
am delighted at last we will have a final vote on the minimum wage 
increase today. The American people wanted this, 8 out of 10, and I am 
pleased that both Democrats and Republicans also will make this a 
reality. Twelve million workers certainly deserve better than to be 
working at their current level. Yes, the minimum wage that we are 
raising is not sufficient, but indeed the minimum wage increase will 
raise that to a level which will be a livable wage.
  The minimum wage worker now earns about 50 percent less if you equate 
the value of the raise now to the cost and the value some years ago. It 
means that the minimum wage we are increasing then is still not 
sufficient, but nevertheless this is an important first step. At least 
117,000 or more persons who live in my State will have the benefit of 
this increase.
  What will this mean to them? Obviously it will mean 90 cents over 2 
years, for a 2-year period, but that increase will mean $1,800 a year. 
That means it will make a difference in their lives and their families, 
their ability to provide for their families food and shelter, clothing 
and education. While indeed the cost of bread and eggs and a place to 
sleep and clothes to wear, a bus ride or even a ride to the doctor has 
increased, this minimum wage is beginning to approach that increase in 
the cost of living.
  We are now at the threshold, I think an important threshold, of 
saying that the American workers also need to have some of the 
abundance of our economy. Just as our corporate structure has great 
profits and our executives have great increases in their salary, we are 
saying to the average worker, they too can have a benefit. I am 
delighted that we are going to pass this. This is a historic day.
  Mr. MOAKLEY. Mr. Speaker, I yield 2 minutes to the gentleman from 
Maryland [Mr. Cardin].
  (Mr. CARDIN asked and was given permission to revise and extend his 
  Mr. CARDIN. First let me thank my friend, the gentleman from 
Massachusetts [Mr. Moakley], for yielding me this time.
  Mr. Speaker, there are many reasons to support this rule and the 
conference report. It contains very important provisions increasing the 
minimum wage and extending some very important tax credit provisions 
that will help create more jobs and investment in our community.
  I would like to just mention one provision in the conference report 
that I take pride that we are finally going to get enacted, that is, 
pension simplification that will help many businesses in this country 
and many small businesses particularly. I started working on this issue 
5 years ago when I filed legislation in this area. I did it because the 
savings ratios of this country indicate very clearly that we must 
encourage more private sector investment and savings.
  Retirement plans, particularly for small companies, were on the 
decline because of the red tape and difficulty in establishing a 
pension plan for small businesses. In 1992 many of the provisions that 
are included in this conference report were passed by a Democratic 
Congress and vetoed by a Republican President for reasons totally 
unrelated to the retirement provisions, because they were included in 
an omnibus bill. Then again on 1995 these provisions were passed by a 
Republican Congress, vetoed by a Democratic President, again for 
reasons totally unrelated to the retirement provisions.

  The third time is the charm. It looks like we are finally going to 
get these provisions enacted into law. I particularly want to thank the 
gentleman from Ohio [Mr. Portman] for the work that he has done on 
pension simplification. I want to thank the gentleman from Texas [Mr. 
Archer], chairman of the Committee on Ways and Means, and the gentleman 
from Florida [Mr. Gibbons], the ranking member, for making sure that 
these provisions were included in this very important legislation.
  This is a very important provision for the small businesses in our 
country. it will allow them to expand and set up retirement 401(K) 
plans that will encourage more people to be able to plan for their 
retirement. I congratulate the committees for including this in the 
  Mr. MOAKLEY. Mr. Speaker, I yield 2 minutes to the gentleman from 
Mississippi [Mr. Taylor].
  Mr. TAYLOR of Mississippi. Mr. Speaker, I want to compliment the 
Rules Committee for bringing this bill forward today.
  One of my friends spoke a little earlier and said that Congress 
cannot determine wealth or it cannot set wages. Yet every year for the 
7 years that we have both been here, Congress has given our senior 
citizens a COLA, cost of living increase, on their Social Security 
check. For each of those 7 years, we have given retired Federal 
employees a cost of living adjustment on their check. For each of those 
7 years, we have given our military retirees a cost of living 
adjustment on their check, not for what they are doing but for what 
they have done. And no one stood up and said we should not do this, 
because everyone realized that the cost of living has gone up.
  This week speaker after speaker came to the podium and said that 
people should value work, and I agree. But if people should value work, 
then work must have value. And so, yes, the least fortunate in our 
society, those who by and large have the toughest jobs, they deserve a 
wage increase. I want to compliment the gentleman from New York [Mr. 
Solomon], and I want to compliment the gentleman from Massachusetts 
[Mr. Moakley] for bringing this bill to the floor today. It is long 
overdue. Let us help those people out.
  Mr. MOAKLEY. Mr. Speaker, I have no further requests for time, and I 
yield back the balance of my time.
  Mr. SOLOMON. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, I think it was the gentleman from West Virginia that 
stood up a few minutes ago and said, ``Hallelujah, I never thought this 
day would come when we would have this bill on the floor.'' He was 
talking about raising the minimum wage. I guess I would have to turn 
around and say, hallelujah, I thought this day would never come, 
either, because for the last 2 years we have been trying to give some 
tax relief to working men and women, to small businesses in this 
country, and, yes, it is so terribly important that we do raise the 
minimum wage like the gentleman from Mississippi said. That is 
important. But just as important, Mr. Speaker, is the fact that

[[Page H9846]]

we have to give some tax relief to small businesses to help offset the 
cost of the minimum wage increase.
  I could go down through this list. There is $22 billion in tax relief 
for the American people in this bill: Increases in expensing for small 
businesses. That is terribly important. Home office deductions so that 
people can run their businesses out of their home, particularly women 
who have to stay home with children and still want to operate a 
business. There is tax relief in there. To expand eligibility for 
first-time farmers. Industrial development bonds. This is more for 
first-time farmers. I could go through this whole list. Employer-
provided educational assistance. Contributions for stock to private 
foundations to help the charities in this Nation. It goes on and on and 
  Mr. Speaker, this is a good piece of legislation, it does provide for 
the increase in the minimum wage, but it also provides for $22 billion 
in tax relief for the American people. That is why we should all come 
over here, vote for this rule, and vote for the outstanding bill that 
the gentleman from Texas [Mr. Archer] will be bringing to the floor in 
just a few minutes.
  Mr. Speaker, I yield back the balance of my time, and I move the 
previous question on the resolution.
  The previous question was ordered.
  The resolution was agreed to.
  A motion to reconsider was laid on the table.
  Mr. ARCHER. Mr. Speaker, pursuant to House Resolution 503, I call up 
the conference report on the bill (H.R. 3448) to provide tax relief for 
small businesses, to protect jobs, to create opportunities, to increase 
the take home pay of workers, to amend the Portal-to-Portal Act of 1947 
relating to the payment of wages to employees who use employer-owned 
vehicles, and to amend the Fair Labor Standards Act of 1938 to increase 
the minimum wage rate and to prevent job loss by providing flexibility 
to employers in complying with minimum wage and overtime requirements 
under that Act.
  The Clerk read the title of the bill.
  The SPEAKER pro tempore (Mr. LaTourette). Pursuant to House 
Resolution 503, the conference report is considered read.
  (For conference report and statement, see proceedings of the House of 
Thursday, August 1, 1996, at page H9568.)
  The SPEAKER pro tempore. The gentleman from Texas [Mr. Archer] and 
the gentleman from Florida [Mr. Gibbons] will each be recognized for 30 
  The chair recognizes the gentleman from Texas [Mr. Archer].

                             general leave

  Mr. ARCHER. Mr. Speaker, I ask unanimous consent that all Members may 
have 5 legislative days within which to revise and extend their remarks 
and include extraneous material on the conference report on H.R. 3448.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from Texas?
  There was no objection.
  Mr. ARCHER. Mr. Speaker, I ask unanimous consent that I allot 15 
minutes to myself for distribution and, subsequent to the conclusion of 
that, 15 minutes to the gentleman from Pennsylvania [Mr. Goodling], 
chairman of the Committee on Economic and Educational Opportunities, so 
that he may distribute that time according to his discretion.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from Texas?
  There was no objection.
  Mr. ARCHER. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, today the House is on the verge of enacting the first 
major tax bill of this new historic did-something Congress. It is great 
to report to the American people that this bill provides tax relief and 
not tax increases. What a difference this new Congress is making in the 
lives of the American people.
  This bill actually is three bills: We have combined many of the items 
in the Small Business Relief Act with the adoption tax credit and with 
the trade bill renewing the generalized system of preferences, also 
known as GSP. I am really not sure what to call this new bill, except 
to call it a helping hand for millions of Americans struggling to make 
ends meet.

                              {time}  1015

  This bill awards three gold medals to the American people. The first 
gold medal goes to millions of small businessmen and women so that 
their companies can grow, prosper and create jobs.
  The second gold medal goes to hundreds of thousands of loving 
families who seek the joy of adoption and the children who will benefit 
from that love.
  The third gold medal goes to millions of Americans who worry about 
their ability to retire with comfort and security. The two dozen 
pension changes in this bill will make it easier for people to save for 
retirement and protect their retirement nest eggs so that these savings 
will be secure.
  I especially want to note that this bill will end the discrimination 
against homemakers, usually women, that stay in the home to take care 
of children and to do what is so important to our society, and in doing 
so that has stopped them from getting the same individual retirement 
deduction allowed to those who work outside the home. So we have a new 
homemaker IRA that is a great addition to this bill. It is a part of 
this bill that also helps people retire with comfort and security.
  Let me add one other thing. This bill, together with the health bill 
that we passed last night, updates and closes several corporate tax 
loopholes, particularly the section 936 tax break for companies doing 
business in Puerto Rico and a big loophole that benefitted insurance 
  I am pleased to note that we are taking action to close tax loopholes 
just as we said we would at the beginning of the Congress last year. I 
am proud that the new Republican Congress is getting the job done.
  Mr. Speaker, as I said earlier, by giving tax relief and pension 
security to the American people, this Congress is doing the people's 
business and doing it right. Democrats and Republicans, on a bipartisan 
basis, are working together, and that is good government.
  Mr. Speaker, this new Congress is moving America in the right 
direction, and I am pleased that President Clinton is going to join 
with us by signing this bill. It has been a great week for the 
Republican Congress and it has been a great 2 years of accomplishment 
for our efforts to reform Congress and change America.
  Mr. Speaker, I reserve the balance of my time.
  Mr. GIBBONS. Mr. Speaker, I ask unanimous consent to yield 15 minutes 
of my time to the gentleman from Missouri [Mr. Clay], and that he may 
further yield that time.
  The SPEAKER pro tempore (Mr. LaTourette). Is there objection to the 
request of the gentleman from Florida?
  There was no objection.
  Mr. GIBBONS. Mr. Speaker, I yield myself 2 minutes.
  Mr. Speaker, this is a very important piece of legislation, 
particularly the minimum wage part, but I shall dwell on the part that 
is germane to the Committee on Ways and Means and talk about that.
  As best I have been able to tell, from all search and research and 
participation, this bill is a fair bill. It contains little if nothing 
that was not in either the House bill or the Senate bill and it stays 
within the germaneness of the topic that we are dealing with.
  There are many fine adjustments in here that are perhaps warranted. I 
believe they are warranted because the Internal Revenue Code is 
probably the most complex document that exists on the face of this 
Earth and it, from time to time, needs adjusting.
  The adjustments here were done with the help of a very competent 
staff and under the direction of, I think, a very conscientious 
chairman of the Committee on Ways and Means. The gentleman from Texas 
[Mr. Archer] was fair, he was principled, and he did a good job of 
putting this bill together and controlling it through conference.
  I urge the Members to support this bill. It is extremely thick and 
complex. The conference report is about six inches thick. It will 
probably take a week to print, but I believe it is an important and 
well-produced document. I urge favorable consideration and passage of 
this bill.
  Mr. CLAY. Mr. Speaker, I yield myself 2 minutes.
  Mr. Speaker, I am pleased that at long last a Congress will provide 
hard-working wage earners a well-deserved raise. I commend the 93 

[[Page H9847]]

the 1 Independent, and the 187 Democrats who made this increase 
possible with their vote to raise the minimum wage.
  Mr. Speaker, I cannot resist expressing my disappointment with the 
Republican leadership that attempted to sabotage this badly needed 
increase for our workers. The Republican leadership has fought this 
effort with every fiber of their beings. For months the Republican 
leadership refused even to allow the committee of jurisdiction to hold 
a hearing on the minimum wage.
  When forced to bring the bill to the floor, the Republican leadership 
tried to gut the legislation, tried to exempt most employers from the 
obligation to pay the minimum wage.
  In this conference report the Republican leadership has needlessly 
postponed the minimum wage increase by 1 month in 1996 and, incredibly, 
by 2 months in 1997. At every turn the Republicans have felt compelled 
to nickel and dime low-wage workers and their families. Now some to 
them want the American workers to believe that the leadership of the 
Republican Party are giving them a raise.
  Mr. Speaker, I am also extremely disappointed that the conferees 
included a special interest provision, the so-called Harris Trust 
provision, that weakens the protection for pension participants and 
beneficiaries. The final conference report moderates that provision 
somewhat by providing that ERISA shall be fully applicable to pension 
plan contracts with life insurance companies issued after 1998. 
However, the Harris Trust provision should never have been included in 
the first place.
  Despite serious misgivings, Mr. Speaker, I support the conference 
report. American workers deserve a fair day's pay for a fair day's work 
and we cannot afford to delay an increase any longer.
  Mr. ARCHER. Mr. Speaker, I yield myself 1 minute. I do so to thank my 
colleague, the ranking Democrat on the Committee on Ways and Means, the 
gentleman from Florida [Mr. Gibbons], who will be retiring at the end 
of this Congress, for his kind comments about how we put this bill 
  We did it, Mr. Speaker, on a bipartisan basis, the way the Committee 
on Ways and Means should operate. Members from both sides of the aisle 
had a chance to make an input. I do agree with the gentleman from 
Florida, naturally, that I think we have a good bill, but I am grateful 
for his comments and I want to compliment him for his input in making 
this bill the good bill that it is.
  Mr. Speaker, I yield 3 minutes to the gentlewoman from Connecticut 
[Mrs. Johnson], the distinguished chairman of the Subcommittee on 
Oversight of the Committee on Ways and Means.
  Mrs. JOHNSON of Connecticut. Mr. Speaker, this is truly a great day 
for the American people. This is a good bill but it is a result of 
outstanding leadership.
  Let me make plain that as one of those who supports increasing the 
minimum wage, I feel honored to stand here today in support of a bill 
that not only does that but recognizes the ramifications of increasing 
the minimum wage on our society and protects, for example, job 
opportunities for teenagers in the summer, and protects small 
businesses by giving them a series of preferred tax treatments to lower 
their costs of doing business.
  This bill opens up pension opportunities for employees of small 
businesses. It dramatically helps women. For the first time it puts in 
the law the legislation we need to give women who stay home and take 
care of the children the same IRA rights as anyone else in America.
  This is a sea change. This is good legislation. This is about 
equality for all of us. This is about building a strong future for the 
families of our Nation.
  Mr. Speaker, there is also a very important provision that we have 
worked on for many years, giving our small businesses greater expending 
rights so that they can expense out the costs of machinery and 
equipment, computers and so on, and add more jobs, grow more rapidly.

