In the midst of all the breathless coverage of the economy “recovery” (is it recovering? Isn’t it? Why does this coverage sound like a pennant race in September?), and our myopic focus on the “jobs number,” the New York Times highlights a recent study which shows the structural problems of low-wage work in America.
According to the report, a single worker needs an income of $30,012 a year — or just above $14 an hour — to cover basic expenses and save for retirement and emergencies. That is close to three times the 2010 national poverty level of $10,830 for a single person, and nearly twice the federal minimum wage of $7.25 an hour.
A single worker with two young children needs an annual income of $57,756, or just over $27 an hour, to attain economic stability, and a family with two working parents and two young children needs to earn $67,920 a year, or about $16 an hour per worker.
The study makes clear its assumptions, and notes that there will be significant regional variations, especially given the range of housing costs in different areas. (Furthermore, the report will undoubtedly fuel some comments about the economic difficulties inherent in single-parenting, but it seems pretty important to note that the traditional Catholic teaching on just wage assumes that only one parent has to work full-time outside the home, so the above data for two-parent families is not much better!) But for all the quibbling, these numbers can help us see at the nickel-and-dime level what exactly it means to live in a society of injustice. Yes, injustice, systematically – for we undoubtedly rely on sub-$14/hour wage levels to buy many of the things we use in life every day.
Pope John Paul II makes clear what all recent popes have said: “[I]t is respect for the objective rights of the worker – every kind of worker: manual or intellectual, industrial or agricultural, etc. – that must constitute the adequate and fundamental criterion for shaping the whole economy.” (Laborem Exercens, 17) Chief among these is the just wage, for the pope goes on to say that “the justice of a socioeconomic system, and in each case its just functioning, dserve in the final analysis to be evaluated by the wahy in which man’s work is properly remunerated in the system.” (LE, 19) This is crystal clear.
All too often, this question becomes bogged down in objections over what counts as a “just wage” – and it is true that it is not as simple a naming a number (hence, the inadequacy of simple minimum wage law). Neverthelerss, there can be no doubt that, system-wide, we fall significantly short of a just wage. John Medaille, in one of the best Catholic economics books available, The Vocation of Business: Social Justice in the Marketplace points out that we can see this because our situation inevitably requires constant increases in two areas: one, in debt (often short-term debt) that covers over the gap between income and expenses, and two, subsidies and transfer payments, which de facto mean that the taxpayer “makes up” for the poor wages paid by business. Can’t pay the rent on your $8/hour job? Well, we’ll subsidize you with a voucher. But in fact, we are subsidizing the landlord and the employer! The entire system relies on our refusal to confront the central problem, that we won’t pay the prices needed to pay people what they deserve. We avoid the immediate consequences of that by applying what are in effect Band-aids, but these do not address the underlying disease. We can be sure there is no just wage so long as “payday loan” shops do a thriving business and slumlords need section 8.
The only way “out” of this situation is to patronize businesses that pay just wages. Famously, Costco pays its workers substantially higher wages than any other mega-retailer… and simply offers a smaller profit margin to its stockholders. In my CST class, I had the opportunity to find the pay rates of workers at dozens of American retailers… and in virtually every case, the stores are run by workers making $8/hour and managers making $12/hour, and the same goes for virtually all fast food franchises. And of course one knows well that the farmers behind this food are also not making just wages. One might consider starting with one’s food, and considering how one might acquire one’s food – both groceries and restaurants – within a system that pays just wages. I pay $5.99 for my organic, locally-produced gallon of co-op milk, and I can reasonably believe that everyone involved in getting me that milk is getting paid fairly (not least because I am on the board of the co-op, and the co-op contracts directly with a Pennsylvania dairy to get the organic milk, the price of which does not fluctuate like the price of commodity milk). True, the logistics and scale of a large chain COULD enable me to pay (maybe) $5.00 for this milk, and still think that everyone working to bring me the milk would be treated fairly. But I don’t think it could go much below that… even discounting any environmental issues! Just wages mean $5.00 milk. By doing this practice, I accustom myself to seeing prices that are “lower” as most likely hiding injustices – not just on milk, but on a whole array of items. Do I know this? No. It would be nice to imagine I could find other ways to assure myself of just pay all along the production line. And I try (did you know that Amazon pays its warehouses workers at Costco levels? And that your mailman definitely makes a living wage?)… but wouldn’t it be nice if we knew more about this? Then we could shop at stores with the slogan “Always fair wages. Always.”
David, It is funny that we both uploaded similar posts today.
We are always plagued by incomplete knowledge – I frequently have people ask me for a “complete list” of where they should and should not shop.
