Political campaigns oversimplify issues, and this year seems no different. As a reminder that solutions to complex social problems are not typically simple or straightforward, I want to explore some of what it would take to pay a just wage (a kind of complement to my earlier post on what it would take to feed the hungry).
While the unemployment rate slowly drops, it seems as if those returning to work are earning less money (as David Cloutier noted in his last post). Because the Catholic faith is founded on a messiah who preached good news to the poor (Luke 4:16-19) and promised the poor the kingdom of God (Luke 6:20-21), it has a history of thinking about how to address poverty, one part of which is paying a just wage for work.
- is given in due time and in proportion to the work done
- must not be below the level of subsistence
- furnishes the means to cultivate worthily the laborer’s material, social, cultural, and spiritual life and that of his or her dependents
- is first the responsibility of the employer but then also of the economic system as a whole
What would it take to ensure a wage is just?
Businesses must pay fairly for the work that is done. Obviously, the current minimum wage is not enough to support a family. As a crude estimate, $7.25 an hour at 40 hours a week for 52 weeks a year comes out to a little over $15,000 a year. Yet, the solution is not a simple minimum wage increase.
- According to the Bureau of Labor and Statistics, people who typically earn minimum wage are unmarried teenagers working part-time in the service industry. Given this reality, it is not surprise that many economists do not believe that raising the minimum wage actually helps the working poor. The two most prominent reasons are: 1) raising the minimum wage typically prices out unskilled workers who most need the work and the job experience and 2) raising the minimum wage typically fails to address the needs of full-time workers, less than 3% of whom earn at or less than the minimum wage.
- Moreover, trying to address differing personal and family needs in the work place is difficult. Difference in pay, even if justified, often results in discord in the work place, an aspect of what is know as relative poverty. It also presumes a level of disclosure of an employee’s personal life to employers that would make both employees and employers uncomfortable.
Even though businesses tend to pay more to full-time workers and heads of households typically make more than the minimum wage (see the Bureau of Labor and Statistics statistics again), this does not mean that wages are just. Rather, it means that businesses provide wages “in proportion to the work done”, do so frequently above “the level of subsistence” for full-time workers, and are thus fulfilling the primary “responsibility of the employer” to pay the just wage. Still, this achievement of most businesses does not guaranteed that everyone has enough to live on, have access to the goods of society, or that the economic system is just. These demands seem to go beyond what can be expected of a business. So . . .
Government needs to foster just wages. Its work is not primarily the payment of wages but to ensure that “the economic system as a whole” supports the payment of a just wage. If it does this well, those who are working have a better chance of cultivating their and their dependents “material, social, cultural, and spiritual life”. While there are countless ways that government can help foster just wages in the economic sector, there are two functions that seem readily apparent.
- Operate a judicial system that protects the rights of all. Businesses that “employ” others below subsistence wages, do not honor the protection of workers written into our law codes, and take advantage of immigrants and other vulnerable populations should be prosecuted. If effective and fair, a justice system will deter these wrongs and foster businesses that pay their workers justly.
- Develop a tax system that supports wage earners. In the United States, perhaps the best example is the Earned Income Tax Credit, “a benefit for certain people who work and have low to moderate wages . . . [that] . . .reduces the amount of tax you owe and may also give you a refund.” This tax credit helps account for the different situations of employees—their overall income and the number of dependents for example—and thus helps the wages paid by businesses to become more just either by lowering the taxes on the wages or even supplementing it with a refund.
Even with this work toward just economic system that cooperates with businesses to pay just wages, there will still be workers, even full-time workers, struggling to have access to the goods of society. So . . .
The Church must continue its work on behalf of the poor. Like the government, the church is not primarily responsible for paying wages. Its role is to help make the economic system as a whole favorable to workers and their dependents so that they can live a life with physical and spiritual dignity. The church acting as a whole body and acting through its individual members does amazing work to this end. Part of what the Church does to foster just wages is that it:
- Preaches Jesus’ message of love of God and love of neighbor, so that those in the pews, rather rich or poor or somewhere in between, are active in living out God’s will by attending to the needs of others.
- Provides direct service to those in need. Catholic hospitals, catholic schools, and Catholic Charities are just a few examples of this type of work.
- Advocates within our society to ensure an economy that protects “those most in need wherever they might live on this globe” and is measured by “how the poor and vulnerable are faring”.
While more is needed to secure just wages, it is hard to imagine less than what I have sketched here. Thus, to provide a just wage (or to address any one of a number of our social issues) entails:
- Cooperation of several institutions
- Attentiveness to what each of these institutions can and cannot do
- Coordination of these institutions based on this knowledge
While I hope this makes us all suspicious of simplistic solutions, I also hope it helps us to couple our love of others with the practical wisdom needed to do so effectively.