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Tuesday, October 24, 2017

California's New Minimum Wage Under Federal Poverty Level

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WoooHoo!!...Starting on the first of January, a family of four will have an extra $20 bucks a week in disposable pre-tax income.

On January 1, 2008 California will raise it's minimum wage to a whopping $8.00 an hour. That will tie California with Massachusetts for the highest state minimum wage in the nation. Sounds all good, right? I guess it's just fine if you are 18 and living at home with the warden, paying no rent and eating for free. But for many Californians that $8.00 per hour is meant to pay the bills, all the bills. The rent, food, utilities, gasoline, doctors, lawyers and Indian Chiefs, all paid from that $320 a week gross.

The "wink, wink," Federal poverty level for a family of four is officially listed at, or about, $24,000 a year. That might work in Kentucky but it just doesn't fly in California. Actually a Californian family of four needs over $50,000 a year to just cover the basics.

"The California Budget Project," self described as a, "nonpartisan, nonprofit organization seeking fiscal reforms to benefit low and moderate income Californians," recently released a 30 page report titled "Making Ends Meet." The numbers laid out in that missive are no less than stunning. And remember, these are "basic costs," there is no home ownership or keys to a Lexus involved.

A single man or woman, needs to make a minimum of $28,336 a year, just to live. That comes out to $13.62 an hour. Just one working parent in the typical family? Well, you need to knock down at least $50,383, or $24.22 an hour. Hey, this is the new America, both spouses can bring home the bacon...that should help right?

Maybe yes, maybe no, once you throw the daycare "card" into the pot.......well, the price of poker goes up. To get the same quality of life that just one working spouse provides, two worker bees will required $72,343 a year in income which equates to an hourly wage of $17.39 for EACH honey maker.

And don't forget, this report assumes full-time 40 hour weeks, 52 weeks a year.

So, who will benefit from this mandated $.50 per hour bonanza? It can't possibly even put a dent in the problems of even the poorest of California families. One could surmise that the legions of undocumented workers, knowingly hired by American employers, will see it as a boon. If you are working 120 hours a week at 3 jobs, that extra $60 bucks a week you now can send back to your home country can change lives. I don't begrudge them a centavo.

And who is going to pay for this new $.50 tariff? I wrote about this subject last year when there was a $.75 hike on the first of the year. I asked a a friend of mine who owns a small chain of pizza parlors what he was going to do. He gave a simple response, "We will raise prices accordingly." And on Jan 1, he did just that....I asked him again this week and it was deja vu all over again.

Just as I did last year, I urge people to educate themselves on the concept of a living wage. Information can be found at: http://www.epinet.org/content.cfm/issueguideslivingwage (2002), http://www.livingwagecampaign.org/index.php?id=1958 (2006) and http://www.brennancenter.org/subpage.asp?key=40&initkey=66 (2007)


www.thelenreid.co
www.reuters.com
www.abcnews.com
www.cbp.org



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Steven Lane is a writer for BrooWaha. For more information, visit the writer's website.
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11 comments on California's New Minimum Wage Under Federal Poverty Level

