Venezuela Hikes Minimum Wage 30 Percent Amid Economic Crunch

CARACAS, Venezuela – Venezuela’s president is ordering a 30 percent increase in the minimum wage, the latest move by the socialist government to grapple with high inflation and economic stagnation.

The boost announced Saturday night by President Nicolas Maduro comes after a 25 percent increase on March 1.

The new increase is effective Sunday, which is International Labor Day, and will push the minimum wage to 15,051 bolivars a month. That is about $1,500 at the official exchange rate, but is around $50 at the current black market rate, which largely sets prices of goods for Venezuelans.

Venezuela’s oil export-dependent economy shrank 5.7 percent last year, shortages of basic goods multiplied and prices soared. The government has instituted rolling blackouts and state employees are working only two days a week to conserve electricity.

The Associated Press

NEW YORK, NY - JULY 28: Venezuelan President Nicolas Maduro speaks to the media following a meeting with UN chief Ban Ki-moon at the United Nations (UN) headquarters in New York on July 28, 2015 in New York City. Maduro is in New York to speak with the UN about his country's escalating border dispute with Guyana. (Photo by Spencer Platt/Getty Images)

Venezuelan President Nicolas Maduro speaks to the media following a meeting with UN chief Ban Ki-moon at the United Nations headquarters in New York on July 28, 2015 in New York City. (Photo by Spencer Platt/Getty Images)




US Virgin Islands Prepares for Minimum Wage Increase

CHARLOTTE AMALIE, U.S. Virgin Islands (AP) — The government of the U.S. Virgin Islands announced Wednesday that it will soon increase the minimum wage to $8.35 an hour.

virgin-islands-flag

U.S. Virgin Islands flag

Labor Commissioner Catherine Hendry said the increase will be effective June 21. Another increase to $9.50 is scheduled for June 2017 and a final increase to $10.50 is slated for June 2018. The U.S. territory’s current minimum wage is $7.25 an hour.

Hendry says tourist service employees and restaurant workers are exempt from the increases.

Legislators last year pushed for the increase despite concerns it might force some local businesses to close because of the weak economy. Supporters argued that the minimum wage has not kept up with cost of living increases.

The increase comes as the U.S. Congress considers whether to allow neighboring Puerto Rico to lower its minimum wage for workers younger than 25 in hopes that will help create more jobs amid a dire economic crisis. Puerto Rico’s minimum wage varies from $5.08 to $7.25 an hour. The island is struggling to emerge from a decade-long economic crisis and its government has a $70 billion public debt that the governor says is unpayable and needs restructuring.

 

By The Associated Press




California, New York Enact US-Highest $15 Minimum Wages

LOS ANGELES – California and New York acted Monday to gradually push their statewide minimum wages to $15 an hour – the highest in the nation – as Hillary Clinton and Bernie Sanders again seized on wage disparity and the plight of the working poor as a defining issue in the presidential race.

Clinton joined New York Gov. Andrew Cuomo as he signed the law that will gradually boost that state’s pay rate and she predicted the movement will “sweep our country.”

In a statement, Sanders said his campaign is about building on the steps in California and New York “so that everyone in this country can enjoy the dignity and basic economic security that comes from a living wage.”

In Los Angeles, Gov. Jerry Brown signed a bill into law that will lift the statewide minimum wage to $15 an hour by 2022.

Together with New York, it marks the most ambitious moves yet to close the national divide between rich and poor. Experts say other states may follow, given Congress’ reluctance to act despite entreaties from President Barack Obama.

FILE - In this Monday, March 28, 2016 photo, Gov. Jerry Brown is hugged by Holly Dias, a Burger King employee who praised Brown's announcement of proposed legislation to increase the state's minimum wage to $15 per hour by 2022, during a news conference in Sacramento, Calif. On Monday, April 4, 2016, Brown is set to sign the legislation into law in Los Angeles. (AP Photo/Rich Pedroncelli)

Gov. Jerry Brown is hugged by a Burger King employee. (AP Photo/Rich Pedroncelli)

“This is about economic justice. It’s about people. It’s about creating a little, tiny amount of balance in a system that every day becomes more unbalanced,” Brown said before signing the bill at the Ronald Reagan State Building.

