Tuesday, January 28, 2014

Full-time and in poverty

"In America no one should be working full time and be in poverty!" I have been reading this recently and have heard President Obama make the assertion.  It sounds laudatory and everyone seems to accept this premise.  (Following the assertion we usually have the bemoaning of income inequality in America and drum beating for raising the minimum wage.)

I need to object to the premise.  It is not pleasant and probably terribly incorrect, but somebody has to point this out.  Because someone works full-time does not necessarily mean that they create adequate value - for themselves or for others.  Because someone works full-time does necessarily mean that they produce enough value that warrants a paycheck above the poverty level. I know, I'm just heartless.

Suppose I worked full-time sweeping and cleaning my street. And suppose I was successful at getting my neighbors to pay for it.  The ten other families on our cul-de-sac each agreed to pay me $100 a month for this service.  It was hard work and I was committed to doing a good job. I worked sun-up to sundown 5 days a week to accomplish the task.  Well, I would make $1000 a month before taxes, $12,000 per year.  This is half the official poverty level for a family of four in America.  According to Obama this is unfair.

What is unfair? I chose the work. My neighbors agreed to pay me a wage for the job that was, if anything, probably MORE than the real value to them (perhaps my good looks and neighborly ways added to the value provided!). In other words, the value of the work I produced for my neighbors was worth only $12,000 a year.  I am in poverty, but there is no injustice committed.

The reality is that some tasks are less valuable than others. Some tasks that require very little skill pay very little money.  It could be that engaging in the task on a full-time basis is not going to produce enough income to raise one above the so-called poverty level even if it is done with great effort and honor.  And it IS fair to pay someone for the worth or value of the task performed, be it valued at $100 a month or $100 an hour.

By saying this I am not wishing poverty on anyone. I desire an America of great opportunity for everyone. I would like to see everyone get a good education, acquire at least adequate skills and be at least a productive citizens.  I would hope, in America, this opportunity would be available to all and that some with talent and effort would realize great success and wealth.

So what to do about people working full-time and not making enough to lift them out of poverty? Well, first it does not happen much anymore.  The so-called safety net in America encourages our citizens to not work and bring in way more than the poverty level.  But that is an issue for another time. 

The answer is not to bemoan the injustice.  Workers need to develop sufficient skills to produce enough value so that they earn more than the poverty level.  This goes back to God-given talents, education and effort.  Perhaps in my example above I give up my day off on Saturday and in addition to sweeping the streets I add mowing yards and with some training, landscaping. Maybe I then double my value to my neighbors and double my income and exceed the official poverty line.

Yes, I know this is a simple example and the real world is messy and difficult.  Helping people acquire skills to make themselves more valuable in the marketplace is difficult and it starts with our education system. Making unfounded platitudes which end up requiring me to pay for the false premise is the easy thing.  Save the cries of injustice; I'm not buying it.