Low-Wage Employers Have Fought Hard to Keep Their Workers Poor

http://billmoyers.com/2013/09/04/low-wage-employers-have-fought-hard-to-keep-their-workers-poor-now-workers-are-fighting-back/

September 4, 2013
by Joshua Holland

-----

Between 1973 and 2011, the top 10 percent of American households saw their inflation-adjusted incomes rise by almost $100,000, while the bottom 90 percent – the vast majority of us –actually saw their incomes drop by $4,425 per year, according to economists Emmanuel Saez and Thomas Piketty (XLS). During that time, pensions largely disappeared, and the costs of health care and education shot through the roof.

-----

But it’s not just companies like Wal-mart and McDonald’s paying their employees too little. According to a study by Demos, the federal government, indirectly, is the nation’s largest low-wage employer. A coalition called Good Jobs Nation began a campaign earlier this year urging President Obama to sign an executive order requiring federal contractors to pay their employees a living wage. With the stroke of a pen, Obama could lift the living standards of two million American workers.

These campaigns are filling a gap left by Congress, which hasn’t raised the federal minimum wage fast enough to keep up with the cost of living. Poverty wages represent a type of “market failure.” Like selling widgets for less than what it costs to make them, low-wage workers are selling their labor for less than what it costs to cover the basic necessities of life, which is why taxpayers end up subsidizing the profits of low-wage employers with various public benefits. “In today’s economy, the math simply doesn’t make sense,” says Basta. “If you’re paying workers between $10,000 and $18,000 a year, it’s impossible to live in a place like New York City without receiving public assistance.”

-----