  In a society where small business is driving job growth, the kind of 
help this bill gives to small business is indeed critical and key to 
leading our Nation to enjoy a more rapid rate of economic growth, job 
growth, and job opportunities for career advancement for our people.
  Last, I want to mention the R tax credit in this bill. I regret we 
could not do it retroactively, I regret we could not do it many more 
years out to the future, but we have reformed it in a way that small, 
inventive little companies, our future, those companies will be able to 
take advantage of it.
  We have also restructured it in a way that the old defense companies 
that we need to be able to turn around, we need to be able to do new 
product research, we need to be strong in 10 years, will also benefit 
from the R tax credit for the first time in many years.
  This bill before us helps families in numerous ways, not only 
increasing the minimum wage but also increasing pension opportunities, 
saving opportunities, job opportunities, and it strengthens the very 
sector on which our future growth, job expansion, and well-being 
depends, the small business sector.
  Mr. Speaker, I thank the chairman for his extraordinary leadership 
and for the work of both sides on this bill.
  Mr. ARCHER. Mr. Speaker, will the gentlewoman yield?
  Mrs. JOHNSON of Connecticut. I yield to the gentleman from Texas.
  Mr. ARCHER. Mr. Speaker, I want to compliment the gentlewoman for 
driving the expensing for small business. She was the one who pushed 
and pushed and pushed to get this in the bill.
  Mr. GIBBONS. Mr. Speaker, I yield 2 minutes to the gentleman from 
Massachusetts [Mr. Neal].
  (Mr. NEAL of Massachusetts asked and was given permission to revise 
and extend his remarks.)
  Mr. NEAL of Massachusetts. Mr. Speaker, I thank the gentleman from 
Florida, and, like the gentleman from Texas [Mr. Archer], I want to 
thank him for the many remarkable years of service in this institution, 
and for those of us on the minority side of the Committee on Ways and 
Means, we want to thank him for the leadership he has provided during 
the past 18 months.
  I also want to thank Chairman Archer for the provision in this 
legislation that deals with the New Bedford fishermen, which was a 
contentious issue for many years. I am grateful we were able to resolve 
this issue in an amicable manner.
  I want to ask the following rhetorical question, if I can, for just a 
second. Last year in this House we voted more than 1,000 times. Here we 
are now, in the middle of the Olympics, with a tangible accomplishment 
for the American people in this piece of legislation. Why do we not ask 
ourselves this: What did we accomplish in this institution last year 
with 1,000 votes?
  Well, we certainly satisfied the psychology of an element that got 
elected. We made them happy that they were able to go home and point to 
some headline-grabbing news that really had little consequence for the 
American people, but we spent 5 days a week and sometimes 5 nights a 
week on this floor and in this institution talking about things, again, 
that had little relevance to the American people.
  So here we are on the day before the House recesses, with a tangible 
piece of legislation, and it is in the middle of the summer Olympics, 
so we cannot report back to the American people on what we have done 
during the last week.
  We have a good increase in the minimum wage. What did the majority 
leader of the Republican Party say? He was going to do everything he 
could to stop that bill from ever happening. That is what we did last 
  There is an improvement here in spousal IRA's, which I have sponsored 
and pushed hard for. That should have been done last year. We, in fact, 
should have done a more expansive individual retirement account piece 
of legislation that we all could have taken satisfaction from its 
passage having occurred.
  One thousand votes last year. We should ask ourselves, what did we 

                              {time}  1030

  Mr. CLAY. Mr. Speaker, I yield 2 minutes to the gentleman from New 
York [Mr. Owens].
  (Mr. OWENS asked and was given permission to revise and extend his 
  Mr. OWENS. Mr. Speaker, I agree with the gentlewoman from Connecticut 
[Mrs. Johnson], my classmate, my Republican colleague, that this is a

[[Page H9848]]

``see'' change. This is a very important change. This Congress should 
congratulate itself. We did in a bipartisan way finally come to grips 
with the common sense of the American people. The common sense of the 
American people came home to us.
  The polls showed that almost 90 percent of the American people wanted 
a minimum-wage increase. This is important for people at the very 
bottom of the rung. It does not seem like much, an increase of 90 cents 
over a 2-year period. But it will buy shoes, it will buy beans, it will 
buy rice. This is very important to these other people that have been 
left out while prosperity soared in America. It is very important that 
we begin to reward work.
  There are a lot of very powerful people who have spoken loudly about 
moving from welfare to work in the last few weeks. Well, the burden of 
proof is on them. Will there be work or jobs? In my district you 
mention a job, and people line up in long lines and hundreds of people 
go away disappointed because there are only a few jobs.
  So let us create the jobs first, and let us make the jobs pay minimum 
wage. There is a lot of work to be done, but work is not a job unless 
it is paid properly. We need the minimum wage plus a health care 
package. A real job is minimum wage plus a health care package. It is 
up to us to try to create that. Start with the minimum wage.
  We also want those health care packages for everybody. People on 
welfare find they are better off not going to work because they lose 
their health care. Let us finish the job, but begin with the minimum 
wage. We want work. The tremendous economic gap exists, with the top 5 
percent of the American people, income earners, earning huge profits 
while at the very bottom they have found their wages have gone down in 
the past 20 years. If we really increase the minimum wage to a level 
where it would keep pace with inflation, we would be talking about a 
$6.25 increase.
  Mr. Speaker, let us reward work and pay what it is worth so that 
people will go to work.
  MR. ARCHER. Mr. Speaker, I yield 1 minute to the gentleman from 
Minnesota [Mr. Ramstad], a distinguished member of the Committee on 
Ways and Means.
  Mr. RAMSTAD. Mr. Speaker, I thank the chairman for yielding, and I 
rise today to enter into a brief colloquy with the gentleman from Texas 
[Mr. Archer]. First of all, I want to commend the gentleman for his 
outstanding leadership in bringing this legislation to the floor.
  I am concerned, however, about regulations that were just issued by 
the IRS in May regarding the section 936 possession tax credit therein. 
I believe these regulations will have an unfair impact on companies 
during the phaseout of section 936 because they cast aside regulatory 
rules upon which companies have relied for many years permitting arm's-
length pricing in the purchase of components. They produce a 
discriminatory result that an arm's-length third party price can be 
used to value outbound sales of components but not inbound purchases by 
the possession company for purposes of the section 936 calculation.
  Mr. Speaker, I believe that a fair and workable solution can be 
developed to address these concerns, and I would ask that the chairman 
join me in strongly encouraging the Treasury Department to seek such a 
  Mr. ARCHER. Mr. Speaker, will the gentleman yield?
  Mr. RAMSTAD. I yield to the gentleman from Texas.
  Mr. ARCHER. Mr. Speaker, I am happy to join the gentleman from 
Minnesota [Mr. Ramstad] in strongly encouraging the Treasury Department 
to do that.
  Mr. RAMSTAD. Mr. Speaker, I thank the gentleman for his agreement and 
also for his leadership.
  Mr. ARCHER. Mr. Speaker, I yield 2 minutes to the gentleman from Ohio 
[Mr. Portman], a distinguished member of the Committee on Ways and 
  (Mr. PORTMAN asked and was given permission to revise and extend his 
  Mr. PORTMAN. Mr. Speaker, I thank the gentleman from Texas [Mr. 
Archer] for the time. This is a guy who has had his own legislative 
marathon this week during the Olympics, and he deserves a medal because 
he has achieved a lot of good legislation for America.
  Mr. Speaker, I want to talk about a gem hidden in this bill, and I do 
not want it to be lost. It is simplification of our pension laws and 
strengthening of retirement savings for all Americans.
  My friend from Maryland [Mr. Cardin] and I have pushed this 
legislation, because we want to expand retirement security for all 
Americans. It is in this bill and something very important for America 
and for American workers.
  These days 401(k)'s profit-sharing plans, and other pension plans are 
being used less and less because, frankly, they are overregulated. 
Today small businesses, for the most part, do not offer any kind of 
retirement savings at all. Of those companies under 20 employees, fewer 
than 20 percent of them offer any pension savings plans at all.
  Since 1980, Congress has passed an average of one law per year 
affecting private sector pensions. Congress has increasingly 
complicated this area, and as these rules and regulations have 
multiplied, retirement savings plans have become less and less 
attractive. They are too costly to set up and too costly and burdensome 
to maintain, particularly for small businesses that cannot afford 
either the inside or outside professional help to make their way 
through the bureaucratic maze.
  As a result, these days pension plans are being terminated around 
this country faster than they are being established. The bottom line is 
that if this legislation is enacted, which I think it will be now, it 
will encourage private savings, it will help the economy because we 
need to increase our savings rate, and, most importantly, it will allow 
more people to plan for their future.
  Mr. Speaker, I applaud the gentleman from Maryland [Mr. Cardin] and 
the gentleman from Texas [Mr. Archer], as well as the other conferees, 
for including this legislation in this report, and I hope that this 
legislation receives the support of all Members of the House.
  Despite the fact that these important pension simplification 
provisions are included in the conference report, I am concerned that 
this bill will also raise the minimum wage. In my view, this is a 
misguided and regrettable effort, because I fear it will hurt the very 
working people we are trying to help. Thankfully, because of Chairman 
Archer's leadership, we added the pension reform and other provisions 
that will help to mollify the effect of his legislation on small 
business. For that reason, I will vote in favor of this bill, despite 
my deep concerns about the effects of the minimum-wage increase on 
working people at the low end of the economic ladder, on small 
businesses and on local and State governments.
  Mr. ARCHER. Mr. Speaker, I yield myself 15 seconds in order to 
compliment the gentleman from Ohio [Mr. Portman] and the gentleman from 
Maryland [Mr. Cardin] because it was their efforts that put this 
pension simplification provision in the bill.
  Mr. GIBBONS. Mr. Speaker, I yield 2 minutes to the gentleman from 
North Dakota [Mr. Pomeroy].
  Mr. POMEROY. Mr. Speaker, I thank the gentleman for yielding. This is 
vital legislation, and I applaud those on the majority caucus that 
broke away from their leadership that was doing everything possible to 
stop a minimum wage increase and joined with us in the minority to 
reach the critical mass necessary to pass the minimum wage and get 
these workers at the lowest levels of earning power the raise they so 
desperately needed. it took guts to buck your own leadership and those 
of you who did that I applaud you.
  While we address the immediate earning needs of those at the lowest 
level, this legislation should also be commended for what it does to 
advance pension and retirement savings policy. Our Nation has a looming 
crisis because Americans are not saving adequately for their 
  Three aspects of this bill advance pension retirement savings policy. 
The first is straightening out and clarifying how the pension 
administration occurring in the life insurance industry will proceed in 
the wake of the Harris trust ruling. Unlike previous comments made on 
this floor, I believe that the Harris trust language is very positive 
and helpful in clarifying this situation and should be in this bill.

[[Page H9849]]

  Second, pension simplification: at a point when only 24 percent of 
employees and employers under 100 have the opportunity to save for 
retirement at the workplace, this simplifies pensions. This is going to 
make small employers more willing to offer pension and retirement 
savings opportunity for their employees. It is a vital part of the 
  Third, the spousal IRA. Representing a rural area, I cannot think of 
a more unfair part of the Tax Code relative to retirement policy than 
the present provision which limits to $250 a contribution by a spouse 
not employed in the workplace.
  In a farm family where you have the husband and wife pitching in to 
make that farm go, it is just desperately unfair to limit to $250 the 
contribution of the second spouse. By allowing the full contribution in 
the spousal IRA we have improved this law a lot.
  Mr. CLAY. Mr. Speaker, I yield 1 minute to the gentlewoman from 
California [Ms. Woolsey].
  (Ms. WOOLSEY asked and was given permission to revise and extend her 
  Ms. WOOLSEY. Mr. Speaker, it is about time. It is about time to make 
work pay more than welfare.
  When I was on welfare 28 years ago, I had to go for aid for dependent 
children because my wages were so low that I could not afford the 
health care, the child care and the food that my three small children 
needed. Too many American workers face that same situation today. In 
fact, many minimum wage earners look like I did 28 years ago.
  Sixty percent of minimum wage earners are woman; one-fifth are single 
parents. Increasing the minimum wage will mean that these parents and 
others can depend on work rather than welfare to support their 
  Increasing the minimum wage will prevent the need for welfare in the 
first place. Increasing the minimum wage is the right thing to do, it 
is the smart thing to do, and it makes work pay. It is about time, Mr. 
  Mr. ARCHER. Mr. Speaker, I yield 3 minutes to the gentleman from 
Pennsylvania [Mr. English], a distinguished member of the Committee on 
Ways and Means.
  Mr. ENGLISH of Pennsylvania. Mr. Speaker, I would like to start by 
joining my colleagues in complimenting the distinguished chair of the 
House Committee on Ways and Means, who in my view has done a superb job 
of bringing to the floor a balanced conference report that not only 
addresses the needs of minimum wage workers, but also the needs of 
small business.
  I particularly want to acknowledge his role in addressing a pension 
provision which is included in this package which addresses an inequity 
in the law that would have otherwise destroyed 1,100 jobs, including 
150 jobs in Erie, PA, at Erie Forge & Steel, and I salute him for doing 
  Mr. Speaker, I am proud to rise in support of this conference report 
that will increase the minimum wage for the first time in 5 years and 
at the same time provide significant tax relief to America's small 
businesses. This is a balanced approach, and this legislation is long 
  I remember last year when I was the first member of my party to 
introduce minimum wage legislation in the House. Since then, I joined 
some of my colleagues and ultimately supported the Riggs-Quinn-English-
Martini amendment that increased the minimum wage and included it in 
this package of legislation. I am proud to see and very pleased to see 
that it has earned massive, bipartisan support.
  In my congressional district in northwestern Pennsylvania, I have 
seen far too many families supported by one or more members working in 
minimum wage jobs. These hard-working people could very easily 
surrender to the welfare system, but they do not. Instead of taking tax 
money, they pay it, and I think they deserve more.
  At the same time, I know of many small business people who are 
struggling to get by, who are struggling to grow their businesses, and 
they are finding it difficult because of the Tax Code. This legislation 
provides incentives for them to grow jobs, to create more jobs and at 
the same time bring part of the bounty back to minimum wage workers.
  Mr. Speaker, this legislation, as has been noted before, includes 
important expensing liberalization in the Tax Code. It includes a home 
office deduction, subchapter S reforms and much-needed pension 
simplification. In addition, it extends some critical expiring tax 
provisions, including the work opportunity tax credit and employer-
provided educational assistance.
  In my view, Mr. Speaker, this is a balanced package that merits the 
support of every Member of this House. I am happy to endorse it. It is 
a great day for American workers and American small businesses.
  Mr. ARCHER. Mr. Speaker, I ask unanimous consent to yield the balance 
of my time to the gentleman from Pennsylvania [Mr. Goodling] to add to 
his original 15 minutes, and ask that he be allowed to control that 
  The SPEAKER pro tempore (Mr. LaTourette). Is there objection to the 
request of the gentleman from Texas?
  There was no objection.
  Mr. CLAY. Mr. Speaker, I yield 1 minute to the gentleman from 
California [Mr. Becerra].
  Mr. BECERRA. Mr. Speaker, about a year and a half ago, January 1995, 
the gentleman from Texas [Mr. Armey], the majority leader, said, ``I 
will resist an increase in the minimum wage with every fiber in my 
  Well, sure enough, on more than five occasions on this floor, 
Democrats tried to pass a minimum wage bill and each time it was 
defeated. The result, about 12 million Americans had no chance to see 
their wages increased. The result of that, well, about $5.6 billion in 
lost earnings for these people. What does that mean? About 3\1/2\ 
months of groceries for an individual on the minimum wage or maybe 6 
months of health care insurance payments or about 4\1/2\ months of 
payments of utility bills or about 2 months of housing for that 
particular worker were lost as a result of 18 months of delays.

