Future Hindsight - Exclusions in the Social Contract: Eduardo Porter

Exclusions in the Social Contract: Eduardo Porter

12/02/21 • 38 min

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Future Hindsight

Racism Bites Everybody

Creating racist policies and ideologies is short-sighted. In the long run, these practices affect everyone, including white people. In 1978, older white voters in California decided they didn’t want their tax dollars going towards the funding of education for children who were increasingly non-white. To reflect this, Prop 13 capped property taxes and essentially led to a defunding of public education in the state, which families of every race and ethnicity rely on.

Intersectionality

History has shown that when the American social safety net becomes beneficial for people of color, support for the policies and programs diminish. For example, criminal justice started to be used more and more as a tool for social management after poverty programs in the 1960s allowed Black Americans to access it. Today these relationships between race and a social safety affect our entire society, across the landscape of labor, education outcomes, and incarceration.

Abstract Fears

Abstract fears are based on something people believe to be true, even though it is not part of their lived experience. For example, if someone believes that immigrants abuse Medicaid, they will fight against Medicaid as a whole, even if the program would be beneficial for them. Abstract fears and prejudices that are not rooted in reason erode the social contract because they block citizens from making decisions that benefit both their own lives and society at large.

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Eduardo Porter is an economics reporter for The New York Times, where he was a member of the editorial board from 2007 to 2012 and the Economic Scene columnist from 2012 to 2018. He began his career in journalism as a financial reporter for Notimex, a Mexican news agency, in Mexico City. He was a correspondent in Tokyo and London, and in 1996 moved to São Paulo, Brazil, as editor of América Economía, a business magazine. In 2000, he went to work at The Wall Street Journal in Los Angeles to cover the growing Hispanic population.

Porter is the author of The Price of Everything (2011), an exploration of the cost-benefit analyses that underpin human behaviors and institutions. His latest book is American Poison: How Racial Hostility Destroyed Our Promise (2020).

You can follow Eduardo Porter on Twitter at @PorterEduardo

Racism Bites Everybody

Intersectionality

Abstract Fears

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You can follow Eduardo Porter on Twitter at @PorterEduardo

Previous Episode

Ending Subminimum Wage: Saru Jayaraman

5 Recommendations

The Legacy of the Subminimum Wage

The devaluation of Black lives and women's work is at the heart of the subminimum wage. Until the 1850s, restaurant workers were white men who were unionized and were tipped on top of a living wage. But business owners started hiring women and black people for free, making them rely on tips to make their living. This means that the customer—instead of the employer—is responsible for paying the worker. A century and a half later, the subminimum wage has increased to only $2.13.

Tipped Work in the Pandemic

The COVID-19 pandemic exposed how precarious tipped work is. Full time tipped workers, such as in bars or restaurants, often did not qualify for unemployment benefits because their tips were never reported, and it made them look ineligible for not having worked enough hours or earned enough pay. We have an opportunity to get rid of the subminimum wage by advocating for the Raise the Wage Act, supporting restaurants that pay their workers a livable wage, and demanding the same from businesses that don’t.

Who Gets Paid Subminimum Wages?

The restaurant industry makes up a big piece of the work force, but it’s not alone. Nail salon workers, car wash workers, parking attendants, sky caps at airports all work for tips. Subminimum wage laws also take advantage of a subset of people who are deemed ineligible for a proper minimum wage. Incarcerated workers are often paid even below the subminimum wage per hour; teenage workers produce the same work as adults but get paid less; and people with disabilities also perform the same as other workers but do not get paid the same amount.

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Saru Jayaraman is the President of One Fair Wage and Director of the Food Labor Research Center at University of California, Berkeley. Saru has spent the last 20 years organizing and advocating for raising wages and working conditions for restaurant and other service workers. She is a graduate of Yale Law School and the Harvard Kennedy School of Government. She was listed in CNN’s “Top 10 Visionary Women” and recognized as a Champion of Change by the White House in 2014, a James Beard Foundation Leadership Award in 2015, and the San Francisco Chronicle ‘Visionary of the Year’ in 2019.

Saru has written several books, including Behind the Kitchen Door (Cornell University Press, 2013), a national bestseller, Bite Back: People Taking on Corporate Food and Winning (UC Press, 2020), and most recently One Fair Wage: Ending Sub Minimum Pay in America (The New Press, 2021).

You can learn more at onefairwage.com.

You can follow Saru on Twitter at @SaruJayaraman

Next Episode

Social Contract and Taxes: Sarah Christopherson

Tax Policy is Where It Starts

What do our tax dollars really go towards? The truth is, so much of it is invisible. Tax dollars go towards helping homeowners through mortgage deductions or keeping prices low on your water bill. The money we spend on taxes has the power to shape our social contract, but it’s not always spent correctly. By focusing on tax policy first, we can control which programs and policies are funded and which are not. In this way, taxes are at the root of social change.

Tax Fairness

The topic of tax fairness is shrouded in the myth that America’s tax system is progressive. We tend to only talk about federal income taxes, which do in fact increase as you make more income. But we fail to recognize the unfairness of other taxes, like property and sales tax. For example, middle class families pay the same sales tax as the ultra-wealthy, and even renters end up paying property taxes at a rate equivalent to billionaires. When you look at the full scope of the tax burden, it really falls most heavily on middle- and lower-income families.

Taxing Billionaires

Billionaires don't have to pay taxes on their capital investments. They pay taxes when they sell their assets. However, billionaires are rarely in a position where they need to sell, thanks to loopholes in the system. For example, Jeff Bezos, who owns billions in Amazon stock, can take out huge loans at low interest rates, using his stock as collateral, avoiding any taxable event like selling stock. To effectively tax the ultra-wealthy, these loopholes can be closed by taxing annual gains of public stock whether they’ve been sold or not, much like a property tax assessment.

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Sarah Christopherson is the Legislative and Policy Director of Americans for Tax Fairness. She leads ATF’s advocacy efforts with Congress and coordinates the coalition’s policy work. Prior to joining ATF, she served as the Policy Advocacy Director for the National Women’s Health Network for five years, responsible for directing their advocacy efforts on federal health reform, among other issues. Christopherson also worked for Congress from 2005 to 2015, including serving as the Washington Director/Legislative Director to Congresswoman Niki Tsongas (D-MA). There she directed the Member’s legislative agenda and led her tax, financial services, consumer protection, and federal budget portfolio. Christopherson has bachelor’s degrees in political science and history from Arizona State University and a master’s degree in foreign policy from George Washington University.

You can follow Sarah on Twitter at @sarahcgchris.