The Land of Opportunity

A friend of mine called the other day and was excited to have found a job. It's temporary, but after 13 months looking for work she jumped at the chance to earn $12/hr. She has 15 years of solid experience as a Bookkeeper. So I did a little calculating and realized she will bring home what she made on unemployment.

What the hell is going on here? Unemployment benefits and earnings are a patch, not a lifestyle. The government wants to step back once we get on with our lives. But when the economy undercuts life-sustaining earning levels? What then? Check out the example below to see what a $12 life looks like:

Our hero rents a studio apartment (650), utilities (85), phone (35), pays transportation (public, 100), food (200) and renter's insurance (55), contributes his part to health insurance (400 or more), he would need to earn $12 take home to sustain his life. Net wages would need to hover around $1400 /mo ($22k/yr). The government lists the poverty level in America at $10k, or $833/mo net.

But let's say our hero eventually becomes dissatisfied with that lifestyle and wants a bigger piece of the pie. He adds an occasional social activity (100), contributes to savings (50), buys clothes and stuff (125), gets cable tv (70), maybe a modest car with a payment (225) that is insured (70) and a computer w internet (35). His take home wages now would need to jump to $17/hr or $2100/mo ($33k/yr). And good luck if he ever wants to do any retirement investing, own his own home or go back to school.

How do you think he handles the unexpected things like dental work, car maintenance, sick children, accidents, family get togethers, back to school clothes? That's right: he charges it. What other option is there when life keeps on trucking? No wonder people get themselves crazy into credit card debt.

So back to my friend, who has lived the last decade earning probably $40K and is now subsisting on a net salary of about $1,000/mo as a temporary worker. Likely without benefits. And feeling grateful. And then I want you to multiply the forced impoverishment of hundreds of thousand (millions) of hard working people who are in the same boat. Somebody is definitely making out in this deal and it sure isn't the workers. She will need a roommate to afford the home and lifestyle she has enjoyed for over a decade...

It's tragic that the Land of Opportunity is becoming a place where government subsidies and public health assistance will have to make up the difference. I wonder if they're ready for it.