Seattle Press on Line - Federally Subsidized Poverty

Federally Subsidized Poverty

By Jim Hightower

Mar 03, 2003 --

HERE’S A novel concept: If you work full time and do a good job, you shouldn't be paid so poorly that you live in poverty.

Try to tell that to the federal government, though. An independent study released by ACORN, the grassroots advocate for the working poor, finds that corporations enjoying fat, tax-paid contracts from the feds are paying poverty wages to the people actually doing the contract work. The same federal government that sets precise standards for, say the tensile strength of screws that it buys, sets no standards for the fair pay of people working under its contracts.

The study, conducted by the Economic Policy Institute, revealed that 11 percent of federal contract employees receive less than a "living wage," which is to say their paychecks are too low to lift them and their families above the poverty level. In this period of economic prosperity and federal surpluses, in this period when congress annually raises its own pay, in this period when federal contracts routinely cover the million-dollar paychecks of the corporate CEOs getting the contracts – it's absurd that our tax dollars would be used to subsidize sub-poverty pay.

Ironically, while the companies profit on the backs of these workers, many of the workers themselves have to turn to food stamps, housing assistance, and other federal poverty programs just to make ends meet. This means that we taxpayers are hit with a double whammy: First, we're subsidizing low-wage companies, then we have to provide services to assuage the poverty of their workers.

Better that the contractors themselves be required to pay fair wages from the start, which is why the Living Wage Responsibility Act has been introduced in congress, sponsored by Representative Luis Guitierrez of Illinois. It requires big businesses that get federal contracts to pay their employees a wage no less than the federal poverty level.

For more information, contact ACORN: 202-547-2500.

Jim Hightower is a national radio commentator, writer, public speaker and author of "If the Gods had Meant us to Vote They Would Have Given us Candidates."

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Joan Aarvig	Mar 04, 2003	Minnesota	Grants Specialist/State Employ
This is a good reason not to shop at Wal-Mart, for example. Some years ago when Wal-Mart first came to my home town, I participated in a discussion group with the Financial Services Director of our county's Social Services agency. The two of us brought to the attention of the group (comprised of government and nonprofit organization employees who daily encountered the poor of a four-county region) the practice of Wal-Mart to employ people at less than full time. This made them ineligible for any employer-paid or -subsidized health insurance. Because the wages were very low, many of these part-timers and their families were eligible for Medical Assistance, Minnesota's health plan at that time for low-income families and those on public assistance. We saw this as a tax-payer subsidy of the Wal-Mart corporation. Local chain grocery outlets were also mentioned as practicing this type of part-time employment. I'm sure there are others we could mention. Are we willing to pay a little more for our laundry detergent, clothing, groceries, so that our neighbors, friends, and family members can be paid a living wage? That's the question, isn't it?