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THE ECONOMY

November 23, 2004
Nickel and Dimed and Quartered
by Russell Roberts

A friend of mine asked me the other day about Nickel and Dimed, Barbara Ehrenreich's experience as a low wage worker trying to make ends meet.  She has a tough time.  It's not easy living on the minimum wage.  It's particularly hard to support a family of four on $10,000 a year.  My friend wanted to know how a classical liberal devoted to limited government would view the challenge of the working poor.

My simple answer was that better education would go a long way toward helping the working poor in the future.  But won't we always need people to do menial tasks, my friend wondered, people to wait on tables and work as janitors and dishwashers.  Another variant on this point is the presumption that we need low-wage people willing to do those menial tasks and therefore, the entire capitalist system and our vaunted standard of living needs an army of low-wage people to support the rest of us.

In fact, if education were better in the United States, and more people were more productive, the higher wage alternatives would induce businesses and ourselves to look for ways of accomplishing unpleasant tasks using machines and technology in place of labor.  That's precisely why the occupations of butler and housekeeper have declined so dramatically in the United States over the last 100 years.  You'd think as we get richer as a society, more people would want to hire servants.  But the rising wage of servants, a rising wage due to the higher productivity and therefore higher paying alternative occupations of potential butlers and maids, induces most of us to live without live-in servants.  Instead we use vacuum cleaners and washing machines and dishwashers instead.  Or if you can afford it, you hire a fraction of a servant, a cleaning service that comes once a week.

But surely some unglamorous jobs will always be done by human hands.  Waiters and waitresses, a janitor to push the improved vacuum cleaner or power waxer, the cleaning service that comes once a week.  That may be true, but there's nothing inherently demeaning about those jobs.  What's demeaning in some dimension, or at least sad, is the idea of a 50 year-old mother or father of four doing that job and being barely able to put food on the table for the two kids.  What's sad is doing a job like that for 60 years with no change in what you do or what you get paid.  And that phenomenon will disappear as we get more productive due to better education.

You can see it happening all around us.  Go into a restaurant and your waiter is often a 19 year old rather than a dignified and graceful middle-aged waiter or waitress as in a 1940s film.  The service isn't quite as good as it once was, but that's actually the result of a rising standard of living rather than some cultural collapse of standards.  Hiring the better, older waiter is simply too expensive.  The skilled waiter has too many better-paying alternatives.  Customers aren't willing to pay the prices that would entail, at least in most restaurants.  Look at the person behind the desk at the next hotel you check into.  It's usually a kid or an immigrant, a person who is using this relatively undemanding job as a stepping stone and is able to do that job adequately because of the technology that is behind the desk, a computer system that lets a high schooler or a person with imperfect English take care of everything with a few keystrokes.

As it is, less than three percent of the American work force earns the minimum wage or less, and more than half of them are under 25.  Yes, there are working middle-aged parents who earn more than the minimum wage but who struggle to feed their families and pay their bills.  But their numbers will continue to dwindle if educational levels continue to grow.

Finally, those of us who earn more than the minimum wage don't need poor people to keep our standard of living high.  As the working population gets more skilled, we can all get wealthier.  That is the story of 20th century America.

As for the problem of the here and now, the problem of what to do about the current 50 year-old in a menial job is a tougher question.  It's usually too late for better education.  Raising the minimum wage could end up putting the person out of work altogether, a fate even worse than a low-paying job.  Would a poor person today find comfort in the fact that his or her children are likely to have a much better life as long as they stay in a decent school?  An even tougher question is what can we do for that poor person today that doesn't handicap the kids down the road.


Postscript:  Ironically, in the evening of this conversation about the hardships of the working poor, I saw Sullivan's Travels.  Written and directed by Preston Sturges, it's about a film director who decides to stop making comedies and instead make a serious picture about misery and hardship. He decides to wander the country as a hobo with a dime in his pocket.  He gets into some interesting adventures, and the plot twist and the punchline at the end is quite delightful.  Woody Allen either stole a variant of this plot twist from Sturges or discovered it for himself and used it in Hannah and her Sisters.  Here's an excerpt from Sullivan's Travels (from the Memorable Quotes part of IMDB) where Sullivan's butler, Burrows, finds him dressed in tattered clothes about to hit the road.  Evidently, Preston Sturges didn't think much of the sociology of poverty.

Burrows: I don't like it at all, sir. Fancy dress, I take it?
John L. Sullivan: What's the matter with it?
Burrows: I have never been sympathetic to the caricaturing of the poor and needy, sir.
John L. Sullivan: Who's caricaturing?
John L. Sullivan: I'm going out on the road to find out what it's like to be poor and needy and then I'm going to make a picture about it.
Burrows: If you'll permit me to say so, sir, the subject is not an interesting one. The poor know all about poverty and only the morbid rich would find the topic glamorous.
John L. Sullivan: But I'm doing it for the poor. Don't you understand?
Burrows: I doubt if they would appreciate it, sir. They rather resent the invasion of their privacy, I believe quite properly, sir. Also, such excursions can be extremely dangerous, sir. I worked for a gentleman once who likewise, with two friends, accoutered themselves as you have, sir, and then went out for a lark. They have not been heard from since.


Burrows: You see, sir, rich people and theorists -- who are usually rich people -- think of poverty in the negative, as the lack of riches -- as disease might be called the lack of health. But it isn't, sir. Poverty is not the lack of anything, but a positive plague, virulent in itself, contagious as cholera, with filth, criminality, vice and despair as only a few of its symptoms. It is to be stayed away from, even for purposes of study. It is to be shunned.

 

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