                              {time}  1045

  It is about time, Mr. Speaker, that we got a message here in 
Congress, the message that America has known for a long time. American 
workers deserve a raise. I am pleased that we are finally going to get 
the message here in Congress.
  Mr. GOODLING. Mr. Speaker, I yield 1 minute to the gentleman from 
California [Mr. Thomas].
  Mr. THOMAS. Mr. Speaker, I thank the chairman for yielding me the 
  I just want to take a minute because very often we forget that the 
legislation in front of us, although worked out in general by Members, 
is always finalized, structured, coordinated and made correct by staff.
  Chief of staff on the Committee on Ways and Means, Phil Moseley, and 
those competent staff under him on our side, Jim Clark, Paul Auster, 
Tim Hanford, John Harrington, and Norah Moseley, and the Joint 
Committee on Taxation under Ken Kies, have worked a number of hours, 
along with minority staff, to make sure that what is in front of us is 
done accurately.
  I want to make sure that they got credit because they certainly put 
in the hours.
  Mr. GIBBONS. Mr. Speaker, I yield 2 minutes to the gentleman from New 
York [Mr. Rangel].
  (Mr. RANGEL asked and was given permission to revise and extend his 
  Mr. RANGEL. Mr. Speaker, I would like to join the gentleman from 
California [Mr. Thomas] in expressing our appreciation for staff, both 
Democrat and Republican, because it was they that guided us when we 
were not actually in session for the conference. And the conference was 
a bipartisan conference inasmuch as we had very strong disagreements, 
but the issues were resolved at least in a civil manner.
  I think it is a successful conference because I think we emphasize 
how important it is for people to have jobs. We are obsessed with the 
problems we get from immigrants, from unwanted children, from drugs, 
from crime and from violence. Yet education, job training and the 
opportunity to have hope for the future seems to have in great measure 
reduced these problems.
  The minimum wage just makes a lot of sense, and I am glad the 
American people just did not say no but insisted that at least we move 
this far forward.
  I also wanted to thank the Republicans for extending the targeted 
jobs credit, which means disabled people,

[[Page H9850]]

veterans, those that come from poor families, those that are on welfare 
will be provided with incentives to get jobs by giving credits to 
employers who take this risk and who hire people.
  It is unfortunate that most of the moneys in this bill were raised 
just by cutting off economic development in Puerto Rico. I think it 
will take a long time before this country and especially this Congress 
would recognize these are citizens who fight and die for the United 
States of America and, if we want to change the support that we are 
giving them, I would think that you could put me first on the list to 
review it.
  I think that it is insulting just to cut off economic assistance and 
job creation without hearing, without even thinking about the impact 
that this will have not only to people in Puerto Rico but those who 
will leave to come to the mainland because of lack of opportunity on 
the island.
  I would hope, too, that those of us that intend to work together 
would realize that working together with civility makes a heck of a lot 
more sense than attacking each other in a partisan way.
  (Mr. GOODLING asked and was given permission to revise and extend his 
  Mr. GOODLING. Mr. Speaker, I yield myself 5 minutes.
  Mr. Speaker, throughout the sometimes fractious debate on the minimum 
wage over the past few months, it has been my observation that we were 
concentrating on our areas of disagreement. However, I think there was 
a fundamental thing on which Republicans and Democrats, liberals and 
conservatives seemed to agree, and that was that America needs a raise. 
But as most of my colleagues know, simply raising the minimum wage 
without making other reforms may do more harm than good. Economists and 
experts have let us know in no uncertain terms that raising the minimum 
wage will in fact hinder job growth, particularly for those in the 
lowest rungs of the economic ladder.
  That is why a series of reforms and changes must occur before 
Americans truly see the economic situation improved overall so that 
everyone can benefit. Small business tax breaks proposed in our bill 
will help our Nation's mom and pop businesses better afford the minimum 
wage hike that they are receiving. We are past due in fixing the IRA 
system so that the spouse who works at home as the homemaker can enjoy 
IRA retirement savings and benefits similar to that enjoyed by the 
spouse who works outside the home.
  We have also simplified and strengthened retirement plans through a 
number of reforms, including permitting a simplified plan for small 
businesses which will encourage pension plan growth for workers who 
currently do not enjoy those benefits.
  The report also provides incentives for employers to provide their 
employees with educational assistance. These reforms and others 
contained in the bill will help all Americans receive a raise.
  With respect to the minimum wage itself, I supported the increase 
after modifying it to protect the most vulnerable workers. Many studies 
support the conclusion that a mandated increase in the minimum wage 
would jeopardize disadvantaged Americans, those least educated, senior 
citizens, young Americans looking for their first job. These people are 
the last hired, the first fired, and least likely to be hired with a 
higher wage. As we mandate an increase in the minimum wage, we must 
protect the most vulnerable Americans.
  While some low wage earners reap the benefits of an increase in the 
minimum wage, other low wage workers would bear the brunt of the 
destructive effects of the minimum wage. The additional protection 
which we have included in this legislation helps to eliminate the 
negative effects. The opportunity wage allows employers to pay new 
hires under the age of 20 not less than $4.25 per hour for the first 90 
calendar days of employment. This will encourage employers to hire new 
workers and in turn help low skilled and entry level workers gain a 
foothold in the job market.
  The current law cash wage paid by employers to tipped employees is 
maintained by the conference reports. Tipped employees typically 
receive wages of $7 to $8 an hour, so this modification will help to 
soften the negative impact of a wage increase on these types of 
workers. If tips are insufficient to earn the new minimum wage, the 
employer must pay the difference.
  The conference agreement also maintains the current law requirements 
for the computer professional exemption, ensuring that the minimum wage 
increase will go to those most in need.
  The conference report changed the effective date of the minimum wage 
increase to allow employers an opportunity to be notified of the new 
wage and to adjust for the wage increase.
  I would like to note that the conference agreement will clarify the 
Portal-to-Portal Act of 1947 to allow employees and employees to agree 
on the use of employer-provided vehicles to commute between work and 
home without travel time having to be treated as hours of work.

  Turning to section 1461 of the conference report, I want to briefly 
discuss the improvements in the bill that we were able to achieve 
through the House amendment concerning the Harris Trust decision:
  Under the conference agreement, future general account contracts sold 
to pension plans will have to fully comply with the fiduciary standards 
of the Employee Retirement Income Security Act, ERISA. Under the 
Senate-passed language, these pensioners would never have received the 
protections of ERISA.
  Under the new agreement, existing general account contracts, and new 
contracts sold until full ERISA protection takes effect, now will have 
to be managed prudently and will have to meet reporting and disclosure 
requirements, requirements not imposed by the Senate-passed provision.
  Insurers will now have to mention pension assets held in insurance 
company general accounts with a prudent man's level of care, skill, 
prudence, and diligence. The Senate version would have offered 
pensioners a significantly lower level of protection.
  With respect to existing contracts, insurers will now have to meet 
stringent new reporting and disclosure rules. The insurer will have to 
provide periodic reports to the policyholder disclosing the allocation 
of general account income and expenses to the policy, and disclosing 
the effect of such allocation on the return to the plan under the 
  While these improvements are important, compromises were made, and 
compromises by the very nature are not perfect. I do believe that this 
matter would have been better addressed in another area and not in this 
  Mr. GIBBONS. Mr. Speaker, I yield 1 minute to the gentleman from 
Maryland [Mr. Hoyer].
  (Mr. HOYER asked and was given permission to revise and extend his 
  Mr. HOYER. Mr. Speaker, we are about to go home; 1995 was about the 
principles of the majority, and 1996 is about the politics of the 
majority. The Contract With America, does anybody remember that? It has 
not been mentioned much; unremembered, unhonored and not inclusive of 
what this bill does, because the central part of this bill is the 
minimum wage.
  Yesterday we did something to try to do a little bit for health care 
for Americans: preexisting conditions, portability. It is not in the 
  Today we do minimum wage; not in the contract. The contract has been 
forgotten. Why? Because it is not what the American public wanted. But 
this minimum wage bill is. It is the right thing to do.
  Dick Armey was wrong to say that he would fight it until his last 
breath. I am pleased that we move today on America's agenda.
  Mr. GOODLING. Mr. Speaker, I yield 3 minutes and 30 seconds to the 
gentlewoman from New Jersey [Mrs. Roukema], a member of the committee.
  (Mrs. ROUKEMA asked and was given permission to revise and extend her 
  Mrs. ROUKEMA. Mr. Speaker, I rise in strong support of the Small 
Business Job Protection Act and ask consent to revise and extend my 
  It's long past due that we raise the minimum wage and extend many of 
the tax provisions that are so beneficial to small business nationwide.
  But Mr. Speaker, I rise this morning to address provisions of this 
bill that are designed to clarify uncertainties

[[Page H9851]]

raised by the John Hancock versus Harris Trust Supreme Court decision 
in 1993. Earlier this year, I introduced legislation that would address 
problems raised by the Court's holding that an insurance company's 
general account may contain plan assets because of the purchase by a 
plan of certain contracts issued from such accounts.
  I want you to know that my legislation was cosponsored by a strong 
bipartisan majority of the Members of the Opportunities Committee and I 
am pleased that compromise language on this issue is contained in this 
conference report.
  The specific provision we are debating is a modified version of the 
legislation I introduced in March. I believe it is a good compromise 
that balances the interests of plan participants and beneficiaries, 
plan sponsors, the Department of Labor and the insurance industry.
  There are some who wrongly believe and I must stress this legislation 
eliminates essential Federal protections from billions of dollars of 
pension assets. In fact, the legislation requires any policy issued 
from an insurance company general account after December 31, 1998, that 
is not a guaranteed benefit policy to meet ERISA's standards.
  With respect to contracts issued before that date, the legislation 
requires the Department of Labor to issue regulations which Secretary 
of Labor Reich states, ``will hold the insurance companies to as high a 
level of fiduciary responsibility as any pension plan.'' In testimony 
before our committee the Actuarial Association assured us of the high 
judiciary compliance that is not violated.
  There are those who are also concerned with the relief the 
legislation gives to insurers for lawsuits with respect to past 
  I am here to say that relief is appropriate. During this period, the 
insurance industry, along with the parties with which it did business, 
including employee benefit plans, relied on the Department of Labor 
guidance on how it was to act. In other words, Labor Department set the 
rules and the industry followed them. There is no dispute on this 
  I must add that during this period it has never been established that 
an insurance company violated any of ERISA's fiduciary responsibility 
provisions or caused harm to any plan participants.
  Moreover, insurers still remain liable for violations of any Federal 
criminal law or for fiduciary breaches that also rise to the level of a 
Federal or State criminal violation.
  Finally, the legislation does not affect any lawsuit brought prior to 
November 7, 1995.
  Mr. Speaker, I recognize that this legislation has been controversial 
to some people and there are different points of view regarding its 
efficacy. However, this provision is a good compromise that will avoid 
undue disruption to the pension community while assuring that the 
rights and interests of participants are protected.
  Again this is supported by a strong bipartisan majority of the 
  Mr. Speaker, I urge support for this important legislation.

                              {time}  1100

  Mr. CLAY. Mr. Speaker, I yield 2 minutes to the gentleman from New 
York [Mr. Hinchey].
  Mr. HINCHEY. Mr. Speaker, first I want to express my thanks to the 
gentleman from Missouri [Mr. Clay] for his tireless and dedicated 
leadership on behalf of working Americans and to strongly support this 
legislation, H.R. 3448.
  At long last this body today has the opportunity to provide some 
relief to working families in my district in New York and across the 
country. A 90-cent increase in the minimum wage will raise the earnings 
of a full-time minimum worker by $1,872 a year. If we had raised the 
minimum wage last year as we advocated, in New York alone minimum wage 
workers would have earned an additional $181 million last year. 
Nevertheless, this now will help thousands of families work themselves 
out of poverty and raise their standard of living.
  While I would have preferred to see the minimum wage increased higher 
than $5.15 an hour and put into effect sooner than October 1, I support 
this bill in its current form recognizing that it is the best we are 
going to get. In addition to raising wages, the tax relief contained in 
the bill will help small businesses hire more workers, invest in new 
equipment and create more jobs.
  Finally the expansion of the availability of IRA deductions to 
homemakers is a good idea and one that I advocated since the beginning 
of this Congress. I am glad to see it finally enacted.
  Mr. Speaker, this conference report is an example of how this 
Congress can overcome the objections of the leadership of this House 
and finally work in a dedicated and productive way on behalf of 
American families.
  Mr. GOODLING. Mr. Speaker, I yield myself 5 seconds first just to 
remind everyone on that side that they had 2 years when I was a 
minority Member in the committee, and the words ``minimum wage'' were 
never raised.
  Mr. Speaker, I yield 4 minutes to the gentleman from California [Mr. 
Riggs], who added the amendment to the portal-to-portal bill, which 
brought about the minimum wage.
  Mr. RIGGS. Mr. Speaker, I thank the gentleman for yielding me time to 
speak during what has, I think, truly been a remarkable and historic 
week and the most productive and significant Congress in modern 
history. In the last 72 hours we have enacted truly historic changes 
which will better the lives of millions of our fellow Americans.
  We have made it easier to move from welfare to work, arguably a very 
difficult transition especially for single mothers. We are making work 
pay more than welfare by raising the Federal minimum wage, if not to 
keep pace with inflation at least to restore some of the purchasing 
power of the minimum wage that has been eroded by inflation, and we are 
making it easier for American workers in the workplace to get and keep 
accessible affordable health insurance.
  Welfare reform, which we enacted earlier this week, fundamentally 
changes a system that, in my view, over time had come to replace 
compassion with a system of political patronage, and it is estimated 
that our welfare reform will help move 1.3 million of our fellow 
Americans into productive jobs by the year 2002.
  Health insurance reform, which we enacted yesterday on this floor, 
will end job lock. For many of our fellow Americans, it will make it, 
as I said earlier, easier to get and keep health insurance. It will 
make it easier for people to move from job to job without the risk of 
losing their health insurance due to a pre-existing medical condition, 
and it will eliminate the longstanding insurance practice of excluding 
Americans from health insurance based on a pre-existing health 
  And today we take up the minimum wage package, which is coupled with 
some very necessary and important small business tax incentives. I was 
proud to offer the minimum wage increase when that legislation first 
came to the House floor, and the minimum wage increase will help 
roughly 10 million of our fellow Americans, and it will reverse this 
perverse incentive where welfare is more attractive than work.
  I think many of us recognize, and this is truly on a bipartisan 
basis, that we must in America, if we want to move people from welfare 
to work, make work pay more than welfare. We must make work more 
attractive than welfare.
  Now, this stands in stark contrast to the last Congress, and I am not 
going to get real partisan for a moment, but I could not help but 
notice how many speakers on the Democratic side of the aisle have come 
down to the well during the debate on the rule and during this general 
debate on the legislation and have made extremely partisan remarks. I 
think that is unfair.

  I think the record speaks for itself. The last Congress, the 
Democratically controlled Congress, did not pursue welfare reform 
legislation, did not pursue an increase in the Federal minimum wage, 
and, of course, did pursue a dramatic overhaul of the American health 
care delivery system, a 13,000-page bill that would have nationalized 
and arguably led to a big government takeover of the private health 
care delivery system in America.
  But that partisanship aside, I think it is very important to look at 
the fact

[[Page H9852]]

that we have on a bipartisan basis in this Republican-led Congress been 
able to enact these very important and historic reforms that emphasize 
work, families, and personal responsibility while leaving in place a 
very strong safety net for the genuinely indigent and the desperately 
poor in our society.
  We are, and I think we can all take pride in this as we prepare to go 
home and report to our bosses, our constituents, back home in our 
congressional districts, we are building a better America with more 
hope and more opportunity for millions of our fellow citizens and that 
is, again, why I say this is the most productive and significant and 
historic Congress in modern history.
  Mr. GIBBONS. Mr. Speaker, I yield 2 minutes to the gentlewoman from 
California [Ms. Pelosi].
  Ms. PELOSI. Mr. Speaker, I thank the gentleman for yielding this time 
and thank him for his great leadership in this Congress. I know that we 
will continue to be well-served by him until the last day of this 
Congress and we will be the beneficiaries of his legacy for a long time 
to come. I thank him again for yielding.
  Mr. Speaker, today is a good day, not a great day but a good day for 
the American worker. It is a day that the Republican leadership has 
finally been dragged kicking and screaming in support of raising the 
minimum wage.
  Democrats can be proud that at long last the pressure that we have 
brought to bear on Republicans has finally produced real results for 12 
million working Americans. The Republicans have finally caved after 
months of staunch opposition-voting five times to defeat Democratic 
efforts to bring up an increase in the minimum wage.
  Even with polls showing over 80 percent of the American people 
support increasing the minimum wage, the extreme Republican majority 
tried to kill the bill or gut the bill and blunt its impact. These 
delaying tactics cost American workers $5.6 billion. Faced with the 
failure of their extreme agenda, moderate Republicans finally have 
embraced this Democratic initiative, but in the meantime the American 
worker has paid the price for Republican extremism.
  By refusing to take action on the minimum wage sooner, Republicans 
have cost American workers, as I have said, $5.6 billion in lost wages. 
That increase in the minimum wage would have paid for 3\1/2\ months of 
groceries, 6 months of health care, 4\1/2\ months of utility bills or 2 
months of housing. Too bad it took 18 months to shame Republicans into 
doing the right thing and raising the minimum wage from a 40-year low 
in purchasing power.
  House Republican leader, the gentleman from Texas [Mr. Armey], has 
said, and we have quoted him many times, that he would fight an 
increase in the minimum wage with every fiber of his being. That was an 
earlier statement. As recently as Monday he blasted the minimum wage 
increase yet again saying that it was not a matter of importance to 
real people and dismissing it as an inside-the-beltway issue.
  I urge our colleagues to recognize the importance of the Democratic 
effort and increase the minimum wage.
  Mr. CLAY. Mr. Speaker, I yield 1 minute to the gentleman from 
Missouri [Mr. Volkmer].
  Mr. VOLKMER. Mr. Speaker, Members of the House, yes, it is a great 
day for the people of this country who are the working poor. That is 
right, they are the working poor. They are the lowest level in the 
financial status that we have, but they work just as hard as my 
colleagues and I do and everybody else does.
  This should have been done a year ago. That meant that those people 
would have been able to buy shoes for the kids. Not at the retail 
store, but no, at the yard sale, at the Salvation Army secondhand 
  I challenge all of my colleagues to realize that these people who 
work every day for the minimum wage are not able to live like my 
colleagues and I. My colleagues must realize that these people scrape 
and save to just make ends meet every day.
  I challenge those that are going to vote against this bill to take 
this month of August and go out and visit with some of the people in 
their home areas that earn the minimum wage and find out how they have 
to live and how my colleagues wanted them not to have that minimum wage 
  Mr. GOODLING. Mr. Speaker, I reserve the balance of my time until 
they are all finished.
  Mr. GIBBONS. Mr. Speaker, I yield 1 minute to the gentlewoman from 
Hawaii [Mrs. Mink].
  (Mrs. MINK of Hawaii asked and was given permission to revise and 
extend her remarks.)
  Mrs. MINK of Hawaii. Mr. Speaker, I thank the gentleman for yielding 
this time to me.
  Mr. Speaker, it is very important for this body and the country to 
realize that the vast majority of workers in this country working for 
the minimum wage are women, and it is these hard-working women who are 
supporting their families that we need to celebrate today because they 
are finally going to get 90 cents an hour more, not a whole lot, but it 
is $36 week, $1,800 a year, something which they should have been 
getting many, many months ago. They are finally getting it. We have 
been preached at about the importance of work, so today finally they 
are getting a pay raise to help support their families.
  Under welfare we are forcing single mothers to go to work. With this 
minimum wage they will have a chance to lift their families out of 
poverty. Not a single person in this body ought to regret the fact of 
minimum wage going up today.
  Mr. GIBBONS. Mr. Speaker, I yield 1 minute to the gentlewoman from 
Connecticut [Ms. DeLauro].
  Ms. DeLAURO. Mr. Speaker, this is a great day that almost never came. 
America needs a raise. It is a tribute to the dignity and to the hard 
work of those Americans who get up every morning and go to work for the 
minimum wage that we are here today about to pass legislation raising 
the minimum wage by 90 cents.
  The American people's overwhelming support for a minimum wage 
increase has won the day today, but we had to overcome the steadfast 
opposition of a Republican leadership who vowed to stop it and even 
denied that minimum wage workers exist in this country.
  I know different. I have a letter from Janis Venditto, a working 
mother in Hamden, CT, whose husband fought in the Persian Gulf war. 
They are struggling to feed their kids and to pay their bills and my 
constituent says:

