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Is is permissible for a Catholic to reject the Catholic doctrine on the Just Wage?
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markomalley
Guest
Actually, that is not a good example.Take the medical profession. You will pay more to get an injection/pap smear/whatnot from a doctor than from a nurse in the same clinic. Yet they are doing EXACTLY THE SAME THING! With exactly the same inherent value.
Do you think that doctor really has more training or experience in giving injections or taking pap smears than that nurse? In many cases, no.
Patients pay more because
a) the doctor has a lot of fancy letters after his or her name, and that must mean something, right?
b) the doctor has enormous student debt that they have to pay off sometime before they retire, much more so than a nurse
c) doctors have (as the numerous ones in my family tell me) what is known as a ‘God complex’ - a sense of entitlement, a sense of superiority, a sense that they’re worth scads of money. Drummed into them as they go through their training. Unlike nurses.
First of all, you’re not talking about wages. You are talking about retail pricing of services where consumers hypothetically are given a choice of service provider. The price you pay not only includes the wage of the laborer, it also includes his/her overhead (things like utilities, rent, equipment depreciation, and so on) as well as the wages of any support staff (nurse assistants, medical accountants, and so on).
I will fully grant that the salary of an LPN or a PA is going to be less than the salary of an MD. But look at the scope of the person’s capabilities. Sure, either an LPN, a PA, or an MD can do a pap smear. But what happens if the pap smear comes back positive and additional tests are required to confirm cervical cancer and, God forbid, cervical cancer is confirmed? Is the LPN or PA going to be able to provide the treatment for the cancer? No, only the MD will provide that treatment. Because of that increased scope of capabilities, the MD should certainly make more than the LPN or the PA.
As far as wages are concerned, distributive justice, in theory, says that distribution should be made from a society to an individual in proportion to the contribution of that individual to that society. In a practical sense, this means that the society (the company) should distribute (pay) the individual in proportion to his contribution (looking at the skills and capability he brings and the revenue he generates for that company). An example of where distributive justice would be violated would be if you had two LPNs with similar education, similar capabilities, similar experience, and similar work ethic get paid dramatically differently, particularly if that distinction was made on an irrelevant factor (say due to the race or sex of the LPN).
Secondly, for the most part, pricing in the medical industry within the US is not based upon market factors. The reason for this is that most consumers of medical services in the US do not pay for those services. Most consumers of medical services pay for a portion of an insurance policy and pay a fixed co-payment for a provider. The actual “payer” of medical services are mostly large insurance entities (either commercial or government owned). That’s the way virtually all insurance schemes work, as well as Medicare, Medicaid, VA, and military insurances operate (although granted that VA and military also operate their own clinics that do not directly charge the patient either).
This dramatically distorts pricing. The consumer will typically pay a set co-payment for a primary care provider, whether that provider is an LPN, a PA, or an MD. The provider, in turn, generally bills the insurance entity who reimburses based upon their allowable pricing for a given procedure from a given type of provider. This allowable pricing is based upon data that insurers analyze to determine a fair market price. To my knowledge (and I am willing to be corrected by a person who is actually in the medical billing field), insurers typically will reimburse differently based upon the type of degree the provider has: i.e., they have different rates for MDs than for LPNs or PAs.
Naturally, in order to cause the reimbursable amount to increase, providers almost universally attempt to charge more than what the insurer will reimburse, even though the patient almost never directly sees this. If you have health insurance, all you need to do is look at an “Explanation of Benefits” from your insurer. For example, I just happen to have one sitting in front of me that shows that a provider charged $178 for a routine office visit (procedure code 99214). My insurer only allowed $98.95 for that visit. My portion was only $20. It wouldn’t matter to me if they attempted to charge $300 for that visit. The insurer would still only allow $98.95 and my copay would still only be $20. I really don’t care. All I care about is the $20 copay.
Where this causes a problem is for the small minority who actually pay cash for their medical services. Using the example above, many providers would expect $178 from the patient (though some will discount cash patients so they would only have to pay out what the provider would get from an insurance company – my dentist works like that for his cash customers). And that is where you’ll start to see the difference between the pricing for an LPN/PA and an MD.
If we dealt in a truly free market with the medical industry, then you would see prices go down. And while you would still see a difference between what an MD charged compared to an LPN/PA for the same service, the difference would be significantly less than what it is today.
But keep in mind the above discussion talks about prices, not wages. As I explained at the top of the post, the two are different.
