Bill aims to hike U.S. minimum wage to $12

May 2, 2015 4:28 PM by CBS News

Nearly 38 million Americans -- or one in four workers-- would get a raise under a bill introduced this week on Capitol Hill.

The measure, co-sponsored by Representative Bobby Scott, D-Virginia, and Senator Patty Murray, D-Washington State, would gradually increase the U.S. minimum wage, which has been stuck at $7.25 an hour for the last six years, to $12 an hour in five years and then index it to median wage growth.

"It's just unfair for people to work for 40 hours a work and still live in poverty," Scott told CBS MoneyWatch.

The proposal would raise the minimum hourly wage to $8 in 2016 and increase it by a dollar annually in subsequent years, until hitting $12 in 2020.

The proposal would also gradually phase out the tipped minimum wage, which has held at $2.13 since 1991, raising it to equal the minimum wage, followed by indexing.

Tipped workers are two times more likely to live below the federal poverty line than the general workforce, and more than 46 percent receive federal assistance, according to Democrats on the House Committee on Education and Workforce.

Proponents argue that a hike in the federal minimum wage is not only long overdue but has widespread public support. A survey earlier this year found 75 percent of Americans -- including 53 percent of Republicans -- favor hiking the minimum wage to $12.50 by 2020.

That poll, released by the National Employment Law Project, also found 63 percent of Americans backing an even larger hike to $15 by 2020.

"It's extremely popular nationwide, even in states that were simultaneously electing Republicans," Scott said.

Twenty-nine states and the District of Columbia, along with 21 cities and counties, have minimum wages above the federal rate, according to the Economic Policy Institute. Cities including Seattle and San Francisco have raised their minimum wages to $15, and some of the nation's largest employers have raised wages "even in the absence of federal action," the institute said.

The Scott-Murray proposal would bring workers more than $100 billion in increased earnings over the next five years, bolstering Main Street and the U.S. economy. "Because low-wage workers tend to spend increased earnings locally on basic needs, this will benefit Main Street businesses that rely on consumer spending," the institute said.

If the minimum wage had kept pace with price increases since 1968, by 2014 it would have stood at $9.54 --about 32 percent higher than its actual level, according to the Economic Policy Institute, which on Thursday published a report entitled "We Can Afford a $12.00 Federal Minimum Wage in 2020."

In the Senate, 32 Democrats signed on as co-sponsors to the Scott-Murray bill, while 160 Democrats are co-sponsoring in the House. Given the lack of support from Republicans who hold majorities in both chambers, advancing the measure could be difficult, if not impossible.

"The chair of the committees will decide if and when hearings will be held. Hopefully, we'll go through the legislative process," said Scott.

Spokespeople for both Republican chairs did not offer comment. Troy Young, a spokesman for Minnesota's John Kline, chairman of the House Education and Workforce Committee, deferred to colleagues in Washington.

"Working families are hurting in the Obama economy, and that is why we will continue to support pro-growth policies that help create jobs and raise wages for America's workers," Brian Newell, communications director for the House Education and Workforce Committee, said in an email response when asked about the Scott-Murray proposal.

Caroline Taylor, a spokeswoman for Tennessee Senator Lamar Alexander, who chairs the Senate Committee on Health, Education, Labor and Pensions, could not provide comment. However, in the past Alexander has opposed increasing the federal minimum wage.

Still, Scott remained optimistic that his Republican colleagues might be swayed by their constituents, saying the outcome "depends on the public reaction. A groundswell of support should be there."

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