My Turn: How our government supports slave labor
With a minimum wage of $7.25, many families must rely on numerous government programs to survive.
Increasing wages for the lowest paid among us would greatly reduce government dependence and the annual deficit of the federal government.
These are things all of us should support.
Let me use a real life example:
A mother and her two teenage children live in the Concord area. The children’s father is deceased. The mother works as close to full time as her employer, a major retailer, will allow. She is paid $10.25 an hour and her total income for last year was $20,500.
How did her family manage to survive? Her biggest expense was rent at $1,000 per month.
Section 8 housing provided a $650 per month subsidy and she paid $350 per month.
Using the IRS tables for Earned Income Tax Credit, she received $250 per month in food stamp benefits to assist in buying some of the family’s food. (Two teenagers remember!)
She received some federal fuel assistance for winter heating from the Community Action Agency amounting to $500 for the year.
Her employer provides health insurance for her but not her children. The children are covered by the New Hampshire Medicaid program, funded 90 percent by the federal government and 10 percent by the state government. If she bought commercial insurance for the children, it would probably cost about $3,000 annually.
This is how the family survived 2013:
Earned Income Tax Credit: $4,100
Section 8 rent assistance: $7,800
Food stamp assistance: $2,400
Fuel assistance: $500
Health insurance (Medicaid): $3,000
This family’s earned income of $20,500 was supplemented by more than $18,000 in government financial assistance.
If this mother’s employer paid her $15 per hour (perhaps required by a minimum wage at that level), she would have earned $30,000 and would need and receive much less in the way of government subsidy, probably only the Medicaid for her two children and a much smaller Earned Income Tax Credit.
If her retail industry employer would also include family health insurance as an employer provided benefit, even that subsidy would not be necessary.
Note that this family’s income is too high to qualify for the federal state Temporary Assistance for Needy Families program that most people consider “welfare.”
Also note that reinstating a New Hampshire minimum wage, even at the proposed rate of $9 in 2016, will not help this family in any way as the mother’s wage is already $10.25 per hour.
Why do we, the public, agree to subsidize low-paying employers through these programs instead of insisting that employers pay a livable wage?
Minimum wage should be at least $15 hour.
(Doug Hall lives in Chichester.)