My article from November 2011 said that subsistence living would cost $41K, or $19/hr, for a person supporting a family of four. Updated figures tell us that the cost would be over $25/hr today. Note that this provides the bare essentials, nothing more. No retirement savings, no luxuries, no higher education.
Congress argues endlessly about increasing the minimum wage to $10. This is at least 250% short of income adequate for a family of four. Further, it perpetuates unnecessary government welfare expense and stifles the economy. Rather than a minimum wage, what we need is a Living Wage.
Congress argues endlessly
about $10/hr. min. wage,
but $25/hr. would be enough
for bare-bones life.
Here are some figures for current living costs in San Francisco. I have extracted these figures from the Living Wage Calculator by MIT for the city of San Francisco, where I live. Average US costs, particularly for housing, are lower.
- Monthly Expenses 1 Adult 2 Adults, 2 Children
- Food $242 $713
- Medical $149 $402
- Housing $1,144 $1,760
- Transportation $285 $686
- Other $109 $264
- Required annual income before taxes
- $26,692 $52,914
- Living Wage $12.83 $25.44
Recent figures show that an average 2BR apartment in San Francisco rents for $3250 per month, suggesting that the above calculated income would be inadequate by almost $18K. An average worker would be priced out of the market by gentrification. The median rent for the US is $736, more in the Northeast and West, less in the Midwest and South. Urban rents are more expensive, as are larger rental units.
In San Francisco, only six of the 22 occupations listed by the MIT calculator pay a living wage, most of them requiring advanced degrees. All others would require a second job or a second person working to have adequate income. Gentrification is raising rental costs so rapidly that required income will soon be at least $70K.
Here are some other figures: The Economic Policy Institute estimates for minimum income are a US average of $58,627 for a family of five. The average cost of living per person, according to Open Source Ecology, a Wiki, is $20,194 per person, which would be $80,776 for a family of four. There are other estimates, but the lowest is more than $50,000, or $24 per hour.
In SF, only jobs requiring
advanced degrees pay
Living Wage or better.
Yet Congress is arguing about increasing the minimum wage to ten lousy bucks, and some politicians argue that it’s not necessary to even have a minimum wage. Others argue that it’s quite possible to live on such very low income, although they of course can’t manage to do so themselves for more than a week, before they go back to their expensive houses, late model cars, and two-week cruises.
National corporations that pay poorly, such as Walmart and McDonald’s, are advising their employees how to get by on the inadequate wages they pay by accepting welfare and charity, buying used clothing, and patronizing food banks. In other words, government money—our money.
At present, the only way a family can survive on such substandard pay is with significant government assistance. Conservatives want to do away with all such assistance. At the same time they want workers to live on impossibly low income. There are only two ways to think about this. Either they have their heads up their asses, or they are utterly cruel.
Congress gets $83.65/hr.
for 126 days of work and
239 days of paid vacation.
Suppose everyone earned no less than a Living Wage. If that were so, government welfare could be limited solely to the aged and infirm, the permanently injured, and others who are unable to work. This would be a major budget savings that would make lower taxes possible. All workers would have enough money to buy what they want and need, which would give an enormous and permanent boost to the economy, and would create many new jobs. All workers would be contributing to tax revenue, rather than drawing from it, also making lower taxes possible. The imbalance between Social Security costs and revenues would be reduced. Far more people would be able to attend college. It’s quite possible that the incidence of crime would lessen, thus reducing government costs in several ways. In all, there don’t appear to be any downsides for Living Wage.
But instead of talking about something that makes sense, Congress is arguing on and on about increasing the minimum wage to $10, a level that is at least $15 per hour short of the amount needed for bare-bones essentials, with nothing saved for the future.
For this kind of shortsighted nonsense we pay them $83.65 an hour for 126 days of work and 239 days of paid vacation.