       I really wish someone out there can really listen to me for 
     once. Raise the minimum wage. I know I am not the only person 
     in this situation. It is a shame that the most wonderfulest 
     country in the world cannot give us moms a small break.

  That is what this is all about. We need to pass the minimum wage.
  Mr. GIBBONS. Mr. Speaker, I yield 1 minute to the gentlewoman from 
New York [Mrs. Maloney].
  Mrs. MALONEY. Mr. Speaker, there is a crisis of fairness in this 
country. The rich are getting richer and the poor are getting poorer. 
In real terms, the minimum wage is at its lowest level in 40 years. 
Where I come from if one earns the minimum wage and work full-time, 
they live in extreme poverty. More than 600,000 New Yorkers will 
benefit from this increase.
  This is also a woman's issue; 5.7 million women earn the minimum 
wage. That is 59 percent of all minimum wage earners.
  Raising the minimum wage promotes families. If we want to encourage 
work and make it pay, we need to do this for the American people. 
Unfortunately, it took a Democratic uproar in Congress and 80 percent 
of the American people to get the Republican Congress to give in and do 
the right thing.
  The current minimum wage is indefensible, it discourages work, it 
demoralizes workers, and it makes a mockery of fairness.
  Mr. GIBBONS. Mr. Speaker, I yield my remaining 1 minute to the 
gentleman from Maryland [Mr. Cardin] to close debate on our particular 
part of this.

                              {time}  1115

  Mr. CARDIN. Mr. Speaker, once again let me thank the gentleman from 
Florida [Mr. Gibbons] for his leadership on this legislation.
  Mr. Speaker, we are going to be able to enact this legislation. Why 
we are going to be able to do it, it is because it is the right mix. We 
have a well-balanced bill. It is good for small businesses and it is 
also good for those people who work for small businesses.

[[Page H9853]]

  It provides real help to small businesses by extending tax credit 
provisions for work opportunity tax credits; employer-provided 
educational assistance; the R credit; retirement simplification that 
I talked about before, and which the gentleman from Ohio [Mr. Portman] 
has talked about; the small business expensing, where it helps small 
businesses because it increases the minimum wage.
  Mr. Speaker, I hope we will use this formula in the future in 
considering legislation, and rather than looking at extreme 
legislation, let us look at well-balanced legislation. It is in the 
interests of our constituents, and I urge my colleagues to support the 
conference report.
  Mr. CLAY. Mr. Speaker, I yield 3 minutes to the gentleman from 
Michigan [Mr. Bonior].
  Mr. BONIOR. Mr. Speaker, House Majority Leader Dick Armey loves to 
quote country music lyrics.
  Well, the Republican strategy on the minimum wage reminds me of 
another old country song. It's called, ``Walk out Backwards Slowly So 
I'll Think You're Walking In.''
  Republicans have been walking up to the podium today to take credit 
for raising the minimum wage. But we all know that beyond a few people 
like the gentleman from New York, Jack Quinn, and a few others over 
there, they have been running away from this issue for months.
  Five separate times, this Republican Congress blocked an increase in 
the minimum wage. Newt Gingrich implied that the minimum wage should be 
based on Mexican wages. Tom DeLay said that minimum wage families don't 
really exist. John Boehner said he would commit suicide before voting 
to raise the minimum wage.
  Dick Armey said he would fight a minimum wage increase with every 
fiber in his being. And just last week, he said the real people don't 
care about the minimum wage.
  Well, I think they've found out the past few months that real people 
do care about the minimum wage. The American people understand that if 
we want to move people from welfare to work, we have to make work pay. 
You can't raise a family on $4.25 an hour.
  These are people who work hard--and work long hours--to give their 
kids a better life. They deserve to be treated with dignity and 
  Mr. Speaker, it's sad that it took 18 months for Democrats to 
browbeat the Republicans into doing the right thing for America's 
families. But thanks to public pressure, and the hard work of people 
like Senator Ted Kennedy, an increase in the minimum wage will be 
signed into law by Labor Day.
  Mr. Speaker, the Republican leadership can quote all the country 
songs they want. This is one song that has a happy ending for America's 
  Mr. CLAY. Mr. Speaker, I yield such time as he may consume to the 
distinguished gentleman from Missouri [Mr. Gephardt], the minority 
leader, who will be the majority leader.
  (Mr. GEPHARDT asked and was given permission to revise and extend his 
  Mr. GEPHARDT. Mr. Speaker, in a few short moments I believe this 
House of Representatives will vote to raise the minimum wage, which is 
at a 40-year low. It is severely impacting, in a negative way, American 
  I realize that for many of my colleagues on the other side of the 
aisle this is a difficult vote to cast. Even for some who will support 
this increase, this is a vote of resignation, not one of joy. But while 
this might not be an easy vote for some of you, I believe with all my 
heart that this is the right vote and probably the most important vote 
of this Congress.
  Let us put aside this morning all the ideology, all the partisan 
differences, all of the political argument, and let us put one thing 
and one thing only in our mind today, which is what the gentleman from 
Michigan [Mr. Bonior] talked about: That is American families that are 
living day-by-day today on the minimum wage.
  I had a woman in my district recently, as I went door-to-door, tell 
me that she had two minimum wage jobs, worked 16 hours a day, two 
children. She said, ``Congressman, I cannot pay my bills. But that is 
not what I am worried about. That is my problem.'' She said, ``What I 
am worried about is that I am never home to raise my children.'' She 
welled up as she talked about her failure of responsibility to raise 
her children to be productive citizens. She said, ``I am not worried 
that they will be victims of crime, I am even worried they will commit 

  It went through me like a knife. We had women out here the other day 
who talked about living on the minimum wage, what it means to raise a 
family on $8,500 a year. We had a woman go through her bills. She had 
her bills: How much she paid for rent, how much she paid for health 
care, how much she paid for groceries.
  She said, ``You know, at the end of the month I always have to put 
three bills aside because I cannot pay them.'' She said, ``My son hurt 
his hand in football. We went to the emergency room. They gave me a 
bill for $1,500 after he was treated.'' She said, ``I will never pay 
that bill.''
  The people of this country are responsible. They want to work. They 
want most desperately to raise their children to be productive 
citizens. This bill, more than anything we will do in this Congress, 
gives those American families and those parents and those children the 
ability to do what they desperately want to do. Two years from now, 
$1,800 more than they are able to earn today will make their lives 
better, and allow them to meet their most important and fundamental 
human responsibility, which is to raise their children to be productive 
  Mr. Speaker, Republican or Democrat, conservative, liberal, or 
moderate, please vote for this bill for the American people.
  Mr. GOODLING. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, is it not amazing? I hope the American people have been 
listening to this discussion. We have heard from the other side today 
that yesterday we had welfare reform that was a bipartisan effort 
because 98 Democrats supported it, but the last speaker did not support 
it. Then on this side we had 93 who supported minimum wage, but that is 
a Democrat program. Is that not amazing?
  What I want to remind the American people is that for 2 years this 
minority was in the majority, they had the majority in the House, they 
had the majority in the Senate, and they had the White House. Not one 
word in committee was ever mentioned about minimum wage, not one word. 
Oh, but thanks for the conversion: An election year conversion. We are 
happy to have you converted. It is good to have you with us.
  But nevertheless, we realized from day one, as the President said, 
because he is the only one who mentioned minimum wage during the 2 
years when they had this big majority, and what did the President say? 
``Hiking the minimum wage is the wrong way to raise the incomes of low-
wage workers.'' That is what the President said, the only thing 
mentioned about minimum wage.
  We knew on our side that we had to do more than just raise the 
minimum wage if we were going to help American workers, if we were 
going to help those most in need. We knew that just raising the minimum 
wage could be devastating if we did not do the other things that are 
now in this package, which makes it a good package.
  We knew that changes would be necessary in the tax program. We knew 
that including spousal IRA's was important. We knew educational tax 
assistance to workers was important. So when we got the whole package 
together, we then had this wonderful election year conversation.
  Mr. Speaker, I yield the balance of my time to the gentleman from 
Ohio [Mr. Kasich].
  The SPEAKER pro tempore. The gentleman from Ohio [Mr. Kasich] is 
recognized for one and three-quarters minutes.
  Mr. KASICH. I just wanted to rise and make the point, Mr. Speaker, 
that was raised by the delegate, the gentleman from Puerto Rico [Mr 
Romero-Barcelo], regarding the 936 program that currently exists, where 
we try to create incentives for companies to create jobs. We believe 
that that whole 936 had a very big element of corporate welfare, where 
companies were able to get signficant tax reductions without providing 
the kind of jobs and income levels that we had anticipated.
  A lot of folks in Puerto Rico and a lot of economists would argue 
that we

[[Page H9854]]

should be very careful as we work our way through the wage credit, 
where we more approximately give a tax incentive based on what you have 
actually done for an individual in Puerto Rico to get a job. I 
understand that over the course of the next 10 years we are going to 
phase this out.
  I have to tell the Members, I have been thrilled with the work of the 
chairman of the committee, the gentleman from Texas [Mr. Archer], to 
close loopholes in the Tax Code that have been given to folks that do 
not represent strong economic incentives to create growth. What I would 
say, through, as we move through this period in the next few years, we 
should take our time to make sure that that wage credit is viewed 
carefully. There may be a way to reform that program where we in fact 
can help people in Puerto Rico and provide economic growth, but yet not 
have tax loopholes that represent giveaways to large corporations.

  Mr. Speaker, I appreciate the chairman of the committee yielding to 
me. I think he made an outstanding statement on this bill.
  Mr. GIBBONS. Mr. Speaker, I yield such time as she may consume to the 
gentlewoman from Texas [Ms. Jackson-Lee].
  (Ms. JACKSON-LEE of Texas asked and was given permission to revise 
and extend her remarks.)
  Ms. JACKSON-LEE of Texas. Mr. Speaker, I rise to support the 
Democratic-led fight to raise the minimum wage.
   Mr. Speaker, I rise today to voice my reluctant support for the 
conference report on H.R. 3448, the Small Business Job Protection Act 
and minimum wage increase.
  It was my hope that we would not turn the issue of raising the 
minimum wage into a political football. The weight of public opinion is 
squarely on the side of raising the minimum wage, but the Republican 
leadership of both Houses of Congress could not provide a clear victory 
for the working poor of this country.
  This conference report would eliminate the existing provision which 
requires employers of tipped employees to pay at least 50 percent of 
the statutory minimum wage in case, and replaces it with a provision 
which locks the cash wage at the current standard of $2.13 an hour. It 
would also deny any automatic future increases in the minimum wage to 
those who work and earn tips as a part of their income.
  To further add insult to hard working Americans, this conference 
report delays the initial start of the 45 cents an hour increase to the 
minimum wage from July of this year until October 1.
  The conference report also eliminates the existing provision 
exempting certain computer professionals from requirements that they 
receive overtime pay. This would mean that no additional computer 
professionals will be protected by the Fair Labor Standards Act's time 
and one-half overtime requirements.
  In my Houston, TX district that would mean a real income drop for 
computer professionals who would no longer be subject to this 
  This conference report would make permanent a failed experiment 
contained in the 1989 Amendment to the Fair Labor Standards Act that 
expired in 1993. Where employers were allowed on a temporary basis to 
pay a rate lower than the minimum wage. This change if widely used 
would create an incentive to displace older workers.
  Paying this lower wage to workers under age 20 for 90 days presumes 
that it must cost them less to live than you or me. This subminimum 
wage workers will not get a corresponding break in the cost of living. 
They will still have to care for their children and families just as 
they are required to do today. This change in the Fair Labor Standards 
Act would restrict these worker's freedom to seek other employment 
opportunities that may be presented to them for fear of taking lower 
pay for a quarter of their first year of employment.
  Some would argue that a raise in the minimum wage would result in 
high unemployment so the idea to limit the number of workers who would 
qualify for the increase is a good idea. If the proposal was more than 
a mere 90 cents divided between 2 years their might be some merit to 
that position. The real discussion should be about supporting those 
poor families that choose work over welfare.
  The first step to moving people from poverty to self sustainment is 
to raise the minimum wage for all workers with malice toward none. I 
will support this bill to raise the minimum wage because this is 
consistent with the long-standing fight we have waged to help hard-
working Americans, of which some 69 percent are women with children, 
get a fair wage for a days work.
  This is long overdue.
  Mrs. MINK of Hawaii. Mr. Speaker, today is a great day for American 
workers and their families--not only because we are raising the minimum 
wage, but because the voice of the American people was heard by the 
Congress of the United States.
  This bill is a true example of how government and this Congress can 
work together for the people of this Nation. Despite opposition to 
raising the minimum wage from the major party, the workers and families 
all across the country rose up and made their voices heard in support 
for an increase in the minimum wage. And today we are finally 
responding to their cry for a decent wage for an honest day's work.
  The people of this Nation know they are working harder today for 
less, struggling to make ends meet, and barely getting by even in a 
strong economy. Over the last decade they have watched as the salaries 
of CEOs and their corporate bosses skyrocket, as the value of the 
minimum wage decreased--falling 50 cents since the last increase in 
  Mr. Speaker, this increase is even more critical today because of the 
passage of the welfare reform bill which will soon become law. The new 
welfare bill will force many women into the work force. It is fine to 
emphasize work, but we must assure that work pays a living wage.
  Many women currently on welfare work at minimum wage jobs. One of the 
biggest misconceptions about welfare is that welfare mothers stay at 
home and collect welfare check. In most cases this is simply not true. 
Forty percent of women on welfare combine their income from work and 
welfare in order to care for their children. A minimum wage income is 
not enough to support the basic needs of a family, so women must 
continue to receive welfare assistance while they work in order to care 
for their families.
  This bill moves us in the right direction for many women in the work 
force. Ninety cents an hour, $36 a week, $144 a month. It's not much, 
but it could mean the ability to buy a desperately needed pair of 
children's shoes or to pay the extra cost of heating in the winter. 
Raising the minimum wage means women--those on welfare and many who are 
not--will now be able to better care and provide for their families. 
Women make up 64 percent of the minimum wage work force. It is for the 
women of this country that we must pass this bill today.
  In addition, Mr. Speaker, I would like to note the small business tax 
relief provisions and the assistance we are providing to this important 
sector of our economy. Also, I want to express my support for the 
provision which allows women who work at home--home makers to invest in 
IRAs. This is an important step for the economic self-sufficiency and 
economic security of women in this Nation.
  Mr. Speaker, I urge my colleagues to support this conference report.
  Mr. POSHARD. Mr. Speaker, today this body can be proud to be passing 
legislation that will directly impact the lives of millions of American 
workers. I wholeheartedly support this legislation, and while we have 
met our goal of providing a more livable wage for those hard-working, 
citizens who desperately need it, this bill also provides tax 
incentives to help our small businesses as well. Provisions such as the 
Work Opportunity Tax Credit will allow our small business owners to 
claim substantial tax relief at the same time they are giving vital 
opportunities to new workers.
  This measure also rewards the invaluable efforts of housewives across 
the Nation by allowing nonworking spouses to contribute $2,000 annually 
tax free to an IRA, finally according the raising of children and other 
home-related activities the respect they deserve in regard to the tax 
code. Many more pension reform provisions are included which will help 
empower the American people to save for their own retirements, which in 
time will help to take the load off of Federal entitlement programs. At 
the same time, we have taken strides toward curbing corporate welfare, 
and have provided incentives in the tax code for the adoption of 
  Perhaps it has taken too long to reach this goal, but we have truly 
given hope to legions of citizens with this bill. This legislation is 
all about rewarding work, and it, combined with the welfare reform 
legislation of earlier this week, goes a long way toward giving 
incentives to individuals and families to gain economic independence 
and self-sufficiency through viable work opportunities and wage rates. 
I urge all of my colleagues to vote in favor of the conference report.
  Mrs. COLLINS of Illinois. Mr. Speaker, I would like to say that I am 
pleased that the Democrats and the Republicans have come to an 
agreement on raising the minimum wage. It should have been simple: No 
one can support a family working in a job that pays the current minimum 
wage. But because the Democrats stayed on task and on track, we were 
able to convince the Congress that this was the right thing to do for 
the American economy and for the American family.
  For the minimum wage worker, a 90 cents an hour increase means a lot. 
It could mean

