Raising the Federal Minimum Wage Would Allow Us to Cut Government Spending- Because $7.25 an Hour is NOT a "Living Wage".
When people are paid less than it costs to live,yes, they will try to qualify for "free stuff". After paying for foodand rent, who can live on $71 a month? If we raised the U.S. Federal minimumwage to $20 an hour, the Federal, State and local governments would no longerhave to subsidize wages -- meaning, the taxpayers wouldn't have to give awaymost of all that so-called "free stuff".
The U.S. government defines "poverty" for a single person (withoutchildren) as someone with ANANNUAL GROSS INCOME of $11,170 --- which includes ALLsources of income (wages, unemployment insurance, Social Security, welfare,veteran's benefits, pensions, alimony, child support, etc).
Over 38 million American wage earners (25% of the entire work force) NET less than that a year.And 50 million (33% of the entire work force) only NETS $15,000a year or less (based on wages earned that are subjected to FICA andFederal income taxes and are reported by employers on Forms W-2. (Source:Social Security Administration).
If you work full-time and earn $8.25 an hour in Nevada, you would beOVER thelimit to qualify for food stamps (SNAP).
And if you earned ZERO in income and had ZERO in assets,but were older (say 55) and had access to an IRA,401k or pension fund for an early withdrawal, that would be considered first before determiningwhether or not you could qualify for TANF (welfare) -- which is only $400 a month for asingle person without children in the State of Nevada.
I've lived all over the country, and so the calculations below are based on the REAL average cost-of-living expenses based on my own personal experiences. You can use your own "wage" and calculate your payroll taxes here -- and then apply the cost of rent, utilities and groceries where you live.
If You Live in Las Vegas and Earn the Nevada Minimum Wage
In my case scenario below you are single, you have no children, you live in Las Vegas,you earn the Nevadaminimum wage of $8.25 an hour and you walk to work, so you don't need nocar. (I also don't mention exemptions, deductions or other expenses that could convolutethe scenario, keeping this scenario as simple as possible.) I also use Nevada inmy scenario because it not only represents the average cost of rent and food,but it is also is the best case scenario for someone making $8.25 anhour, where there is no State, County or City taxes withheld from someone'spaycheck (asit is in places like NYC).
Here Are Your Basic Monthly Living Expenses
- $750 rent for a 700 sq-ft one-bedroom apartment (includes W/D, water, trash pick- up)
- $150 electric or gas (heat, A/C, hot water, cooking, etc.)
- $200 food ($50 a week or $6-$7 a day)
- = a total of $1,100 a month -- or $13,200 a year for the most basic living expenses.
Look at this weekly paycheck
If you are earning the Nevada minimum wage in Las Vegas (and pay no state or city payrolltaxes, just federal and FICA taxes): That equates to $8.25 an hour X 40 hours a week (if you are allowed to work full-time) = $270.18 NET a week after payroll withholding taxes (see chart below)= $14,049.36 a year in actual take-home pay.
That this leaves you...
- $14,049.36 in NET wages per year
- minus $13,200.00 a year for rent, heat and food
- = $849.36 a year NET as a balance --- or $70.78 a month to live on.
What can $70.78 a month pay for, beyond BASIC rent, heat and food?
$70.78 a month is what you willhave left over for...
- clothes
- hygienic and cleaning goods
- basic land line telephone (no cell)
- basic cable TV and internet connection (if this is not considered a "luxury", like telephones and refrigerators once were.)
After that, this is what you would not have any money left overfor...
- health insurance (not near enough!)
- savings for emergencies (not enough)
- savings for retirement (not enough)
- school tuition (not enough)
Now let's add another "luxury"
- car payment (not enough)*
- car insurance (not enough)
- gas for car (not enough)
- car maintenance (not enough)
* Remember, in my case scenario you are walking to work, so a car isn't needed -- although most people need a car to get towork. And you are living in a small average-sized apartment within walkingdistance to your work, so you wouldn't need bus fare either.
The maximum monthly gross income in Nevada (for someone who is single withoutchildren) to be eligible for food stamps is $1,174 a month GROSS (or $903 amonth NET).
