Statements on Introduced Bills and Joint Resolutions

Floor Speech

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Mr. JOHNSON. Mr. President, I rise first to say thank you to the Senator from Tennessee for leading this vote of disapproval on what is really a terrible rule. It is a solution looking for a problem.

I spent 31 years running a manufacturing plant. It has been my experience that I have never had somebody in my operation ask to go from salary to hourly. I remember in 2004 when they tightened the rules and a number of people who worked for me were forced into hourly. None of them wanted to go. By the way, none of them received higher wages or a higher salary; they just lost flexibility--and that is exactly what is going to happen.

Being an accountant, I would like to kind of go through the numbers. These are the Department of Labor's own calculations. They claim there would be $1.2 billion more wages paid to workers. That is what they claim the benefit is going to be, but they also admit that there will be $678 million in compliance costs to businesses just trying to figure out the rule, trying to implement it.

What they are missing is, if wages--and I think that is a big ``if'' because I think what will end up happening is--you know, employers are competing in a global economy, and you can't just increase costs. So my guess, basically, is what is going to happen--and happened to my business in 2004--is they will just adjust. The workers won't get any more money. But let's just say $1.2 billion in wages is paid to workers. Well, that will be a cost to businesses. So as far as the overall benefit to the economy, wages might increase $1.2 billion, but business costs will increase $1.2 billion, and that nets to zero benefit to the economy. But there will still be a $678 million compliance cost to businesses, and, of course, that will be added to the already onerous regulatory burden on our economy.

There are three different studies--the Small Business Administration, the Competitive Enterprise Institute, and the National Association of Manufacturers--putting the cost of complying with Federal regulation somewhere between $1.75 trillion to over $2 trillion per year. If you take the medium estimate of that and divide it by 127 million households, that is a total cost of compliance with Federal regulations of $14,800 per year, per household. The only larger expense to a household is housing. That is the cost of complying.

Let me finish with another figure--$12,000 per year, per employee. That is the cost of just four Obama regulations to one Wisconsin paper manufacturer. I can't tell you which one because the CEO fears retaliation. Now, think of that for a minute. But just four Obama regulations are costing one paper manufacturer the equivalent of $12,000 per year, per employee.

So if you are concerned about income inequality, if you are wondering why wages have stagnated, look no further than this massive regulatory burden, and of course the overtime rule is just one of those burdens. I would just ask everybody, would you rather have that $12,000 feeding the government in compliance costs or would you rather have that $12,000 in your paycheck feeding your family?

Making a living is hard. Big Government just makes it a whole lot harder, and this overtime rule is just going to make it that much more incrementally harder.

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