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Jaypeeto4
Guest
Let’s boil it down to brass tacks, then:
If Jesus doesn’t approve of theft, and he doesn’t,
that means that if we steal, we have to repent of it and stop stealing
(and make restitution to the best of our ability and means.)
So since Jesus doesn’t approve of stealing,
do we actually think that he approves of those, with ample means and more than ample,
working people to death in backbreaking work for practically a pittance?
Do we seriously believe that???
One of my distance relatives owns some of the enormous vegetable farms in South Florida. He is richer than you can possibly imagine and lives like a King.
Now, he started out with nothing and, yes, through ingenuity and hard work, he built up his farming business. I do not fault him for that, how COULD I do so???
But, part of his ability to acquire more and more and more land, bigger crops, and
hence GREATLY INCREASED WEALTH comes from his (and other large farmers here)
“hiring” (if you can call it that) desperate unskilled workers from Latin America who
work themselves to death under the hot sun doing brutally hard labor for next-to-nothing.
They are migrant, have no fixed addresses, their kids do get some education, but it doesn’t even compare to even most public schools, they have no insurance, and if it weren’t for catholic and protestant church charity, these people would have no access to any medical care at all. As it is, they have access to precious little.
That is not right. If they were paid more, would WE have to pay a few bucks more each (and it wouldn’t be any more than that divided up among 300 MILLION people who benefit from their backbreaking labor) a month for our groceries? Probably. But so what?
Most of us buy not only store-bought groceries, but we eat out at restaurants, too, so most of us really, despite the economy, aren’t hurting THAT much, as most of us (not me, at least not right now, LOL ) are middle to upper-middle, class. These workers are squalidly poor yet work like animals. And thanks, in PART, to taking unfair advantage of them, my second cousin is rolling in money. He is old now and “can’t take it with him,” and has no children to leave it to, so why risk your soul by abusing people to get VERY rich when it all ends when you die anyway?
Some, incidentally, post charts showing how America’s poor own tvs, radios, computers, furniture, etc. That is true, but doesn’t tell the whole story. Many of them get that stuff by going deep into credit card debt AND by being suckered into taking what are called PayDay Loans (with ungodly huge interest) in order to buy those things.
And by the way, in the modern world, those things aren’t “luxuries,” they are absolute necessities if you want to be able to function. The migrant workers that my relative “employs,” by the way, do not have any of those things, and they live in what amount to shacks.
If Jesus doesn’t approve of theft, and he doesn’t,
that means that if we steal, we have to repent of it and stop stealing
(and make restitution to the best of our ability and means.)
So since Jesus doesn’t approve of stealing,
do we actually think that he approves of those, with ample means and more than ample,
working people to death in backbreaking work for practically a pittance?
Do we seriously believe that???
One of my distance relatives owns some of the enormous vegetable farms in South Florida. He is richer than you can possibly imagine and lives like a King.
Now, he started out with nothing and, yes, through ingenuity and hard work, he built up his farming business. I do not fault him for that, how COULD I do so???
But, part of his ability to acquire more and more and more land, bigger crops, and
hence GREATLY INCREASED WEALTH comes from his (and other large farmers here)
“hiring” (if you can call it that) desperate unskilled workers from Latin America who
work themselves to death under the hot sun doing brutally hard labor for next-to-nothing.
They are migrant, have no fixed addresses, their kids do get some education, but it doesn’t even compare to even most public schools, they have no insurance, and if it weren’t for catholic and protestant church charity, these people would have no access to any medical care at all. As it is, they have access to precious little.
That is not right. If they were paid more, would WE have to pay a few bucks more each (and it wouldn’t be any more than that divided up among 300 MILLION people who benefit from their backbreaking labor) a month for our groceries? Probably. But so what?
Most of us buy not only store-bought groceries, but we eat out at restaurants, too, so most of us really, despite the economy, aren’t hurting THAT much, as most of us (not me, at least not right now, LOL ) are middle to upper-middle, class. These workers are squalidly poor yet work like animals. And thanks, in PART, to taking unfair advantage of them, my second cousin is rolling in money. He is old now and “can’t take it with him,” and has no children to leave it to, so why risk your soul by abusing people to get VERY rich when it all ends when you die anyway?
Some, incidentally, post charts showing how America’s poor own tvs, radios, computers, furniture, etc. That is true, but doesn’t tell the whole story. Many of them get that stuff by going deep into credit card debt AND by being suckered into taking what are called PayDay Loans (with ungodly huge interest) in order to buy those things.
