The unemployment rate remains at more than eight percent, the longest stretch of such high joblessness since the Great Depression. Further, millions of working people are struggling to pay their monthly mortgages; thousands of college graduates are struggling with crushing student loan debt; formerly middle-class folks are now feeding their families with food stamps; and, over the past 30 years, there has arisen a growing income inequality which has led researchers to conclude that the United States is the most economically unequal country in the advanced world.
In 1986, the U.S. Catholic bishops sought to address the issues confronting our economy in the light of Catholic social teaching, with a particular focus on poverty, unemployment and the relationship between the American economy and world economies.
We developed a pastoral letter, “Economic Justice for All,” which outlined four economic themes and principles that are as relevant today — if not moreso — than 25 years ago:
1. “Every economic decision and institution must be judged in light of whether it protects or undermines the dignity of the human person.”
2. “Human dignity can be realized and protected only in community and according to the norms of love, solidarity and the common good.”
3. “All people have a right to participate in the economic life of society and all members of society have a special obligation to the poor and vulnerable.”
4. “Human rights are the minimum conditions for life in community and they include social and economic as well as political and civil rights.”
Today, unfortunately, we have over 46 million Americans living below the federal poverty level. This poverty level has risen by 15.6 percent in the past year — the highest number in the 52 years the Census Bureau has been keeping statistics on it. Another 51 million are in the next category, termed the “near poor.”
Minorities have been hit the hardest. Blacks experience the highest rate at 27 percent and Hispanics at 26 percent. Poverty has also swallowed up more children, with 16.4 million in its ranks.
Reasons for poverty
Joblessness is the main culprit for pushing more and more Americans into poverty. Last year, for example, 48 million people in our nation ages 18 to 64 did not work even one week out of the year.
At the same time that people are desperate for jobs and striving not to fall out of the middle class into poverty, disparity continues to rise. For example, Atlantic magazine reports this month that the richest one percent of households in our nation earn as much as the bottom 60 percent put together; they possess as much wealth as the bottom 90 percent.
Equally distressing, if not moreso, are the tax loopholes which allow huge corporations to pay little or no taxes, and permit their wealthy corporate executives and board members to command salaries which are obscene in contrast to employee wages.
Last month the Albany Times Union newspaper reported that a 50-year-old executive from Schenectady’s General Electric Co., in an exchange for a three-year, no-compete promise, is to receive a severance package that will pay him $89,000 a month income until he reaches the age of 60. That is more than $10.5 million.
Let it stop
A T.U. editorial opined: “Most families in America don’t make $89,000 per year. Is it really necessary to pay out that compensation per month, for a decade, for a departing executive?” It also noted: “When that’s the environment confronting the working man or woman, blue collar or white, would it be asking too much for corporate leaders to ease off on the outrageous severance deals for their boardroom buddies?”
The new question needing to be asked (of the economy, specifically, and of political arrangements in general) is about the dispositions necessary for a healthy society — one in which everybody flourishes, since the economy cannot be measured only by the maximization of profits, but rather in accord with the common good.
Let me make three concrete suggestions for how to respond to this question in accord with our Catholic social teaching.
1. First, a commitment to unions is an important salve to addressing poverty and social injustice. In his encyclical, “Caritas In Veritate” (“Charity in Truth”), Pope Benedict XVI warns against the dehumanizing forces of capitalism and calls for the promotion of workers’ organizations that can defend their rights.
During the last 30 years, the minimum wage in our country has fallen to a 50-year low. This scale now pays a worker $15,000 a year — not nearly enough to keep a family of three above the official poverty level of $22,000.
Meanwhile, not coincidentally, union membership has been cut in half, falling to a new low of only 12 percent of the overall work force and only seven percent of private-sector workers.
Further, the voice of the worker has been muted. In a study by Kay Lehman Schlozman of Boston College, Sidney Verba of Harvard University and Henry Brady of the University of California at Berkeley, titled, “The Unheavenly Chorus: Unequal Political Voice and the Broken Promise of American Democracy,” the authors document that in the corridors of power in Washington, D.C., for-profit corporations outnumber those representing labor unions by 50 to 1. About 72 percent of all expenditures on lobbying originate with organizations representing businesses.
That is why John Dilulio, who served as the first director of faith-based initiatives in the administration of President George W. Bush, states that “without a rebirth of the American labor movement, our nation’s interwoven economic and political inequalities will only become more sizable — and more sinful.”
