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Minimum wage bill rejected by Senate

By ASSOCIATED PRESS
Published August 4, 2006

WASHINGTON - A Republican effort to fuse a cut in inheritance taxes on multimillion-dollar estates with the first minimum wage increase in nearly a decade was rejected by the Senate late Thursday.

Republicans needed 60 votes to advance the bill, which links a $2.10 increase in the $5.15 federal minimum wage over three years to reductions an estate taxes next decade. The bill got a 56-42 vote, four votes short of succeeding. Both Florida senators, Republican Mel Martinez and Democrat Bill Nelson, voted for the measure.

The House passed a version of the bill last Saturday.

For Republicans, the combination could have neutralized a Democratic campaign issue while also advancing an estate tax cut, a priority that could have an uncertain future if the GOP loses seats in Congress in November's election.

The vote forced Democrats to go on record voting against the minimum wage increase, although they said they were opposing the plan because it also cut taxes on multimillion-dollar estates.

The vote would have been 57-41, but Senate Majority Leader Bill Frist, R-Tenn., switched his vote in a maneuver preserving the right to debate the bill again this fall. He urged senators who voted against it to "rethink long and hard" before lawmakers reconvene in September.

Four Democrats joined Republicans and voted for the bill: Sens. Robert Byrd of West Virginia, Ben Nelson of Nebraska, Nelson of Florida and Blanche Lincoln of Arkansas.

Two Republicans voted against the bill: Sens. Lincoln Chafee of Rhode Island and George Voinovich of Ohio.

Senate Finance Committee chairman Charles Grassley, R-Iowa, likened the minimum wage and estate tax bill to "a long-shot" bet on racing horses.

"Once they're out of the barn and running around, it's kind of hard to turn them around," he said. "Senators can be similar, especially when a vote is highly political."

Frist had tried repeatedly this year to repeal or reduce the estate tax.

"This death tax punishes everyday Americans by forcing them to give up their business, to give up their farms," he said.

An earlier bid to move an estate tax bill to debate fell three votes short of succeeding. Frist and House Republican leaders had hoped adding the minimum wage, along with a package of popular tax cuts, could carry it to passage.

Among other things, the bill resurrects deductions that expired last year for state sales taxes, tuition and teachers' classroom supply purchases, along with a business research and development credit.

The bill had extra items to entice Democrats who were uneasy about voting for the estate tax reductions. The add-ons included a cut in timber capital gains taxes, rural development incentives and a program cleaning up abandoned coal mines.

[Last modified August 4, 2006, 01:46:24]