Mom Salary

It turns out that moms do about $118,000 worth of work per year, according to Salary.com.  In light of this fact and the suggestions of certain less than intellectual U.S. public officials, I would like to share my thoughts on this. 

First let's look at the math.  One of the worst financial decisions anyone could make for single moms is to offer them free child care so they can work jobs that pay less than $10 an hour.  At full time, a $10 an hour job pays $20,800 a year, which is less than 20% of the value of staying at home to raise children.  It would be better to give them the $20,800 a year, no strings attached, because at least that way, we don't loose $97,200 a year in value.

Note that this accounts only for the actual monetary value of the work, not the social value.  The social value cannot even be calculated.  Civilization itself largely depends on it.


Now, here is a list of my immediate thoughts on this:

When we suggest that a mother work outside the home, we should start by comparing the income she could earn with the value of the work she does at home.  If the income from working is not significantly higher (recall that the $118,000 a year does not include social value), we should shut up and mind our own business.

There are not many jobs worth over $100,000 at entry level.  Motherhood is the easiest to get into.

While it is a volunteer position, unless we can justify the loss of volunteer labor at that value, we should be doing everything we can to make sure mothers have the necessary resources to do their job well.  In other words, it is a better financial choice to give a single mother $100,000 a year in welfare than it is to pay for daycare while she works a $10 an hour job.  The fact, however, is that $35,000 a year would be sufficient.  Are we really so stingy that we are not willing to pay 1/3 of the going rate for an essential service?  Even non-profits can afford to pay their lawyers and accountants around $40,000 a year.

As far as the government and society are concerned, raising children is an investment.  The average child does more to help society in the long run than to help her parents.  The majority of the payoff from the investment goes to the employers of the child, the government, and society in general, so why does the mother have to foot the entire bill of $100,000 per year worth of work?  In fact, why do the parents have to foot the entire monetary cost of child rearing, when they are not even in the top three who benefit from the investment?  We should not just be giving tax write offs and paltry credits for children.  Parents with children should be getting significant stipends, and society should be grateful that they are not demanding even more!

What I just said above is even more applicable when a majority of the children are being raised by a minority of the people.  When pretty much everyone raises 2 or 3 children, the costs get spread out fairly well (excluding the part owed by the government and businesses).  When Mormons have a birth rate of 3.4 and everyone else is hovering around 1.9, everyone but Mormons are freeloaders who are not doing their share.  Without Mormons, Catholics, and Protestants, we would probably be almost as bad off as Japan or South Korea.  You are welcome, all of you Americans who are choosing to have one child or less.  It would be nice if you at least acknowledged the massive value of our public service!  And it would be even better if you would occasionally help us out (without any petty complaining) when we needed it ("need" in this case should include things like occasional vacations, because raising children does not come with paid or even unpaid vacation time; you have to actually buy vacation time when you have children).


Now, I should probably note that a working mom evidently still does about $70,000 worth of work at home, in addition to paid work.  For single moms working $10 an hour jobs, the total value still comes out at only just over $90,000 a year (assuming full-time), except, of course, that the social value is significantly lower, because the kids get significantly less time with mom.  Also, the statistics seem to indicate that working moms ultimately do more hours of work total per week, for that lower total value.  This does not change the fact that a majority of U.S. society is freeloading though.  Likewise, even a working mom is doing $70,000 more worth of work that is benefiting everyone else more than herself, and that does not magically reduce the monetary cost of having kids (in fact, daycare actually increases that cost).

Small Businesses in the 3rd World

Recently, American investors have started funding startups in 3rd world countries.  It turns out that in Africa, the Middle East, and Southern Asia, there are a lot of artistic skills, without much local demand for the products.  Well, Americans have both the funds and the desire to purchase these products.  Some U.S. investors and charities have started providing funding for people in these 3rd world countries to start their own businesses based around these local arts.  Among other things, the funding is used to obtain training, pay for raw materials, and start shipping the goods to the U.S. where they can be sold.  Programs like this are helping to lift people in these countries out of poverty, and they are providing middle and upper class Americans with goods that are often of superior quality to factory produced products.  The problem is that this does not do anything for our large numbers of people in poverty here in the U.S.

