The election is just around the corner and we are inundated with selective data from one side of the political spectrum claiming that everything is going well while the other side denies that anything good has happened or is likely to happen. The real questions are: What is a good economy and for whom?
Our economy has not been good for most people in the country, state and county. A good economy that works for most people or, say, everyone, is not difficult to define. A good economy is one in which everyone can find and develop their talents for a good life from birth, regardless of the economic and social conditions of their families. A good economy is one in which everyone has a chance to succeed. A good economy is one in which people can work and afford a life that meets their basic needs and lives with human dignity. A good economy is an economy that lives in peace and harmony with itself and the environment and serves the common good.
According to the MIT Living Wage Calculator, an adult with two children in California needed a living wage of $56.48 in 2021. In Ventura County, the family wage level was even higher at $58.01, with an annual pre-tax salary of $120,659. In Ventura County, only two professions, management and legal, offer such salary levels. In 2015, the same family in Ventura County required a living wage of $31.9, meaning more professions and institutions pay at this wage scale. How many professions saw an 82% salary increase from 2015 to 2021? The living wage for a family with one parent and three children increased from $40.49 in 2015 to $79.30 in 2021, a rate of almost 100%. In 2015, we had four professional groups with such an average wage scale; there were none in Ventura County in 2021.
According to the U.S. Census’ five-year American Community Survey, 30.8% of families with children under 5 live with a parent and 73% of them live with their mothers in Ventura County. These rates are higher in underserved communities and among low-income families. According to the U.S. Census, Ventura County has had a chronic 86% gender pay gap for many years. The rate varies depending on the profession and type of establishment. It may be harder to question what is happening in the private sector, but we can ask our local and state governments why they are among those where the gender pay gap is much larger than average. The gender pay gap in Ventura County local government is 78.4%, which has barely improved in a decade.
The problem with the gender pay gap is that it impacts the lives of our families headed by single mothers and their children. Even for such a family with a living wage, which only applies to a very small proportion of working families, the cost of child care as a share of the mother’s after-tax income is more than 24%. If we look at what happens to families in poverty, the share of child care costs is 126% of family income, and at minimum wage it is about 90%. The health and food costs for the same family earning a living wage are 21% of their after-tax family income. For poverty earners this rate is 110% of their income, for minimum wage earners it is 78%. Knowing that more than 26% of families spend 50% or more of their income on housing, we can only imagine what kind of life lies ahead for most of our families in Ventura County, and the situation in California is no better .
A good economy requires that we know where we stand and be transparent about the economic plight that many face. We have to admit that working people’s lives are not improving. We need universal, high-quality early childhood education. This will be the most significant investment in our children’s lives and the most effective pay raise for parents. We need a universal, high quality and accessible healthcare system. This will reduce our healthcare costs relative to our GDP and direct our tax dollars toward healthcare, not the colossal profits of big pharma. We need affordable housing, and the solution isn’t building homes for families who can’t afford to buy or rent. The solution is not market based.
By supporting those who support our families in the upcoming elections, we can begin to experience what can be called a good economy.
Jamshid Damooei, Ph.D., is executive director of the Center for Economics of Social Issues and director of the undergraduate economics program at California Lutheran University.
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