[[Page H9855]]

the difference between having a roof over your head or living in 
substandard housing. It could mean the difference between providing a 
healthy, balanced diet for your family or waiting in line at a soup 
kitchen so your children can have a square meal. It could mean the 
difference between having a telephone or being isolated. It could mean 
the difference between a car or relying on expensive public 
transportation to get to your job, the doctors, or the grocery. With 
the increase in the minimum wage, after the 2-year phase in, the 
American worker will have about $36 a week extra.
  In Illinois, nearly 11 percent of the wage earners are paid the 
minimum wage, currently only $4.25 an hour. There are over 12 million 
Americans currently working in jobs that pay the minimum wage, and with 
that, the average wage and salary paid per hour for employee 
compensation in the private, nonfarm labor sector in 1995 was $12.25 
per hour.
  According to the Bureau of the Census, women make up 46 percent of 
the work force, and 40 percent of those women are working mothers. A 
single mother cannot work at a minimum wage job if she has to pay for 
nonfamily child care because she can't afford it. When President 
Clinton declared a ``National Pay Inequity Awareness Day'' his 
statement provided the information that last year American women earned 
only 75 cents for every $1 a man brought home, with African-American 
women and Hispanic women collecting just 66 cents and 57 cents, 
respectively, when compared to the male wage earner. Raising the 
minimum wage will help women achieve a better payday.
  Students are a large proportion of minimum wage earners. Students who 
are supple- menting their family's income by working are not a thing of 
the past; they are the foundation of many communities. In 1980, the 
minimum wage was raised from $2.90 to a whooping $3.10, and since then 
it has only gone up to $4.25 where it has stayed since 1991. Since 
1980, the cost of college has gone up 260 percent, but the minimum wage 
for earners trying to pay their way through school only went up by 
about 30 percent.
  Raising the minimum wage will not fill anybody's wallet or bank 
account, but it will help change lives.
  I urge my colleagues to support this conference report and put a 
little more in the pockets of the American worker by raising the 
minimum wage.
  I yield back the balance of my time.
  Mr. STOKES. Mr. Speaker, I rise in strong support of the conference 
report to H.R. 3448, the Small Business Job Protection/Minimum Wage 
Increase Act. After months of staunch opposition from our Republican 
leadership, I am pleased that my colleagues on the other side are 
finally able to join in support of a minimum wage increase.
  At a time when wage inequality has widened dramatically in the United 
States, this piece of legislation would give over 21 million hard-
working Americans a well-deserved wage increase. In addition, a higher 
minimum wage will serve to benefit families with the least income, 
those families which have been the target of many of this Republican 
led Congress' pernicious legislative efforts--low-income and lower 
middle class families.
   Mr. Speaker, research has demonstrated that at least 10 million 
Americans working at minimum wage would take home an additional $1,800 
a year when this legislation becomes law. There can be no doubt that 
this modest increase in the minimum wage will make a substantial 
difference for thousands of minimum wage earners in my district in 
addition to millions of other workers across the Nation who, despite 
working hard every day, still find themselves in the midst of poverty.
  According to the Department of Health and Human Services, with this 
90 cent wage increase, as many as 300,000 families could be lifted 
above the poverty line, including more than 100,000 children.
   Mr. Speaker, in my congressional district, 22 percent of my 
constituents live below the poverty line. There is no doubt in my mind 
that our Government must do all that it can to provide wage equity for 
the thousands of working families who work hard but most still live in 
  It's been 5 long years since America's minimum wage workers got a 
raise. The proposed minimum wage is a logical step in our efforts to 
enable families to be productive and self-supporting.
   Mr. Speaker, H.R. 3448 is an historic effort toward economic 
justice. I urge my colleagues to support this vital legislation.
  Mr. BENTSEN. Mr. Speaker, I rise in support of H.R. 3448, the Small 
Business Job Protection Act of 1996, and in strong support for 
America's working families who are finally getting the raise they 
  Increasing the minimum wage will help ensure that holding a job pays 
more than being on welfare and it will help lower-income families 
struggling to make ends meet, it puts our values of work, family, and 
responsibility ahead of partisan gain or bottom line accounting. This 
increase will restore not just the purchasing power that has eroded to 
nearly a 40 year low, but the self-esteem and pride that can't be 
scored by the CBO or OMB.
  Mr. Speaker, families living on the minimum wage do exist and a 
living wage is integral for workers to provide for themselves and their 
families in dignity. These are not families seeking a handout, or 
special provision in a nonrelated tax bill, or line item in an 
appropriation bill. What they are seeking is the opportunity to provide 
for themselves and this Congress should not frustrate their 
determination to pursue this better, dignified life.
  Mr. Speaker, we may disagree on a number of social economic theories. 
However, this disagreement cannot overshadow the pressing concern that 
families of goodwill are entitled to pursue a living wage.
  I also support the provisions in this legislation to help small 
businesses provide retirement security for their workers and their 
families. While there are a number of measures not included in this 
legislation that should have been, I strongly support the SIMPLE plan 
and the increase in the contribution to an Individual Retirement 
account for nonworking spouses. These provisions will allow more 
families to save for their retirement and not penalize parents who 
choose to stay home and raise their children.
  However, I am disappointed that we didn't do more to help families 
provide for their retirement. This conference agreement should have 
further expanded IRA eligibility and allowed penalty-free withdrawals 
from an IRA for a first home purchase, tuition, major medical expenses, 
or during long-term unemployment, but doesn't. That being said, I do 
support this conference report and pledge to pursue these changes in 
future legislation.
  Mr. FRANKS of New Jersey. Mr. Speaker, I rise today in strong support 
of the conference report for H.R. 3448, the Small Business Job 
Protection Act.
  Mr. Chairman, I voted against the original House bill which increased 
the minimum wage by 90 cents because I firmly believe that losing one 
American's job is not worth 90 cents. Statistics prove that eight of 
the last nine increases in the minimum wage have resulted in either a 
loss of jobs or an increase in the inflation rate. In fact, President 
Clinton said that raising the minimum wage is not the way to improve 
the economic well-being of the lower class. I believed that we must 
include tax reforms for small business. Unfortunately, the House chose 
not to combine the minimum wage bill and the small business tax 
reforms. The Senate bill did combine the two initiatives.
  Had the Senate bill been considered in the House, I would have 
unequivocally voted in favor of the bill. The wage increase and the 
small business tax reforms will prevent the loss of jobs and the 
raising of product prices.
  Mr. Chairman, I proudly rise in support of the conference report 
Small Business Job Protection Act.
  Mr. SABO. Mr. Speaker, today is a great day for American workers who 
will get a pay raise on October 1 because the Republican majority 
finally allowed a vote to increase the minimum wage. While $.90 an hour 
is not a total solution to the growing income gap that plagues our 
society, it will make a big difference to the 12 million workers who 
will receive this boost in pay.
  American working families have been forced to sit on the sideline 
while congressional leaders went through legislative maneuvers, made 
empty promises, and generally used dilatory tactics. By refusing to 
take action on the minimum wage sooner, Republicans have cost American 
workers $5.6 billion in lost wages. Had the increase taken place when 
it was first proposed in this Congress, it would have paid for 3\1/2\ 
months of groceries, 6 months of health care, or 2 months of housing. 
Today, however, the majority realized they could no longer stall and 
the minimum wage will increase from a level that left it at a 40-year 
low in purchasing power.
  For many years, I have been speaking about the growing income gap in 
America. Several months ago, due in large part to the Republican 
Presidential race, this issue finally catapulted to the forefront of 
the Nation's consciousness. In fact, it has been hard to open a 
newspaper op-ed page or turn on a television news program without 
hearing something about declining worker wages, increased layoffs, and 
increasing corporate profits and CEO pay.
  Thanks in part to the deficit reduction measures we passed in 1993, 
the American economy today is in good shape. We enjoy strong growth 
combined with low unemployment and low inflation. The stock market has 
reached record highs, as have profits of many American companies. This 
should have all seemed like good news for the average American family; 
for, in the past, Americans at all income levels shared in our Nation's 
prosperity. However, in recent years while we have seen stock prices 
and corporate profits rise, the incomes of most middle-class American 
families have stagnated or dropped.

[[Page H9856]]

  If stagnating wages were the only problem that working Americans had 
to face, things might not be so bad. But, in recent years our Nation 
has also seen unprecedented worker layoffs in corporate America. Of 
course, it is understandable that such upheavals may occur as our 
economy becomes more technology-based and integrated into global 
markets. What is difficult to understand, however, are the tremendous 
bonuses and pay increases enjoyed by the very CEO's who lay off 
thousands of workers.
  The United States has prided itself on being a nation of the middle 
class--one in which if you work hard and follow the rules, you can 
expect to do well enough to support yourself and your family. 
Alarmingly, this is no longer true for an increasing number of 
  In the decades following World War II, all American workers shared in 
the Nation's prosperity. Over the past 20 years, however, only high-
income Americans have moved ahead economically. Between 1977 and 1990, 
for instance, the average after-tax income of the wealthiest 1 percent 
of our population increased by 67 percent, after adjusting for 
inflation. During this same period, the average after-tax income of the 
bottom fifth decreased by nearly 27 percent.
  This is not a problem that affects only the poor. Every year, 
thousands of Americans are laid off from well-paying middle-class jobs, 
to be left with a choice between a new job that pays less or the 
unemployment line. Clearly, this trend cannot continue.
  America's level of income inequality is already higher than that of 
any industrialized nation. Our middle class is evaporating, and we are 
well on the road to becoming a Nation divided between a few very rich 
and many who simply struggle to get by. None of us, in the works of 
Labor Secretary Robert Reich, will ``want to live in a society sharply 
divided between winners and losers.''
  The widening income gap lays before us the question of what kind of 
country we want to be: One sharply divided between the rich and poor, 
or one in which all citizens can benefit from a strong economy. I 
believe that our choice is clear. America has always been the land of 
opportunity. We should work together for policies that do not favor any 
income group, but enable all Americans to share in our Nation's 
strength and prosperity.
  Today we take a small step in the right direction for those at the 
very bottom of the income ladder by passing this increase to our 
Nation's minimum wage. The bill increases the Federal minimum wage from 
its current $4.25 an hour to $5.15 per hour. I applaud this action and 
the victory for American workers.
  The American people should feel good today because they forced Newt 
Gingrich and the Republican leadership to sit up, listen, and act. The 
public said that America needs a raise, and on October 1, millions of 
working Americans will get that raise and find it just a little easier 
to provide for their families.
  Mr. BLUMENAUER. Mr. Speaker, providing for their families is a daily 
struggle for the working poor. Basics like food, shelter and healthcare 
are out of reach for too many full-time employees and their children.
  Congress, so far, has not chosen to improve upon this sad situation. 
What we have seen is welfare reform which threatens the little 
assistance available for those with low-paying jobs. I fear, Mr. 
Speaker, that poverty may continue to be the reward many receive for 
their work.
  There are solutions to these problems--the proposed minimum wage 
increase being the most obvious. This simple act will do more to create 
self-sufficiency than any government program or bureaucracy. I am 
pleased to be a part of this long overdue adjustment.
  Mr. FAZIO of California. Mr. Speaker, I am very pleased to rise in 
support of H.R. 3448, a bill to increase the minimum wage and provide 
various tax incentives.
  After a long, hard battle, we can be proud of passing a bill that 
will produce real results for 12 million working Americans.
  This increase will pay for an extra 3\1/2\ months of groceries, 6 
months of health care, 4\1/2\ months of utility bills, or 2 months of 
housing. America's working families are finally getting the raise that 
they deserve.
  This bill, like the health insurance reform bill that was passed 
yesterday, isn't an ``inside the Beltway'' issue like some in the 
Republican leadership have claimed. It's common-sense, pro-family 
legislation that many of us in Congress have been championing from the 
  In addition to the minimum wage increase, this bill also contains 
some important tax provisions for Americans and small businesses.
  The conference agreement includes a pension provision to allow 
spouses who do not work outside the home to contribute $2,000 annually 
to an IRA. Now couples living on one income can save the same amount as 
two-income couples. Not only does this provision encourage saving for 
thousands of households across the country, it reinforces a feeling 
that we have started to lose: staying at home to raise a family is one 
of the most important jobs in America. It is a full-time job which 
should be rewarded with the opportunity to save for the future.
  Along the same family-strengthening lines, H.R. 3448 includes a tax 
credit up to $5,000 for parents who adopt children. Also included is a 
$6,000 credit for parents who adopt children with special needs. This 
provision is a powerful one. It encourages the union of couples who 
long to be parents with children who might not otherwise belong to a 
loving family.
  Finally, while reinforcing our nation's family structure, H.R. 3448 
also strengthens our Nation's economic structure by extending the 
research and development [R] tax credit. Federal support for R is 
the quintessential investment in our Nation's future. R is 
responsible for approximately one-half of the productivity in the 
Nation's economy and is the single most important source of long-term 
economic growth.
  In my home State of California, R has been particularly important 
to the growth of the State's economy. California received about $722 
million in energy R funding in 1995. We are heavily involved in 
programs like energy conservation research and research on fusion 
energy development. These programs would have suffered severe setbacks 
under the original bill the house passed in May. Fortunately, an 
extension of the R tax credit is included in the bill before us 
  All of these measures will strengthen the economic foundations of our 
families and will allow them to invest in themselves and their futures. 
I urge my colleagues to support the conference agreement for H.R. 3448.
  Mr. COSTELLO. Mr. Speaker, I rise in strong support of an increase in 
the minimum wage. The 90-cent increase that is being considered today 
by the House of Representatives will begin to address the erosion in 
American workers' purchasing power. If the minimum wage is not 
increased, it will fall to its lowest level in 40 years.
  Mr. Speaker, this is essential legislation that directly impacts 
millions of American workers. Over 500,000 of these workers are in 
Illinois. Because the majority of American workers who are paid the 
minimum wage are over 20 years old, the increase will aid these workers 
in supporting themselves and their families. As we encourage people to 
find jobs instead of relying on public welfare, we must work to ensure 
that the minimum wage is a living wage. Receiving a living wage makes 
workers more productive for society and more willing to work. As a 
result of the reduction in turnover, the employer's costs of recruiting 
and retraining are lower.
  Raising the minimum wage is expected to immediately lift it 300,000 
families out of poverty. My colleagues who charge that a 90-cent 
increase is nominal and unnecessary probably are not aware that a 90-
cent increase in the minimum wage could pay for seven months of 
groceries, rent or mortgage payments for 4 months, or a full year of 
health costs. These are real expenses that working people have and that 
can be addressed by a minimum wage increase.
  Many of my colleagues also charge that the minimum wage increase will 
result in lost jobs. However, many economists dispute this claim. In 
addition, according to the Bureau of Labor Statistics, 10 million jobs 
have been created since the last increase in the minimum wage.
  These are among the reasons why I strongly support a 90-cent increase 
in the minimum wage and urge my colleagues to join me in voting for the 
  Mrs. MORELLA. Mr. Speaker, I rise in strong support of the conference 
report on H.R. 3448, the Small Business Job Protection Act. I commend 
the members of the Conference Committee for their diligence in sending 
to the House floor a bill that will provide tax relief for small 
businesses, equal individual retirement account [IRA] treatment for 
spouses who work at home, and will raise the minimum wage for our 
Nation's workers.
  I have long supported a so-called Homemaker IRA, which is part of the 
Women's Economic Equity Act (H.R. 3857) which I introduced last month 
in my role as co-chair of the Congressional Caucus for Women's Issues. 
Current law penalizes one-income families by limiting the tax deduction 
that spouses who work at home can take for money put aside for 
retirement. Presently, spouses who stay at home to raise children or to 
take care of an elderly parent can only save $250 above the $2,000 
allowed for the spouse who works outside of the home.
  Women face a number of barriers when it comes to saving for their 
retirement. They live longer, earn less than their male counterparts, 
and receive less from Social Security. The spousal IRA, included in 
this bill, will go a long way toward helping American women during 
their retirement years.
  This conference report also extends, until June 30 of this year, the 
tax exclusion for graduate level education assistance provided by an 
employer. I have supported, since coming to Congress, legislation that 
would restore and make permanent the exclusion from gross income of 
employer-provided education assistance. This partnership between 
employer and

