Middle Class, R.I.P.

 

By Rick Boettger

 

The School Board recently voted 4-1 to keep outsourcing the district’s maintenance workers. This is a terrible idea. It takes over half a million of our Monroe county tax dollars and sends them up to Cleveland.

 

 

Worse, it converts decent middle-class jobs into dead-end poverty labor. America is losing its major strength as a land of opportunity for a broad middle class to enjoy the kind of lives that my Baby Boomer generation may be the last to have experienced.

 

 

The cruel reasoning of the four school board members who voted to screw the county and their workers to serve their narrow bottom line demonstrates the general direction of economic reasoning that is killing the America we knew. Basically, the new economic religion is that nothing matters but the bottom line: Profits for businesses, or balanced budgets for governments and nonprofits.

 

 

A hundred years ago, an infamously hard-line conservative named Henry Ford raised his workers’ wages from $2.34 to $5.00/day, or $120 in today’s money. He did it mainly to reduce turnover and impose his version of American values on his workforce, but it also enabled his workers to be able to afford to buy the very cars they were making. For this, Ford is credited with sparking the development of our middle class.

 

 

Fighting communism by creating unions and the great leveling and economic burst of World War II led to the height of the middle class in the 1950s and ’60s. But starting in the ’70s, a combination of gutting the labor laws, Reagan breaking the Air Traffic Controllers union and free trade agreements led to workers getting paid less and less even as their productivity improved.

 

 

We have long ago lost our manufacturing jobs to Chinese prisoners and 14-year-old Bangladeshis. One of the few areas safe from international competition is government services — you can’t have the prisoners and 14-year-olds work here in the U.S. But our public sector unions are being beat down across the country, and it is to the detriment of us all.

 

 

Here in Monroe, the district is paying Cleveland-based GCA Services $2.1 million. They pay the custodians around $1.4 million, over a million dollars less than the same workers earned as employees of the district. So, $700,000 of our dollars head up north to be spent in Cleveland. The currently-unfashionable truth about government spending on salaries is that money circulates rapidly. Especially for low-wage earners, a dollar in their hands becomes a dollar in private sector restaurants, stores, and services.

 

 

Workers’ wages are what is called “high velocity” money. The opposite is wealth sitting in banks that don’t even loan it out. High velocity money, which is spent in the active economy, actually has a multiplier effect on everyone’s income. The restaurant owner can buy a home. The store manager can hire a music teacher for his kids.

 

 

The wealthy owners of GCA might be spending our money in Cleveland, or not, but either way my tax dollars have left the building. Governments looking only at the bottom line, with the excuse that their only mission is to, as above, make profits, or follow a “strategic plan” to put “classroom spending first and foremost,” are losing sight of their larger mission to serve all of the people.

 

 

I am especially disappointed that a school district, charged with educating our children, would bald-facedly ignore their “moral obligation to provide a living wage to our family of employees,” as only board member Ed Davidson put it. What kind of example are they setting for our children?

 

 

Sadly, the American middle class is complicit in their own demise. Over 30% of public sector union members in Wisconsin, including two of my relatives with lifetime secure government jobs there, voted to retain Scott Walker, who had just crushed them.  The spirit that created the middle class in the 1920s, with workers ready to stick together and fight for their prosperity, has been bought off by WalMart, cheap cable, and SmartPhones.

 

 

District employees have decent retirement packages and can afford to stay in the Keys. GCA will contribute all of $624/year to an average employee putting away $1,040, or 5% of his meager earnings. After 25 years, with 3% pay increases and earnings, he’ll have around $75,000 in his 401k, if he hasn’t had to raid it for a medical emergency. That looks like a retirement program, but it’s not. Bye-bye, custodians.

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