WASHINGTON — Hours to go before a midnight government shutdown, the House approved a new plan late Friday from Speaker Mike Johnson that would temporarily fund federal operations and disaster aid, but drops President-elect Donald Trump's demands for a debt limit increase into the new year.
Johnson, R-La., insisted Congress would "meet our obligations" and not allow federal operations to shutter ahead of the Christmas holiday season. But the day's outcome was uncertain after Trump doubled down on his insistence that a debt ceiling increase be included in any deal — if not, he said in an early morning post, let the closures "start now."
The bill was approved 366-34, and now goes to the Senate for expected quick passage.
"We will not have a government shutdown," Johnson said ahead of the vote.
Speaker of the House Mike Johnson, R-La., talks briefly to reporters Thursday at the Capitol in Washington.
It was the third attempt from Johnson, the beleaguered House speaker, to achieve one of the basic requirements of the federal government — keeping it open. It raised stark questions about whether he will be able to keep his job, in the face of angry GOP colleagues, and work alongside Trump and billionaire ally Elon Musk, who called the legislative plays this time.
Trump’s last-minute demand was almost an impossible ask, and Johnson had almost no choice but to work around his pressure for a debt ceiling increase. The speaker knew there wouldn’t be enough support within the GOP majority to pass any funding package, since many Republicans prefer to slash federal government and certainly wouldn’t endorse more debt.
Instead, the Republicans, who will have full control of the White House and Congress next year, with big plans for tax cuts and other priorities, are showing they must rely on Democrats for the votes needed to keep up with the routine operations of governing.
"So is this a Republican bill or a Democrat bill?" scoffed Musk on social media ahead of the vote.
The new 118-page package would fund the government at current levels through March and adds $100 billion in disaster aid and $10 billion in agricultural assistance to farmers.
Gone is Trump's demand to lift the debt ceiling, which GOP leaders told lawmakers would be debated as part of their tax and border packages in the new year. Republicans made a so-called handshake agreement to raise the debt limit at that time while also cutting $2.5 trillion in spending over 10 years.
It's essentially the same deal that flopped the night before in a spectacular setback — opposed by most Democrats and some of the most conservative Republicans — minus Trump's debt ceiling demand.
House Minority Leader Hakeem Jeffries, D-N.Y., speaks to reporters Thursday after President-elect Donald Trump abruptly rejected a bipartisan plan to prevent a government shutdown at the Capitol in Washington.
Democratic Leader Hakeem Jeffries of New York was in contact with Johnson, but Democrats were cool to the latest effort after the Republican speaker reneged on their original bipartisan compromise.
"Welcome back to the MAGA swamp," Jeffries posted.
Rep. Rosa DeLauro, the top Democrat on the Appropriations Committee, said it looked like Musk, an unelected official and the wealthiest man in the world, was calling the shots for Trump and the Republicans.
"Who is in charge?" she asked during the debate.
Still, most Democrats approved the bill's passage.
Trump, who has not yet been sworn into office, is showing the power but also the limits of his sway with Congress, as he intervenes and orchestrates affairs from Mar-a-Lago alongside Musk, who is co-leading the incoming administration's new Department of Government Efficiency.
"If there is going to be a shutdown of government, let it begin now," Trump posted early in the morning on social media.
President-elect Donald Trump speaks Monday during a news conference at Mar-a-Lago in Palm Beach, Fla.
Trump does not fear government shutdowns the way Johnson and the lawmakers see federal closures as political losers that harm the livelihoods of Americans. The incoming Trump administration vows to slash the federal budget and fire thousands of employees. Trump himself sparked the longest government shutdown in history in his first term at the White House, the monthlong closures over the 2018-19 Christmas holiday and New Year period.
More importantly for the president-elect was his demand for pushing the thorny debt ceiling debate off the table before he returns to the White House. The federal debt limit expires Jan. 1, and Trump doesn't want the first months of his new administration saddled with tough negotiations in Congress to lift the nation's borrowing capacity.
It gives Democrats, who will be in the minority next year, leverage.
"Congress must get rid of, or extend out to, perhaps, 2029, the ridiculous Debt Ceiling," Trump posted — increasing his demand for a now five-year debt limit increase. "Without this, we should never make a deal."
Johnson tried at first to appease Trump's demands, but ultimately had to work around them.
Trump and Musk unleashed their opposition — and social media army — on the original plan Johnson presented, which was a 1,500-page bipartisan compromise he struck with Democrats that included the disaster aid for hard hit states, but did not address the debt ceiling situation.
A Trump-backed second plan, Thursday's slimmed-down 116-page bill with his preferred two-year debt limit increase into 2027, failed in a monumental defeat, rejected by most Democrats as an unserious effort — but also by conservative Republicans who refuse to pile on the nation's red ink.
How the US minimum wage compares to other countries
How the US minimum wage compares to other countries
Updated
For almost 15 years, the U.S. federal minimum wage has remained stuck at $7.25 an hour, amounting to $15,080 annually for a full-time, 40-hour week. That's just over the poverty line.
More than 3 out of 5 adults representing almost every demographic group in the U.S. favor raising the federal wage floor to $15 an hour, according to a 2021 survey by the Pew Research Center. Even among those who oppose the $15 raise, a majority still favor a slight increase.
Inflation and productivity have long outpaced the $7.25 federal minimum wage. Its purchasing power dropped 17% between 2009 and 2019, reflecting an annual loss of over $3,000 in earnings for full-time workers. It is an unlivable wage in most parts of the U.S., covering only 29% of living expenses in places like New Hampshire. The National Low Income Housing Coalition points out that the average minimum wage earner would have to work 97-hour weeks to afford rent in a two-bedroom apartment at fair market value.