[[Page H9857]]

employee has enabled millions of Americans to upgrade their work skills 
in order to improve their productivity and better support themselves 
and their families.
  I am also pleased that the adoption tax credit is part of this 
package. The provision is similar to the tax credit approved in the 
Adoption Promotion and Stability Act, which passed the House in May, 
and which I strongly support. The conference report allows individuals 
with adjusted gross incomes below a certain level to deduct, over 5 
years, up to $5,000 per eligible child--$6,000 for the adoption of 
hard-to-place children--from their income tax liability. This adoption 
tax credit will help ease the expenses of adoption, allowing more 
families to adopt.
  Recently, I introduced a resolution regarding tuition prepayment 
plans by States to allow families to save for their children's college 
education at a fixed rate. I am very pleased that this conference 
report includes an amendment which would prohibit the Internal Revenue 
Service from taxing State-sponsored prepaid college tuition plans until 
the funds are distributed. These State-sponsored plans have allowed 
more than 500,000 American families to save years in advance for their 
children's college tuition. The provision regarding prepaid tuition 
plans will make it possible for more States to adopt similar programs, 
affording more families the opportunity to save for their children's 
  From raising the minimum wage to providing tax relief for small 
businesses, this conference report is an example of bipartisan 
cooperation for the benefit of all Americans. Again, I commend the 
conferees, and I urge my colleagues to support this fine legislative 
effort to promote economic prosperity.
  Mr. CAMP. Mr. Speaker, I rise to strongly support H.R. 3448, the 
Small Business Job Protection Act and congratulate and thank the 
chairman of the Ways and Means Committee, Mr. Archer, for his 
leadership and success in this matter.
  I am very pleased that the bill includes the Tax Fairness for 
Agriculture Act which I sponsored with bipartisan support from many of 
our colleagues. The Tax Fairness for Agriculture Act will help State 
and county farm bureaus across the country continue to serve the farm 
families which are their members.
  I am particularly pleased that the conferees agreed with the Senate 
to make this proposal effective for taxable years beginning after 
December 31, 1986, and to provide transitional relief for organizations 
that had a reasonable basis for not treating amounts received prior to 
January 1, 1987, as unrelated business income. This is consistent with, 
and an improvement upon, my original bill.
  For these purposes, as I have said many times, reasonable basis 
includes the longstanding recognized practice by agricultural and 
horticultural organizations of relying upon the 1983 IRS position that 
associate member dues are not taxable.
  With the passage of my legislation, these unfortunate controversies 
should be put to an end once and for all. Accordingly, I thank the many 
Members of this and the other body who have supported me in this 
important effort.
  Mr. CRANE. Mr. Speaker, today I regret that I must speak in 
opposition to H.R. 3448, the Small Business Job Protection Act. Despite 
the fact that as one of the conferees on this bill I worked to 
incorporate, and support, many of the tax provisions contained in the 
legislation, and despite the fact that as chairman of the Trade 
Subcommittee I support a key trade provision contained in the bill, I 
must oppose this bill because of the minimum-wage increase it contains.
  Increasing the minimum wage will not protect jobs as the title of 
this legislation implies, but will do just the opposite--it will 
destroy jobs. Although I do not intend to dwell entirely on this issue 
in my statement, as I do not intend to dwell entirely on this issue in 
my statement, as I do want to discuss the tax and trade portion of the 
bill as well, I do want to include in the Record following my 
statement, the testimony from someone who certainly knows something 
about the impact of the minimum wage on a business. Herman Cain, 
president of Godfather's Pizza testified before the Joint Economic 
Committee on the subject of a minimum-wage increase, and I must say 
that his inciteful comments are indicative of conversations I have had 
over the years on this subject with economists and employers. I would 
urge my colleagues to review his testimony because he makes clear that 
this feel good legislation is for people with blinders or rose colored 
glasses who do not care to acknowledge the real economic consequences 
or raising the minimum wage.
  Supporters of the minimum wage, while they might be well intentioned 
and might receive an award from the media establishment for being 
politically correct, are hurting the very people they purport to help--
the young, poor, unskilled individual who wants to work. Raising the 
minimum wage raises the costs for businesses that operate on a thin 
margin--such as those in the food industry--and leaves them with the 
choice of marginally raising prices in a highly competitive sector of 
our economy or cutting costs--i.e. jobs. All too many companies must 
choose the later, and estimates I have seen indicate that this minimum-
wage increase will cost Americans 200,000 jobs. So how does increasing 
the minimum wage help the young, poor unskilled worker? Good question.
  While I oppose the minimum-wage increase, as vice chairman of the 
Ways and Means Committee and as one of five House conferees on the tax 
portion of this bill, I would be remiss if I did not comment on the tax 
provision of H.R. 3448. The tax provisions of the bill, for the most 
part, will make a positive economic contribution and will hopefully 
blunt, to some degree, the negative impact of the minimum wage. While 
this is by no means an all inclusive list, some of the highlights of 
the bill include the expansion of the expensing provisions for small 
businesses, the package of S corporation reforms, pension 
simplification items including critical spousal IRA provisions, the 
employer provided educational assistance exclusion, the extension of 
the research and experimentation credit, the clarification of worker 
classification language relating to independent contractors, and the 6-
month delay of the IRS' electric payment system. Also included in the 
bill was an adoption credit which had passed the House of 
Representatives by a substantial margin earlier. As I indicated, there 
are many other positive tax proposals contained in this legislation too 
numerous to mention here. If signed into law, these provisions will 
help blunt to some degree the negative fallout from the minimum-wage 

  Although the overwhelming number of tax provisions in the bill are 
positive, I must also express my concern, as I did when the bill first 
passed the House, with regard to that portion of this bill which would 
phase to section 936 of the Tax Code over a 10-year period. Section 936 
of the Tax Code provides tax incentives to companies that locate 
production facilities in Puerto Rico. I must say that it is most likely 
that the vast majority of members in this House do not fully appreciate 
the negative impact that eliminating section 936 will have with regard 
to the economic vitality of Puerto Rico and what the decline in that 
regard will mean to our Federal budget in the long run.
  Having served on the committee with jurisdiction over this issue for 
the past 20 years, the Ways and Means Committee, I can unequivocally 
state that section 936 has been one of the most successful provisions 
in our entire Tax Code. Section 936 has spurred economic development in 
Puerto Rico which has in turn created thousands of jobs--American 
jobs--dramatically reducing the unemployment rate in Puerto Rico. 
Sadly, all too many people view Puerto Rico as a foreign country rather 
than as the American territory that it is. Jobs created in Puerto Rico 
are U.S. jobs. Moreover contrary to what many critics contend, the 
majority of jobs created in Puerto Rico through section 936 would not 
have been created on the mainland absent section 936. The production 
facilities in Puerto Rico would likely have been located in a foreign 
country if not in Puerto Rico. In short, don't expect a wave of new 
production facilities opening on the mainland United States because 
section 936 is being phased out.
  By removing this incentive for companies to locate in Puerto Rico, an 
economic vacuum will be created which I do not see being filled any 
time soon. This void will bring on increased unemployment, and hope and 
opportunity, which has been on the rise over the last 20 years in 
Puerto Rico, will decline steadily. As the economy declines there will 
be an increased dependency--dependency on Uncle Sam to help those that 
no longer have jobs. Just what form this dependency will take, whether 
it be statehood or some other arrangement, remains to be seen, but mark 
my words, it will mean greater expenditures by the U.S. Treasury. So I 
would say to those that think they are saving taxpayers dollars when 
they vote to eliminate this socalled corporate welfare in the Tax Code, 
that you can either pay now by encouraging economic growth and 
opportunity, or you can pay later by increasing Federal outlays for 
welfare and creating a dependency which I don't think the American 
citizens--either on the mainland or in Puerto Rico--will appreciate. It 
is my urgent hope that the Ways and Means Committee will revisit this 
issue at a later date--and sooner rather than later.

[[Page H9858]]

  Having discussed the minimum-wage provisions and the tax provisions, 
I must finally comment on the lone trade provision contained in H.R. 
3448. As chairman of the Trade Subcommittee, I am very pleased to 
report that this conference report extends the Generalized System of 
Preferences [GSP] Program through May 31, 1997. The extension of GSP is 
critical to our free trade efforts, and I have included a more detailed 
and separate statement on this subject later in the Record.
  Mr. Chairman, again I would say that I am disappointed with the 
minimum-wage portion of this bill. And while I am extremely pleased 
with the extension of GSP and the long overdue tax provisions contained 
therein, I must still oppose this bill because of the loss of jobs that 
will result from the minimum wage provision.

             [From the American Enterprise, July/Aug. 1996]

  Bad Solution for the Wrong Problem--How Forcing up the Minimum Wage 
                     Hurts Those Who Need Help Most

       My name is Herman Cain. I am President of Godfather's 
     Pizza, Inc., a 525-unit pizza restaurant chain headquartered 
     in Omaha, Nebraska. I am also President of the National 
     Restaurant Association.
       There are nearly 740,000 food service units in this 
     country, including everything from fast-food chains to fine-
     dining restaurants. We are an industry dominated by small 
     businesses, and we employ a diverse workforce of over nine 
     million people. Our employees are white, African-American, 
     Hispanic-American, Asian-American, and more. We expect to 
     employ 12.5 million by the year 2005, with the fastest growth 
     coming in the category of food service managers. More than 30 
     percent of Americans under age 35 had their first job in the 
     restaurant industry. Restaurants offer an important boost 
     into the job market for millions, as well as a clearly 
     defined career path for those willing to work hard and stay 
     in the business.
       There are numerous reasons why I firmly believe a minimum-
     wage increase is attacking the wrong problem. Allow me to 
     list the three reasons I believe to be most important.
       First, mandated wage increases reduce entry-level job 
       A few weeks ago, a colleague in Oregon told me about a 
     homeless 17-year-old he hired in the mid-1980s. He gave the 
     teenager a job chopping lettuce, deveining shrimp, and 
     sweeping floors. That 17-year-old has worked his way up: He's 
     now the executive chef at the restaurant. But the job that 
     brought him into the business no longer exists. When Oregon 
     raised its minimum wage a few years ago and the restaurant 
     owner looked for ways to cut costs, this job was one of the 
     first to go. Now, my colleague buys lettuce already chopped 
     from a nearby automated facility.
       It's a good example of the split personality of the minimum 
     wage. When you make it more expensive to hire people who lack 
     basic work skills and experience, you risk shutting them out 
     of the workforce.
       My second point: A minimum-wage increase jeopardizes 
     existing jobs by threatening businesses that may be 
     marginally profitable. In my case, for example, Godfather's 
     Pizza, Inc., has nearly 150 company owned and operated units, 
     and a few of them are either marginally profitable or not 
     profitable at all. If you raise costs for the many thousands 
     of enterprises like these, you risk shutting their doors 
       When you're running a restaurant that's on the edge, you're 
     scrutinizing every penny. Can ninety cents an hour put me 
     under? It could. Maybe not by itself--but when labor accounts 
     for about 30 percent of my expenses, second only to my food 
     costs, a mandated wage increase is one more factor tipping 
     the balance. A mandated wage increase triggers wage inflation 
     by rippling up through the entire wage spectrum and by 
     causing increases in payroll-related expenses like FICA 
       Some people would say ``Just raise your prices.'' It 
     doesn't work that way. In a competitive market, that's the 
     fastest way to drive away customers with limited 
     discretionary income. That can close a business fast.
       My third point: A minimum-wage increase is an ineffective 
     way to raise someone out of poverty. Most minimum-wage 
     earners are part-time workers under age 25--mostly first-time 
     workers, students, people holding down second jobs or 
     supplementing the income of their household's primary earner. 
     In my restaurants, for example, nine out of ten of my hourly 
     employees choose to work less than 35 hours a week--even 
     though fulltime work is available. These are not the poor 
     people policymakers most want to help. By shooting wide and 
     hoping to hit the right target, you're taking a gamble with 
     harmful side effects.
       The best way to lift a family out of poverty is to get 
     people into the job market and give them a chance to acquire 
     skills. I think of my father, who worked three jobs until he 
     was skilled enough to cut back to two jobs, and who kept 
     going until his skills were good enough that he could support 
     us on one hourly job.
       There are other dangers with a minimum-wage increase. Like 
     the fact that a federal mandate prescribes the same wage for 
     a mom-and-pop restaurant in rural Nebraska as it does for a 
     restaurant located in a high-cost-of-living metro area. It's 
     not a good idea to try to overrule the laws of supply and 
     demand that do a pretty good job of setting local wages 
     according to the specific conditions of specific markets.
       Congress has recently been playing close attention to the 
     state and local officials--Democrats and Republicans alike--
     who say ``enough is enough'' when it comes to picking up the 
     tab for unfunded federal mandates. Please give businesses the 
     same hearing: An increase in the minimum wage is also an 
     unfunded federal mandate. Someone has to pay--and it's 
     usually the entry-level employee.
       I urge you to look deeper for solutions. Some people lack 
     the skills to make them competitive for entry-level 
     employment. This is why we have tax credits to encourage 
     businesses to hire employees who typically have a hard time 
     gaining a foothold in the job market. This is why politicians 
     are setting up empowerment zones to help businesses hire in 
     impoverished areas. These programs rightly recognize that 
     some workers may be overlooked if it gets too expensive for a 
     business to hire them. Congress should be looking for ways to 
     encourage people to work, and businesses to hire, instead of 
     making it more expensive for employers to give the low-
     skilled a job.
       You're getting a good dose of information lately on the 
     theories behind successful welfare reform. In businesses like 
     ours, real life crowds out theory. While our main expertise 
     is in getting out good meals at good prices, as entry-level 
     employers we've also become fairly expert at finding ways to 
     help millions of troubled teens and troubled adults get 
     beyond some daunting barriers to employment. We see that real 
     entry-level jobs provide training in the fundamentals--
     reliability and teamwork, to name just two--and thereby field 
     long-term social payoffs that don't come in any other way.
       Right now we have more than four million people earning the 
     minimum wage in this country, 7\1/2\ million unemployed 
     persons, and nine million adults receiving welfare payments. 
     Tackle the right problems first. Focus on creating more jobs, 
     not on raising the cost of entry-level employment and 
     eliminating existing jobs. A minimum-wage increase doesn't 
     attack the right problem. I urge you to reject it.

