Tag Archives: income disparity

From Middle-Class to Minimum Wage. With No Way Back

21 May

By Michael Valpy

 

Eric Schuppert’s realization that he had left the middle class did not occur in 2008, when his $75,000-a-year salary with full benefits, pension and five weeks’ paid vacation vanished along with his job as a public-service manager for the municipality of Caledon.

It did not occur when, at age 46, he had to borrow money from his parents to meet his monthly living costs. It did not occur when he was forced to sell his house in nearby Alliston.

It did not even occur when he found himself behind a counter at his local Tim Hortons — “Standing there in that crappy uniform with that dinky little hat on serving my friends coffee” — at the minimum wage of $10.25 an hour, taking direction from kids 20 years younger.

It occurred when the fear came to him that he would never be back to where he had been, that he was looking at a slammed-shut door to anything that resembled progress.

And with that fear, Schuppert, now 51 and working in Toronto as a night-shift college porter earning $30,000 a year, became part of a new phenomenon in Canada that social scientists haven’t previously encountered: he self-deselected from the middle class.

Frank Graves, president of EKOS Research, says his firm’s surveys show that since the start of the 2000s, Canadians identifying themselves as middle class have declined from 70 per cent to about 60 per cent of the adult population and possibly much lower.

What that means is not something that can be calibrated simply by the metrics of median-income statistics. It is not really about numbers, and the bromides being offered by politicians in the U.S. and Canada about a healthy middle class being good for society miss the point.

Declining middle class in Canada

Middle class is a state of mind, an emotional state, a feeling of optimism, a feeling of belonging to the great swath of Canadian society that has been resolutely marching forward in the sunshine for decades. It is an important element of social cohesion.

When the level of income inequality rises — in tandem with a stagnant economy, which is what is happening in Canada — the relationship between income and class identity becomes stronger, says University of Toronto sociology doctoral candidate Josh Curtis, who studies class awareness and its links to political behaviour.

Inequality above all else is a profound social circumstance, a subjective sense of one’s status both in comparison to others and in relation to what one expects from oneself. Thus, especially in rich societies, a substantial income loss in an environment of inequality is more than apt to be construed as an assault on class identity.

And what EKOS finds, as inequality has risen, is powerful evidence that middle-class optimism that existed as recently as the end of the last century has crashed and burned, to be replaced by a pervasive, dark pessimism and a loss of faith in the ethic of progress.

Says Graves: “The dominant challenge of our time is to reverse this infectious belief that progress is over and produce a vibrant new liberal capitalism for the 21st century. Growing and invigorating the dormant middle class is task number one in any blueprint to a brighter future.”

A North American survey by EKOS and partner research firms in the U.S. and Mexico found that Americans who identified themselves as members of the middle class had declined from roughly 62 per cent in 2002 to 46 per cent at the end of 2013, a more precipitous plunge than in Canada, where the figures are 67 and 48 per cent respectively. But this isn’t grounds for complacency. Graves says rising inequality and a declining middle class in Canada have been driven by what’s going on in the U.S., and Canada is now sliding faster down the slope than its neighbour.

“When you don’t have people moving ahead, you have trouble,” he says. “And the trends in Canada are very, very clear. It’s the Acemoglu thesis.”

He is referring to the 2012 book Why Nations Fail: The Origins of Power, Prosperity, and Poverty, in which economist Daron Acemoglu, of the Massachusetts Institute of Technology, argues that societies fail when they move from an inclusive to an extractive economy, meaning an economy “designed to extract incomes and wealth from one subset of society (the masses) to benefit a different subset (the governing elite).”

Inequality, in other words.

And when EKOS asked Canadians which groups they thought had moved ahead, fallen behind, or stayed the same over the last 25 years, the results were a rabbit punch in the midriff.

Nearly 90 per cent of respondents said the CEOs of large companies had benefitted most; 63 per cent identified financial sector employees as the winners; 40 per cent chose public servants; 18 per cent chose blue collar workers, and just 8 per cent picked middle-class households.

Winners and losers

Eric Schuppert’s narrative, to be sure, is about income and struggling to earn enough money to survive. But primarily it’s about a place in society and his links to the connecting points of middle-class existence.

He’s a soft-spoken, thoughtful, well-read man. He tells his story without complaints, and yet a listener can hear very clearly the pain he’s experienced over the past five years.

