POVERTY AND WAGES

She may be struggling more than you and I could ever imagine.

For the sake of this week's class session, I think it's most appropriate to update the Why? What is being done? and What should be done?
Why??
This week's session was immensely helpful in explaining the reasons why many people remain in poverty. Just for clarification, I would like to remind you all that poverty does not mean someone is homeless or unemployed. A person in poverty can be a full-time worker and continue to remain there, because of low wages. While reading through notes, I was dumb-founded to realize that there were two types of minimum wage; State and Federal. Prior to this point, I was under the impression that everyone with a job was making at least $7.25/hour (with the exception of tipped workers). The Georgia minimum wage is still at $5.15/hr which is $2.10 lower than the federal minimum wage. This means that thousands of full-time Georgia employees are working their tails off for approximately $10,000/ year. Ten-thousand dollars per year will barely cover rent of a $900/month apartment, so how does the government of georgia expect individuals to survive?? Although Georgia's minimum wage is embarrassing, the situation for tip workers is even more deplorable. As an ex-waitress of a fairly decent restaurant, I know first hand how bad things can get when business is slow around the restaurant. Relying on tips to complement the hefty $2.13/hour wage of tip workers is not a reliable way of making money. The fact that a great deal of georgians are being forced to work two or three jobs just to make ends meet is not acceptable in my opinion. Let's look at it this way, after a single mother of two finishes her two shifts per day, how much time is she going to be able to spend with her children reading, cooking meals, or just spending quality time?? I would be entirely surprised if she gets to see them for 30 minutes each day before bed time; and we wonder why children are dropping out of school, selling drugs, and stealing. Low wages keep the cycle of poverty going, but if wages were increased by a few dollars I would bet my bottom dollar that poverty would decrease along with the percentage of illicit activities. It's just a thought.

What is being done? and What should be done?
Unfortunately, many employees of Georgia are still fighting for the state government to raise its minimum wage at least $2.10/hour. This would allow Georgia's minimum wage to rise to $7.25/hour which would award a full-time employee with a whopping wage of $14,000/year. Although $14,000/year isn't nearly enough money to take care of basic expenses, it's a little better than making $10,000/year. If this does happen, people might actually make a little slot labeled 'Food' in their monthly budget (I'm being very sarcastic). There is also a Living Wage Movement that seeks to encourage the government to pass legislation so that the minimum wage will be a large enough figure that full-time workers will only need to work one job to pay for basic necessities. The ideal Living Wage Rate would be at least $10.50/ hour if health insurance was provided, and if not then $11.75/hour should suffice. This would help an individual make at least $22,000/year which would greatly decrease many of the problems associated with low-wage compensation. The effort being placed into raising minimum wage is exactly what we need. Not only would raising minimum wage stimulate the economy, but our friends and family will be able to better support themselves if they made more money. Those requiring less help from the federal government means less money out of tax-payers pockets (this is a good thing!).

The Economics of Poverty

The Struggles of Parenting in Poverty

After a rather interesting week of finding a job and producing a theoretical budget for a single mother with two kids, I have gained an immense amount of respect for those that can actually make ends meet. For the sake of this week's class session, I will only update the why?, what is being done?, and what should be done?, as those are the three that apply to the topics discussed this week.

WHY?

Despite what I have said in previous posts about the various reasons people come to be impoverished, I would like to change my perspective once more. As I was studying for this week's class, I ran across  a chart that lists fifteen different reasons why a person(s) may be in poverty. For example: Immigration status, access to public benefits, and culture shock are just a few of the many plausible reasons. I think i made a huge mistake by taking on the responsibility of listing one-by-one the possible causes of poverty. From now on, whenever I am asked the question, "Why are people in poverty?" my response will be "there are too many reasons to list, furthermore each individuals situation is unique and their reason for being poor may be totally different compared to the next persons' reason." 