Helping starving people in 3rd world countries is a noble goal.  Helping them in ways that reduce their dependence on us is even better.  It cannot last though.  We are not in any position to be giving people outside the U.S. significant amounts of our time and effort.  Poverty is increasing in the U.S., and we have plenty of our own starving people that need our help.  Our welfare system takes away some of the burden, but it adds others, partly because it is poorly designed.  What we really need is not U.S. investors providing funds for startups in Africa.  What we need is U.S. investors providing funding for U.S. poor.  Most of these businesses that we are funding in 3rd world countries could exist in the U.S. as well.

Americans can make shoes and rugs and many of the other things that we currently import.  Training is not that expensive, and it does not have to involve expensive trade schools.  Things like knitting and weaving can be learned on the internet.  Those with any level of artistic talent can learn how to make high quality costumes out of fairly cheap materials, and the current cosplay trend would help fetch some pretty good profits on this.  Things like blacksmithing and metal casting are also easy to learn on the internet, and in most areas of the U.S. there are groups that would be willing to help with training for cheap or even free.  This just brushes the surface.  There is a market in fixing old toys.  Learning to make simple web sites for individuals and small businesses is pretty easy.  Many people with unusual talents have managed to make a decent income just recording and publishing YouTube videos of their performances.  All of these things are artistic in nature, which means that they are not subject to the same sort of competition that normal jobs and products are.  There are only two things most poor Americans are missing: time and training (and sometimes equipment and materials).

American investors and charities should be looking at the American poor, instead of, or in addition to, those living in 3rd world countries.  They should offer funding, including enough for living expenses and training, for Americans who have or want skills in things that would provide the opportunity to start a small business based on artistic skills.  Besides helping those in the U.S., this could also be quite profitable for investors.  Demand for artistic products in the U.S. is fairly high, especially among the upper class.  Art knives made by reasonably skilled blacksmiths can demand $10,000 a piece or more, for products that take about one month to produce.  Hand crafted shoes can bring in a few hundred to a thousand dollars each for a week of work or less.  An old doll that takes a few hours to clean, repair, and repaint can bring in $20 or $30 with a half decent job (more for an experienced artist).  Hand knit or woven clothing and rugs can bring in a reasonable income as well.  Many people have managed to make a decent supplemental income with YouTube videos, and good ones can bring in ad revenue for months or years after they are published, without any additional work.  Even for those with less skill, these kinds of work can be done from home and supplement a poor income enough to make a significant difference.

What about those who are starving in 3rd world countries and do not even have food stamps to help them out?  The more we help our own poor, the more resources we will have to help others.  Every poor American we help out of poverty in a sustainable way is another potential donor, investor, or customer for poor people in other countries.  Instead of looking at investing in Americans as a drain from funds that could be invested elsewhere, consider it an opportunity for a more sustainable investment model for everyone in need.  Any investment that pays off will provide additional funding that can be used anywhere.  In addition, investors might encourage Americans they help to invest in or donate money to organizations that help people in other countries.  One rich person investing in some businesses in Africa will help a few people, until something happens that prevents that investor from continuing to invest (death or massive medical bills, for example).  Several thousand middle class Americans donating money to charities that help people start businesses in Africa will ultimately provide far better funding and be far more resilient.

The best strategy here is probably a mentorship strategy.  Investors should start investing in hobby-style artistic professions for poor Americans.  They should provide paid or volunteer mentors for every person they fund.  Those mentors should help beneficiaries manage their finances, find training, and setup their operations.  The mentors can also report back to the investors, to allow them to bail as soon as possible when a beneficiary is not using the funds wisely.  Another responsibility of a mentor should be to encourage beneficiaries to help out others once they are able to, and this theme should be repeated during regular meetings of the beneficiaries with the investors.  With mentors, chances of success will be much higher, and imminent failure will be much easier to detect much earlier.

The long term effect of this will be to teach Americans that cannot find jobs to create their own.  It will improve the U.S. economy, and it may even reduce the burden of the poor on the U.S. welfare system.  More importantly though, it will provide Americans with the means to provide aid for others far better than we are currently capable of.  A few rich investors helping the 3rd world poor start businesses to get them out of poverty cannot compete with what a robust U.S. economy composed of a large number of American middle class donors can do for them.  A common religious theme applies here: You must help yourself before you can truly help others.  To maximize the good we can do, we must first remove the mote from our own collective eye.

