Study Shows Need for Anti-poverty Measures, But Obama Seems AWOL on Minimum Wage

By Roger Bybee, July 2012

In addition to our regular weekly posts, we are also going to start adding second posts, when possible, from current news articles. Here Bybee discusses the recent report from the Economic Policy Institute on American poverty, the congressional attack on the social safety net led by Congressman Paul Ryan, and Obama’s inaction.

Reposted from Working In These Times, the blog of In These Times Magazine, with the permission of the author.

We are at a moment, where if government’s growth is left unchecked and unchallenged … we will transform our social safety net into a hammock, which lulls able-bodied people into lives of complacency and dependency.

—US House Budget Chairman Paul Ryan (R-WI) in his State of the Union response in 2011.

As America’s most lavishly funded congressman with $5.4 million on hand, Paul Ryan feels total safety in marketing his Ayn Rand-fueled hallucinations about the soft life supposedly led by those at the bottom of America’s economic and social pyramid.

Claiming that the growth in food stamp usage shows a failure of anti-poverty efforts, Ryan is actively promoting the notion that food stamps should be slashed by $134 billion so funding can be diverted to job-training programs.

Thus far, Ryan has failed to explain how providing more training will automatically induce employers to create a sufficient number of family-sustaining jobs after more than a decade of sluggish domestic job creation and widespread offshoring  (see here and here) of existing jobs. Nor has Ryan accounted for how hungry Americans like those in his own deeply-distressed (see herehere and here) First District are supposed to survive without food stamps until the new jobs somehow materialize.

Ryan’s proposal is undermined is a new study by Economic Policy Institute economist Elise Gould and researcher Hilary Wething on the extraordinary extent of poverty in America and the appalling weakness of government efforts to reduce it.

The study shows how America has nearly double the percentage of its citizens living in poverty than do other wealthy nations. According to Gould, this directly reflects the relative absence of government effort via tax and transfer programs—like, say, food stamps—that would lift more families out of poverty.

“The relatively low social expenditures in the United States partially explain the high poverty rate,” said Gould. “When it comes to alleviating the effects of poverty, the U.S. could learn from its peers. … The U.S. only spends about half the average amount on social spending that alleviates poverty compared to other advanced nations.”

The result is not only a high poverty rate, particularly among children under age 6, but a far more extreme depth of poverty. “About a quarter of our kids under 6 live in poverty, and that includes 46% of black kids,” Gould noted.

In examining about 33 advanced nations, Gould found that “low-earning U.S. workers are actually worse off than low-earning workers in all but seven peer countries.” This means that the bottom 10% of full-time workers in the US, compared with a worker at the median wage, is far worse off than in other nations. “We have much wider inequality than most nations.”

One obvious step to improve the lives of workers trapped at the bottom of the economic ladder would be an increase in the minimum wage, currently at $7.25 an hour. Even during the George W. Bush Administration, the last increased in the minimum wage was passed on a bi-partisan basis.

But curiously, President Obama is strangely silent. As Harper’s publisher and author John R. MacArthur recently wrote:

Obama’s do-nothingness has reached new heights with the introduction by House Democrats early this month of a bill to raise the federal minimum wage to $10 an hour. The proposed law is called the Catching up to 1968 Act of 2012, because a $10 minimum wage, adjusted for inflation, would still only be worth roughly what it was in 1968, when the minimum wage was $1.60.

For some members of the president’s party, this bill is a no-brainer, since raising the minimum wage would not only help the beleaguered 4.4 million workers who try to live on it (as well as the roughly 16 million who make less than $10 an hour, but more than the minimum wage), but would also stimulate the economy by encouraging large numbers of people to spend more more.

But Obama and the White House have shown a curious lack of interest despite the efforts of a few liberal Democrats, Ralph Nader, and writer Timothy Noah.

“Nobody’s paying attention,” MacArthur told Working In These Times. “We couldn’t get a comment from the White House on the minimum-wage bill for weeks. Obama won’t even mention it in his speeches”.

Romney, speaking in his peculiar “corporations are people”/”I like firing people “ idiom, recently stated that “right now there’s probably not a need to raise the minimum wage.” But even this tempting target has not led Obama to speak out and lead the charge for a significant increase in the minimum wage.

There is no doubt that another Obama term would be infinitely preferable to the unpredictable chaos that Mitt Romney—ever eager to win the approval of the Far Right—would bring to America and the world. But the minimum-wage episode shows progressives that they must recognize that their advances will be based purely on their willingness to forcefully push Obama in the right direction. As MacArthur concludes:

Obama’s principal objective these days is not to offend the U.S. Chamber of Commerce or his Wall Street campaign contributors. He doesn’t want the Democratic Party to be a popular party; he much prefers doing a populist pantomime and blaming the Republicans for intransigence. The last thing he wants is a revived Democratic base that might start demanding action on other fronts…

 

About Roger Bybee

Roger Bybee is a Milwaukee-based freelance writer and progressive publicity consultant whose work has appeared in numerous national publications, including Z magazine, Dollars & Sense, Yes!, The Progressive, Multinational Monitor, The American Prospect and Foreign Policy in Focus. His e-mail address is winterbybee@gmail.com.


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