Catholic doctrine has held that labor has an “intrinsic priority” over capital. To this end, Catholic social teaching considers labor unions “indispensable,” not only because they protect the rights of workers, but also because they provide a check on the concentration of economic power that threatens equality across society.
In the words of Pope Benedict XVI, any attempt “to limit the freedom or negotiating capacity of labor unions clearly is not in conformity with Church teaching.”
There is no doubt that union leaders have not always led wisely and prudently. Indeed, in this year’s Labor Day statement, we bishops note that, “like other institutions, including religious, business and civic groups, unions sometimes fall short of their promise and responsibility. Some union actions can contribute to excessive polarization and tent partisanship, can assume positions that conflict with the common good, or can focus on just narrow self-interest.
“When labor unions fall short, it does not negate Catholic teaching in support of unions and the protection of working people, but calls out for a renewed focus and candid dialogue on how best to defend workers.”
Moreover, as the editors of America magazine pointed out in the magazine’s July issue, “Middle-class and working-class people throughout the United States owe much to the 20th-century labor movement. It deserves better than to be served up as a scapegoat for a national economic crisis that has been cleverly exploited by forces eager to accelerate the demise of organized labor.”
That is why I believe Charles Wheelan, an economist from the University of Chicago, is right when he states: “We need some kind of Labor Relations 2.0 where you try and protect some of the leverage that comes with collective bargaining, but [in which] the entities doing that are [also] respectful of the fact that the industry in which they’re bargaining has to stay competitive.”
Raise minimum wage
2. Second — and building upon the above, along with the bishops of New York State — I urge the State Legislature and the Governor to raise the minimum wage. On the subject of wages, Catholic social teaching is clear: Remuneration for work should guarantee the worker an opportunity to provide a dignified livelihood for oneself and one’s family on the material, social, cultural and spiritual level. In New York State, a full-time worker earning minimum wage will earn $15,080, living below the poverty level for a family of three.
When full-time workers cannot afford to purchase healthy food, pay rent and access vital health care, their wages are unjust. When workers must labor day and night in multiple jobs to piece together a livable income as the fabric of family and community life is torn apart, their wages are unjust. When workers suffer the enduring consequences of poverty — ill health, impeded educational achievement and housing instability — even as company executives amass extraordinary wealth, their wages are unjust.
It is time to raise New York’s minimum wage from $7.25 to $8.50 per hour.
Catholic social teaching tells us, “The economy must serve people, not the other way around. Work is more than a way to make a living; it is a form of continuing participation in God’s creation. “Employers contribute to the common good through the services or products they provide and by creating jobs that uphold the dignity and rights of workers — to productive work, to decent and just wages, to adequate benefits and security in their old age.
“Workers also have responsibilities — to provide a fair day’s work for a fair day’s pay, to treat employers and co-workers with respect and to carry out their work in ways that contribute to the common good.”
According to David Cooper of the Economic Policy Institute, if the presently proposed bill is passed, 609,000 minimum-wage workers in New York would directly get a raise, while another 473,000 who have wages just above the proposed new minimum would also see a wage increase as employers adjust overall pay structures.
This translates into an estimated $600 million in additional economic activity, which means more jobs. By raising the minimum wage, we begin to discern a path toward dignity and respect for all members of our society.
3. Third, the faith community can and should be in the forefront of addressing the needs of the poor, vulnerable and unemployed.
During the past year, there have been some victories worth celebrating: for example, the 2011 federal budget was adopted without any major cuts to programs focused on the hungry and poor in our society.
Rev. David Beckmann, president of Bread for the World, attributes this success to an alliance called the Circle of Protection, a multi-faceted group that includes the U.S. Conference of Catholic Bishops, the National Council of Churches, the National Association of Evangelists and many more.
This alliance was also instrumental in having a provision inserted in the congressional debt ceiling agreement that exempted low-income entitlement programs like Medicaid and the Supplemental Nutrition Assistance Program (formerly known as food stamps) from automatic budget cuts in 2013.
However, as we look to the future, things look tougher. We must address the federal deficit and the debt ceiling crisis and make reforms to the tax code and entitlement programs.
The bi-partisan Simpson-Bowles Commission on Fiscal Responsibility and Reform has surfaced proposals for how to do this. Unfortunately, to date neither the administration nor Congress has responded to these proposals or proposed variations thereof. That is why the national debate in the upcoming presidential and congressional elections and our assessment of the issues facing us through the lens of Catholic social teaching are so important.
I’ll write more on this next month.