A friend of mine posted something I can understand in reaction to a news article I shared on Facebook yesterday. The article was talking about how the Harper government wants to put through some changes that will cut the amount of money going to the majority of people, how the Middle Class is disappearing, how the average person in My Home Town earns $27 an hour, and can’t afford a house. Personally, I find that disgusting. However, his response annoyed me despite it having some degree of merit. He implied that the Western world is so laughably wealthy, and it’s awful difficult to complain when so many people the world over have it worse than we do.
I agree to an extent. There is no denying that we are a wealthy society, and many others are not. There is also no denying that our standard of living is dramatically higher than many places on earth. But is that reason to shut up and take it whenever things get a bit worse? I just can’t help but take issue with that.
The cost of living has risen steadily over the past decade, but the comparable earning power of individuals is dropping like a sack. Isn’t that enough reason to say, “Gee, things are not particularly super-bestest”? Yes, things are not so bad that the entire country looks like a bombed out crater, but does that mean we shouldn’t want and expect better? Should we smile when the government tries to take even more of our quality of living and give it to their special friends?
I don’t bloody think so.
One of the comments he made was that it was ridiculous to assume that anyone earning $27 an hour couldn’t afford a house. Well, that’s partially a true statement. Let’s explore that.
So the “average person” makes $27 an hour. I’m always troubled by the word “average”, because of that college Stats course I took. Is that the mean? median? mode? Remember that stuff?
A series: 1, 1, 1, 1, 3, 6, 6, 14, 30
Series mean (sum of the series divided by how many numbers): 7
Series median (middle number of the series): 3
Series mode (number occurring most frequently): 1
What kind of average are we talking about? I’m going to assume that we are talking about the mean, which means that $27 is the total amount of all hourly wages divided by the total number of people earning. So your mean average person, if that’s what this number implies, grosses about $4320 a month. Take off a grand for taxes, and you get around $3300. Lots of people will do better than that, but an equal number will do worse. For every guy who makes $100 an hour, quite a few people have to make significantly less than that to balance the equation.
Now, the average housing price. I’m going to use this page’s numbers and we’ll pretend that we are looking at a condo rather than a house. I’ll use this mortgage calculator, so feel free to check my work. If we pull a mean price for condos between all four “zones” identified, we get $267,111.50. Let’s say we’re doing a 10% down payment amortized over 25 yeras with a 10 year term at 7% yearly interest (I have no idea how realistic these numbers are, so this may be misleading) then my down payment if $26,711.15 with a monthly payment of $1683.81, leaving me still owing $188,501.60 at the end of my 10 years. Or if we just make it a 20 year term and amortization, then I owe nothing and pay out $1849.43 a month for 20 years. Yikes.
No, after we took our estimated tax off, we had $3300 a month. Let’s use the larger of those numbers (I assume a 20 year mortgage is reasonable?) and that means after just paying our mortgage payment, we are left with $1450.57 to buy food, pay for transportation to our jobs, cover any unexpected health costs, pay the utilities and gas, have a phone, and whatever else we end up with. Ah, the luxurious lifestyle! And of course there’s no saying where the hell the more than $25k came from for our down payment. Now, for a single person, that’s probably not a horrible life. But what about the wrinkles, things like divorce, children, falling salaries, medical problems… The list is endless, but the wiggle room in that budget sure as hell isn’t.
I don’t anticipate that everyone in our society is going to have it easy. But according to those sources (and they may be wrong, I’m not going to pretend that they are impossibly accurate), our “average person” is in trouble. It means a lot of people are scraping by, and the Harper government wants to start rolling our wages back. Do the companies take a rollback in profits? Does the government take a rollback in tax revenues? Gee, I didn’t think so. Looks like it’s just us.
And for that, you’re damn right I can bitch.