Unions

I have a problem with unions.  It comes down to two things: Unions are too powerful and too easy to abuse.  Unions are currently absolutely necessary to take care of problems that the government refuses to treat fairly.

The recent Supreme Court ruling on a dispute between an Amazon contractor and its warehouse employees (which I have discussed in more detail in a previous post) illustrates the second part of my problem.  Without unions, many workers are just plain not treated fairly.  In the Amazon case, workers were being forced to go through excessively long security checks daily without pay for the time spent.  Our Supreme Court justices (whom I must assume are idiots, because the only other option is that they are deliberately helping to enslave and oppress innocent Americans, and I want to give them the benefit of the doubt) declared that businesses do not have to pay workers for time spent doing anything that is not, in essence, part of the job description.  At this point, this declaration now counts as an infallible part of U.S. law.  The government offers no protection for what amounts to blatant wage theft.  There is only one solution: unions.

Unions were originally created in response to government inability to enforce fair labor practices.  In the early U.S., it was common for employers to underpay workers and to require far more hours of work than is healthy or fair.  Unsafe work conditions were more common than safe ones by a very wide margin.  People were regularly inured or killed in workplace accidents that could have easily been prevented, because owners were too cheap to spend even small sums to ensure safety.  Children were treated as slaves, working 16 hours days in these conditions, for so little money that entire families had to work, and that was still not enough to get by.  The government was not powerful enough to do anything to stop these unfair practices, and in many cases, the government did not have enough reach to even be aware of them.  The solution was labor unions.

Workers in these conditions eventually banded together, demanding fair treatment.  Their employers refused the the demands and threatened to fire anyone who continued to dissent.  Eventually the workers realized that if all of them dissented at once, their employers would be unable to replace them all fast enough to avoid financial catastrophe.  The worker strike was born (it was actually born in France, but it was quickly adopted by oppressed U.S. workers).  Nearly all of the workers in one or more factories refused to continue work until conditions, hours, and wages were improved.  Employers were powerless against the unions because they were dependent on the employees.  Firing them all would result in financial ruin for the company.  Initially the government panicked: Worker's unions threatened the U.S. economy.  If workers had so much power, they could easily force businesses to pay so much that it would cause rampant inflation.  Besides that, even short strikes resulted in production halts, and in factories that produced necessities, those halts could result in serious harm.  This did something else very important though: It put the problem of workers right in the face of the government, where it could no longer be overlooked or ignored.

The government realized that treatment of workers was a major problem.  It also recognized its responsibility in doing something about it.  The government still did not have the power or reach to handle the problem on its own.  It did have the power to protect the workers in their own attempts to deal with the problem.  Business owners lobbied the government to make unions and worker strikes illegal.  Their claim was that these things caused economic instability.  Their claims seemed reasonable, however, the government eventually recognized that the underlying problem was not the strikes, but the unsustainable hours and pay, as well as the often deadly work conditions provided by employers.  Laws were passed to protect unions and striking workers from retaliation.  Currently, workers cannot be fired for discussing unionization, actually unionizing, or for striking.  Workers who are striking on economic grounds (wages, other compensation, or work hours) can be "permanently replaced" (they cannot be fired, but if a willing replacement can be found, the strikers hours can be reduced to 0 indefinitely, which is approximately the same as being laid off).  The government also created a set of safety and treatment requirements and guidelines for how employees may be treated.  Strikes related to these issues are further protected, prohibiting even permanent replacement.  When it comes to safety and other government protected employee rights, replacements hired during a strike must be fired to make room for striking employees returning to work once the dispute has been resolved.

The potential for abuse of unions was still clear, so some restrictions have been added.  Closed shops, where the company may only hire union members, was strictly prohibited.  Closed shops allow the union to control all hiring decisions by restricting admittance into the union.  This gives the union veto power over any hiring action.  In the U.S., closed shops are illegal.  Union shops, where new hires are required to join the union after being hired, are legal, as well as agency shops, where non-union members must still pay union dues, and open shops, where employees may choose but are not required to pay dues if they are not union members, are all legal in the U.S..  Prohibition of closed shops prevented the most obvious abuses of unions, but it still left some loopholes, most of which still exist.


