Sometimes you wonder what the economy is actually for – or rather, whom it is for.
President Obama held a summit at the White House on Monday where top brass from the administration, business leaders and celebrities talked about making paid maternity leave available to all working mothers and some other policies for balancing work and family life.
In Congress, however, Republicans are plugging for flexitime in lieu of overtime payments while the Democrats want a national paid maternity leave scheme funded by a payroll tax. Obama himself has not yet backed the latter, and the Democrats in the Senate don’t want the former.
Meanwhile conservative pundits debate the merits of expanding the existing child tax credit, one supporting it, the other arguing that it won’t increase economic growth. (Actually, says the first, there are ways of achieving both at the same time.)
It looks as though working families will just have to keep waiting for some improvement in their lot. But if quibbling over paid parental leave and tax credits that will help middle class families isn’t mean enough, what about calculating how little you can pay those at the bottom of the income heap?
Ikea made a bold move this week in announcing that it is raising the minimum hourly rate in its US shops to $10.76 an hour – a 17 percent increase. That seems little enough, but Oxfam America says that if just $10.10 per hour were a national minimum it would “benefit more than 25 million workers, lift five million to six million people out of poverty, strengthen our economy, and save taxpayers billions of dollars.”
We’ll come back to the saving to taxpayers later; for the moment let’s think about all those people who would be grateful to earn over $10 an hour. A lot of them are fathers and mothers. Can America – and the multinationals — really not afford to pay them what is still only a living wage if both parents work?
Do these people and their children, and others like them around the world, exist only for the (global) economy? It seems so.
One could argue that the working poor should have stayed at school, done some (more) vocational training, got married, stayed married – done the things that make a big difference to the family economy and family stability.
But as David and Amber Lapp argue in an excellent article on the Institute for Family Studies blog, a low-wage economy makes it more difficult for working class young adults to get married in the first place, and then stay married.
The two marriage researchers introduce us to an Ohio couple with four children. They have been married for 10 years but still cannot afford to rent their own place, depending instead on both sets of parents to accommodate them – Jolie and the children with hers during the week, all of them with his at the weekend.
They both work in low-wage jobs – Jolie at a daycare where she can take her two youngest children with her, Jake in the latest of many low-skill jobs. They are looking for careers, not just a job. Them, and a host of others:
The data suggest that Jake and Jolie are not alone in their search for decent-paying work. A new report by Oxfam America shows that several of the occupations with the highest employment in America have annual mean wages between $19,000 and $30,000. For instance, the mean annual wage for America’s 2.4 million waiters and waitresses is about $21,000. For America’s three million food prep workers and servers, it’s about $19,000. For the 3.3 million cashiers, it’s about $20,400.
In other words, when we’re talking about low-wage workers, we’re not just talking about high-school seniors saving up money for college; we’re talking about mothers and fathers, husbands and wives, trying to make their car payments and saving to buy a house.
We know what liberals say to Jake and Jolie: Here’s your Medicare, here’s your food stamps, and we’ll try to get you some paid maternity leave and flexitime — but don’t forget your free contraceptives, because, you know, four is more than enough for people in your situation.
But what have conservatives to say to such a couple? Not very much, the Lapps suggest:
The prevalence of low-wage work raises challenges for married couples, but the very people who most care about strengthening marriage are typically the ones absent from the conversation about a living wage, or at least on the defensive. This is unfortunate, because there is a conservative case to be made for the living wage.
And here it is:
Firstly, corporations that pay employees low wages effectively depend on subsidies from taxpayers. Food stamps, Medicaid and the like top off their low-wage workers’ incomes. This where the savings on taxpayer dollars comes in:
Indeed, allowing profitable corporations like McDonald’s to pay workers low wages is simply another version of corporate welfare. Because the reality is, it takes more than $20,000 to $30,000 a year to raise a family. Conservatives concerned about unsustainable levels of government spending should care about a living wage because when businesses don’t pay living wages, taxpayers foot the bill and the welfare state expands.
Secondly, paying the worker a just wage is a moral issue. There is a Christian tradition (going back at least to the 19th century) about which the current Catechism of the Catholic Church says: “A just wage is the legitimate fruit of work. To refuse or withhold it can be a grave injustice.”
Of course, as many conservative commentators note, the question hinges on what constitutes a just wage in twenty-first-century America. And that’s where the conversation typically stops.
But in his encyclical Centesimus Annus, St. John Paul II says that “society and the State must ensure wage levels adequate for the maintenance of the worker and his family, including a certain amount for savings.” That description does not fit many of the mean annual wages noted in the Oxfam America report. How is a parent of two or more children supposed to support a family, and leave aside a certain amount for savings, with an annual wage of $20,000? (We haven’t even mentioned that these low-wage jobs rarely offer health insurance or other benefits that college-educated people mostly take for granted.)
Pope Francis has been lambasting a global capitalism that tolerates widespread poverty as contrary to the Gospel.
Why is there not more moral urgency surrounding the wage issue? ask the Lapps.
And isn’t a CEO-to-average-worker pay ratio of 331 to 1 in the US just a little bit scandalous when 30 years ago, it was just 40 to 1?
If executives at the very top dramatically increased their incomes while maintaining profitable businesses in the last several decades, why hasn’t pay risen for average workers? Surely this isn’t the result of economic necessity. Instead, it seems to reflect the free decisions of free people—decisions that could be otherwise.
But, some argue, at least today’s poor and working class are better off than previous generations – look at the big screen televisions in their living rooms and the iPhones in their pockets.
However, as the Lapps rightly point out, these material things do not compensate for the cost to family life itself that a couple like Jolie and Jake experience. “[T]he problem with the just-wage-for-cheap-goods trade is that it reflects more of a preference for the consumer, rather than a preference for the family.”
The fact that some families console themselves with consumerism does not make it desirable. And as the Lapps say, “for conservatives who claim to care about supporting stable families, sacrificing a just wage for cheap goods is an unacceptable bargain.”
Probably David and Amber Lapp were not among the luminaries at the White House summit on working families, though they should have been. They should certainly be at the next conservative summit. They have a lot of important things to say.
Carolyn Moynihan is deputy editor of MercatorNet.