Thursday, January 30, 2014

Obama raises business leaders' hopes - Los Angeles Times

WASHINGTON — President Obama's State of the Union address raised hope among business leaders for action this year on some of their priorities, including immigration reform, a corporate tax code overhaul and more trade deals.

But the domestic centerpiece of Obama's speech — raising the minimum wage — drew strong opposition even as he took to the road Wednesday to rally public support for it.

Even so, those business issues face a common major obstacle: a congressional election year in which almost anything controversial isn't likely to win approval.

That was clear when one of the items at the top of the business community's wish list — so-called fast-track trade negotiating authority — suffered a major blow just hours after Obama finished speaking.

Senate Majority Leader Harry Reid (D-Nev.) said he opposed legislation granting the president the authority to strike trade deals that Congress cannot amend. So do many Democrats who are concerned that such power would lead to unfair trade deals that cost U.S. workers their jobs.

"I'm against fast-track," Reid told reporters Wednesday. "I think that everyone would be well-advised just to not push this right now."

Meanwhile, many business groups would like Obama to back off his push to increase the federal minimum wage to $10.10 an hour from $7.25.

"The economy is having a hard time creating jobs right now, and the prospect of a 40% increase in the minimum wage is almost inevitably going to cost some individuals a future opportunity to get a job," said David French, senior vice president of government relations at the National Retail Federation.

His members, many of which rely on minimum-wage employees, and others argue that hiking base pay would hurt entry-level workers, such as teenagers, and the cost would be passed on to consumers in higher prices.

Obama zeroed in on a minimum-wage increase as part of his emphasis on closing the widening income gap between rich and poor and reviving the American Dream of upward mobility.

On Wednesday, he went to a Costco in Maryland to rally support for pending legislation to raise rates. Costco, where workers start at $11.50 an hour, is among companies that support an increase.

"If you work hard, you should be able to pay your rent, buy your groceries, look after your kids," Obama said. "If you put in a hard day's work, you deserve decent pay for it."

Richard Trumka, president of the AFL-CIO, the country's largest labor federation, said Obama's call for an increase is "a good step."

"Now we need congressional action," Trumka said.

In his State of the Union speech, Obama also asked employers to raise their workers' pay voluntarily. But Trumka said Washington needed to do more.

"You can't just ask employers to raise wages," he said. "You have to have a minimum wage that they're obligated to pay."

Most Republicans oppose a minimum wage increase, dimming the prospects for legislation this year.

But many Republicans support Obama's push for expanded trade.

A key to that is trade promotion authority, which allows lawmakers to set guidelines for trade deals and consult with the president during negotiations. In exchange, the president gets a fast-track approval process that requires an up-or-down vote with no amendments. The authority expired in 2007.

"We need to work together on tools like bipartisan trade promotion authority to protect our workers, protect our environment and open new markets to new goods stamped 'Made in the USA,'" Obama said in his Tuesday speech.

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