politics4thepeople

$2.00 A Day: Living on Almost Nothing in America

By: Kathryn J. Edin and H. Luke Shaefer

A Review by Steve Hough

When my parents separated in December 1967 (divorce papers followed), my mother moved her four kids to Florida with no marketable skills and no child support. Living with my grandparents was never intended to be a permanent solution, so we soon moved into a tiny two-bedroom home. It was actually a guest house or mother-in-law’s quarters in the back yard of the main residence. It was located across town in one of the poorest sections, just blocks from the paper mill. My grandfather loaned mom his car, so she could get to work and take us to school.

That first summer my mom got a job as a hostess/waitress at a restaurant on the beach. She was able to put two of us kids to work there as well. At fourteen, I was washing dishes by hand in a sweltering kitchen. At thirteen, my sister waited tables during the breakfast shift. Mom also secured a job for my older brother as a deckhand on one of the fishing boats at the marina where the restaurant was located. He was seventeen. Our baby sister was only three, and I do not recall what arrangements were made for her while we worked. We were all lucky to be working, but the jobs disappeared at the end of tourist season.

We went back to school and mom got a job as a waitress, in town, at one of those steak houses where you go through a line to order. The pay was minimal and tips were meager. Although we were living across town from my grandparents, we did not enroll in a new school. This housing arrangement was also temporary, as my mom had been on a waiting list for public housing.

We soon moved into “the projects” close to our schools and my mom’s job. My grandfather took his car back and we all walked to school and work for a short time until my grandfather bought my mom an old rusted-out Ford. It actually had huge rusted-out holes in the body and hood. It ran alright, but was embarrassing to be seen in it. We also began getting surplus commodities from the government. We were on “welfare”.

After working a short time on weekends at a downtown cafeteria, owned by the same man who operated the restaurant the previous summer on the beach, I got a job bussing tables and washing dishes at a Ramada Inn restaurant near my grandparents. I was moving up in the world, because this restaurant had an air conditioned kitchen and an automatic dishwasher. Things were looking up, but now that my mom had a car, she drove me back and forth to work. I hated being seen in that rust bucket, but it was better than walking.

I did not know what a minimum wage was but, apparently, it had increased while working at the Ramada. Seemingly, out of nowhere, my paystub had a deduction for meals, when I had never eaten a meal at the restaurant. When I asked the owner what the deal was, he told me I had better start eating something, because the deduction would continue. I wasn’t happy about it, but felt I had no recourse. I’m sure I told my mom about it, but she probably said the same thing the owner did. At least I started getting a decent meal when working.

The owner knew where I lived. He knew my grandfather, and he had seen my mom drop me off at work. This guy wasn’t going to go broke paying me an extra $0.25 per hour as required by law. While still working for him, a year later, my mother remarried and we moved to Texas. The restaurant owner had the audacity to ask why I couldn’t stay and live with my grandparents. Apparently, I was that good of a worker; just not good enough to pay me minimum wage.

The whole point of this story, and the stories detailed in the book, is that greed will always rear its ugly head on every level, ignoring the struggles and suffering of others. My boss refused to give me a raise when the minimum wage increased. Those buying SNAP benefits for cash take a 40-50% “service fee”. Variable interest rates on everything from credit cards to auto loans hit those with the least money hardest. Credit scores impact insurance rates and job prospects. Banks collect billions of dollars in overdraft fees. It appears to be harder than ever for people to pull themselves up by their bootstraps when the deck is stacked against them.

Although the greed may not be relatively worse the higher people move up the income scale, the effects are more widely distributed and the impact is felt across society as a whole. The owners of capital (aka the 1%) appear to have no concern for workers beyond how much they can benefit from their labor. When they locate a cheaper source of labor, they move operations and simply forget about those left behind. Unemployment insurance is temporary, and token programs for retraining displaced workers often do not fit the needs of worker profiles in a given area.

The notion of equal opportunity is a myth. It leads many to believe that people in dire financial circumstances find themselves in such situations as the result of personal failings. In some case, that may be true but, in most, it is far from the truth. While the impact of my personal experiences, described above, shades my opinions to this day, if today’s income gaps are not due to individuals’ personal failings or unmitigated greed, what else could it be?

One might say it is merely a result of supply and demand (too many workers; not enough jobs), and I wouldn’t argue that point. However, I would ask if the glut of labor has occurred only by natural causes (increased birth rates). I would argue that it has occurred primarily in response to governmental policies (both directly and indirectly) enacted at the direction of the owners of capital. As such, I believe the government must act to correct deficiencies in economic policies that adversely affect the working class.

Raising the minimum wage is the most obvious first step. Despite the conservative mantra that raising the minimum wage will result in massive job losses (especially among unskilled low wage workers) studies have shown employers respond to a rise in the minimum wages in various ways, and the extra money in workers’ pockets does not stay there long. They spend the extra money which has a ripple effect in both the private and governmental sectors. Workers can afford to buy more products and services in the private sector, and the government pays out less for programs such as the Earned Income Tax Credit (EITC).

For those not working, but desiring a job, a solution may be as easily stated as raising the minimum wage, but harder to implement. Everyone wanting a job, should be provided a job. Easier said than done.

While neglect of government-provided infrastructure over a long period will require additional spending, the related jobs are temporary and should not be viewed as a long-term solution. Even expanding full-time government employment is a bad idea long term. We may have already passed the point where the private sector will be able to continue fully funding promised benefits to public employees.

I would first suggest that radical reform of our tax code is required immediately. As part of such reform, I advocate eliminating the corporate income tax entirely. Revenue lost from corporate taxes could be recouped by taxing investment income as ordinary income and adjusting the top rate as necessary.

Secondly, I highly recommend adopting a universal single-payer healthcare system. This is another overhead item that adversely affects American competitiveness in the global marketplace. We will never have any hope of bringing a significant number of jobs back home without these two changes.

Finally, I believe we must overhaul our “welfare” system in such a way that it also addresses the needs of those with less cash than $2 per day per person. In a nutshell, repealing the EITC and other child credits should be part of a tax reform package. These benefits could be replaced with a monthly universal basic income, adjusted for earned income and SNAP benefits.

Obviously, such changes would involve complex coordination of input and effort between multiple agencies and both political parties. Discovering that there may actually be solutions to some of the collective problems we face as a country will require thinking outside existing partisan boxes. At what point will the political parties stop blaming one another and begin collaborating? When we get the big money out of politics? Perhaps.

Steve Hough is a lifelong independent and became an activist for political reform after retiring as an accountant. He is the director of Florida Fair and Open Primaries.

Please Join the Politics for the People Conference Call

With Kathyrn Edin

We will be discussing:

$2.00 a Day: Living on Almost Nothing in America

Sunday, December 3rd at 7 pm EST

Call In and Join the Conversation

641-715-3605 and passcode 767775#