Republicans and business groups warn that the move could cost thousands of jobs, while a legislative analysis puts the cost to California taxpayers at $3.6 billion a year in higher pay for government employees.

A $15 base wage will have “devastating impacts on small businesses in California,” Tom Scott, executive director of the state branch of the National Federation of Independent Business, said in a statement. “Ignoring the voices and concerns of the vast majority of job creators in this state is deeply concerning and illustrates why many feel Sacramento is broken.”

Democrats who control the Legislature approved the increase Thursday, days after the agreement was announced. The measure passed with no Republican support.

The bill will bump the state’s $10 hourly minimum by 50 cents next year and to $11 in 2018. Hourly $1 raises will then come every January until 2022, unless the governor imposes a delay during an economic recession. Businesses with 25 or fewer employees have an extra year to comply.

Wages will rise with inflation each year thereafter.

The Democratic governor negotiated the deal with labor unions to head off competing labor-backed ballot initiatives that would have imposed swifter increases with fewer safeguards.

About 2.2 million Californians now earn the minimum wage, but University of California, Irvine, economics professor David Neumark estimated the boost could cost 5 to 10 percent of low-skilled workers their jobs.

Brown has said California, with the world’s eighth largest economy, can absorb the raises without the problems predicted by opponents.

California and Massachusetts currently have the highest statewide minimum wage at $10. Washington, D.C., stands at $10.50. Los Angeles, Seattle and other cities have recently approved $15 minimum wages, while Oregon officials plan to increase the minimum to $14.75 an hour in cities and $12.50 in rural areas by 2022.

New York’s state budget includes gradually raising the $9 minimum wage to $15, starting in New York City in three years and phasing in at a lower level elsewhere. An eventual statewide increase to $15 would be tied to economic indicators such as inflation.

The Associated Press




California, New York Poised to Raise Minimum Wage to $15

State Sen. Mark Leno, D-San Francisco, left, one of the authors of a bill to raise California's minimum wage, is hugged by Sen. Ben Hueso, D-San Diego, as the Senate voted on the bill, Thursday, March 31, 2016, in Sacramento, Calif. The bill, SB3, to gradually raise the state's minimum wage to a nation-leading $15 an hour by 2022, was approved by both houses of the Legislature and sent to Gov. Jerry Brown. (AP Photo/Rich Pedroncelli)

State Sen. Mark Leno, D-San Francisco, left, one of the authors of a bill to raise California’s minimum wage, is hugged by Sen. Ben Hueso, D-San Diego, as the Senate voted on the bill, Thursday. (AP Photo/Rich Pedroncelli)

SACRAMENTO, Calif. – California and New York are poised to become the highest-paid minimum-wage states in the nation after their governors each reached deals with lawmakers to raise the lowest amount a worker can be paid to a record-shattering $15 an hour.

California Gov. Jerry Brown said he will sign a new minimum-wage bill Monday after it passed the Legislature on Thursday. Across the country in New York, Gov. Andrew Cuomo reached a tentative deal late Thursday with top lawmakers to raise the state’s base wage.

The actions in two of the country’s most labor-friendly states come as the income divide has emerged as a key issue nationwide in a presidential election year. President Barack Obama, who first proposed an increase to the $7.25 federal minimum wage in 2013, applauded the states’ actions and called on the Republican-controlled Congress to “keep up with the rest of the country.”

“California takes a massive leap forward today in the fight to rebalance our nation’s economy,” said Art Pulaski, executive secretary-treasurer of the California Labor Federation.

California’s current $10-an-hour minimum wage is tied with Massachusetts for the highest among states. Only Washington, D.C., at $10.50 per hour is higher. New York’s minimum wage is $9.

Democrats who control both legislative chambers in California hailed the increase as a boon to more than 2 million workers. Brown, also a Democrat, said it proves the nation’s most populous state can get things done and help people get ahead.

But Republicans echoed fears from business owners and economists that California’s annual increases – eventually tied to inflation – will compound the state’s image as hostile to business.

Republican Assemblyman Jim Patterson of Fresno said the increase would force small-business owners to make layoffs “with tears in their eyes.”