As stated earlier, a few of my classmates and I were assigned the task of finding a job for a single mother with two children. She was a high school graduate, but possessed no specific work skills. We eventually found an entry level position at a bank. Her salary was roughly $19,000 dollars after taxes. After we did research and made a budget for the woman, we realized that she would need to make double the amount of money to make ends meet. In the end, I believe there were two problems 1) the job chosen for the woman did not pay enough and 2) the budget we prepared for the woman was a bit too expensive. I believe if the task of the project was to make the budget work, we could have made some huge decreases in spending, but that wasn't the case. The point I am trying to make is that there may be individuals that are not taking the appropriate steps to reduce the amount of overhead that they are responsible for paying, as well as taking advantage of government programs aimed at alleviating poverty. In addition, the theoretical situation of the single mother with two kids fits perfectly with the Neoclassical Economic Theory which states, "individual traits, such as family background, education, human, social, and cultural capital effect economic well-being (Iceland, 2003)" Although we weren't given very much information about the woman's family background, she did lack in the education department as well as in the human capital department (knowledge, skills, training and education). 

I also I think some truth lies in the Structural Economic Theory of Poverty as well. This specific theory, "emphasizes the impact of economic, social, and political systems on poverty (Iceland,2003)."

WHAT IS BEING DONE?

As stated in previous updates, the government has a number of programs in place that aim to alleviate poverty. I forgot to mention President Obama's health care bill which aims to make health care universal by the year 2014. I think it's a great idea to spread the availability of doctors and nurses to those that are not able to afford health coverage. The only downside is I worry about how the quality of health care will change, which I'm sure it will. I guess the bill has a few positive and negative areas, but overall I think it's a step in the right direction. I try to take a moment to think about how I would feel about these sort of things if i were the impoverished individual.

WHAT SHOULD BE DONE?

After watching a poverty simulation video clip, I am now aware that a great deal of those working at government agencies are suffering through the same situations as those they are working to help. In one scene, a long line of unemployed individuals were waiting to be helped with paperwork. There were three available employees, but only one was actually assisting customers, the other two were talking to each other AS IF there wasn't a long line of people standing in front of them! I was even more chocked to find out that what happened in the poverty simulation is exactly what happens to those in real life. After analyzing the situation more, I realized a family friend of mine is in the same position; she works at the IRS, has two kids, and struggles each month to pay the bills. The shocking part is she's a college graduate, but she's still not making enough money to live comfortably. The point I am trying to make is how can the government expect people in need to get the help they deserve when employees are suffering just as much as those they are supposed to be helping?? That doesn't seem fair at all- to either party. The government needs to improve the benefits and salaries of it's workers before we can expect those in need to get the attention that they deserve.

RANDOM

Did anybody else have an "ah-ha" moment when the people participating in the poverty simulation raised their hands when asked if they'd engaged in illegal activities to pay their rent? 

--I'll be honest, for years I was under the impression that those in underprivileged communities were involved in crime just because they thought it was fun or there was nothing else to do. I now understand that there are some people selling drugs, stealing, and prostituting because that's the only way they can guarantee their lights won't be off or they won't be evicted. I completely understand now.

Poverty In a Global Context

Women and Children

WHO AND WHY?
It's no secret that poverty exists in extremely large numbers across the globe, but who knew women and children were some of the hardest hit by this devastating cycle? According to the article Rich World, Poor Women by Bill Moyer, "In many places, women and girls are often the last to eat when food is scarce."  Gender inequality is often the result of a cultural or religious belief that women are not capable of doing the things that men are. Men and women across the globe have been brainwashed into the idea that women are valuable beings- except for reproduction. The result of such discriminatory behavior results in masses of uneducated women, masses of unemployed women, and ultimately, masses of women and children in extreme poverty. Fortunately, the United States has come a long way in dealing with discriminatory practices in education and employment; the same cannot be said about women in other countries.
WHAT IS BEING DONE?
A large percentage of United States citizens are under the impression that at least a quarter of our nation's annual budget is reserved for humanitarian/development projects- wrong. In fact, Jeffrey Sachs, director of the Millennium Project, reports, "... [the amount of money for development assistance] is far less than 1 percent of the federal budget." That's a HUGE difference. We have to keep a better watch over how our money is being spent.
WHAT SHOULD BE DONE?
 As stated earlier, the United States is giving far less than it should to development projects across the globe. I suggest that our defense budget be cut significantly so that we can contribute to poverty alleviation projects as we should. The United States is considered the most prosperous country in the world, there is no acceptable reason why it's among the nations giving the least. I also think it wouldn't be such a bad idea to designate a tiny percentage of income to poverty alleviation projects. If each person in the United States gave a couple dollars here and/or there, millions of lives would be saved each year. It doesn't sound like that would be too hard to accomplish.