BELOW THE LINE – II

US-Quarter-25-Cents

Now that the weather has improved, I’ve been taking Aubren out for walks in his stroller.   Some days we go to the park, other days I will go to different stores that are within walking distance.  Meijer, Target, and Aldi are 15 or 20 minutes away.

Today, we went to the post office and then to Aldi.  Aldi is a German-owned grocery chain which operates in many countries – I’ve seen them in my home-town in England, across Germany, around the US and elsewhere.  They claim to save people up to 50% on their grocery bill.  They offer “no frills” – they do not bag your groceries and they do not pay anybody to periodically go outside and round up shopping carts.  At Aldi, you have to use a quarter to free a cart from a chain and then use it.  When you return it, you can get your 25 cents back.  I’ve seen this at other stores – in England, Asda (Walmart) charges one pound, which is roughly six quarters.

Aldi attracts a lot of poorer people, people who have to be careful with their money.   Many customers use food stamps (which are not literally stamps – it’s now a credit card provided by the government for people, which is topped up each month).  There are also more affluent customers, judging by their clothes and the vehicles they pull up in.  Maybe they choose to economize on food while splurging on the other two items.

During the seven years we’ve lived in this neighborhood, I’ve noticed their business boom.  The Wall St Journal a couple of years ago said they were the fastest growing chain in the US.  They keep their prices down by not selling brand names, but guarantee their products are as good as any brand.

Today, for the first time, I met an elderly gentleman who pointed out that my grandson’s shoe had come off.  I thanked him and picked the shoe up.  He then noticed I did not have a shopping cart (trolley), the reason being that I could not push a cart and a stroller.  But he assumed it was because I didn’t have 25 cents.

He also told me that he hangs around a lot offering to return carts just to get the 25cents.

I told him that, at the park, I often see people carrying black trash bags collecting discarded cans, for which they can get ten cents each.  He commented on how times are hard and getting harder.  For many people, this is true.

Yet at the same time, we are being told the economy is improving.  Even locally this is the case.  Lansing is the fastest growing area in Michigan when it comes to high tech jobs; the sixth fastest in the United States.  Other areas of the economy are also improving.

It would appear that while some people are doing well, others are struggling more than ever before.

The minimum wage remains at $7.25 an hour.  After taxes, that means somebody working forty hours takes home about $250 a week.  If the minimum wage had kept up with inflation, it would now be $16.50 per hour, over twice as much.  I saw a number of “Situation Vacant” ads this morning, all offering work at about $10 per hour.

If anything, wages will go down further.  The proposed amnesty for undocumented workers could add 11 million, mostly unskilled people to the labor pool thereby driving wages down further.  Also, in spite of high unemployment, the numbers of immigrants allowed into the country each year has not changed.

The unemployment figure continues to be inaccurate.  I know a number of people who are unemployed but not classed as such because they do not qualify for unemployment benefit.

So how do people manage?  The biggest single answer to that question must be “food stamps.”  Over 47 million are now on food stamps, a government program that gives free food to poor people.  What will happen if the US government has to cut back on the program?

The people I know who are on food stamps also receive free medical care under a government program called Medicaid, not to be confused with Medicare which is for people over 65.  Medicaid is for the poor.  In Michigan, it is reserved for those below the poverty line, currently $15,132 per year per couple.  A family of four that earns less than twice that is below the poverty line and will also qualify.

It’s not just jobs that are needed – it’s good jobs that pay well.  These are in short supply.  There is no sign of a return of good paying jobs in any significant number.  This bodes ill for the future of the American economy and Americans.

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One thought on “BELOW THE LINE – II”

  1. You have hit the nail on the head. No matter how you look at it, from which direction, the United States has become a service oriented job market, not a manufacturing job market. Most of the manufacturing jobs have gone overseas. And you are correct, undocumented illegal aliens have artificially suppressed the minimum wage. Even Donald Trump has spoken out, saying we have become a failed economy. My father, who majored at Harvest Business School, if he were alive, would say we’re in a depression, not a recession. Notice the politics are very careful not to use the “D” word to describe the economy. The American economy is like the Titanic, when it’s bow was dipping underwater, i’m afraid.

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