The increases would start with a boost from $10 to $10.50 on Jan. 1. Businesses with 25 or fewer employees would have an extra year to comply. Increases of $1 an hour would come every January until 2022. The governor could delay increases in times of budgetary or economic downturns.

The tentative deal reached by New York officials would be phased in regionally in the nation’s fourth-largest state. It also would eventually affect more than 2 million workers.

In New York City, the wage would increase to $15 by the end of 2018, though businesses with fewer than 10 employees would get an extra year. In the suburbs of Long Island and Westchester County, the wage would rise to $15 by the end of 2022. The increases are even more drawn out upstate, where the wage would hit $12.50 in 2021, then increase to $15 based on an undetermined schedule.

“This minimum wage increase will be of national significance,” Cuomo, the Democratic governor, told reporters. “It’s raising the minimum wage in a way that’s responsible.”

Cuomo had initially proposed a simpler phase-in: three years in New York City and six years elsewhere. The more gradual, nuanced approach was the result of negotiations with Senate Republicans who worried such a sharp increase would devastate businesses, particularly in the upstate region’s more fragile economy.

Economists have long debated the impact of a higher minimum wage. Some studies have found that higher wages contributed to job cuts, while others found little effect on hiring because employers could absorb the costs or pass them along to customers.

The Congressional Budget Office conducted an analysis in 2014 finding both benefits and trade-offs with an increase. A higher minimum wage would generally raise incomes and lift people above the poverty line, but it also would lead to a wave of job losses for some low-income workers.

The non-partisan agency examined the prospect of raising the national minimum wage to $10.10 an hour from $7.25. It would raise incomes by a net of $17 billion for families below or relatively close to the poverty line. But it would cost 500,000 jobs, a 0.3 percent decline in total employment.

In California, Brown was previously reluctant to raise the base wage. He negotiated the deal with labor unions to head off competing November ballot initiatives that would have imposed swifter increases without some of the safeguards included in the legislation. The governor now says California’s fast-growing economy can absorb the raises without the problems predicted by opponents.

About 2.2 million Californians now earn the minimum wage. The University of California, Berkeley, Center for Labor Research and Education projected that pay would rise for 5.6 million Californians by an average of 24 percent. More than a third of the affected workers are parents.

Latinos would benefit most because they hold a disproportionate number of low-wage jobs, the researchers said.

The right-leaning American Action Forum countered with its own projection that the increases would slow the rate of job growth, potentially costing the state nearly 700,000 jobs over the next decade.

The increases are expected to eventually cost California taxpayers an additional $3.6 billion annually for higher government employee pay.

In New York, the tentative deal also includes middle-class state income tax cuts starting in 2018. The cut would apply to New Yorkers with incomes between $40,000 and $300,000 and rates that currently range from 6.45 percent to 6.65 percent starting in 2018. The rates would gradually drop to 5.5 percent by 2025.

Cuomo administration officials estimate the lower tax rates will save more than 4 million filers nearly $6.6 billion in the first four years, with annual savings reaching $4.2 billion by 2025.

The Associated Press




Deal Reached to Take California Minimum Wage to $15 an Hour

SACRAMENTO, Calif. – California legislators and labor unions have reached a tentative agreement that will take the state’s minimum wage from $10 to $15 an hour, a state senator said, a move that would make for the largest statewide minimum in the nation by far.

“This is not a done deal,” Sen. Mark Leno, D-San Francisco, told The Associated Press on Saturday. “Everyone’s been operating in good faith and we hope to get it through the Legislature.”

Leno said if an agreement is finalized, it would go before the Legislature as part of his minimum-wage bill that stalled last year.

If the Legislature approves a minimum-wage package, it would avoid taking the issue to the ballot. One union-backed initiative has already qualified for the ballot, and a second, competing measure is also trying to qualify.

“This is an issue I’ve been working on for many years,” Leno said. “The governor and stakeholders have all been negotiating earnestly and in good faith for some time.”

Leno did not confirm specifics of the agreement, but most proposals have the wage increasing about a dollar per year until it reaches $15 per hour.

