Wednesday, January 8, 2014

The Myth of a "Living Wage"

This is the new war that the democrats are fighting to retain political power.  The others, such as the "War on Women", will be trotted out as needed, but this is the one that they are concentrating on this election season.  The mid-terms are now just 10 months away.  
The President and his ilk are talking about a raise in the minimum wage and income equality with vigor.  There is also a push for the workers at McDonald's to get a rate of $15 per hour, so they can live on it.  Wonderful.  But what does a "living wage" really mean?  I relocated a year ago to just outside of New York City from just outside of Washington, DC.  While I was growing up in Fairfield County, CT it was then the most expensive county in the country to live in.   Now that county is the one I just left,  Fairfax County, VA.  Another words I have spent almost my entire life living in very high cost of living areas.  My cost of living is much higher than someone who lives in say rural Nebraska or Wyoming.  
In Virginia, I could have gone say thirty miles south and my cost of living would have dropped, considerably in fact.  The rents in Fredericksburg, VA are substantially lower.  But I wouldn't have made nearly the same amount of money.  The same holds true in Connecticut.  I could go live in the "valley" and the housing is much cheaper.  A smaller percentage of my income would go to housing.   But the better paying jobs are closer to New York City.  I could commute that distance I suppose, but then I would then be spending my money on transportation instead of housing.  I would also have fewer hours to live a life outside of work.  
Making a national minimum wage that is a "livable wage" may sound good on the surface, but it won't work.  You can't compare the cost of living of very rural areas of the country to large cities.  They are just not the same.  Buzzfeed did a comparison between two twenty-somethings who made virtually the same salaries, but live in very different areas of the country.  The way they live is very different.  
Twenty-two-year-old Madeleine Harrington of Greenpoint, Brooklyn, makes slightly less than Brooklyn’s average median income of $32,135, racking in $31,000 a year working two part-time jobs. Harrington also pays less in rent than Brooklyn’s average: Her home costs only $2,000 a month. Still out of her price range, the two-bedroom apartment has been converted into a three-bedroom, although the additional room is “questionable.” There are no walls, and you have to walk through it to reach the bathroom.
While this might be standard for a NYC lifestyle, it is an anomaly in other parts of the country: In Waco, Texas, for example, the average cost of a two-bedroom apartment is just $683. Mia Francis, 22, of Waco, makes well over her city’s average of $26,264, pulling in $33,000 a year, and is able to live in a spacious three-bedroom, two-bathroom house, equipped with a backyard, patio, washing machine, and a driveway for her car. The monthly rent is $900, and she splits it evenly with her fiancĂ©.
Madeleine will have to make a really good bank to live in New York the way Mia lives in Waco.  Many people who live in New York aren't really all that interested in owning a large single family home with a backyard, when it  doesn't have a great deal to offer in terms of entertainment and cultural activities.  Many people who live in Waco  want no part of the all the noise and congestion that comes with living in a large city.  Different people have different needs and that dictates how they live.  I personally would never want to live on a farm or in the middle of nowhere.  I have friends who recently relocated to a small town in New Hampshire.  While I like going to visit them on occasion, the desolate nature of that town is not for me.  I am a 'burbs girl.  I live living close to large city, but not actually living in one.  I want access to a 24 hour store, but one single CVS works just fine for me.  
How can we possibly pass legislation on the federal level that addresses all of these issues?  The short answer is that we can't.  The country is far too diverse to say that this is a "livable wage" for the entire country.  Small rural areas of the country couldn't possibly support paying the wages it costs to live in a large city.  
If this is to be done, which I am not advocating at all, it would have to be done on a state level.  Even then it wouldn't work, because the costs from one part of the state to another can differ just as widely.  Another issue that is not being really being addressed is how do we define "livable wage"?  
Does this wage mean that you can live with four roommates in a tiny cramped apartment or does it mean that you can afford a single family home?  Does everyone have to able to afford a car?  If so, a Hyundai or BMW?  What foods does this wage need to cover?  Does everyone have to eat rice and beans or do they get surf and turf?  I personally am a big fan of Salmon.  Should I be able to afford to buy it daily, weekly, or monthly?  Does my television have to have WiFi, as many of the brand new models now have?  A laptop, desktop, or I-Pad?  After all, we had disgraced, and currently jailed, former Congressman Jesse Jackson, Jr, talking about how I-Pads are a right.  So that must fit into the equation of "livable" does it not?  We have had other progressive elected officials saying that homeownership is a constitutional right.  In my neck of the woods a single family home can, and normally does,  cost over a million dollars.  
All of this opens up all kinds of questions about who gets to decide what "livable" means.  Does some politician I have never met, that lives off a tax payer salary, get to decide what foods I need to be able to afford to call my way of living "livable"?   What if I prefer to eat beans & rice and pasta every night instead of filet mignon and arugula.  
This is the problem with politicians making broad statements about "inequality".  They never define what it really means nor does anyone explain how we get there.  Yes, we can have the federal government force businesses to pay a higher wage all across the country.  But that doesn't mean that people will live "better".  Those increase costs in labor will show up in costs to the consumer.  That is simple economics.  President Obama doesn't tell us how a much a bar of soap will cost in this utopia he is trying to create.  Yes, people will make more, but they also will be spending more on goods and services.  We also find that certain businesses will have fewer people doing more, as that is what they can afford to pay out in labor costs.  So we will find fewer available jobs and fewer hours.  That will not help people live better.  
Many of the goals of progressives can be described as laudable.  That doesn't mean that in the real world they will work.  While I am not making light of the people who live with limited means.  It is a difficult life to be sure.  The reality is that today in America, what we define as poverty is still rich in comparison to the poverty that we see around the world.  With few exceptions in America, we have electricity, we have indoor plumbing, we have potable water, and access to basic needs of life.  If we are truly looking to address poverty in the world, America really isn't the place to be doing so.  We should be looking at the huts that people live in South Africa and India.  Most of Africa lives in poverty that very few in this country can understand.  We can even move much closer to home to Mexico and South American countries and see what real poverty is.  We hear that people in the richest country in the world shouldn't be living in poverty.  When you go and look at the rest of the world, we aren't.  A "livable wage" is a myth and won't address the real issues of why people in this country live in "poverty".  But government never really addresses the real issues, do they?  

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