                  Fact and Fiction on the Minimum Wage

       Minimum-wage workers are the most vulnerable Americans, 
     right? Actually, more adults who earn the minimum wage live 
     in families with over $30,000 in annual income than live in 
     families making under $10,000. Over all, 22 percent of 
     minimum wage earners are poor. The majority of poor Americans 
     don't work at all, at any wage.
       Minimum-wage work is undignified. Fifty-five percent of 
     minimum-wage workers are youths age 16-24. Many of these live 
     with their parents. Only 2 percent of workers age 25 or older 
     are paid the minimum wage.
       You can't raise a family on the minimum wage. Few have to: 
     89 percent of all workers now making less than the proposed 
     minimum have no spouse or child depending on them as sole 
     breadwinner. Of these, 44 percent are single individuals 
     living with their parents or other family member, 22 percent 
     are single individuals living alone, and 23 percent have a 
     spouse with a paying job.
       Minimum-wage jobs are a dead end. Sixty-three percent of 
     minimum-wage workers earn higher wages within 12 months. 
     Seventy percent of the restaurant managers at McDonald's, 
     plus a majority of the firm's middle and senior management, 
     began in hourly positions. (This includes CEO Ed Rensi, who 
     started at 85 cents an hour in 1965.)

     Sources: U.S. Bureau of Labor Statistics: Employment Policy 
     Foundation; Wall Street Journal; Industrial Relations and 
     Labor Review.
  Mr. CRANE. Mr. Speaker, as chairman of the Trade Subcommittee, I want 
to highlight that the conference report on H.R. 3448, the Small 
Business Jobs Protection Act, contains provisions that extend the 
Generalized System of Preferences [GSP] Program, through May 31, 1997.
  The GSP Program promotes three broad policy goals: First, to help 
maintain U.S. international competitiveness by lowering costs for U.S. 
businesses, as well as lowering prices for American consumers; second, 
to foster economic development in developing countries and economies in 
transition through increased trade, rather than foreign aid; and third, 
to promote U.S. Trade interests by encouraging beneficiaries to open 
their markets and comply more fully with international trading rules.
  This important legislation will help American businesses across the 
country, both small and large, by eliminating unnecessary tariffs on 
certain imported products. Extension of GSP will expand trade and 
prevent job losses in a wide variety of U.S. industries currently 
suffering increased tariff costs as a result of the expiration of GSP.
  Reauthorization of GSP, in this difficult budget environment, should 
be viewed by our trading partners as indicative of our continued 
commitment to the expansion of international trade and economic 
opportunity. H.R. 3448 is important trade legislation, which, I 

[[Page H9859]]

will be followed next year by an extension of fast-track trade 
negotiating authority, and legislation to expand trade with Caribbean 
Basin region.
  H.R., 3448 makes modest reforms and technical changes to title V of 
the Trade Act of 1974, which are intended to simplify and improve the 
administration of the GSP Program. For example, the bill recodifies a 
3-year rule whereby specific products may only be considered for 
addition to the GSP Program every third year. The bill would exclude 
high-income countries from GSP, and would have the effect of reducing 
the per capita gross-national-product [GNP] limit from $11,800 to 
$8,600, a number which would be indexed. Beneficiary countries that 
exceed the per capita GNP limit will be removed form the GSP Program.
  The bill would reduce the competitive need limit [CNL] in the expired 
law from about $108 million to $75 million, to be increased by $5 
million annually, but would retain the competitive need waiver 
authority. Also, a beneficiary country that exceeds the CNL on a 
particular product would lose GSP on that product. Under certain 
circumstances, however, the President could waive the CNL and restore 
the product to GSP status for that country.
  The bill also contains new authority, which was requested by the 
Administration, to designate any article from a least developed 
developing country [LDDC], if the President determines that the article 
is not import-sensitive in the context of imports from LDDC's.
  Designed to promote economic development through increased trade, 
rather than foreign aid, GSP is a valuable program, both for 
beneficiary countries, and for U.S. businesses and consumers. I urge my 
colleagues to support its inclusion in H.R. 3448.
  Mr. RAMSTAD. Mr. Speaker, I rise in strong support of the Small 
Business Job Protection Act and to discuss a related issue regarding 
the tax treatment of independent contractors.
  The Ways and Means Oversight Subcommittee, on which I serve, has been 
aggressively working to rationalize the tax laws governing independent 
contractors. As we learned from the White House Conference on Small 
Business and through testimony before the subcommittee, sound rules 
covering employee classification are sorely needed. I commend Chairman 
Archer for the improvements in the bill before us, as they are an 
important first step in achieving this goal.
  I do, however, want to speak to one improvement that is needed to 
ensure the proper balance between consumer protection and appropriate 
application of employee classification laws.
  I was pleased to see that in the recently issued IRS Worker 
Classification Training Manual, the Service acknowledged the importance 
of balancing competing regulatory demands--those designed for consumer 
protection purposes and those driven by tax considerations. The 
training manual made significant progress by stating that rules imposed 
by a business on its workers in order to comply with Governmental 
agency requirements should be given little weight in determining a 
worker's status.
  Unfortunately, the manual goes on to state that if the business 
develops more stringent guidelines for a worker in addition to those 
imposed by a third party, more weight should be given to these 
instructions in determining whether the business has retained a right 
to control the worker. As you know, the amount of control exercised 
over a worker is indicative of that employee's status with respect to 
classifying workers as independent contractors. It is this second 
portion of the rule that could unintentionally compromise consumer 
  For example, in the securities industry, the Securities and Exchange 
Commission [SEC], the National Association of Securities Dealers [NASD] 
and State regulatory agencies' regulations are broad in scope and 
require securities dealers to exercise significant discretion in their 
implementation. I am concerned that this ambiguity may force businesses 
to comply with only the most minimal standards in order to avoid 
potential conflict with the tax laws. It makes no sense to place 
companies that exercise higher standards of due care in meeting their 
regulatory obligations at a greater tax risk than more lax competitors. 
I do not believe this was the intention of Congress.
  I urge the IRS to revise its guidelines so that no weight is given to 
any business policies or procedures that are reasonably designed to 
achieve compliance with applicable laws and regulations of Government 
or self-regulatory organizations, including the supervision of 
activities of workers and associated person to ensure compliance 
  I would like to thank both Chairman Archer and Subcommittee 
Chairwoman Johnson for their leadership in this area. I look forward to 
working with them to develop rational employee classification tax rules 
in general, and also to ensure that our Nation's complex regulatory 
laws are not undermined by the Tax Code.
  Mr. MARTINI. Mr. Speaker, I rise today in support of the American 
worker and in strong support of raising the minimum wage. To me, this 
has never been an issue of politics, but rather a simple issue of 
fairness. Too often Americans are working long hours and even taking 
second jobs, yet they feel like they are running in place. If we really 
want people to move from welfare to work, we have to make work 
worthwhile. Americans deserve a fair wage for a hard day's work.
  Raising the minimum wage will reward those able bodied individuals 
who chose work over welfare by improving their quality of life. 
Ultimately, that's what this is all about. Mr. Speaker, people want to 
support their families without Government help, but we have to make 
work worthwhile. I believe one way to do that is to raise the minimum 
wage. It just comes down to basic fairness.
  Congress has not raised the minimum wage in over 7 years. In 
comparison to other wages, the minimum wage is now at a 40-year low. I 
don't think that is fair. I believe people deserve a fair return on a 
hard day's labor. My record reflects a strong commitment to working 
people's issues and that is why I joined Jack Quinn and 21 other 
Republicans to introduce legislation to increase the minimum wage back 
in April.
  It's time to help people earn more and keep more of what they earn. 
Raising the minimum wage is just one aspect of the kind of economic 
growth and opportunity package this country desperately needs. In 1 
week this historic Congress has done more to advance the agenda of 
working Americans than any legislative session in recent memory.
  We have successfully passed comprehensive welfare reform, the most 
significant health insurance reform legislation in a generation, and 
today we will finally give low wage earners a much needed raise. Mr. 
Speaker, the verdict's out. The 104th Congress has been a champion for 
working Americans. This Congress has stood up for fairness.
  Mr. Speaker, I believe in raising the minimum wage, but I also 
believe that we have an obligation to our small businesses and mom and 
pop shops to ease the Federal tax and regulatory burden placed on them. 
True small businesses are often the most vulnerable and have extremely 
high rates of failure. Today we are increasing the minimum wage and 
providing necessary tax relief to our small businesses.
  Mr. Speaker, I am proud to have helped introduce a minimum wage 
increase bill and I am also proud to have cast my vote for the 
successful tax relief, welfare reform, and immigration reform bills. We 
need a responsible and fair government for a change, and this Congress 
is on the right course.
  This legislation is a victory for low wage earners, a victory for 
small business, and a victory for the American people. I strongly urge 
my colleagues to support the conference report on H.R. 3448.
  Mr. ROTH. Mr. Speaker, I rise in strong opposition to this conference 
  While this legislation has some strong points--increased expensing 
and pension simplification for small businesses--it would also impose a 
massive unfunded mandate on American businesses, and it would destroy 
Puerto Rico's enterprise zone status.
  Both are grave mistakes with real consequences for real people.
  The minimum wage increase will kill 600,000 jobs for low-skilled 
workers. These are the people who can least afford to lose their jobs. 
Without work, what will they do?
  Phasing out section 936 and immediately repealing QPSII would have a 
devastating impact on the economy and people of Puerto Rico.
  Today, section 936 businesses employ one-third of Puerto Rico's 
entire work force. They produce 40 percent of Puerto Rico's annual 
economic output. They are responsible for 200,000 mainland jobs.
  Section 936/QPSII has also attracted $15 billion in additional 
capital to the island--capital that would otherwise have gone 
  As a result, more entrepreneurs can start new businesses, more 
consumers can buy household appliances, and more families can purchase 
  Mr. Speaker, let's not abandon the people of Puerto Rico. Let's not 
cripple our Nation's job creators with needless unfunded mandates.
  Vote for opportunity. Defeat this conference report.
  Ms. VELAZQUEZ. Mr. Speaker, I rise today in support of the conference 
  Legislation to increase the minimum wage is long over due. For 
months, Democrats have been calling for a raise for the American 
people, but that wasn't enough. Even when 85 percent of the American 
people voiced their support for an increase, that wasn't enough. I'm 
glad to see that the Republican majority is finally starting to get it.
  The increase in the minimum wage will help to lift millions of 
Americans out of poverty. For years, single mothers have been 
struggling to feed their families on a poverty wage. This

[[Page H9860]]

takes on even more importance, now that this Congress has shredded the 
safety net of welfare. We must make work pay, and make the pay a living 
  Although I support this conference report, I also want to express my 
great anger over the price that some will have to pay for the adoption 
of this legislation. In classic Republican style, they give a helping 
hand to the needy while using the other hand to stab someone in the 
back. By removing the 936 tax credit, Republicans are taking the 
lifeforce that keeps Puerto Rico alive.
  I urge my colleagues to support the conference report. But keep in 
mind the 300,000 U.S. citizens that live in Puerto Rico, who will not 
gain but lose under this legislation.
  Mrs. THURMAN. Mr. Speaker, I rise today to support the conference 
report on H.R. 3448 I am particularly happy about a provision that 
protects the tax exempt status of State-sponsored prepaid tuition 
programs, which mirrors, H.R. 3842, legislation that I introduced. This 
provision is of great importance to working parents and their children 
across this Nation.
  For years, parents have been looking for a financially sound way to 
fund their children's education. In this era of continually rising 
costs and reduced Federal aid, that desire appears even more 
unattainable. In response, 16 States, including my home State Florida, 
have formed innovative partnerships known as prepaid college tuition 
programs. In fact, Representative Ros-Lehtinen and I worked on this 
issue in the Florida State Senate.
  Prepaid tuition programs allow individuals to purchase contracts that 
provide for the cost of college tuition in the future, locking in 
today's tuition rates. As a result, more than 500,000 mostly middle-
class families are taking part nationwide in these programs.
  Earlier this year, the IRS announced its intention to tax these 
programs. This makes no sense because the contributors of this fund 
have no access to it. As a result, I introduced H.R. 3842, which would 
clarify that prepaid tuition programs are tax exempt. I was happy then 
to get 60 bipartisan cosponsor of this bill. But I am even happier 
today that the conferees included this valuable and meritorious 
provision in this bill.
  Mr. Chairman, the conference report on H.R. 3448 is good policy 
because it guarantees American workers a higher wage and a better 
standard of living. But it is even better policy because it guarantees 
that a good number of our children, our future workers, would be 
educated and not have to struggle with the notion of a minimum wage. I 
urge my colleagues to support the report.
  Mr. NEAL of Massachusetts. Mr. Speaker, today we are voting on a 
piece of legislation that is long overdue. We are increasing the 
minimum wage by 90 cents over 2 years. The value of the minimum wage 
has dropped to a 40-year low.
  Today, by increasing the minimum wage we are doing something tangible 
for the American worker.
  Two days ago on this floor we passed a tough welfare bill. The major 
goal of this bill is to move individuals off of welfare and to work. 
Increasing the minimum wage goes hand in hand with welfare reform. To 
encourage individuals to work we have to make work more attractive. 
Increasing the minimum wage is a step in making work a better 
  By earning more there will be less of a need for Federal assistance 
such as food stamps. We are helping workers become more self-
  The Small Business Job Protection Act includes many tax provisions 
that many of us have been working on the past few years. Many of these 
provisions have been long awaited.
  The tax provisions do not include everything I would have liked, but 
I believe it's a good package that will go along with helping small 
  This bill includes a provision which would assist the fishermen of 
New Bedford, MA. I cannot think of a better example of a small 
  I am a strong supporter of IRA's and believe we should provide tax 
incentives to encourage savings. This legislation includes a provision 
which increases the availability for spousal IRA's. The provisions 
permit deductible IRA contributions of up to $2,000 to be made for each 
spouse, including those who do not work outside the home. This will 
help women to increase savings for their retirement. It corrects an 
inequity that existed in our Tax Code.
  This legislation extends the exclusion for employer provided 
educational assistance. This provision allows for exclusion from income 
up to $5,250 for tuition paid for by an employer. As a former 
professor, I have seen how helpful this provision can be. 
Unfortunately, the exclusion only applies to graduate-level education 
until June 30, 1996. I plan on continuing to work on including graduate 
education. Education is important to increasing our competitiveness in 
this global economy. We are creating more high wage jobs and we need 
education workers. The exclusion for education workers helps more than 
lawyers and doctors.
  This legislation provides an extension of the R credit. The credit 
is reinstated for July 1, 1996 to May 31, 1997. This is the first time 
the credit has not been extended retroactively. I am pleased the credit 
has been extended and I will continue toward making the R credit 
permanent. We need to assist corporations with research and 
development. R is necessary for global competitiveness. The R 
credit will help keep high wage jobs in the United States.
  This legislation contains a package of S corporation reform 
provisions. The package includes a provision I have worked on the last 
couple of years. This package will help small businesses that are 
organized as Subchapter S corporations.
  The legislation includes pension simplification provisions. The 
purpose of this package is to strengthen and simplify the pension 
provisions of the Tax Code. The package includes provisions which make 
it easier for small businesses to offer pension plans. Church pension 
simplification provisions were also included in this package.
  This pension package takes a step toward making retirements more 
secure. These provisions will help increase the access to retirement 
savings for many American workers. We have to continue to work to make 
it easier for more American workers to have pensions.
  Today is a good day for the American worker and small businesses. The 
bill is a good compromise and it should make a difference.
  Mr. MONTGOMERY. Mr. Speaker, I want to commend the conferees on this 
measures for including changes to the Tax Code which ensure that 
employers who reemploy veterans after military service are not 
penalized for restoring their pension benefits. Two years ago, the 
Congress enacted the Uniformed Services Employment and Reemployment 
Rights Act of 1994 [USERRA], Public Law 103-353. This law was a 
restatement and clarification of the existing veterans reemployment 
rights law, and like that law, it guarantees that reservists and other 
persons who go on active military duty will be restored to their 
civilian jobs without any loss of seniority.
  This law originated in 1940 and has been the subject of a number of 
Supreme Court decisions. The Supreme Court has held that one of the 
most important benefits of seniority, the high to a pension, is a 
protected benefit to which a veteran is entitled.
  In discussions with various pension experts over the past several 
years, it was pointed out that technical amendments to the Internal 
Revenue Code were needed. The Tax Code limits employer and employee 
contributions to tax-favored pension plans and thus benefits payable to 
reemployed veterans. Other limits on deductible contributions, and 
qualified plan non-discrimination, coverage, minimum participation, and 
top-heavy rules do not take into account the veteran returning from 
active duty and his right to have his pension rights restored as if he 
had never left.
  Last year, I introduced legislation, H.R. 1469, to allow employers 
who reemploy veterans to comply with both USERRA and the Internal 
Revenue Code when they endeavor to restore veterans' pension benefits 
as required by USERRA. The bill would provide assurance to employers 
that such contributions would not in any way disqualify a tax-favored 
plan. I am pleased that the bill before the House today includes the 
text of H.R. 1469 with minor technical changes.
  It is very important to note that the legislation before the House 
today would allow employers and pension plans to make contributions for 
any veteran, World War II, Korea, Vietnam, as well as Persian Gulf. In 
essence, this provision corrects an oversight contained in the 1974 
ERISA legislation which failed to take into consideration the rights of 
reemployed veterans, and is a good measure for employers as well as 
veterans. Again, I thank the conferees for including this provision in 
the conference report.
  Mr. FAZIO. Mr. Speaker, I am very pleased to rise in support of an 
increase in the minimum wage.
  After a long, hard battle, we can be proud of passing a bill that 
will produce real results for 12 million working Americans.
  This increase will pay for an extra 3\1/2\ months of groceries, 6 
months of health care, 4\1/2\ months of utility bills, or 2 months of 
  America's working families are finally getting the raise that they 
  This bill, like the health insurance reform bill that was passed 
yesterday, isn't an inside the Beltway issue like some in the 
Republican leadership have claimed.
  It's common sense, pro-family legislation that many of us in Congress 
have been championing from the beginning.
  In addition to the minimum wage increase, this bill also contains 
some important tax provisions for America's small businesses.
  The bill includes an important provision that increases the amount 
that a small business can deduct from the costs of business-related 

