Senate backs rise in minimum wage

Bill would give tax breaks to small businesses

February 02, 2007|By NEW YORK TIMES NEWS SERVICE

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WASHINGTON --The Senate voted overwhelmingly yesterday to increase the minimum wage and give $8.3 billion in tax cuts to small businesses.

The increase in the minimum wage, the first in 10 years, was a victory for Democrats, who had made it a key plank in their midterm election campaign.

Despite the wide margin of the Senate vote, 94-3, the increase - to $7.25 per hour from $5.15 per hour - must clear several hurdles before it becomes law.

Maryland's two senators, Democrats Barbara A. Mikulski and Benjamin L. Cardin, voted to increase the minimum wage.

Democratic leaders in the Senate face their first big conflict with counterparts in the House as the two chambers try to negotiate differences between the Senate bill and the one the House passed last month.

House Democrats promised that if they became the majority they would pass an increase in the minimum wage, along with ethics reform and other measures, in their first 100 hours, and they succeeded.

But the House bill did not include tax breaks. House Democratic leaders have said they want a "clean" bill, which simply raises the minimum wage.

That approach failed in the Senate last week. Democratic leaders there say that they cannot get the Republican support they need without the tax provisions.

That leaves it to the Democratic leader in the Senate, Harry Reid of Nevada, to negotiate with the House speaker, Nancy Pelosi of California, and Rep. Charles B. Rangel of New York, chairman of the Ways and Means Committee.

The House could block consideration of the bill or strip out the tax provisions and send it back for another Senate vote.

Reid told reporters yesterday that he thought the Senate might approve a clean bill if the House sent it back for another try. But his office said later that he did not believe the vote count had changed and that he expected the differences could be worked out in negotiations.

"It's not exactly clear what road we're going to take," said Sen. Max Baucus of Montana, chairman of the Finance Committee. But, he added, "the desire to get the minimum wage passed is going to trump" any concerns or delays in negotiations.

Sen. Edward M. Kennedy, a Massachusetts Democrat who has championed the bill, said it was "unrealistic" to expect that it would simply go through the House.

Still, he said: "The minimum wage is going to go up. I wish it was going to be tonight or tomorrow that we get it to the president's desk, but it is going to increase, and the only question is whether it's going to take perhaps a week or it's going to take ... two weeks or so."

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