Wal-Mart created a big stir with its recent decision to raise wages to at least $9 an hour for all its workers, but that's not enough to keep many of its employees off public assistance, according to a new study from Americans for Tax Fairness
"At $9 per hour and 34 hours a week (Wal-Mart's definition of full-time work), an employee would take home just $15,912 a year," the report states.
"This single worker would qualify for three out of five public programs for which they would be eligible. A worker with one or more children would qualify for all eight of the programs studied." That includes Medicaid and food stamps.
Because so many of its employees rely on taxpayer-funded programs, "Wal-Mart receives an estimated $6.2 billion annually in mostly federal taxpayer subsidies," the report states.
Not surprisingly, the group favors a bigger wage increase.
"Increasing Walmart employees' wages to $15 an hour at full-time work of 40 hours a week, or $31,200 a year, would lift many of its workers above the income level at which they would be eligible for these programs," the report states.
Meanwhile, Americans are concerned about the growing inequality of income, but they don't see the government as a solution for the most part, according to a new study by four esteemed professors for the Washington Center for Equitable Growth
"The survey shows that while respondents who view information about inequality are more likely to believe that inequality is a serious problem, they show no more appetite for many government interventions to reduce inequality — with the notable exceptions of increasing the estate tax and the minimum wage," the professors write.
They are Ilyana Kuziemko of Princeton University, Michael Norton of Harvard University, Emmanuel Saez of University of California, Berkeley and Stefanie Stantcheva of Harvard.
For the survey, more than 10,000 respondents were randomly assigned to view a short online presentation conveying information about income inequality or to a control group that did not view this presentation.
When respondents were given the actual data on the growing income gap in the United States, their concern about the problem increased by 35 percent.
When respondents in the treatment group learned the small share of estates subject to the estate tax (roughly one in 1,000), their support increased at three times the rate of the control group.
Similarly, after reviewing the presentation on income inequality, support for raising the minimum wage jumped 4 percent (from an already high baseline of support of 69 percent) in the treatment group relative to the control group.
At the same time, attitudes toward some policies were unaffected, including increasing top income tax rates and support for the Earned Income Tax Credit for low-wage workers and the Supplemental Nutrition Assistance Program.
"Our working hypothesis is that those surveyed alighted on the estate tax because it applies to many fewer Americans than respondents had assumed," the authors say.
"And respondents favored increasing the minimum wage because doing so does not necessitate heavy government involvement, unlike, say, the Supplemental Nutrition Assistance Program, or food stamps for low-income Americans."
Bottom line: "The survey reveals a deep mistrust of the federal government's ability to administer programs effectively and efficiently even after confronted with the importance of these programs in alleviating poverty among those Americans at the bottom of the ladder," the professors conclude.
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