Through Congress, President Obama has attempted for months to increase the Federal minimum wage for all employees entitled to the minimum wage, without success.
President Obama thus decided to use his executive powers to address a portion of the minimum wage issue by issuing an executive order raising the minimum wage for workers under new federal contracts.
This announcement comes just hours before President Obama is scheduled to delivery his State of the Union address.
All other employees are still subject to the Federal minimum wage of $7.25 (or more under State law).
In the press release, President Obama further called upon Congress to raise the Federal minimum wage from $7.25 to $10.10 per hour in stages by the end of 2015 and index the rate to inflation thereafter. The White House believes that this increase would directly increase wages for some 15 million American workers, which would in turn help boost the middle class in the United States.
Critics of the increase in minimum wage often argue that doing so would dissuade small business owners from hiring more workers which would have the adverse effect of less jobs available for America’s young professionals.
Rudy Giuliani, former Mayor of New York, on Piers Morgan, went even further by stating that the proposed Executive Order would “overstep executive authority and violate separation of powers.”
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