He’d worked 22 years for Caledon, population 50,000, rising up the ladder from manager of aquatics to a senior recreation position to manager of customer services with a staff of 10. His job included being in charge of the municipal cafeteria, overseeing the municipality’s office supplies and managing the public reception services.

One the day he was fired — “restructured” in the language of the municipality’s human resources department — he asked his boss, the chief administration officer, if he’d done anything wrong and was told no, the municipality just figured they could do his job better and cheaper without him.

“It wasn’t a fun day,” says Schuppert. “But you can’t let something like that ruin 22 years associated with a wonderful community.”

The CAO sent out an email to the staff saying he was leaving “to pursue other opportunities.”

It was a bad time in the fall of 2008 to be out of a job.

Initially Schuppert says he felt marginalized but not hurt — an interesting word he chooses: without a job, he felt pushed to the sidelines of life.

End of progress

In the first six months after being restructured, he sent out about 100 resumés and got three interviews, none of which led to anything. By August 2009, he had run out of money and needed financial help from his parents. He realized at the same time he was going to have to take whatever job he could find and not wait for something commensurate with his skills and experience.

Within a week he had a job at a Tim Hortons outlet a five-minute walk from his house in Alliston, just north of Toronto. When his friends and neighbours came in, “I could see the click in their eyes when they recognized me, and then they moved on pretty quickly.”

In addition to standing for an eight-hour shift taking orders, Schuppert had to move boxes around. He has a bad back. The work gave him constant pain. He lasted a month and then quit.

The local McDonald’s offered him a job. He asked if there was a chance to move into management, was told yes, and was then assigned to be the overnight cleaner starting at midnight. He declined.

At this point he started to cut off his social connections.

He went to work for Swiss Chalet, again asking for an opportunity to move into management. He was told yes. He worked for nine months, was given periodic management training but never got beyond minimum wage.

He then went to Harvey’s, where he was actually offered a management position. He asked the owner for $16 an hour but never was paid more than the minimum wage of $10.25. Meanwhile, he had to put his house up for sale because he could no longer afford the mortgage payments.

“George saved me from full-blown depression,” Schuppert says. George was his dog, arthritic and going blind, and Schuppert loved and cared for him.

He’d saved for 20 years to buy his house. His house was part of who he was in his community, in his circle of friends. His house was where he once gave parties and cooked dinners until he could no longer afford to do either. The For Sale sign stood on the street in front of his house for eight months, proclaiming his downward journey.

“My emotional state was pretty bad, but I faked it,” he says.

And then the house sold and he decided to move to Toronto and live in the Beach neighbourhood because he had heard it was a good place for dogs.

Before he left, a neighbour offered him a one-month job building kitchen cabinets. “That was as fulfilled as I’d felt in a long time,” Schuppert says. “It was meaningful. In aquatics I had taught kids to save lives. That was meaningful.”

That’s what work is about. Either meaningful or not meaningful.

Schuppert found an apartment in the Beach where he could take George for long, healthy walks. He kept looking for a job. He was turned down for a City of Toronto posting that involved working on its 311 municipal service, which irritated him, because he had led the project to design the service at Caledon.

And then he got the college porter’s job.

The college staff, he says, are wonderful. The students he enjoys. He likes the opportunity to help people. He’s provided with dinner. “I’m underutilized but there’s dick-all elsewhere.”

There’s also the night shift. “I didn’t realize just how lost you are. I live at home alone. I get up in the morning and everyone else has gone to work. By the time I get home, it’s 11 o’clock and everyone else is in bed. I spend the whole day alone and that’s depressing.

There’s the fear — the fear that’s made him say he’s no longer middle class. “I still don’t see anything more than $30,000 a year in my future. That’s not a lot of money for a single person in Toronto. My biggest fear now that is that I’m going to wind up on the street. I’ve just got to get back to trying to find jobs. If I don’t I’m going to be well on the path to the working poor. I think progress has passed me by.”

There’s what Eric Schuppert identifies as the middle class things that are gone.

“I used to go out for dinner

“I used to throw dinner parties at home. I love to cook.

“I used to have parties all the time.

“Dating. How can I take someone out at 14 bucks an hour?

“I don’t get to see concerts and events any more. I used to see live music all the time.

“I have lost the ability to buy new clothes of some quality. I did get used to wearing a jacket and tie for 10 years and looking sharp. It is definitely a status thing.”

All things that middle class people do in middle class society.

