Tuesday, May 22, 2018

Growing Impoverished by Paying Workers, Themselves Impoverished

I have a decent understanding of basic economics, but my mind keeps circling this puzzle again and again, and I just can't make sense of it.

My elderly mother requires lots of care, so we pay a nice, smart Jamaican women (untrained, but bright, principled, and highly competent) to come in 6 days per week. The expense, of course, is killing us. And yet, this woman is very poor. She takes three buses to get to work (>1 hour commute) because she can't afford even a used car.

It irks me that she can be so diligent and smart and competent, and work so hard, and cost so much (from our perspective), and still be poor. But what really confuses me is that we're impoverishing ourselves with her wages...yet she's still poor. That makes no sense at all to me. There's no middleman. We pay her directly. Where, exactly, is the wealth going?

Of course, I can do the math, and spot the shortfall, but in a larger, macroeconomic sense, there's something wrong here, and I can't quite pin it down.

Two notes:

1. I actually do understand one facet of it. It's not that she's poor, it's that she's slightly less obscenely rich. Billions of humans (including her relatives back home in Jamaica) would guffaw at the notion that needing to take a bus to work amounts to poverty. I sound like Mrs. Howell grieving for the unfortunate slobs who can't dine on fine china or vacation in Monaco. But, still, this doesn't explain the lose/lose economic dynamic. How can both sides be making out so poorly?

2. My grandfather was perpetually aggrieved by inflation. "How can people, especially younger people, afford these crazy prices?" he'd cry back in the 80s. "Don't forget that wages increase with inflation, too!" I'd respond assuredly, the cocky American college student. Grandpa would wag his head bitterly, "no." I was missing the essential element. Maybe this is what I was missing?

Update: On three hundredth thought: It's probably useful to bear in mind that we're buying a luxury. Most people put elderly relatives in institutions or find a way to care for them themselves. My mailman and plumber earn good wages by providing essential services time-shared by large communities. One-to-one purchase of a (minor) luxury service is an odd economic proposition, made viable only by inexpensive immigrant labor. It's thus inherently ill-paying, yet high-priced, over time. This doesn't fully satisfy my curiosity, but I'm getting there.

1 comment:

Display Name said...

Keep working on this one Jim. Let me know what you come up with. My college admin friend who lives in Chestnut Hill Pa with her husband the surgeon was agonizing over what to do when her housekeeper became ill and had to miss work for over a week. Sick pay wasn't part of their deal but she knew the lack of pay would devastate her on top of being sick. You always wanted to sound like Mrs. Howell, admit it. :) We are finally getting our rescue dog on friday and I have been lobbying to name her Stella just so I can sound like Brando when I call her.

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