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Every day is a new struggle to get by
The other America

November 22, 2002 | Pages 6 and 7

THE SCANDALS at Enron, WorldCom and other corporate giants have exposed the obscene wealth at the top of U.S. society--and the scams that the superrich used to get that way.

But the stories of the people who lost their jobs or slid into poverty in the wake of these scandals didn't usually make the headlines. These people are part of "the other America"--the America that works long hours for little pay and no respect.

ERIC RUDER reports on the deteriorating living conditions for the working poor in the U.S.

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IN SEPTEMBER, the U.S. Census Bureau reported that nearly 33 million Americans--11.7 percent--were living in poverty in 2001, an increase of more than 1.3 million people in just one year. This was the first increase in the U.S. poverty rate in eight years.

Those eight years were part of the longest economic expansion in the history of U.S. capitalism. Yet at the end of the 1990s boom, workers' wages--after adjusting for inflation--had only just reached the level that they were at in 1973. And between 1989 and 2000, the rate of poverty fell by just 1.5 percentage points--from 12.8 to 11.3 percent. In some states, including California and New York, poverty was worse in 1999 than in 1989.

For African Americans, the statistics are even more shocking. Blacks had the highest poverty rate of any group last year, and median household income fell from $30,495 to $29,470, the sharpest decline in 19 years.

Today, most experts agree that poverty is still on the rise, as layoffs continue to mount and the economy sputters. Meanwhile, the number of millionaires in the U.S. more than quadrupled during the 1990s--from 1.8 million to 8 million.

Throughout the 1990s "miracle economy," the rich enjoyed the lion's share of the benefits. Between 1983 and 1998, 47 percent of the total gain in real income for Americans went to the top 1 percent--while the bottom 80 percent received only 12 percent of the increase.

But to really understand what these numbers mean, you have to look at the stories of those who live them. While Microsoft tycoon Bill Gates ponders which cars to buy to fill the 30-car garage in his new $100 million mansion, Jackie and her partner Steve face a less appealing dilemma.

Jackie and Steve provide for themselves and their two kids on $23,000 a year. They'd have to save every penny of their earnings for 4,340 years to afford Gates' house. Their combined income is almost $5,000 above the official poverty line for a family of four, but they still can't make ends meet.

Steve works full-time as a janitor and makes $17,000 a year, and Jackie receives welfare benefits worth about $6,000 a year. "I want to work," explains Jackie, "but when they went through welfare reform, they didn't think about the cost of child care. Until I finish college, I can't make it worth what I would pay to have someone take care of my kids."

Take a look at facts like these, and it's obvious that the government's numbers don't add up. Most people would find it difficult to provide for themselves and a child on an annual income of $18,000 a year--about $9 an hour. But this is 50 percent more than the official poverty line for a single parent with one child.

One recent study calculated that a single mother with one child living in Washington, D.C., needs to make about $34,000 a year--almost three times the official poverty line--in order to make ends meet, once all expenses are taken into account.

For Jackie and Steve, basic expenses--$500 for rent, $500 for utilities and transportation and $200 to pay off school loans--take up most of the family's income. Jackie also pays $100 a month to credit card companies. "I ran up my credit cards because I sometimes had to charge my car insurance or heating oil," she explains.

After that, the family is left with only $50 a week for food. Then there are the unexpected bills--a car that needs repairs or a hospital bill that isn't covered. That's when it's a choice between paying the rent or putting food on the table. In those situations, Jackie turns to three food pantries to make up the difference.

Jackie and Steve are typical of millions of Americans. Almost 30 percent of families in the U.S. have an income below $35,000--twice the official poverty line. Of these families, 72 percent had at least one serious hardship during the last year, such as worries about food, missed rent or mortgage payments or inadequate child care. And almost 30 percent had a critical hardship, such as missing meals, getting evicted or having utilities disconnected.

We're constantly told that capitalism--especially as it's practiced in the U.S.--represents the high point of human achievement. But the truth is that a society that consigns huge parts of the population to fears about food and health care--while millionaires spend thousands on fine wine and Rolex watches--isn't "the high point of civilization."

We should call it what it is--barbaric.

"I can't miss a day of work"

EDGAR PACHECO started working at a Dominick's supermarket in Chicago at age 19. Now, 11 years later, management at the store is trying to weaken his union by bringing in a two-tier wage and benefit structure. Edgar spoke to Socialist Worker about making ends meet and fighting for justice on the job.

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IS IT a struggle to support your family?

I MAKE $16.30 an hour. I'm a department head, so I make a little more. Most people make $13.80 an hour after four years. I'm supporting my mother, and I have one of my nephews living with me, because my sister has six kids.

Every penny counts. I pay rent, I pay light, I pay gas, food, clothing. My mom's not working because she has leukemia that's in remission right now. If I miss one day of work, that hurts. But I'm living okay. There are times when I have to let my bills go, but I pay them late.

