Martha Sherwood draws upon a heated discussion over the holidays to argue that the gap between the rich and the poor is not only increasing, but many working people do not earn enough to sustain themselves. She argues that the current social welfare model in the US is failing everyone.
Recently, a rather heated discussion erupted at a holiday dinner table, after one of the guests made a disparaging comment about “yuppies” and their habits of conspicuous consumption. Our host, who is quite affluent and surrounds himself with the trappings of affluence, maintained that people with money were entitled to enjoy luxuries, that he acquired his high performance car (to give a specific example) not as a status symbol but because as a person of refined and cultivated tastes he could appreciate an item that would be lost on the peons, and that his consumption created jobs. Like most people I know, he sets the bar of excess well above his own level.
I countered by observing that most people in our society who enjoy an exceptional degree of affluence do so, directly or indirectly, at the expense of people who are working for wages that fail to pay them enough to enjoy a very basic standard of living, and are dependent on taxpayer funded programs like food stamps to shield them from actual want. Programs initially designed as a safety net for the minority of people who are unable to work, or who have unusual circumstances such as chronic medical problems that drain their resources, and for single women with young dependent children whose value as child care providers exceeds the low wages traditionally paid for semi-skilled female labor, have become a subsidy for an increasing proportion of America’s working population.
If the profits from my business enable me to live in an opulent home, drive a BMW and vacation on the Riviera, and my employees are relying on food stamps and Medicaid to meet very basic human needs for their families, the welfare that they are receiving is in effect corporate welfare. I may imagine that I occupy the moral high ground because I am a Democrat and it’s the Republicans that are threatening to cut social programs, but aren’t those programs essential to my bottom line?
Affluent liberals like my host will point to some corporate whipping boy such as Wal-Mart, which actually distributes food stamp and Medicaid applications to new hires, and pretend that the problem is restricted to a few bad actors, when in fact it is systemic. The difference between the median income for families and individuals and self-sufficiency income – the amount social service agencies calculate is necessary to maintain a minimal standard of living without subsidies – has been declining for several decades, to the point where the average American family has very little discretionary income, and no wiggle room at all if income declines or expenses rise. Some of the explosion in personal debt in recent years is the result of luxury spending but a great deal of it reflects, directly or indirectly, expenses individuals and families can’t avoid. When personal debt that individuals have little hope of ever repaying becomes a substitute for adequate compensation for present work, it’s an unsustainable situation.
Failing to pay one’s laborers enough to sustain what society agrees is a living wage is a moral issue. It is the subject of numerous condemnations in the Bible, both in the Hebrew Scriptures and in the New Testament. James 5:4 is representative: “Behold, the wages of the laborers who mowed your fields, which you kept back by fraud, are crying out against you, and the cries of the harvesters have reached the ears of the Lord of hosts.” If one studies British and American history it becomes apparent that the trend for social welfare programs to evolve into subsidies for employers emerges repeatedly, eventually reaching a point where the system as a whole is not generating enough tax revenue to support the program. At this point, neither slashing the social welfare programs and throwing a significant proportion of the work force into real poverty nor further tweaking a basically broken tax system provides a long term solution. The only long term fix is to either raise wages to the point where people can maintain a basic standard of living at the lower wage levels, or accept that some items (such as high tech health care) are not necessary for the average person.
Further Reading:
Third World Traveler – “Wal-Mart Welfare: How taxpayers subsidize the worlds largest retailer.” An article on the ways the public subsidizes Wal-Mart.
Centre for Women’s Welfare – Explanation of what the self-sufficiency standard is.
Photo Credit:
“Mastering Social Welfare.” Flickr creative commons. Some rights reserved by the justified sinner
Recent Martha Sherwood Articles:
- The Year of the Jackpot
- The Novel of My Mother's Past - And Mine
- Has America Lost the Cold War?
- The Grief of Downsizing
- Immunological Paralysis: A Reason for Concern?
thanks for the thoughtful and well written article, martha. the problems you describe are real; i see them every day at work. and the current political climate is discouraging.
like richard, i believe that somehow, someway the solutions must come from “the ground up.” i’d love to see it happen!
Thank you for this thought provoking article. I feel that while I agree with you in principle because most of the metrics used show an ever increasing disparity between the have and the have-not’s, I also feel those of us who struggle, myself included need to think critically about the situation and come up with our own solutions to the problem because the cavalry ain’t comin to save us sister. If anything its coming to detain us for complaining about our woes. Someone I read recently stated that 2012 is going to be the year of the entrepreneur and I feel that is probably correct and nor because of all the prosperity and opportunity but out of necessity. I don’t believe we can count on our governmental leaders to watch our backs any longer. They have lost all touch with the common man. We have to take care of ourselves and each other and we can do so by supporting one another’s individual efforts. You subscribe to my blog and I’ll subscribe to yours. That kind of thing. It has to be a grass roots recovery. I am not personally going to wait around for politicians or anyone living in the 1% to help me.
I agree that “the cavalry isn’t going to come and save us.” I hinted at one possible solution in my last sentence “or accept that some items (such as high tech health care) are not necessary for the average person”. A significant proportion of a median budget goes into enforced consumption of things (especially medical care and education but many other aspects of life as well) that were not part of the picture in this country even forty years ago and which add proportionally rather little to the quality of life.
Returning manufacturing to our own shores, which would mean accepting higher prices for consumer goods, would also help, but that’s not going to happen given the growing dependence of the Federal government on financing from the country we import most finished products from.
An affluent man who justifies his high performance car by saying that lesser people would not/COULD NOT/ appreciate it – does not sound like a liberal to me. More like a fascist. Thanks for the article. I appreciate what is good common sense.
Common sense!! The key to all these complicated problems. I just liked your comment and wanted to let you know. This website needs a like button