Capitalism Causes Poverty; The Poor Get The Blame

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T he cost of living in New York City makes it almost impossible for low-income New Yorkers to afford rent, minimal groceries and still manage to pay their electricity, gas and other household expenses without receiving government subsidies.

Thomas J. Vilsack, an executive within the Department of Agriculture announced the ending of the Supplemental Nutrition Assistance Program (SNAP), formerly known as food-stamps on March 15, 2015.

The Center on Budget and Policy Priorities (CBPP), estimates that more than one million current SNAP recipients will lose their benefits this year pushing the most economically disadvantaged families further into poverty. Vilsack alleges SNAP recipients were abusing the program and does not encourage recipients to work. Yet CBPP analysis found that a large majority (more than half) of SNAP recipients do work.

As an Adjunct Professor of Sociology at LaGuardia Community College, I’ve seen many of my students become discouraged as they strive to succeed. Most of my students either work multiple low income jobs or very long hours yet still need food-stamps, Medicaid section 8 and childcare to subsidize their family’s needs. This disturbed me. How could this happen to so many families?

Barry Ritholtz an American Author argues America has new welfare queens. These welfare queens are not black women in urban neighborhoods having babies without fathersexpecting to get a welfare check. No, the new welfare queens are richer, less deserving of tax payer funding and our economic system supports them. In 2013, a report written by economist Sylvia Allegretto and others, found the low-wage fast food industry cost American tax payers an average of $7 billion a year. Specifically, Allegretto’s report reveals workers at McDonalds received the most public assistance of fast food workers, amounting to $1.2 billion tax dollars a year from 2007-2011.

McDonalds is not the onlylarge corporation criticized for its employees receiving public benefits. According to Florida Congressman Alan Grayson, in many states, Wal-Mart employees are the largest group of Medicaid recipients.

Also, data collected from Wisconsin by House Democrats found the average Wal-Mart superstore cost taxpayers $904,000 a year in various subsidies, or more than $5,000 per employee.

In an article Timothy Egan a NY Times columnist denounced Wal-Mart for poor corporate citizenship, claiming, “Wal-Mart is a net drain on tax-payers”. Egan went on to say “working at Wal-Mart may not make you poor, but it certainly keeps you poor.”

In response, a representative from Wal-Mart said, “We are the largest taxpayers in America”. While a spokesperson from McDonalds responded to paying employees low wages with, “As with most small businesses, wages are based on local wage laws and are competitive to similar jobs in that market”.

How are huge companies allowed to pay low wages forcing their employees to receive public assistance at the expense of tax-payers: Capitalism? Low skilled labors in America are viewed purely from an economic perspective. Today in America there is a large supply of low skilled laborers. Huge profit making American companies (Capitalist) have created a demand for these low skilled laborers. This supply and demand allows capitalist to pay as little as they can for labor in order to maximize their profits.

AreMcDonalds and Walmart to blame for causing poverty? No, these companies did not create the economic system that allows them to make profits while puttingpoor Americans deeper into poverty, nor did theyset eligibility standards for public assistance or establish the poverty guidelines; our government does. The obvious solution is to raiseminimum wage.

As a single mother who has both experienced and studied poverty, it has been my observation that education, job training, personal and professional development programs are key in individuals successfully transitioning off welfare.

Critics of this theory would argue attending school while receiving welfare will increase the time recipients receive benefits and prevent recipients from seeking employment. However ifwelfare recipients are trained for green jobs which needs skilled workers, this would “Renew America,” in more ways than one. This solution would decreasethe amount of Americans dependent on welfare, stimulate the economy and purify the environment.

Sadly the social welfare policy in America is in dire need of reform and works against the verypopulation it is designed to help. Our economic system needs tighter regulation if capitalistare allowed to continuouslyput American families in poverty, bankrupting SNAP benefits, at the expense of tax-payers.Meanwhile everyone blames the poor for circumstances they are not in control yet have to accept.

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