Salt of the Earth: In session--December 1999

In session: legislative update
December 1999

Cause for jubilation
Minimum progress on the minimum wage

Cause for jubilation
Grass-roots organizations working for debt-relief in the world's poorest countries have reason to be jubilant. The omnibus spending bill that Jubilee 2000/USA and other groups had been supporting was passed by Congress on November 19. The bill takes a significant step toward President Clinton's promise of canceling the more than $5 billion in debt owed to the U.S. by nearly 30 poor nations.

Congress agreed to appropriate $110 million for U.S. bilateral debt relief. It will also grant the approval necessary for IMF participation in the Cologne debt relief initiative that could help as many as 39 countries benefit from debt relief when fully funded.

Treasury officials gave much credit to the Jubilee 2000 movement for its work in the last weeks before the vote. The movement included a number of groups including the U.S. Catholic Conference, the Episcopal Church, Bread for the World, Oxfam America. They received a little help from Bono, lead singer of the rock group U2, who spent a day on Capitol Hill. Treasury Secretary Larry Summers called the groups "a formidable force."

But there is still work to be done in the coming months, according to United States Catholic Conference and Jubilee 2000/USA. Congress did not release all the IMF funds to be used for debt relief but plans to revisit the issue on May 1, 2000. There also needs to be appropriations made to help finance the participation of regional development banks such as Inter-American Development bank and African Development Bank in the Cologne Initiative. They hold about 15 percent of the debt of the poor nations the Cologne Initiative aims to help.

"The full force of our campaign is only just now beginning to be felt," said Dr. Jo Marie Griesgraber, chair of the steering committee of Jubilee 2000/USA. "Next year we will mobilize to demand that the U.S. and other G7 nations look for ways to deepen debt relief and expand it to more countries."—Maria Hickey
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Minimum progress on the minimum wage
With an eye to the 2000 elections, both Democrats and Republicans in the Senate saw the wisdom in raising the minimum wage this November but differed in how to pay for the hike and how long the full raise would take to be implemented.

The Republican-sponsored bill prevailed with a 54-44 vote on November 9, increasing the $5.15 per hour minimum wage by $1 over three years. The measure was accompanied by an $18.4 billion tax cut that would be financed by projected budget surpluses over the next five years.

The Democratic proposal was defeated moments before with a 50-48 vote. Their version of the bill would have raised the minimum wage by $1 over 13 months and given $9.6 billion in business tax relief without using budget surplus.

Republicans have been criticized for including tax cuts that would benefit only the wealthiest workers. Only one percent of the highest-earning taxpayers are expected to get nearly 20 percent of the plan's tax cuts, at about $1,600 a year, according to Citizens for Tax Justice. The New York Times reported that financing tax cuts through expected surpluses relies on Congress to abide by current budget caps while cutting domestic discretionary spending by 10 percent.

Republicans have countered that the Democratic proposal would hurt small businesses that could leave up to 500,000 people without their jobs, while raising taxes.

Clinton is expected to veto any proposal that spends surplus dollars, but it is likely that he will not see the bill until sometime next year, if at all. The President said the GOP plan was filled with "unfair and excessive tax breaks to special interests."—Maria Hickey
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