Wages are the Problem.
It’s not taxes, or people living in poverty, or entitlement programs, or the cost of childcare or healthcare; it’s wages.
During the recent virus outbreak, a bright light was shown on the negative impacts massive wage disparities have on Americans.
There are concerns that children who can’t attend school won’t be able to eat. Or parents who live paycheck to paycheck will lose their jobs or their homes. Or people who are sick wont be able to afford their deductibles or copays, so they may not seek treatment… the proposed solutions have been cut taxes, increase government funding, utilize assistance programs.
Most people chalk these issues up to different matters; those kids can’t eat because their parents don’t have a “real job” (despite working 40 hours per week), those people might lose their homes because they didn’t “prepare” or “live within their means,” (even though statistically, they probably did), or they can’t afford healthcare because they didn’t contribute to an HSA (which they probably didn’t have the extra money for).
But the one reason these issues exist is because wages are not regulated. And that’s a problem for all of America.
What is the actual cost of living?
The federal minimum wage is $7.25 per hour.
40 hours per week = $290
4.5 weeks per month = $1,305
51 weeks per year (assuming they have a week of vacation) = $14,700
The federal minimum wage implies that one person can live — pay rent, basic utilities, transportation to and from employment, healthcare, and food — off of $14,700 per year.
The estimated actual cost of living for one single person living in the United States is $2,626 per month, or $31,512 per year. The estimated cost of living for a family of 4 is $4,571 per month, or $54,852 per year.
On the current federal minimum wage, one single person would have to work 80 hours per week at the minimum wage in order to break even — let’s hope they have no medical conditions or health issues that require prescription copays and office visits.
In a family of four, both parents would need to work 140 hours per week between the two of them to break even… meaning if they needed to pay for childcare they’d prob need to tack on another 20–25 hours per week, each. And let’s be honest, if two parents are working 140–200 hours per week just to make ends meet, they’re going to need childcare.
Why Don’t People Just Get Higher Paying Jobs?
The most often used argument against raising the minimum wage is that people who work “entry level jobs” don’t deserve to be paid more money because the job doesn’t require any “skills.”
People should be paid according to their skills, and their level of education, and the time/commitment they put into learning their career. I agree with that.
But that doesn’t mean other people should be doomed to poverty because they didn’t go into debt obtaining a college degree. Nobody should be doomed to poverty, especially not if they’re willing to work, 40 hours per week.
But that’s a moral argument and my point is to show why raising and regulating wages is the only logical solution to improving healthcare, education, and equality.
Skills shouldn’t matter when it comes to setting the minimum wage.
Who’s the Real Drain on the Government?
The American Dream is about building the life you want. Pursuing your own form of happiness and fulfillment, however that may look for you.
The theory is that everyone in America has the same chance to become a billionaire, or to live in poverty.
You either “pull up your bootstraps” and “make it” or you’re solely responsible for your own failure and there is absolutely no outside factors that would have, or could have, negatively impacted your life.
This is America and since you’re “free” to do whatever you want, nothing could possibly be handicapping you from getting rich, as long as you’re really “trying.”
So, because of this “every man for himself” mentality, we have corporations — run by people who want lots of money — choosing to pay workers minimum wage, poverty-level pay, so they can continue to operate their company, make profits, and most importantly, accumulate personal wealth.
Profits should never be regulated, and you can’t tell someone how much money they’re allowed to make off their own company — because that would be fundamentally un-American.
Creating government assistance programs in order to supplement the wages a company refuses to pay is also fundamentally un-American.
But forcing corporations to accept responsibility for the people they employ, and requiring them to pay higher wages, ensures that everyone is given an equal and fair chance to build their American Dream. And more importantly, reduces the need for government assistance programs that cost our government an estimated $1 trillion.
A company like McDonald’s earns revenue in the billions. Each year. Billions.
The CEO of McDonald’s earned $15.9 million in 2018. In one year, multi-million dollars.
The average worker at McDonald’s earns $9 per hour. That’s a little higher than the national average for a fast-food worker, but not by any notable amount. The average fast-food CEO earns just about the same as the CEO of McDonald’s, around $6,000 per hour.
The federal poverty level for one single person is $12,760 per year. For a family of 4, it’s $26,200.
In order to qualify for government assistance; SNAP, WIC, Medicare/Medicaid, TANF, SSI, EITC, daycare vouchers, housing assistance, etc., you must land between 100–300% of the federal poverty level.
McDonalds employs 300,000 in the US and the average worker earns between 100–300% of the federal poverty level.
They can afford to pay their workers more money. They aren’t hard up for profits. And how “skilled” a McDonald’s worker “needs to be” is really irrelevant here.
McDonald’s workers are the reason their company gets the billions. Without workers taking money from the customers and handing it over to the corporation, there would be no billions. The CEO would not earn their millions.
Their workers deserve to earn more because they directly contribute to the success of the company and the personal wealth accumulation of the CEO.
What happens within this profit model is that the CEO of McDonalds is syphoning the profits to the top. He is then subsidizing his workers’ wages with government assistance programs, funded by tax-paying Americans.
Since McDonalds has chosen not to share their profits with most of their workforce, their workers require crowdfunding assistance from the rest of the American workforce for groceries, housing, childcare, and healthcare.
And I know people will argue about salaries, versus stock options, dividends, etc. but that’s all irrelevant too. The money is there in the company. The way the profits are shared, is up to the company.
It should be illegal to employ workers — for 30 hours per week or more — and pay them in such a way that they require government assistance [funded by tax-paying Americans] to cover basic costs of living.
It should especially be illegal, and punishable, if the corporation’s revenue, profits, and executive salaries demonstrate the ability for them to pay their workers a sufficient wage that wouldn’t require government-assistance subsidizing.
By not creating wage requirements or criteria for a business to employ people — to ensure those people do not become dependent on society and tax-funded programs — we are limiting workers’ freedom to pursue their own American Dream. Workers who fall within the federal poverty levels, and workers who don’t.
McDonalds is one example of a company who underpays [300,000] workers and helps them qualify for government assistance programs. There are hundreds of corporations employing people all over the US who are using government assistant programs to supplement wages that they choose not to pay… so their CEOs can earn more than they could ever spend in a lifetime.
Poor people aren’t the problem. Government assistance programs aren’t the problem. The cost of healthcare, childcare, saving for retirement, or college aren’t the problem. Lack of skills or motivation aren’t the problem.
Wages are the problem, specifically, insufficient wages.