DO YOU have health care?

YES, BUT it only covers me. My sister has coverage for my nephew. And my mother has to go to Cook County Hospital [Chicago's only public hospital], because she has no coverage. And I can't get her covered under my plan because she's not a spouse.

BUT DOMINICK'S management wants to push health care costs onto employees.

I CAN'T afford to go on strike, but I can't afford to let this company walk all over me either. So I'm willing to make the sacrifices. If I have to find another job, I will. If I have to find two jobs, I will.

One of the reasons I'm for a strike is the health insurance. Should we lose our insurance, God forbid that I get sick or hospitalized. Then I'd really be in debt. If we cave in to their demands, they're going to use the new hires at a cheaper labor wage to cut all of our hours down.

It makes me angry. They demand loyalty from us, but they're not loyal to us one bit. I'm there every day. I don't call in sick.

I try to budget my money real well. I have a savings account, and I don't take anything out. And at one point, I might have to choose--the rent or the food. In the city nowadays, rents are expensive. I pay $750 now, and every year, it's going up.

I work 40 hours a week. But sometimes I'm at the store a lot more, because I'm a union steward, and if anyone needs me, I'm there. I hate to see people get screwed around. I've been screwed around so many times. That's why I became a steward. I will stand up for my rights, and I won't let them talk me out of it.

Everyone's got my number, and whenever they need me, they call. I'd say that adds another 20 hours to the week--unpaid, of course. But it doesn't bother me one bit.

How welfare was wrecked

WHEN GEORGE W. Bush learned about the rise in poverty statistics, he figured that the time was right--to defend his tax cut for the rich "as more important than ever."

"I'm optimistic about America in general," said Bush. "I mean, the American people are resilient. They're strong. We got the best workers in the world." But Bush and his corporate buddies wouldn't know much about work--and the Bush tax cut is designed to keep it that way.

Under the $1.35 trillion package of tax breaks passed last year, the richest 1 percent of taxpayers will rake in 40 percent of the benefits. The rich will enjoy these tax breaks even as average pay for the top 100 CEOs has soared to $37.5 million--more than 1,000 times what an average worker makes.

Before the midterm elections, the Democrats decided that they should attack Bush's economic record. It should have been easy. But the Democrats couldn't make their attack on Bush's record stick--because they share the blame. After all, how could the "party of the people" call for the repeal of Bush's tax cut when so many Democratic lawmakers voted for it?

In April, Bush and Congress agreed on legislation to reauthorize the federal welfare cuts passed in 1996. As part of the plan, Bush required states to ensure that 70 percent of recipients were working for their benefits--up from the current requirement of about 30 percent. "[This] runs counter to everything we have learned in the past five years about what helps poor families survive," said Deepak Bhargava, director of the National Campaign for Jobs and Income Support. "The plan calls for a massive increase in the number of people required to work, an unrealistic proposal in the best of economic times, but truly bizarre in the middle of a recession. It represents a huge step backwards."

But it was Bill Clinton who first pushed through legislation to repeal federal welfare entitlements and require recipients to work. Now the Democrats have barely raised a peep about Bush's work requirements, which will only force more poor people into sub-minimum-wage jobs.

An injury to one is an injury to all

WHEN ASKED whether the government should help the poor, most Americans firmly agree. According to one poll, fully two-thirds say that they'd forgo tax cuts to provide more help to those in need. But politicians cynically use a combination of shame and blame to demonize the poor--while all the while praising "hard-working Americans."

Yet even while politicians preach about "personal responsibility," spending on "corporate welfare"--subsidies and tax breaks for big corporations--has outpaced spending on welfare for the poor 3 to 1.

Meanwhile, welfare "reform" benefits Corporate America in another way--by flooding the low-wage labor market with people desperate to accept any job. When people making $7 an hour are forced to take jobs paying $6 an hour, those making $10 an hour can be made to work for less also. In the end, the welfare cuts hurt all working people.

The politicians make it sound like welfare recipients are parasites who live off taxes paid by hard-working Americans. But the vast majority of people on welfare generally use it as a way to get back on their feet after a layoff or an illness that leaves them unable to work temporarily.

The truth is that a single mother on welfare and a unionized dockworker making $80,000 a year have a lot more in common with each other than with the likes of George Bush. If the administration succeeds in crushing the dockworkers, this would give corporations the confidence to go on the offensive against workers everywhere.

By the same token, if the dockworkers score a victory, it will help union workers--like those who work for much lower wages at Dominick's supermarkets in Chicago--demand higher wages. And historically, when unions have been strong, they've also fought for government programs that benefit poor and working people.

By building solidarity throughout the working class--from its better-paid sections to its worse-paid ones--we can fight for higher living standards for all. Like the old saying goes: An injury to one is an injury to all.

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