A book you might find interesting on the question of wealth, income and distribution from CST perpsective:
Rediscovering Abundance by Helen Alford, Charles Clark, and Michael Naughton
I just posted my response to your post, and then I see you responded to mine. I love the “complete list” idea – indeed, if we are serious, there is no reason why we can’t figure out a list. I mean, I always say, start with food. Food is increasingly doable in many places. And start with your local food co-op. Check out the list here: http://www.cooperativegrocer.coop/coops . Your one-stop shop for a substantially different economic structure. At your co-op, you likely have a set of employees who are committed to doing the best they can to achieve exactly these ends, so you don’t have to do it alone. Your grocery bill will go up… but there are certainly ways to manage that, primarily by adjusting what you eat. That ends up creating other benefits. Benedict XVI recommends co-ops in Caritas in Veritate. And while, yes, there are plenty of grocery items that may only have a faint sheen of respectability, one develops a certain prudence over time. (To be sure, consumer cooperatives are not the only way to do this – there is the farmer’s market/CSA/grow your own route – but I’ll admit it’s the easiest and it scales well.)
There’s one other thing to add: in my own life, it basically took me ten years and three geographical moves to get to a place where I could purchase 98% of my food at a co-op – not least because I am inherently cheap and working-class, and so it pains me to pay higher prices. It’s OK if one goes step by step.
And to do all of this properly, will require finally being honest about the poverty line and a just wage. As I prepare for next weeks classes on poverty, I find myself always coming back to the central problem – if we do not honestly name poverty and count it realistically we cannot have a reliable starting point for “fair wages” etc. As a society, we have a responsibility to set a real poverty line and acknowledge that wealth is socially created. Setting the bottom at “30,000 for a single worker” would place significantly more people below the poverty line and many people in jobs we don’t expect to be “at poverty line” pretty close. There is a great West Wing clip on mollie orshansky and the measure. (from season 3)
I love this post (and Meghan’s complementary remarks). I did not know about Costco, and I am delighted to hear that mega-retailers have started to move towards more just wages for their workers.
It seems important to recognize that families that are just barely making it, especially in our current economic environment, might not be able to afford $5.00 for milk, especially if they are trying to make their mortgage, buy health insurance, etc. Do you have recommendations for practices that families who are less financially-well off might adopt that are not so financially burdensome? More broadly, it seems to me that in talking about this issue, we have a sort of donut-hole population that is not at or near the poverty line but is also not financially well-off enough to increase their grocery bill substantially. What about this population? What practices can we advocate for them?
In thinking about this issue, I also cannot help thinking of your Society of Christian Ethics talk on luxury. If we gave up our daily $4.00 Starbucks or Qdoba burrito and chips, how much easier would it be to purchase fairly produced milk and eggs? It seems to me that in talking about just purchasing, we also need to talk about luxury and the correlative virtue of simplicity in order to evaluate our broader purchasing patterns and habits.
Beth – you have wait for my part 2 for my humble recommendations….. 🙂
But I too am interested in hearing David and yours as well.
Great points. And yes, I think the connection to luxury is key – and of course besides $4.00 lattes and $1.59 cups of soda, we have to look more seriously at much bigger chunks of money: cars, major household items, and houses. (I will admit, the trickiest element here is housing, not only because it varies so much from region to region, but also because it is surely not in itself a luxury expense, despite it’s expensiveness. I live in an area where realistically, for a modest three-bedroom townhouse in liveable shape, you’re looking at at least 175K (more likely 200K), plus the property taxes are substantial.)
In practical terms, I’d point out two things: 1) The primary point here is that those who can afford this, they should do it, and I think there are an awful lot of people who can. I see no way to get people out of poverty or the donut unless they are making a living wage, and I see no way for folks to make a living wage if those of us who make more than a living wage won’t pay fair prices for our basic goods. 2) Another key in the donut hole has to be community resourcefulness – as it has always been – where goods are shared, goods are repaired, etc. Neighbors working together can do wonders. Does this solve poverty? Absolutely not – not least because we have increasingly created a housing situation where we are severely split off into income classes, rather than living in mixed-income neighborhoods and towns where this kind of sharing can work. There are bigger issues with structures of sin here, but resistance should also be structural – as in “alternative structures” of sharing, or as BXVI would have it, of “gratuitiousness.”
David, I especially like the point about subsidizing employers and landlords. Such an angle on the issue of wages seems to go to the heart of the problem. Does capitalism allow for an acknowledgment of systemic injustice? More often than not, arguments for the free market rely on the category of personal choice which I think the Popes (and the rest of CST) want to interrogate. Bringing to light the reality of poverty complicates the assertion that someone can simply choose to be in a different financial situation. Interestingly enough, I think that even fiscally conservative Daytonians see the flaw in this argument because they live in a city full of workers whose jobs literally left them behind. They choose to work but there is just not enough work to choose.
Katherine (?!)– Great comment. The problem with the category of “personal choice” ultimately gets back to issues about how we understand the common good. I just sent in a paper for review on structures of sin that makes a fairly robust argument that economic agents can be stuck in a structure where there is, properly speaking, no common good, given the parameters of the situation. That is, there is no economic choice which allows for the kind of shared pursuit of goods that is assumed by CST – contemporary economists have some great kinds of “prisoner’s dilemma” scenarios which recognize this. It is interesting to think that folks in a place like Dayton might “get” this, instead of just getting on the endless “race to the bottom” of “luring jobs” to the area!