JUNE 27, 2016
BREXIT & SHELTER
Some say that those in England who voted to leave the European Union were motivated by two factors:
- Fear of globalization; and,
- Fear of job competition from immigrants.
In California in Santa Rosa (about 55 miles north of San Francisco) in the Sunday paper, The Press Democrat, these were the front page headlines this past weekend:
- Plight of the shelterless more visible in city;
- Housing scarcity has officials on cusp of emergency declaration;
- ‘The sad reality’ of life on Homeless Hill, and
- Britain rattles postwar order.
The “postwar order” refers to the seven decades following World War Two during which the United States developed into one of the most powerful nations that has ever existed on the face of the earth.
How does ‘Homeless Hill’, ‘housing scarcity’, and no shelter fit into the picture?
According to the Census bureau, In America the rental vacancy rates in the winter of 2016 were as follow:
Across the US…….7.0%
In the Northeast….5.4%
In the Midwest……7.7%
In the South……….8.8%
In the West…….….5.1%
The problem is not availability. The problem is affordability.
The Press Democrat reports that one woman employee at Walmart lives in her car in Santa Rosa because she is unable to pay rent in an area where the price of an apartment has gone up to $1,700 monthly in recent years.
According to the website, glassdoor.com, in California Walmart pays Senior Software Engineers $125,362 annually, Walmart pays cashiers $9.83 per hour or $20,446 annually.
So after payroll taxes what does that Walmart cashier have left?
Here is the story:
Gross Pay . . . . . . . . . . . . . $20,446
FICA Withheld . . . $1,267
Medicare W/H . . . $ 296
SDI W/H . . . . . . . $ 184
FIT W/H . . . . . . . .$1,664
SIT W/H . . . . . . . .$ 274
Total Withheld . . . . . . . . . . . $ 3,685
Net Amount . . . . . . . . . . . . . $16,761
Net Amount per month . . . . $ 1,397
Effective January 1, 2016, the minimum wage in California is now $10.00 per hour according to ADP. So in our example the woman working at Walmart may be taking home $4 or $5 extra dollars each month in this year but still not have enough to pay $1,700 monthly for rent.
Most retirees who previously earned a middle class wage and most currently employed well paid professionals are often blind to the employment reality now faced by a Walmart cashier and millions of other employees across the country.
When my wife and I began our married life thirty-five years ago in San Francisco our rent for a middle floor four room flat and a two car basement garage was $200 monthly. The minimum wage at that time was $3.35 per hour. At that rate it took about sixty hours or a week and a half of full-time work earning the minimum wage to get an amount equal to the monthly rent we paid then.
At the current California minimum wage of $10.00 per hour one would have to work 170 hours or slightly less than forty hours a week to earn an amount equal to a monthly rent of $1,700.
The lower paid less skilled workers of the United States and Great Britain and their descendants know painfully well how the changes of the last four decades have greatly diminished the personal possibilities in life for many who live in their countries.
Everywhere the anger of the less well off is boiling up.
Each of us would do well to figure out how we may change our own lives and habits so our economy may be changed and re-created into one where everyone may have a decent existence.
Failure to act will surely lead to a much diminished world — one in which none of us would enjoy living.
