Exploiting our ‘Essential Workers’
Look at the list above and you should realize that most of these people are considered ‘essential workers’ during these COVID–19 times. Without their services, none of us could stay at home and avoid the virus. There is no denying that they are essential, so we need to pay them accordingly with a ‘Living Wage’. In doing so, we would also be addressing America’s Poverty Challenge — We Have Fought and Won Bigger Battles!
Is this the America we want it to be? There are two-parent families in America with each parent working two jobs and barely making ends meet. HUD’s 2018 Point in Time Count counted 111,592 homeless youth and 48,319 homeless young adults on a single night in January 2018, and that is just the youth count. If we count adults, the total number is over 500,000. Over 40,000 of them are veterans. I could go on and provide a depressing list of other symptoms of Poverty in America, but you already know them. The Poverty problem is just not acceptable when you also realize that some corporate executives are being paid over $236M per year! Don’t jump to conclusions and go all hostile on me. I am not suggesting the executives should get paid a nominal hourly wage, just a wage that allows more money to be available to ensure that no one who works is living in poverty. There is plenty of wealth in the world to ensure no one is living in poverty, while the high achievers still earn huge salaries and bonuses and accumulate mind-boggling wealth. There is plenty of wealth to go around. We must find a fair and just means of distributing the wealth that are not Robin Hood (take from the rich and give to the poor) programs. There are multiple factors that contribute to a citizen’s level of wealth or poverty. In this post, I focus on income and wealth inequality, and within that framework, on the living wage.
I start from the premise that the minimum wage should be a living wage and adjusted as necessary to maintain its value. Anyone who works a forty-hour week should be able to earn enough to pay the bills for a family of three (Mom, Dad, and one child).
Today, full-time employees earning the federal minimum annually pocket just $15,080 (if they work 40 hours, each of the 52 weeks in a year), placing them well below the $17,240 poverty line in 2020 for families of two. And minimum-wage earners with families of four fall more than $11,000 below the poverty line of $26,200.[1]
Under the current inadequate minimum wage, major retailers pay low wages and consequently their employees are eligible for social safety net programs like Welfare, SSI, and AFDC. That money comes from taxpayers — mostly the middle class tax-payers. Meanwhile, by underpaying their employees, the corporate owners and executives take home huge salaries and bonuses, not because they worked that much harder or produced that much more. No! The only reason they are paid so much more than their employees is because they choose to be. Why do they choose to pay themselves more money? Simple answer — because they can. They are a part of the system that make the decisions regarding how much people get paid. Sadly, GREED usually wins out over altruism. Sounds harsh, but sadly, it must be true.
Let me introduce you to GREED’s friends — SOCIALSM and CAPITALISM. We have all heard the expressions, “Capitalism is the ‘backbone of America’s economy’.”, and, “The ‘market’ drives prices and wages.“ Except it does not. Power drives prices and wages. As soon as I introduced the term socialism into this post, you had a reaction. It is not your fault. Millions, even billions of dollars are spent every year ensuring that whenever you hear the term socialism, you experience a visceral gut-wrenching reaction. Your subconscious probably provides you a visual image of social unrest, crime, looting, rioting, violence, and poverty. Mission accomplished! The reason this deception works is that it is partially true, but not because of Socialism. It’s income inequality. Let us stop looking at capitalism/socialism as a binary choice — meaning it must be either this or that. In fact, both extremes are bad — as is true with most extremes. Let us set aside the labels and instead focus on our values.
We Americans like to describe ourselves as a civilized society, meaning that we have an advanced, humane culture forming a voluntary association of people for common goals. I believe that if most civilized Americans saw a homeless or starving child, our immediate and instinctive reaction would be to rescue it. Unfortunately, two factors have broken that bond. The first is that most of the people in the best position to rescue them never meet them. The second is that there are so many of them that rescuing any single one of them seems like a futile drop-in-the-bucket, and it is. Is it okay for children, or anyone, to be starving and homeless in America?
What makes a country a good place to live? What kind off country do we want to be? Let’s start by looking at the list of the “Best Countries to Live In” according to a study done by the United Nations. Essentially, the Human Development Report summarizes how people feel about our planet as a whole, and then it goes on to discuss, in detail, which countries are best to live in, thus comparing the most satisfied populations with the most unhappy countries in the world.
The variables that this official UN report considers include equality among genders, literacy, average life expectancy, and financial stability. For the sake of this post, I will abide by the regulations put forward by the United Nations in drafting and publishing this report on the best countries to live in around the world. If you have other factors that you deem to be important to consider, then by all means conclude your own. These are the claims of one report, but that does not mean other countries are not amazing as well.
Here are the top places to live according to the United Nations’ Human Development Report, in ascending order:
1. Norway
2. Switzerland
3. Australia
4. Ireland
5. Germany
6. Iceland
7. Sweden
8. Hong Kong
9. Singapore
10. The Netherlands
[The United States ranked 13th.]
Making a country a nice place to live is not an unsolvable mystery. There are 12 countries on this list ahead of us that we can examine for clues and learn from. None of the countries in this top ten list is either a purely Capitalist or Socialist economy. All have carefully regulated economies that ensure the quality of life they value. For some inexplicable reason, we have allowed our economy to force over 500,000 people (150,000 of whom are children and youth) to be homeless every night.
Under our current cruel system, we allow employers to underpay their powerless employees, then the government provides social safety net programs like Welfare, SSI, AFDC, etc. assisting them to survive but still live in or near the poverty line. Instead of social safety net programs, we need infrastructure and public service jobs that pay living wages. If we do not allow the already wealthy people to pay themselves outrageous salaries and bonuses, then we will not have to tax everyone to take back money to redistribute it. The executives will still get more money than they can ever spend. The resulting jobs will reduce the need for social safety net programs, while also reducing homelessness and poverty, and improving infrastructure and public services.
We have heard the contrary idea many times: “Industries must pay workers a minimum wage to keep their prices low and profits high.” The argument goes that if companies are required to pay employees more, there will be fewer jobs available or prices will have to go up. Is that true? NO!
A 2016 National Employment Law Project study[2] looked at job growth trends every time the federal minimum wage increased (since it was first established in 1938). It found no correlation between federal minimum wage increases and lower employment levels.
Instead, the data suggests that employment actually increased about 68% of the time in the year after a minimum wage increase. This improvement is because when companies increase wages, workers spend their additional earnings, increasing demand. This demand increases business, creating jobs and innovation.[3]
The living wage is more than just what happens at the bottom of the scale. It also applies to the middle-income earners. From the early 1900s up into the 1970s, increases in productivity resulted in increases in workers’ pay. But that doesn’t happen anymore. Real wages have declined for most Americans, despite huge gains in productivity over the last several decades.
These major increases in productivity created enormous increases in wealth, but due to income inequality and the lack of paying workers a living wage, that wealth was not evenly distributed. Meanwhile, since the 1970s, the cost of most consumer goods has risen significantly. When compared in terms of spending power, the average worker has lost ground, while the owners, executives, and shareholders have become very wealthy.
Tell your representatives to make the minimum wage a living wage to begin the process of making America the best place to live — not behind twelve other countries. Or do it because it’s simply the right thing to do.
[1] https://www.investopedia.com/articles/personal-finance/022615/can-family-survive-us-minimum-wage.asp
[2] http://www.nelp.org/content/uploads/NELP-Data-Brief-Raise-Wages-Kill-Jobs-No-Correlation.pdf
[3] http://www.upworthy.com/5-successful-corporations-show-what-can-happen-when-employees-are-paid-a-living-wage