The Los Angeles Times, which first reported the deal, said the wage would rise to $10.50 in 2017, to $11 an hour in 2018, and one dollar per year to take it to $15 by 2022. Businesses with fewer than 25 employees would have an extra year to comply.

At $10 an hour, California already has one of the highest minimum wages in the nation along with Massachusetts. Only Washington, D.C., at $10.50 per hour is higher. The hike to $15 would make it the highest statewide wage in the nation by far, though raises are in the works in other states that might change by the time the plateau is reached in 2022.

Some states have passed higher minimums for government employees and state-contracted workers, and some cities including Seattle have already passed $15 an hour increases.

And Oregon officials approved a law earlier this month that will increase that state’s minimum wage to nearly $15 in urban areas over the next six years.

FILE - In this Tuesday, July 21, 2015 file photo, workers hold a rally in Los Angeles in support of the Los Angeles County Board of Supervisors' proposed minimum wage ordinance. On Saturday, March 26, California legislators and labor unions reached an agreement that will take the state's minimum wage from $10 to $15 an hour. (AP Photo/Nick Ut)

Workers hold a rally in Los Angeles in support of the Los Angeles County Board of Supervisors’ proposed minimum wage ordinance. (AP Photo/Nick Ut)

California union leaders, however, said they would not immediately dispense with planned ballot measures.

Sean Wherley, a spokesman for SEIU-United Healthcare Workers West, confirmed that the SEIU parent union was involved in the negotiations. He said SEIU-UHWW’s leadership will decide whether to push ahead with its initiative that has already qualified for the ballot.

“Ours is on the ballot. We want to be certain of what all this is,” Wherley said. “If some agreement is signed into law, then our executive board would decide what to do. They would only make that decision after any agreement is signed into law.”

The union proposal that has already qualified for the ballot calls for reaching the $15 mark by 2021. The second proposed measure would reach $15 by 2020. Businesses and Democratic Gov. Jerry Brown have said such a steep wage increase would be incredibly costly.

A spokesman for Brown, Evan Westrup, did not immediately respond to a request for comment.

Kevin Liao, a spokesman for Assembly Speaker Anthony Rendon, D-Paramount, declined to comment.

The Associated Press




GOP Member Proposes to Eliminate Federal Minimum Wage in Puerto Rico

SAN JUAN — As Congress continues to evaluate options to address Puerto Rico’s fiscal and economic crisis, a Republican representative introduced last week legislation that would allow the commonwealth to opt out of federal minimum wage requirements.

“I recognize that it is by no means a cure-all for Puerto Rico, but I believe it is a step in the right direction in allowing the island to make itself more competitive and thereby avoid bailouts and an alteration to U.S. bankruptcy law,” stated Rep. Mark Sanford (R.-S.C.), author of H.R. 4637, or the Puerto Rico Minimum Wage Improvement Act.

The Puerto Rico government continues to lobby for immediate congressional action, particularly over access to a broad debt-restructuring regime. The Barack Obama administration, through the U.S. Treasury, is also making the case for granting access to a bankruptcy regime they say must be tailored to Puerto Rico and paired with federal fiscal oversight that respects the island’s self-governance.

“I believe allowing Puerto Rico to declare bankruptcy would have far-reaching and very negative consequences for taxpayers in South Carolina and across this country. Federal bankruptcy laws have long prohibited states and territories from filing for bankruptcy. If this was changed, one could expect to see states like Illinois or California that have overspent follow suit, given the impossible math entailed in their unfunded pensions,” Sanford further stated.

For his part, Resident Commissioner Pedro Pierluisi, a Democrat, said he opposes this bill, “which could very well be called, ‘Act to foster more outmigration to the States.’”

Speaker of the House John Boehner (R-OH) conducts a ceremonial swearing-in with Rep. Mark Sanford (R-SC) at the U.S. Capitol May 15, 2013 in Washington, DC. The former governor of South Carolina, Sanford won a special election on May 7 to win the seat vacated by Republican Tim Scott, who was appointed to the Senate. Sanford has bounced back after his political career was derailed in 2009 by an extramarital affair that cost him his marriage.