When unions were originally created, they were necessary.  They were very useful, and they did a great deal of good.  Since then, many things have changed.  The biggest change is power and reach of the government.  Workplace safety is no longer a serious union issue, because OSHA, a government agency, defines and enforced workplace safety.  If a workplace is unsafe, it is faster and easier for an employee to report the violation to OSHA than it is for a union to try to resolve the issue, and the penalties for those violations are enforced by the government, making workplace safety violations fairly rare.  Wages are still a problem, but not because the government is not powerful enough to do anything about it.  They are a problem because the government refuses to do anything about it.  Worse, the most common places for wage issues are not well suited to unions, because employee turnover is too high.  In the past several decades, most union wage issues were not problems of employers paying unfair wages.  Most of the issues were greedy employees who were already being paid far higher than the U.S. average wanting more than their fair share (and, in the case of the U.S. steel industry, this was one of the blows that ultimately killed it).  Unions are no longer useful tools for enforcing fair wages.  Instead they are tools for overpaid employees to rip off their employers even more.

Work hours were another major thing that unions were good for.  Twelve to sixteen hour work days were common.  Unions pulled the U.S. work week down to 40 hours and the work day to 8, requiring extra pay for any time worked beyond that.  Of course, the goal was actually closer to 35 or 30 hours a week (20 according to some), but unions lost sight of that goal almost a century ago.  Unions are no longer necessary to enforce this though, because the government has enacted laws prohibiting employers from giving employees more than 8 hours of work in a day and 40 in a week, with an additional requirement that when this is violated, employees are paid extra for time beyond those limits.  This is no longer a union problem; it is now a government problem.  Worse, despite unions and government, the average American voluntarily works an average of 50 hours a week and often the overtime goes entirely unpaid.  When the workers don't care, there is little unions can do to fix the problem.

Overall, unions have lost most of their usefulness.  They still have potential for abuse though.  Unions have a great deal of lobbying power.  In Alaska, in the mid '90s I believe, the workers at some of the power plants went on strike.  I don't know all of the details, but I do know that the labor union exercised power that belongs only to government and individual citizens, by manipulating the state government in making some very harmful laws.  The power plants hired electrical workers from Washington state, as temporary workers until the strike was resolved.  In retaliation, the union lobbied the state government to change certification laws to require electrical workers in Alaska state to have gone through their training in-state.  In other words, a journeyman or master electrical worker in Washington state could only be hired as an apprentice in Alaska, without going through all of the time required for certification within the state of Alaska.  The union did this to put more pressure on the power company by denying them well qualified temporary workers (the law specifically prohibited hiring them into positions that normally required journeyman certification).  Besides being a low and very unethical blow, this has some severe economic implications.  I am certain the argument given to the legislature and governor was that hiring out-of-state workers would drain money from the state economy.  I don't think this justifies using the law to lie about a person's job qualifications, but besides that, this economic justification was incomplete.  The end result was that the workers got most of their demands.  The economic consequences of that was increased cost for power, which resulted in economically damaging inflation in a state where the cost of living is already quite high.  There may have been short term economic costs of hiring out-of-state workers, but the long term costs of not doing so were far worse.  There is also another long term economic cost: The electrical workers union in Alaska now has a legally enforced monopoly on electrical labor.  The political power held by unions has not just been harmful in Alaska.  In other places in the U.S., unions have used the law or other political influence to merge with other unions against their will (by "merge," I mean "hostile takeover").

Unions have largely become for-profit institutions in the U.S..  Their primary goal is no longer doing what it best for the workers or even representing the workers.  Their goal now is to do whatever gets the union the most money.  This frequently means demanding higher pay even when it is not needed or fair.  It also preempts any requests for reduced hours, because reduced hours means lower gross pay, which means lower dues.  By allowing union and agency shops, the government has allowed unions to force employees to become union members and to pay union dues against their will.  Unions in the U.S. typically have a number of permanent employees who are not actually members of the union.  In many unions, this includes a CEO and other administrative positions, who make decisions about what the employees want, without actually having any experience of being one of those employees.  Some of these positions, like lawyer and accountant, are justified, but full-time administrative positions in a union are absurd.  Unions are now run primarily by people who are totally disconnected from the union members and their work environment.  Frankly, a union that is a for-profit business should not have any degree of legal protection beyond what is normal for any other for-profit business.  Otherwise, it is even more prone to abuse.