But...
If you earn the Nevada minimum wage of $8.25 an hour (X 40 hours a week ($330)X 52 weeks a year ($17,160) ÷ 12 months = $1,430 a month) thatis OVER thelimit to qualify for food stamps. Are you getting all this Bill O'Reilly?
In other words, in a State like Nevada, if you are single,you would have to be already living near the poverty level to qualify for foodstamps, and you will only have your Social Security income to rely on whenyou get older if you opt to take welfare and try live on $400 a month in cashassistance with $200 a month in food stamps. (which is $600 a month X 12 months= $7,200 a year in government assistant) and maybe you might also qualify forstate Medicaidfor healthcare, especially if you have a pending Social Security disabilityclaim.
Fox News BillO'Reilly said "millions are leaving their jobs to go ondisability" and that Social Security disability is a con. He says," It'seasy to put in a bogus disability claim." Yeah Bill, it might be easy to filea claim, but it's very difficult to actually peruse a claim and to havea claim eventually approved (it takes about 2 to 3 years on average).
And IF approved, the averagemonthly SSD benefit is $1,111-- or $13,332 a year -- which is what you'd be earning making $8.25 a hour --- just enoughfor a small apartment, heat and food -- which is toomuch to qualify for food stamps in Nevada --- and leaving you about$70.78 a month left over to live on.
But Bill O'Reilly and John Stossel (and all the other loonsat Fox News) are telling the general public that millions of lazy slackersare leaving their jobs to get $40,000 a year in government benefits.PANTS ON FIRE! They say those things to deliberately enrage the taxpayers, sothat they will demand more cuts in government spending (so thatmulti-millionaires can pay less in taxes).
Bill O'Reilly and John Stossel (and the Republicans and Tea Party)want everyone to believe that millions of Americans are living "high on thehog" and drinking Margaritas by pool at the taxpayer's expense. These seekout a few bad examples and use them to make their case with false analogies.It's just not true.
So what part of my scenario doesn't corporate America, theRepublicans or people like Mitt Romney and Bill O'Reilly understand? When people are paid less than it costs to live(or earn nothing at all), yes, they will try to qualify for "free stuff", such as food stamps(etc).
A payrollcheck for a single person in Nevada earning $8.25 an hour for 40 hours inone week.
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 Net Pay
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Calculation Based On
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According the Bureau of Labor Statistics there are 1,427,300 maids and housekeeping employees in the U.S.-- and that number is expected to climb to another 111,600 over the next 7 years.Maids and hotelhousekeepers work very hard for a median average wage of $9.32 anhour.
But they only gross 82¢ an hour more than in my case scenario...justlike the 1.2 million Americans who work at Wal-Mart, or the 745,000 who work at McDonalds, and all the others who work at places like Dominos,PaPa Johns and Staples --- employers who pay the "47%"sub-standard wages and give them no benefits.
What part of my scenario doesn't corporate America, the Republicans andpeople like Mitt Romney understand?
Mitt Romney's "47%" are just regular Americans who are forced to tryto live on a net annual income of $27,000 a year or less -- and why 80% ofall households NEED two wage earners just to survive -- and why mom canno longer stay home to supervise the kids -- and why over 45million Americans don't have healthcare and also need food stamps.
>>>> Raise thefederal minimum wage to $20 an hour and the government won't have to subsidizewages in the private sector any longer, so there will be far less people whoneed to "free stuff". Then maybe multi-millionaires like Bill O'Reillycan stop whining about government "hand outs" -- and the"makers" can stop complaining about the "takers".
And then maybe we can cut government spending (while eliminating taxloopholes for millionaires) and lower the national debt.
| As an aside - Speaking of tax loopholes: If someone like Mitt Romney can deduct $17,000 a year from his federal income taxes for the cost and care of maintaining a show horse as a medical expense (because it's therapeutic and makes his wife Ann feel better), then if someone loses their job and is diagnosed for depression, can they buy a dog and also write off the cost and care of their pet because it makes them feel better? Just wondering ;) |
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