Rep. Mark Sanford (Photo by Chip Somodevilla/Getty Images)

The idea of allowing Puerto Rico to set a minimum wage below the federal floor was among the recommendations made by a group of former International Monetary Fund economists, led by former chief Dr. Anne Krueger. Yet, the proposal has not been pushed by the commonwealth government as part of its plan to address the fiscal crisis, after it was received with skepticism following the release of the so-called Krueger report.

In rejecting bankruptcy or any type of bailout for the island, Sanford said he thinks “it’s important to address what led to Puerto Rico’s economic problems in the first place, and this is what the Puerto Rico Minimum Wage Improvement Act offers.” He noted how Congress has already modified minimum wage standards for such territories as American Samoa and Northern Marianas.

“This bill would allow adjustment based on the prevailing wages in the Caribbean Basin and better enable the island of Puerto Rico to compete with its island neighbors,” the GOP member said.

House Speaker Paul Ryan (R-Wis.) has said the lower chamber aims to come up with a solution before the end of March, while there is still no consensus on how exactly the Republican-led Congress would deal with the problem.

A copy of the bill can be found here.




Analysis: Obama in Campaign form in Final State of the Union

WASHINGTON – President Barack Obama opened his State of the Union speech saying he’d keep it short, in what must have seemed music to the ears of some in the chamber antsy to get to Iowa to campaign for president.

At times, Obama looked like he was one of them, eager to challenge biting criticism from Donald Trump, Ted Cruz, Marco Rubio, Jeb Bush and other Republicans.

Obama was at turns boastful and biting, confident and sarcastic.

Anyone who says the economy is declining is “peddling fiction,” he argued. Obama characterized skepticism about science and reluctance to adopt technology as absurd. “When the Russians beat us into space, we didn’t deny Sputnik was up there,” he said. Claims that U.S. stature in the world is shrinking, he virtually shouted, is “political hot air.”

“The United States of America is the most powerful nation on earth. Period. It’s not even close. It’s not even close!” the president declared.

The president’s final turn at the House podium was his most high-profile entry yet into the presidential race to succeed him. After largely begging off the day-to-day skirmishes in the raucous contest, Obama showed he was more than ready to defend his record and happy to use one of his last chances to seize America’s attention to show Democrats how he thinks it should be done.

Obama has more than his party’s interest at heart. His legacy will be shaped by whether Americans choose a Democrat to succeed him and cement his signature heath care law, environmental policies and immigration programs. Democrat Hillary Clinton has tried to put some distance between her campaign and the president – often saying she’s not running for his third term. That has at times left Obama as his own best defender.

The White House had billed Obama’s speech as a rethinking of the genre, and delivered.

Obama eschewed a lengthy to-do list for Congress and any rollout of new policies. (White House officials have promised to reveal some new plans in the coming weeks, rather than pack them into one night.)

Obama only breezed through his remaining priorities – raising the minimum wage, overhauling the immigration system, tightening gun laws – even as he acknowledged they were unlikely to get done. He highlighted a few possible proposals with better chances – criminal justice reform and fighting prescription drug abuse.

“Who knows? We might surprise the cynics again,” Obama said.

The flip comment was a reminder that the speech, like the president’s final year in office, wasn’t focused on Congress as much as on defending his accomplishments.

Obama took some clear shots at the cast of Republicans who’ve used him as a target for months.

He defended his handling of the rise of Islamic extremism and tried to temper anxieties about the Islamic State group.

“Over-the-top claims that this is World War III just play into their hands,” Obama said. “We don’t need to build them up to show that we’re serious, and we sure don’t need to push away vital allies in this fight by echoing the lie that ISIL is somehow representative of one of the world’s largest religions.”

With an expected audience of some 30 million viewers, the speech was Obama’s first of two chances to take Americans squarely by the shoulders and make his case for a Democratic successor. Not until his speech at the Democratic convention this summer, will Obama likely have such undivided attention again.

The case he delivered was not new. The president and his aides have been marveling for months at what they described as Republicans’ gloom-and-doom vision. White House officials have labeled it both inaccurate and bad politics. Some of his arguments echoed the case he makes to donors at fundraising events.

In trying to present an optimistic alternative, Obama’s speechwriters were mindful of not taking a victory lap. Americans hardly share his confidence in America’s upward trajectory, polls show. In touting the economic recovery, in particular, Obama risks seeming out of touch.

