She Works Full Time For A Government Contractor, Earns Poverty Wages, And Then Became Homeless

[Omaha Steve]

X post at Labor & GD


http://nhlabornews.com/2015/01/she-works-full-time-for-a-government-contractor-for-poverty-wages-and-then-became-homeless/

Privatization leads the race to the bottom.

Report after report continues to show that workers and taxpayer lose when government jobs are contracted out to the lowest bidder.

Last year In The Public Interest released a biting report on the effects of privatizing public jobs.

“By slashing labor costs, a company may be able to show a city or state cost savings on paper,” the ITPI report states. “However, low wages often mean that the number of Americans on public assistance rolls increases and these supplemental income and healthcare costs, instead of being the contracting employer’s responsibility, are merely shifted onto other parts of the government budget.”

In the report IPTI highlighted First Transit a national contractor for local bus transportation services. First Transit makes their money by slashing wages and employee benefits.

FULL story at link.

Working full time, living on food stamps, and still ended up homeless. There is something severely wrong with this.

Watch this gut-wrenching video about how privatizing jobs pushes workers into poverty.

[Neon Gods]

1. First-hand experience

I was a manager in the federal government for 10 years (now retired). A few years after GWB took office, I was forced to hire contractors to do the same work my other employees did. My government employees made a decent wage, plus vacation and sick leave, and health insurance. My contract workers who did the exact same work got paid about 40% less with almost no benefits. (I wasn't supposed to know this fact, but one of the contractors came to me and said their company had been withholding money for a 401-k account but hadn't deposited the money in her account for over three months and was angry. She then told me how much she made and what her benefits were. I was shocked).

But, you might say, at least the taxpayers benefited from cheaper labor. When I told my Division Chief about the 401-k and wages paid, etc., he showed me how much we paid the contractor supplying the contract employees and it was almost the same as what our employees cost us (including benefits). Later contracts actually ended up costing more than our employees.

The reason why Republicans love contracting is because it allows private companies to siphon money that should go to the workers into their pockets. It also makes it easier and much cheaper to fire employees or otherwise eliminate jobs. My contract employees had zero rights. They were always at the mercy of their employers.

But my biggest problem with my contract employees, all of whom had at least a B.A., was that their pay was so low that their poverty often impacted their work. They couldn't afford day care, relying on friends or relatives for care, which was unreliable. Some also had to rely on friends or co-workers for rides to and from work which meant they had to scramble whenever their ride was sick or had to leave early, etc. They also came to work sick more often because they couldn't afford a day without pay.

There are situations where contracting is cost efficient, but except for those few exceptions, contracting is just a way the private sector to divert tax dollars into their greedy hands.

[yallerdawg]

2. In a nutshell, and very clear!

"The reason why Republicans love contracting is because it allows private companies to siphon money that should go to the workers into their pockets. It also makes it easier and much cheaper to fire employees or otherwise eliminate jobs. My contract employees had zero rights. They were always at the mercy of their employers."

You got it, NG!

And now this applies to private sector corporations (Walmart, etc.) which use contracting to dodge corporate obligations and expenses.

And we wonder why wages are stagnant but profits are through the roof?

[Neon Gods]

3. On the other hand...

...this is what capitalists are supposed to do. Capitalists have only one purpose: make as much money as possible for the owner/owners. They aren't job creators, they aren't supposed to coddle their employees, give them breaks and benefits and nice toilets, etc. If they can get away with paying peanuts and relying on the taxpayers to keep their workers alive and healthy, they will - they would be stupid not to, because if they don't, their competitors will. If a company can talk a gullible government into giving them money to hire cheap labor to do do government work, instead of paying the workers a decent wage and benefits, they'd be stupid to turn it down. That's not their fault, it's ours for our ignorance about what capitalism is. Again, capitalism's purpose is to survive and make as much money as possible.

I'm not nearly as mad at WalMart for screwing the taxpayers as I am with us for not recognizing that capitalism is great for developing new and better products, cars for instance, but it is a lion that will devour a society that let's their guard down and refuses to regulate them. I grew up around small local businesses who cared about their employees and carried them on the payroll even during bad times, sometimes even when it threatened the owner's own livlihood. I used to think that was capitalism. It's not. They were bad capitalists (but wonderful human beings!) But they are all gone now, squeezed out by the "good" capitalists like WalMart.

BTW, I'm not anti-capitalist. I'm in awe of what it does well. I'm just super pissed that our national religion is capitalism, even though some of our most successful programs in this country are a result of socialism. Sorry if this has turned into a rant.

[yallerdawg]

4. Excellent reply!

Your thoughtfulness and insight is very welcome!