[[Page H9861]]

  This will allow our Nation's small businesses to expand and 
contribute even more than they already do to our national economy.
  It will also allow homemakers to invest up to $2,000 a year in an 
individual retirement account, and provides a tax credit of up to 
$5,000 for parents who adopt.
  These measures will strengthen the economic foundations of our 
families and will allow them to invest in themselves and their futures.
  This is a good bill that will help America's workers and small 
businesses. I urge my colleagues to support the conference agreement.
  Mr. BALLENGER. Mr. Speaker, I am opposed to the conference agreement 
on H.R. 3448, the Small Business Job Protection Act because of my 
concern that the increase in the minimum wage or starting wage will 
make it much harder for those with few skills and training or a limited 
education to get a first job. Minimum wage jobs are often the first 
rung on the ladder of upward mobility and this increase will likely 
move that rung beyond reach for many workers. By raising the wage rate, 
we end up denying job opportunities to thousands of workers.
  The conference agreement raises the Federal minimum wage from $4.25 
to $5.15, in two increments. The first increase becomes effective on 
October 1, 1996 and will raise the wage rate to $4.75. The second 
increase would take effect on September 1, 1997, raising the minimum 
wage rate to $5.15. It is well known by economists and lawmakers that 
higher minimum wages lead to job losses. Dozens of studies show that 
raising the minimum wage costs entry-level job opportunities, and does 
little to help the working poor. Job loss estimates for this increase 
range from 100,000 to over 600,000 jobs. In my home State of North 
Carolina, an estimated 19,100 jobs will be lost. A 90-cent increase is 
meaningless for the individual who no longer has a job.
  Just recently, the Washington Post featured a story on the Kiddie 
Junction Learning Center in Zachary, LA. The owner of the day care 
center indicated that an increase in the minimum wage would be bad for 
her business, her employees, and her customers--and that it will likely 
force her to let go one employee and increase prices. This is just one 
more example of how a minimum wage increase does more harm than good by 
costing some low-wage workers their jobs and raising costs for others. 
A copy of the article follows.
  While I am voting ``no'' on the conference agreement to signal my 
concern about the effect wage increases have on job creation, I do 
support the final agreement to bring tax relief for small businesses 
and their workers and as well as the provisions bringing long overdue 
reform to our pension system. These changes will do much to help ease 
the middle class crunch and help many people make more and save more.

               [From the Washington Post, July 30, 1996]

                            (By Gary Younge)

       Zachary, LA.--Jeannette Boggs started her working life 
     making $1.25 an hour as a service representative for a 
     utilities company in Baton Rouge in 1965. Since then, she 
     says, she has ``bettered myself in dollars and cents'' to get 
     where she is today--the proud owner of Kiddie Junction 
     Learning Center, a day-care center 12 miles away in Zachary.
       Zachary is a rural town of about 10,000 where churches 
     outnumber banks by about three to one. Like many in the area, 
     Boggs describes herself as religious and conservative. She 
     believes that in America, if you work hard you will be 
     rewarded, and she says her six employees work very hard 
       ``It's a tough job. It's wiping noses, cleaning butts and 
     tying shoes all day long,'' she said. None of her staff earns 
     more than $6.50 an hour. Two are paid at or around the 
     current minimum wage of $4.25. Many of the parents who use 
     Kiddie Junction also are minimum-wage, or slightly better, 
       When it comes to increasing the minimum wage, many low-paid 
     people here are understandably eager to see it happen but 
     recognize that, like a boomerang, that very increase may well 
     come back and hit them in the form of higher costs. Many 
     cannot decide whether tit will spark a vicious circle that 
     will fuel inflation or a virtuous one that will help 
     alleviate poverty.
       But Boggs has definitely made up her mind. She argues that 
     an increase will be bad for her business, her employees and 
     her customers. If, as appears likely to happen as early as 
     this week, Congress passes a 90-cent increase in the minimum 
     wage, pushing it up to $5.15 an hour, Boggs contends it will 
     force her to let go one staff member and increase her prices.
       ``When people talk about the minimum wage, all they think 
     about are kids working in the fast-food chains. If people 
     work hard, they should get paid well, and that's why we have 
     labor laws to protect them,'' Boggs said. ``But I have lots 
     of hidden costs as well as payroll taxes and workers' 
     compensation. All these things cost money, and if you add 
     them up them the minimum wage is not so minimum any more. 
     It's going to add about 12.75 percent to my cost, and I'm 
     going to have to pass some of that on.''
       That would be bad news for Annette Ponthier. She started 
     her working life at minimum wage six years ago as a driver 
     for a medical transportation company. A few years later, she 
     gave birth to her son, Alex, and soon after that, Alex's 
     father left. At first Ponthier's mother looked after Alex, 
     but she has a heart problem so Annette took Alex to Kiddie 
     Junction, where she pays $62 a week. She now makes $5.50 an 
     hour selling swimming pools and pool chemicals.
       At age 23, she still lives with her parents in Zachary 
     because, she said she cannot afford her own place. A minimum 
     wage increase would be good, she said, although ``you still 
     couldn't live on it.'' But if the price of Kiddie Junction 
     went up even by a few dollars a week, she said, she could not 
     really afford it, and ``with no child care, there's no job.''
       There are 4.2 million people earning the $4.25 an hour 
     minimum, and 7 million earning $5.15 or less. With 19.9 
     percent of its workers earning between $4.25 and $5.15, 
     Louisiana has the highest proportion of working people who 
     will be affected in the country, according to figures 
     compiled in 1994 by the Economic Policy Institute.
       During the debate that has raged in Washington over 
     increasing the minimum, both supporters and opponents said 
     they were arguing in the name of the poor and low-skilled.
       Opponents said the raise would break small businesses like 
     Boggs's and would price low-skilled workers out of their 
     jobs. Supporters protested that the minimum wage level had 
     been eroded by inflation and that an increase would help 
     alleviate the kind of poverty that is prevalent in Louisiana. 
     The measure passed by the House on a 288 to 144 vote would 
     raise the minimum wage from $4.25 to $4.75 an hour on July 1 
     and to $5.25 a year later. The Senate also has passed it, and 
     minor differences in the two bills are being worked out in 
       But Zachary is a long way from Capitol Hill. ``It's just a 
     little town on the go,'' said Norabeth Alexander, who has 
     earned $5.25 an hour as a cook and teacher at Kiddie Junction 
     for the past year and a half. With a large influx of new 
     families eager to take advantage of the local schools, which 
     have a good reputation, Zachary is suffering some growing 
     pains. The community is far less tightknit than it used to 
     be, and urban evils are beginning to arrive from the 
     metropolis. ``Drugs and crime are working their way out from 
     Baton Rouge,'' Alexander said.
       The days when doors could be left unlocked are gone here, 
     said Boggs, 48. Last year, Kiddie Junction was broken into 
     twice in one month. ``Parents just aren't spending enough 
     time with their children anymore. There's too much divorce 
     and no morals and very little discipline in the family. Kids 
     just won't say ``Yes, ma'am' or ``Yes, sir'' anymore like 
     they used to.''
       Kellie Valloton is an exception, Boggs said. Valloton is 
     17, still in high school, and works at Kiddie Junction as 
     part of a work experience program for $4.50 an hour. ``Kellie 
     is mature,'' Boggs said. She wants to be a teacher, but her 
     only experience working with children before she came to 
     Kiddie Junction was baby-sitting for friends. Valloton 
     says there is no way she could live on her own on her 
     wage. ``Sure, it would be nice to have a raise. But it 
     would be hard for some of the adults with more experience 
     because if I got an increase, I suppose they would want 
     one, too. I'm just here really to learn some 
     responsibility and hopefully have something to show for 
     it,'' she said.
       Boggs is certain there will be a chain reaction as high-
     paid workers demand that a differential be maintained between 
     them and their minimum-wage colleagues. Brenda Dugas, co-
     director of Kiddie Junction, thinks that is unlikely, Dugas 
     says that when she was raising her two children, she earned 
     no more than minimum wage, and sometimes less. Now she makes 
     $6.50 an hour, on which she helps support a son working his 
     way through college. Her daughter makes the minimum at a 
     local Lowe's Lumber store. ``Of course it's hard on the young 
     people, but it teaches them responsibility and survival 
     skills,'' Dugas said.
       But Dugas is in the apparent minority here in thinking it 
     is possible to live on the minimum wage. ``I think it would 
     be very difficult for the head of the household to live on 
     that,'' Boggs said. ``I do think it is morally wrong for 
     employers to just exploit people.''
       She prides herself on the benefits Kiddie Junction gives 
     its workers--a week's vacation and two annual sick days after 
     one year; two weeks' vacation and four sick days after three 
     years. ``I used to work in personnel, I know that the best 
     way to keep staff is to invest in people,'' she said.
       But, federal and state law imposes tight--and often 
     costly--restrictions on day-care centers. Boggs can have no 
     more than 16 4-year-olds, 14 3-year-olds or 12 2-year-olds 
     for every staff member. There must be 35 square feet inside 
     and 75 square feet outside for each child. She must pay for 
     fingerprinting (to help detect convicted child molesters), a 
     physical and tuberculosis test for each new staff member, and 
     CPR classes and an additional training day for each worker 
       Boggs charges $62 a week for children age 1 to 3, $56 for 
     those 3 or older and $30 for school-age children who are 
     there before or after school. With 39 children on its books 
     and a waiting list of 11, Kiddie Junction has made a profit 
     for the last eight years.
       Boggs's husband, Louis, who build Kiddie Junction in spare 
     time away from his job as an instrument technician for 
     Georgia Pacific Corp., is proud of its success. Louis Boggs 
     is a fan of conservative talk show host Rush Limbaugh and has 
     few good words to say

[[Page H9862]]

     about President Clinton. ``Every time I turn around, he's got 
     his hand in my pockets and trying to take my money away in 
     taxes,'' he said.
       It is senseless to talk about poverty in Louisiana, Louis 
     Boggs said, let alone to try to fix it with federal help. 
     ``For people at the low end of the wage scale in a state like 
     this, a minimum wage increase is just a vicious circle. 
     People keep talking about poverty. What's poverty? There's no 
     such thing as poverty. There's just workers without skills.''
  Mr. BEREUTER. Mr. Speaker, this Member rises to express his strong 
support for the conference report providing an increased minimum wage. 
This Member supported the bill when it was originally considered by the 
House and believes the time is right to increase the wage of working 
Americans. This Member is also pleased to see that the conferees 
included many important reforms which are designed to offset any 
potential costs associated with the increased cost in wages.
  The minimum wage was last increased on April 1, 1991, from $3.80 to 
$4.25 per hour. Inflation has increased 15.90 percent since April 1, 
1991. At that rate, to have the same purchasing power as the minimum 
wage did when it was last increased, the minimum wage level today would 
have to be set at $4.93 per hour. With the buying power of the minimum 
wage at a 40-year low, this Member has advocated a modest 45-cent-per-
hour increase, which would have appropriately returned the minimum wage 
close to its strength following the latest increase in 1991. Although 
the measure goes beyond his preferred position, this Member simply 
could not in good conscience vote against raising the minimum wage up 
to the level it should be after the effect of inflation. The September 
1, 1997, figure of $5.15 per hour will only be 22 cents more than it 
should be to adjust to the inflation level of July 1, 1996, so the 
prospective increases put in place are not out of line.
  This Member is very pleased that a $5,000 tax credit for adoptions is 
included in this conference report. As you know, the House passed this 
provision several times in the past 2 years; however, each time the 
overall bill was vetoed by the President. It is time that this family-
friendly tax credit becomes law.
  Additionally, this Member is extraordinarily pleased to see that 
conferees agreed to include the so-called Homemakers IRA. This Member 
joined 34 of his colleagues in sending a letter to the conferees 
requesting that they include the provision in the conference report. 
This Member would like to thank the gentleman from Texas [Mr. Archer], 
for his prompt response to the letter and thank the conferees for 
including this provision. The Homemakers IRA will allow America's 
middle-class families to prepare for their future by raising the tax-
deductible amount nonworking spouses may contribute to individual 
retirement accounts. For a family which contributes the new maximum of 
$2,000 for a nonworking spouse, assuming they begin when they are 30 
years old and retire at 65, they would have contributed an additional 
$63,000 to their retirement. This figure is strictly their 
contributions and does not take into account earnings on their savings.
  Mr. Speaker, this Member believes the conference report should be 
approved and urges his colleagues to vote aye.
  The SPEAKER pro tempore (Mr. LaTourette). All time has expired.
  Without objection, the previous question is ordered on the conference 
  There was no objection.
  The SPEAKER pro tempore. The question is on the conference report.
  Pursuant to House Resolution 440, the yeas and nays are ordered.
  The vote was taken by electronic device, and there were--yeas 354, 
nays 72, not voting 7, as follows:

                             [Roll No. 398]


     Baker (LA)
     Barrett (NE)
     Barrett (WI)
     Brown (CA)
     Brown (FL)
     Brown (OH)
     Bryant (TN)
     Bryant (TX)
     Collins (GA)
     Collins (IL)
     Collins (MI)
     de la Garza
     Fields (LA)
     Frank (MA)
     Franks (CT)
     Franks (NJ)
     Green (TX)
     Greene (UT)
     Hall (OH)
     Hastings (FL)
     Jackson (IL)
     Jackson-Lee (TX)
     Johnson (CT)
     Johnson (SD)
     Johnson, E. B.
     Kennedy (MA)
     Kennedy (RI)
     Lewis (CA)
     Lewis (GA)
     Lewis (KY)
     Miller (CA)
     Payne (NJ)
     Payne (VA)
     Peterson (FL)
     Peterson (MN)
     Smith (MI)
     Smith (NJ)
     Smith (TX)
     Smith (WA)
     Taylor (MS)
     Watt (NC)
     Weldon (FL)
     Weldon (PA)
     Young (AK)


     Baker (CA)
     Fields (TX)
     Hall (TX)
     Hastings (WA)
     Johnson, Sam
     Miller (FL)
     Taylor (NC)
     Watts (OK)

                             NOT VOTING--7

     Young (FL)

                              {time}  1146

  Messrs. McCOLLUM, JONES, MICA, MYERS of Indiana, and KINGSTON changed 
their vote from ``yea'' to ``nay.''
  Mr. BACHUS changed his vote from ``nay'' to ``yea.''
  So the conference report was agreed to.
  The result of the vote was announced as above recorded.
  A motion to reconsider was laid on the table.