Feel Good Moment Turns into Horrifying Indictment of America

What was supposed to be a feel-good story about a kind-hearted waitress has unexpectedly and wretchedly morphed into a damning indictment of inequality in America.

Sarah Hoidahl works at a Ruby Tuesday in New Hampshire where she recently picked up the $27 lunch tab for two furloughed National Guardsmen. Ellen Degeneres caught wind of this, invited her on the show to talk about it, and surprised her with a $10,00 check as a reward. You can watch the heartwarming CNN report here:

waitress

After fatuously noting that what she did “turned into some great entertainment”, the CNN reporter asks her what she is going to do with “all that money”. Here’s where things turn tragically, pathetically, execrably damning. She replies that she plans to

  • pay off some medical bills
  • pay off some student loans
  • she has other debt to pay down
  • she owes money to her son’s daycare
  • she wants to make a donation to charity
  • and she wants to buy a car.

Sarah, honey, you need a fuck of a lot more money than $10,000!

Let’s think a minute about her utterly depressing to-do list. She’s likely a college graduate, she owes money to the government for student loans, probably is in hock to credit card companies, had health problems, almost certainly has no health care, is probably a single mom, has no car, and works as a waitress.

I salute you, Sarah Hoidahl, for being a caring person even though America has collectively taken a giant shit on you. Even with a college degree, Sarah has to work as waitress at Ruby Tuesday, condemning her to a hand-to-mouth life in the wretched underbelly of the American economy (to Ruby Tuesday’s credit, they do offer some benefits for their employees). Decent health care for the working poor? Perish the thought! Pure Bolshevism!

Sarah is working at or near minimum wage, which is $7.25 per hour. That is not a lot of money. In terms of purchasing power parity (a way to compare international currency), $7.25 an hour places us behind Luxembourg, France, Australia, Belgium, the Netherlands, Ireland, the UK, New Zealand, and Canada in the OECD countries (all the stats you want are here). When you factor in the cost of living(*) we fall to fifth last in the OECD, ahead of only Mexico, the Czech Republic, Estonia, and Slovakia. This is not the behavior of a rich, “exceptional”, or caring nation.

How hard is it to live on minimum wage? McDonalds teamed up with Visa to create a website that kindly offers financial planning advice for its employees. Their sample budget had the employee working 40 hours week at $7.72 an hour. After allowing a ludicrous $600/month for rent and $20/month for health insurance and other expenses, the imaginary employee was left with $800/month to pay for food, entertainment, travel, Christmas, and all those other expenses that eat into budgets. Here’s the kicker: to get the budget to balance McDonalds and Visa assumed that the employee worked a second full time job! Yes, you need to work 80 hours a week in America to afford your imaginary $600 apartment and $20/month health care.

You don’t need McDonaldian corporate ineptitude to see that something is going horribly wrong in America. Decades of business-friendly legislation, bought legislators, billionaire club lobbying, offshoring, and the slack-jawed lackeyism of our media have brought inequality in America to third-world levels. The gini index for the USA (a measurement of purchasing power inequality) has been climbing steadily since the 1970s. Of the 34 countries in the OECD, the USA stands fourth worst, ahead of only Chile, Mexico, and Turkey.

We all know that it takes money to make money. The natural outcome of this law is that wealth is concentrated into an ever-shrinking tranche of the population. But just how much it has accumulated is shocking and depressing. The top 1% of the population owns 35% of the national wealth; the same proportion as the bottom 95%.

toponepercent

Surely, in our guts, we can’t think this is a good situation. How will it end? Will the top 1% own nearly everything while the rest of us are doomed to groveling servitude? Doesn’t that sound like a recipe for revolution? People will accept a lot of abuse, but at a deep level they have to feel that they are being treated fairly. The ridiculously low minimum wage simply allows McDonalds to earn more corporate profit while the rest of us foot the bill for the food stamps and medicaid that their employees are forced to use. Something needs to change. A simple start would be to raise the minimum wage.

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(*) I computed this by dividing PPP minimum wage by PPP GDP per person.

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