What's more, swaths of low-wage workers in the U.S. aren't covered by the minimum wage umbrella. This includes tipped employees, disabled workers, and teenagers who have been employed for under 90 days.
In addition to stagnant wages and decreased purchasing power, other cutbacks are affecting minimum wage earners. Around 20% less federal spending is now going to benefits like Medicaid, public housing, and social security insurance than in the early 1990s. Squeezed between an unlivable wage and a social safety net that's wearing thin, many minimum wage earners are in an untenable situation.
The minimum wage backstory
The mandate to establish standardized pay for workers—the minimum wage—in the U.S. was almost always contentious, finally enacted by former President Franklin Delano Roosevelt in 1938 after years in the courts on grounds of unconstitutionality. Since its foundation, the minimum wage has been raised 22 times, creeping up from a pittance of 25 cents per hour until plateauing in July 2009.
In some cases, raising the minimum wage had an effect on equality across the economy. The 1966 raise bridged the income gap by more than 20% between Black and white Americans, according to an analysis by University of California, Berkeley researchers.
Until the 1970s, rate increases were linked to inflation and productivity—the ability to generate income by creating goods and services. By adjusting the minimum wage in tandem with other economic increases, workers were better able to keep up with rising costs.
Today, the stagnant minimum wage makes the U.S. an outlier among other countries. According to the Pew Research Center, at least 80 other countries have requirements to review their minimum wages every few years. However, unlike some other countries, the U.S. has the ability to give states, cities, and industries the power to set their own minimum wages exceeding the federal mandate. For instance, California fast-food workers earn at least $20 an hour, and in Tukwila, Washington, a $20.29-per-hour minimum wage makes it the highest local rate in the country.
Resistance to change
Some opponents of raising the rate argue that minimum wage workers are "unskilled," just getting started in the workforce, or only need extra spending money. This contradicts analysis from the Brookings Institution, a nonprofit and nonpartisan organization, which found that the majority of low-wage workers were at the peak of their earning years and were the primary breadwinners for their families.
To chart the wage disparities between the U.S. and other developed nations, JobTest.org used data from the Organisation for Economic Co-operation and Development to look at minimum wages across continents. Only 18 of the 35 OECD countries are illustrated here, representing only the countries with higher minimum wages than the U.S.
This analysis used purchasing power parities conversion rates to compare earnings across currencies, adjusting dollar values for cost differences.
Across continents, minimum wages are higher than in the US
Updated
There are numerous ways that other countries around the world handle the establishment of a minimum wage. A variety of factors can impact the pay and benefits of minimum wage earners, and minimums are set by commissions, collective bargaining, or other factors.
In 2022, when inflation was around a 40-year high, minimum wage earners in the poorest countries were often hit hardest. Luckily for workers in France, Belgium, Poland, and Luxembourg, the minimum wage is essentially raised automatically, in line with price indexes. As of April 2024, only about 17% of countries have minimum wages at or above the cost of living, many of which are in Western Europe, according to data from the WageIndicator Foundation, a global nonprofit that maintains a global living wage database.
Other increases may pay lip service to economic equity but don't impact real change. For example, in Hong Kong—a region with a wage gap of 47 times between the richest and poorest residents—the government raised its minimum wage by a mere 32 cents in May 2023, pushing it up to 40 Hong Kong dollars, or around $5.10 in U.S. currency. Critics argued that the new minimum wage still falls behind what a family of two is eligible for through social services.
Other countries use government benefits to bolster—or harm—minimum wage earners. France has fought again and again since 1995 to reduce employers' contributions to social security for minimum wage workers, according to an OECD policy brief. Meanwhile, the United States, Spain, Slovenia, and Mexico make minimum wage workers pay more in social security benefits or employment taxes than workers earning the median wage.
Some states surge ahead
Updated
While the federal wage remains stuck, local jurisdictions—and even some companies—are finding a workaround. Thirty-four U.S. states and territories have surpassed the federal minimum wage to varying degrees. West Virginia bumped the wage floor slightly up to $8.75; on the higher end, beginning July 2024, Washington D.C. will pay a minimum wage of $17.50.
A number of cities, like Chicago, have introduced their own minimum wage. The rate in Illinois is $14, but in Chicago, the rate is $15.80 for companies with 21 workers or more, and it will increase again in July 2024. Some companies, including Costco and Amazon, have also instituted company-wide minimum wages.
For more than a decade, the ongoing partisan divide has thwarted attempts in Congress to override the minimum wage statute. The latest federal movement on wages was the Raise the Wage Act, a bill first introduced in 2017. Frequently resurfaced by its sponsor, Independent Sen. Bernie Sanders of Vermont, the latest initiative in 2023 proposed a gradual federal minimum wage increase to $17 by 2028. Currently, the bill sits in committee.
There are some bright spots on the wage horizon, however. President Biden signed an executive order in 2021 that raised the hourly wage for federal contractors to $15, with automatic increases for inflation, covering a range of workers from maintenance professionals to nurses caring for veterans.
And despite a standstill at the federal level, local jurisdictions will achieve much of what advocates have long pushed for by year's end. In 25 states as well as 60 cities and counties, the minimum wage floor has or will increase by the time 2024 comes to a close, with over half of those jurisdictions hitting a $15 minimum.
Story editing by Alizah Salario. Copy editing by Tim Bruns.
This story originally appeared on JobTest.org and was produced and distributed in partnership with Stacker Studio.
How the US minimum wage compares to other countries
Updated