So, now we come down to the problem: The government now has the reach and power to make unions entirely obsolete, and it has already made them mostly obsolete.  Instead of doing that though, it is actually making unions more necessary.  Unions should no longer exist, because they should no longer be needed.  When they were created, the potential for good outweighed the potential for abuse.  This is no longer true...except, when the government fails to do its primary job of representing the will and best interest of the people.

The Amazon case is prime example of where unions are useful.  The employees are being robbed by their employer.  They could unionize and strike, demanding pay for their time worked, demanding that the security check be listed in the job description (making it an essential part of the job, and thus legally part of paid work time), or demanding that the security checks be discontinued.  They could even unionize and heavily lobby Congress to repeal the highly constitutionally questionable law the Supreme Court used to justify its appallingly oppressive decision (even abuses of power can have legitimate non-abusive uses).  The problem I have with this is that they should not need to unionize to get paid for all of the time they spend doing work required by their employer.

An employer should have the right to require employees to do worthless work (plenty already do it anyhow), but employees should have the right to get paid regardless of whether the work required is profitable or not.  This should be legally protected.  What free society has a law that explicitly permits employers to blatantly and openly require work time from an employee that does not need to be compensated?

Legalized Wage Theft

This article discusses a recent Supreme Court ruling that Amazon does not have to pay hourly employees for time spent in mandatory security checks.  The case involved several workers at Amazon warehouses, where post-shift security checks are mandatory to prevent theft, and the time spent waiting in line routinely takes more than 30 minutes.  The justification was an ill advised law from the middle of last century stating that work that is not essential and integral to the job position does not have to be paid.  The Supreme Court concluded that since the security checks could be eliminated without harming the work of the employees, Amazon (or rather, the company they pay to manage the warehouses) does not have to pay employees for this time.

This is an absurd case of legalized wage theft.  In this case, the verdict should be simple: The security checks are mandatory.  This makes them an integral part of the job.  Even by that old law, the employees should be paid.  Any mandatory activity that is part of a job should be part of the job description.  If it is not, then it should not be mandatory.  And, if it is part of the job description, then it is an integral and essential part of the job and thus should be compensated.

This ruling leads to other problems though.  It sets a legal precedent for allowing businesses to squander employee time without compensating them for it.  Some easy examples that have been given include sharpening knives in meat packing.  This is an important task, because it affects efficiency and safety, but, unless a knife will no longer cut, it is not essential or integral to the task.  The Supreme Court has said that their ruling does not apply to things done for safety or efficiency, but as a legal precedent, it does apply, because the law in question does not say otherwise.  Given this, another major concern is time spent putting on and taking off safety equipment.  Legally, employers no longer have to pay employees for these things, because the Supreme Court has ruled that something which can be eliminated without removing the ability to do the job does not need to be compensated.

The real problem here is that employers have been given a level power over employees that is entirely abusive.  What if Amazon's security checks get longer?  What if employees are now stuck in line for 2 hours?  It is still not essential to the job, and the Supreme Court has declared that it is permissible to detain employees on pain of firing without paying them for that time.  What if that time goes to 4 hours?  Now, most employees are staying at work for long enough to get significant overtime, but according to the Supreme Court, it is still totally legal to detain them without paying them for that time.

Frankly, I don't care about that old law.  It was a bad idea, but the problem is far deeper:  The Supreme Court has more or less signed over the right to hold employees against their will indefinitely, without any accountability.  At least requiring employees to be paid for the time is an effective deterrent.  If that security check is not part of the job description, employees should be able to easily bypass it without any adverse consequences.  If the employer tries to detain the employee, then the employer should be charged with and convicted of holding the employee against her will.  If it is part of the job description, then by definition, it is an integral and essential part of the job and should be paid as such.  Really, there should be criminal charges going on in this case, not just a question of getting paid for that time.