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By Jen on December 13, 2007 at 05:32 pm
"We will raise prices accordingly." The only real argument about "politics" my ex and I got into was over the issue of minimum wage...and he called me a republican. A REPUBLICAN!!!!! All raising the minimum wage does is make it more expensive for EVERYBODY...including the people who really f'in need the money. I mean...if you make $20 more per week and it costs $30 more to live because "prices have been raised accordingly" then what you've really done is lost ground. Granted...you dont NEED to eat pizza but the cost of milk and bread be "raised accordingly" as well. I dont have any solutions or brilliant ideas but I think that if you are going to set price floors you have to start setting price ceilings. Sounds like socialism but...we're not really a true capitalist economy anymore either. Great article.
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By Ivan Homeless on December 13, 2007 at 07:51 pm
I had to sell my home 2 years ago when I got divorced because I couldn't maintain it on my own. The financial situation in this nation is deplorable - reform is needed on all levels. Great article.
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By 'Mean' Mike Duffau on December 14, 2007 at 03:07 am
They're trying to wipe out the middle-class folks. You're either rich or poor! Great topic champ!
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By Jen on December 14, 2007 at 04:51 pm
"The real winners of an increased min. wage are suburban teenagers from middle class families who will use their extra income to buy their marijuana and their Billy Squire tapes and their guns." LOL! And sooo true. But really...what the hell do you need 7 bottles of bleach for?
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By Jen on December 14, 2007 at 08:44 pm
Incorporating more fiber into your diet might help with that problem.
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By Steven Lane on December 14, 2007 at 10:44 pm
ack!
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By D. E. Carson on December 15, 2007 at 04:52 pm
"Though it’s counterintuitive, raising the min. wage actually most harms those very groups it seeks to help." All the more reason why the minimum wage should be abolished. But you leave out an important point. Not only do prices go up when minimum wage goes up, prices also go up when the price of gasoline and diesel goes up. What teenager making $8.00/hour can afford to survive when nearly half of his hourly wage buys him a gallon of gas to drive to that job? I am not a liberal by any means, but I happen to think that there is some sort of conspiracy with $3.00/gallon for gasoline...but that's another subject for another time. As for your illegal alien theory, they get paid less than minimum wage. After all, who they gonna cry to? If they file a complaint, their butt gets kicked out of the country (or it should). So raising minimum wage isn't helping them one iota. It is true that the middle class is under attack, but it's under attack from the poor. I mean, can any of you who write for this site honestly say that a poor person ever gave you a job? If it weren't for the rich who buy their toys, there wouldn't be a middle class to begin with. Many of you have jobs and complain that you can't afford the basic luxuries. Who says you have to have a television? Who says you have to have cable? Where in the Constitution are we guaranteed the right to everything we want? The answer is nowhere! The very idea that we have to have everything that is dangled in front of us is why so many people are losing their homes right now. Sure it's nice to have a television, but it's not a necessity. Sure it's nice to own a home, but if you can't afford something, why fake your way into it? The housing crunch is a result of greed. Too many people listening to WII-FM (What's In It For Me?). Greedy lenders offer sub-prime loans to people who are too stupid to know what they're up against, and yet the president wants to bail them out? Talk about liberal policy. When I was in school, schools taught basic economics. Nowadays, it's about getting stupid test scores up. Buying on credit is the worst kind of debt in the world. You're not working for yourself when you buy on credit. You're selling your name to someone else. When you do that, you work for them until you pay that debt off. Even calling a house an asset is a lie. If you owe money, it's a liability, period. Raising the minimum wage gives people a false hope that things will get better. I mean, if you think the government lied about Roswell and the Kennedy Assassination, what makes you think for one minute they're telling you the truth about raising the minimum wage being better for everyone?
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By V on December 15, 2007 at 07:18 pm
I remember when you wrote about this last year and I said then that I had been completely shocked when I discovered what the minimum wage is here. Completely and utterly gob-smacked. I took a pay cut working here. I get paid quite a bit less here for the same job back home. I have noticed that yes, America's economy handsomely rewards entrepreneurism. There is serious money to be made here in business. But I have noticed that the average income here - nomatter which industry - is about 2/3 of what you'd earn in the equivalent position where I come from. I don't have any answers, but I honestly can't even imagine how tough it is for people trying to raise a children on such incomes and with such a shoddy healthcare system. My hat off to them.
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By Rose Mountain on December 17, 2007 at 02:18 am
Great article Steven. Throughout US history its clear how the rich became rich and the poor became poorer, let's begin with the people they killed and raped their land when they got here, then they steal other people from their homelands to make them work for free, they own the land and them, and they become rich. When slavery was over and the people began to start their own businesses and elect blacks to Congress, the South freaked and made new rules to prohibit their advances. Now fast forward to modern big business, the workers do all the work but the CEO's get skyrocketing profits, and break the trade unions too. Why do most industrialized countries still have strong unions but not the US. The same old story in the US, when minimum wage is low it allows the wealthy businessmen to make more profits, because of course the oil companies and Enron and PGE didn't steal enough from us yet. The small businesses get screwed, they say, mostly from the Insurance industry, who screw everyone equally it seems.
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By D. E. Carson on December 19, 2007 at 10:14 pm
El G: I took that Economics class and the book was heavy enough that should it be dropped it would knock the Earth off its orbit causing it to careen helplessly into the sun (hey...waitaminute...possible solution here...). I love how Rose likes to beat her drum of "the rich get richer and the poor get poorer". Maybe she should get into my argument with V about how poverty in America is a choice. She's just the kind of person a politican loves: uneducated, uninformed and willing to believe anything she is told so long as it doesn't come from Fox News... In other words: the perfect Democrat.
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By Birdman on January 08, 2008 at 04:34 pm

I'm not so sure minimum wage should have nothing to do with the Federal poverty level-- it's not designed to say "this is what you need to pay someone to support their family of four," it's designed to say "regardless of the nature of the labor, an American must be paid at least X dollars for it."  My cousin is a concrete worker.  He makes $45 an hour, and earns every penny.  I, on the other hand, work at a fast-food joint and shuffle sandwiches around for eight hours at a time.  I have no illusions regarding the low effort required to do my job, and I certainly don't think I deserve more than the $7.50 I make now.  If a family of four is in poverty because one minimum wage worker cannot support them, the blame falls on the worker, not the wage.

Ed: I agree with you 100% on the wrongness of taxing minimum wagers.

El G: I'll vote for anyone honest enough to threaten someone with a mop.

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