“No house.”

Middle class people own houses, or at least a condo.

“I’m wondering if I’ll ever have a meaningful job using my skills and experience again.”

Middle class people have meaningful work.

George died two months ago. Schuppert is now looking for a smaller apartment “down the chain.”

Award-winning journalist Michael Valpy is this year’s recipient of the Atkinson Fellowship in Public Policy. He can be reached at michael.valpy@utoronto.ca

Globe and Mail’s article on income gap really propaganda – Nick Filmore

12 Nov

Nick FilmoreNick Filmore is an award-winning investigative reporter and a founder of the Canadian Association of Journalists (CAJ), Nick was a news editor and producer with the Canadian Broadcasting Corporation for more than 20 years.

Journalist Barrie McKenna, writing in the main hyped-up article inthe Globe’s Focus section on November 9.13, talks about how the gap in income between the rich and the rest of us is a serious problem that will hurt Canada for generations to come. True.

However, McKenna presented the issue as though we had just learned about the income gap. The frustrating truth is that we have known for years that the changes the Conservatives and the Liberals before them were making to the tax system, plus other adjustments, was resulting in much greater income disparity and the hollowing out of the middle class.

Globe and Mail Journalist Barrie MckennaIn fact, even the conservative Conference Board of Canada recognized this as a problem 20 years ago!

The article’s weaknesses are glaring. This is particularly significant because McKenna’s article launched a two-week-long series under the topic, Canada’s Wealth Paradox series.

McKenna makes no effort to explain WHY the wage gap is still increasing. He throws around terms such as globalization as being part of the problem, but he does not explain WHY we have such serious incomes gaps.

Income disparity doesn’t just happen

McKenna leaves readers with the impression that, well, a problem such as income disparity just happens. But serious problems, such as massive income disparities, don’t just happen. These problems occur when governments choose certain economic policies over others.

You would never know from this story that Stephen Harper’s neo-liberal economic policies, which are discredited as a failure in many countries now, are to blame.

reuters-3-20-11-Stephen-Harper

It is puzzling to see the Globe launch such an important – in its own mind – series with such a misleading, dishonest article.

McKenna makes no mention of the fact that Harper, and the Liberals before him, created trickle-down financial policies on purpose to make the already wealthy and giant corporations even more wealthy. This is done based on the false assumption that those rich folks re-invest their wealth in the economy. It’s not happening – it never happens!

McKenna failed to point out that these policies are a total failure. His so-called “journalism” is unbalanced and, considering his own knowledge in this area, dishonest. This article is little more than propaganda for those who espouse right-wing economic policies.

One of the reasons why this article is glaringly flawed is that McKenna’s work normally appears in the Globe’s Report on Business (RoB) where, most of the time, journalists present only the pro-business side of issues. Sometimes an opposing view is dropped in at the bottom of a story.

When an RoB journalist writes for the regular news or features section of the Globe – as in this case – the lack of balance is often obvious.

Economic term ‘neo-liberal’ taboo at the Globe
Interestingly, even though Harper has been governing Canada with extremely damaging neo-liberal policies for seven years, the term is taboo at the Globe. If the mainstream corporate media alerted the public to all of the evil elements in Harper’s neo-liberal package, I can’t imagine the CONS. getting elected again.

globe-and-mail-logo

While McKenna briefly states that the Scandinavian countries are much better compared to Canada in controlling income gaps, he does not explain why this is the case. Simply put, those countries have economic policies that reflect their commitment to the well-being of the general population.

In addition to holding specific media outlets responsible for the integrity of their journalism, perhaps it’s time we held individual journalists responsible for their work. If we started doing this, Barrie McKenna would easily win the award for “Best Propaganda Article of the Week!”

Of course there are lots of journalists putting their bylines on misleading and dishonest stories. In this situation, McKenna is my sacrificial lamb.

Note: I imagine some of you are going to beat me up for singling out an individual journalist – oops, propagandist – for criticism. Well, going after faceless organizations like the Globe doesn’t bring change. So, as an alternative, we need to hold individual journalists responsible for their half-baked, misleading stories.

The little “crimes” that Barrie McKenna committed in the income gap story are, in fact, more serious than we might think. The large volume of such misleading journalism creates a propaganda-riddled “false reality.”

If the so called “reporting” and commentary in mainstream media continues to create the kind of imaginary world our elites want to see, can 1984 be far behind?