“The president’s record has often fallen far short of his soaring words,” South Carolina Gov. Nikki Haley said in the Republican rebuttal. “As he enters his final year in office, many Americans are still feeling the squeeze of an economy too weak to raise income levels. We’re feeling a crushing national debt, a health care plan that has made insurance less affordable and doctors less available, and chaotic unrest in many of our cities.”

But the president showed he was ready to rebut such comments – once Democrats pick a candidate and he’s unleashed on the trail.

Until then, as he told his audience of lawmakers and candidates, he understands the hankering to get back to Iowa.

“I’ve been there,” he said with a grin. “I’ll be shaking hands afterwards if you want some tips.”

By The Associated Press




Obama’s State of Union Proposals often hit Wall in Congress

WASHINGTON – “Dead. Real Dead.” That was the verdict by then-House Speaker John Boehner on President Barack Obama’s proposal to impose higher dividend and capital gains taxes on the wealthy.

But it could just have easily applied to most of the other priorities the president discussed in last year’s State of the Union address: free community college, a higher minimum wage, seven days of paid sick leave, authorization to use force against the Islamic State group. They made no progress in the halls of Congress.

No doubt, Obama had numerous high-profile victories in 2015. He got Republicans in Congress to go along with more spending, killed the proposed Keystone XL pipeline, and his health care law lives on despite Republican-led efforts to repeal it. He also secured international agreements designed to curb global warming and stop Iran from getting a nuclear weapon.

But efforts that required congressional cooperation often proved DOA. Instead, White House officials are left pointing to efforts outside of Washington to make the case that Obama’s priorities are rubbing off with the public.

For example, the National Conference of State Legislatures says 14 states began the new year with higher minimum wages. Of those, a dozen states increased their rates through legislation while two states automatically increased their rates based on the cost of living.

And Oregon became the fourth state to mandate that employers provide paid sick leave. Obama issued an executive order that requires federal contractors to do the same for their workers.

“The president is acutely aware that change doesn’t always start in Washington,” said White House spokesman Eric Schultz.

Obama will go before Congress on Tuesday night with his final State of the Union speech and prospects are bleak for big agreements. For one thing, it’s a presidential and congressional election year driven by sharp partisanship.

Lawmakers will be spending as much time as they can back in their states and districts, and will seek to avoid taking on anything that could cost them votes in November. GOP lawmakers, for example, overwhelmingly put themselves in the free trade camp, yet Senate Majority Leader Mitch McConnell is pushing to delay any vote on the trade-liberalizing Trans-Pacific Partnership until after the election.

Over the years, Obama has returned to familiar themes. He has pushed for higher taxes for the wealthy and using some of the revenue to pay for tax breaks for the middle class. He has often sought more money for education and infrastructure projects, such as roads and bridges.

In 2015, Congress declined to increase the capital gains and dividend rates that Obama called for with the wealthiest families. Nor did it approve a fee on large, highly leveraged financial institutions to discourage excessive borrowing. But it did make permanent tax breaks that Obama had sought for low-income workers and families as well as families with members attending college.

Republicans dismissed the proposal for free junior college, saying it was too expensive and a better option would be to increase access to Pell grants by streamlining the application process.

And on the minimum wage, lawmakers said an increase nationally would eliminate hundreds of thousands of jobs for students and lower-skilled workers.

Despite the congressional opposition to forcing companies to provide paid sick leave, Obama got a bit of his way. He issued an executive order on Labor Day that requires federal contractors to provide paid sick leave – one hour for every 30 hours the employees work. Stretched out over 12 months, that’s up to seven days per year. The order will allow employees to use the leave to care for sick relatives as well, and will affect contracts starting in 2017 – just as Obama leaves office.

For several years now, Republicans have blocked an election-year ritual for Democratic lawmakers: legislation to narrow the pay gap between men and women. And when the GOP took control of both chambers of Congress, prospects for passage got even steeper. But that didn’t deter Obama from making another pitch.

The results were predictable: legislation entitled the Paycheck Fairness Act has yet to make it out of a committee.

By The Associated Press