Serious debates over what the minimum wage should be in various U.S. locales and jurisdictions should start with information on what it actually costs to live in the different places where Americans live. One common reference point, the U.S. federal poverty level, is sorely inadequate to the task. It has two basic flaws. First of all, it is absurdly low, based as it is on a hopelessly antiquated 1950s formula that multiplies a minimum food budget three times. The formula made a certain miserly sense when it was set in 1955 (when the average U.S. family actually did spend one-third of its budget on food), but it is wholly inappropriate today. The minimum required outlays for rent, transportation, child care, health insurance, and medical care have since risen significantly both in absolute terms and as a percentage of U.S. household expenditures.

The curent federal poverty level is:

one person in a household: $11,770

two persons: $15,930

three (one parent and two children): $20,090

four (two parents and two children): $24,250

five: $28,410

six: $32,750

I defy any household that does not grow its own food and manufacture its own clothes and medicine while foregoing modern health care, insurance, telecommunications, and transportation, to try to live with minimum basic level of comfort and health at these levels. A second major flaw in the U.S. poverty level is that it is not adjusted for significant geographic variations in the cost of living across U.S. metropolitan areas. It costs considerably more to get by in Chicago or New York City than it does in “downstate” rural Illinois or “upstate” New York. It is much more expensive to live in San Francisco than in Bakersfield, California.

What does it cost just to get by in the U.S. today? It depends on where you live to no small extent. In an all-too-rare example of real social use value resulting from the labor of intellectuals, researchers at the Economic Policy Institute (EPI) have done some remarkable work on this topic.

They have calculated the varying minimum no-frills “income required to afford an adequate standard of living” for 6 family types living in 615 specific U.S. communities, taking into account the varying costs in each community of 7 basic expenditures: housing, food, transportation, child care, health care (premiums plus out of pocket expenses), “other necessities” (clothing, personal care, household supplies, reading materials, school supplies, telephone), and taxes.

According to the EPI Family Budget Calculator, the real cost of a minimally adequate no-frills standard of living for one parent with one kid in Iowa City, is $48,235—more than 3 times the official U.S, poverty level for a 2 person household. That sounds high until you add up the monthly expenses: housing ($853), food ($369), child care ($684), transportation ($459), health care ($891), other necessities ($313), and taxes ($450), for a total monthly outlay of $4,020. Go to the San Francisco metropolitan area and the cost of a basic family budget for one parent with one kid is $70,929 (compared to $46,989 in Bakersfield), more than 4 times higher than the federal poverty measure. In the Chicago area, it’s $53,168. Even in depressed Rockford, Illinois, its $48,936. In rural Illinois, its $48,129. Make it 2 parents and 2 kids in Iowa City, Iowa, and the cost is $66,667—275 percent of the federal poverty level for a four-person household. With most Americans’ wages stagnating for more than a decade and with the lowest paid workers’ wages shrinking, is it any wonder that half of the more than 24 million Americans who rely on food banks for basic nutrition are employed? The EPI’s figures are worth keeping in mind the next time you hear the Chamber of Commerce or the American Enterprise Institute express horror at the notion that the minimum wage should go as “astronomically” high as $15 an hour. Even such a dramatically increased minimum wage translates into just $30,000 a year for a worker fortunate enough to stay employed full time.

Put 2 parents with 2 children successfully in the job market full time and you still come up $6,667 short in Iowa City, where the local Proctor and Gamble plant is currently hiring (through an employment firm called Staff Management/SMX) warehouse and production workers for just over $10 an hour ($20,000 per year if able to get full time hours year round). Considering all this, I can be forgiven, perhaps, for not showering praise on my local county (Johnson County, Iowa) board of supervisors for agreeing (under pressure from local labor activists) to consider a proposed ordinance that would raise the county’s minimum wage from $7.25 to $10.10 an hour by 2017 in 3, 95-cent increments. To be sure, the current U.S. minimum wage of $7.25 an hour is another bad joke. (If it had kept pace with increases in U.S. labor productivity since the 1970s, it would be $18 an hour today. At its current level, it translates—assuming full-time year round work—into $14,500 per year, well below the horrific federal poverty level for a 3-person family.) It’s good to see local city councils and now even (in this case) a county board experiment with going beyond the federal minimum wage. The precedent is most welcome. But, please, just ten dollars an hour…$20,000 a year, assuming full-time year round work (which many workers cannot attain)…and this just by 2017? Forget for a moment that many employers in the area are already at or above $10 an hour. That aside, the EPI’s carefully calculated basic family budget even just for one parent and one kid in Iowa City (Johnson County’s biggest municipality) is over $48,000 per year. That’s more than 240 percent of what someone can make at a measly $10 an hour.

The so-called People’s Republic of Johnson County is currently “feeling the Bern”—the passion for Democratic presidential candidate Bernie Sanders—more intensely than any county in America. Could its whole county board please join one of its members (Mike Carberry) by having the basic decency to Fight for Fifteen?

Z

Paul Street is an author living in Iowa City. His latest book is They Rule: The 1% v. Democracy (Paradigm, 2014). This article was first published on ZNet (see zcomm.org).

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Paul Street is an independent radical-democratic policy researcher, journalist, historian, author and speaker based in Iowa City, Iowa, and Chicago, Illinois. He is the author of more than ten books and numerous essays. Street has taught U.S. history at numerous of Chicago-area colleges and universities. He was the Director of Research and Vice President for Research and Planning at the Chicago Urban League (from 2000 through 2005), where he published a highly influential grant-funded study: The Vicious Circle: Race, Prison, Jobs and Community in Chicago, Illinois, and the Nation (October 2002).

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