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Workers Exploited by Your Tax Dollars

McDonalds not the only low wage player

8/7/2013, 12:11 p.m.
Did the golden arches deserve the ridicule that ensued after its employees staged a mass protest?
Martha Burk

McDonald’s really stepped in it this summer when the fast food empire created a budget for its underpaid employees to help them make ends meet on the low wages they bring home after flipping burgers all week.

At first, the McBudget didn’t include any money for food or gasoline, then it fixed that by telling its full-time workers to get a second job. It allocated only $20 a month for health insurance — less than half of what it costs to carry McDonald’s most affordable coverage option.

The golden arches deservedly came under fire and faced widespread ridicule.

This blunder underscored how huge corporations like Mickey D’s and Walmart are responsible for the majority of our nation’s low-wage jobs. But there’s another player in this mix that’s responsible for creating more poverty- level jobs than these two companies combined. It’s good ol’ Uncle Sam.

That’s right. The federal government supports more U.S. low wage jobs than McDonald’s and Walmart put together, according to a recent report from Demos.

One reason why we don’t hear much about it is that these exploited workers don’t get a paycheck directly from the U.S. Treasury. They work for contractors — companies that are paid with your tax dollars to staff government facilities and do government-funded work around the country.

Contractors get big bucks to make goods, like military uniforms, and provide services. These companies do construction jobs, employ home health care workers, and are responsible for cleaning government buildings.

Though the contracts can total billions of dollars, frontline workers are paid at poverty levels. After decades on the job, these workers may never get a raise that brings their pay above our paltry minimum wage.

Guadalupe Rodriguez is an example. She has worked for almost 20 years for a janitorial company at Union Station, a federal property. She receives no benefits and has never made more than the minimum. Workers who are undocumented, and there are some, are paid in cash and cheated out of even that lowly sum.

These workers exploited by companies raking in your tax dollars number about two million. On top of that, there are at least one million underpaid farm workers taken advantage of by Big Ag companies subsidized with government handouts.

Well, some of these underpaid federal contract workers are mad as hell, and they’re not going to take it anymore. Rolling strikes in Washington have been held this summer at the Smithsonian Institution, Union Station, and the Ronald Reagan building. Led by the union-backed Good Jobs Nation, the strikes are sure to spread to other cities with large numbers of government-contracted workers.

The Demos report urges President Barack Obama to issue an executive order that would mandate higher wages and benefits as a condition of federal contracting, an already common practice at the municipal level.

Better yet, why not cut out the middlemen? Uncle Sam used to employ people directly, with decent wages and benefits. Now those jobs are outsourced to corporations making big profits on the backs of workers.

By allowing contractors to pay low wages and no benefits, the federal government is forcing us taxpayers to pick up the tab for the help these employees must have to make ends meet — services like Medicaid, food stamps, and subsidized child care.

There’s no sane reason why corporations should be allowed to benefit from billions of your tax dollars to line their already overflowing pockets, all the while keeping your neighbors in poverty.

Martha Burk is the director of the Corporate Accountability Project for the National Council of Women's Organizations.