And by the way, in the modern world, those things aren’t “luxuries,” they are absolute necessities if you want to be able to function. The migrant workers that my relative “employs,” by the way, do not have any of those things, and they live in what amount to shacks.
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Newbie2
Guest
Excellent points, B.
Conceptually, that may be true. However, many businesses cannot pay such a “just wage” as the term has been used in this thread.
My business partner and I employ 4 other people. They all would have a difficult time living on what we pay them. That is what we can afford to pay; if we paid them more, we would have to make do with fewer workers and we would not be able to function as a business.
So are the wages we pay them “just”?
BTW, lest anyone play the “rich business owner card”, let me add that my combined household income, (wife does not work at my business) does not approach anywhere near what you might guess. My newest car (not by choice) is now 10 years old.
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markomalley
Guest
Going along with your thought, Pope Pius XI said, in Quadragesimo Anno:
- In determining the amount of the wage, the condition of a business and of the one carrying it on must also be taken into account; for it would be unjust to demand excessive wages which a business cannot stand without its ruin and consequent calamity to the workers. If, however, a business makes too little money, because of lack of energy or lack of initiative or because of indifference to technical and economic progress, that must not be regarded a just reason for reducing the compensation of the workers. But if the business in question is not making enough money to pay the workers an equitable wage because it is being crushed by unjust burdens or forced to sell its product at less than a just price, those who are thus the cause of the injury are guilty of grave wrong, for they deprive workers of their just wage and force them under the pinch of necessity to accept a wage less than fair.
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JRRTFAN
Guest
Let’s look at it realistically. Sy you’ve got a hardware store with 2 employees. You can pay them “X” which is less than a living wage or you can not employ them due to the expense. Are you violating any fundamental law of equity by continuing to employee them, if they agree to work at that wage rather than have no job at all?
Should every adult (often retired) supermarket clerk be denied a job because the pay is not a “living wage”?
There are a TON of people willing to work 2 jobs in order to survive. Would it be equitable to deny them the opportunity for either of those because of some idea of what constitues a living wage? Are you willing to pay $6 for a burger at the Mickey D’s so the lady behind the counter can make $50,000 a year? Would that be equitable to you? To the lady? To the stockholders?
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Nate13
Guest
Incorrect, your missing a vital thing here. Think of it in terms of how much a person’s time is worth and not actually what they are doing. A doctor’s time is worth X amount per hour and a nurse’s time is worth X amount per hour based on their qualifications and overall abilities. In economics there is a thing called opportunity cost. When you choose to do one thing with your time, it means your choosing not to do another. If a doctor chooses to perform a pap smear with his time, he is choosing not to do something that may have required all of the qualifications that he has. Thus you pay more for his time than the nurses because its worth more. It’s all about time. A doctor’s time is worth more than a nurse’s because the doctor has the possibility of performing many more tasks than a nurse does based on their qualifications.
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LumenGent
Guest
If your goal is to make an “X” amount of profit and you don’t meet that goal, it doesn’t mean that you can’t afford to pay your workers a just wage. The Church has never and will never set a “Just” figure since it really can not be uniform given the differeing circumstances and situations.
All that Pope Leo’s encyclical is advocating, is the use of good will. Whoever lacks that, can keep quoting his words or any other words for that matter, but it really amounts to nothing. And, yes, I speak from experience, I did run my business and I wasn’t falling behind one bit by paying my workers more than what “the law” allows. The bonuses I received were their faithfulness, honesty, friendship and most importantly, God provided for more than I thought he will. I’m not advocating that people should do that (that is for the individual to decide), but I was one of many Catholic business owners who did use the model I described, without suffering any losses.
Maybe the problem is that we need to re-examine our understanding of what Justice really is about.
All that Pope Leo’s encyclical is advocating, is the use of good will. Whoever lacks that, can keep quoting his words or any other words for that matter, but it really amounts to nothing. And, yes, I speak from experience, I did run my business and I wasn’t falling behind one bit by paying my workers more than what “the law” allows. The bonuses I received were their faithfulness, honesty, friendship and most importantly, God provided for more than I thought he will. I’m not advocating that people should do that (that is for the individual to decide), but I was one of many Catholic business owners who did use the model I described, without suffering any losses.
Maybe the problem is that we need to re-examine our understanding of what Justice really is about.
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Holly3278
Guest
A Catholic should at least seek to understand all doctrines that they do not agree with. One should not just simply reject the doctrine without seeking to understand it.
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markomalley
Guest
Was your business publicly held?If your goal is to make an “X” amount of profit and you don’t meet that goal, it doesn’t mean that you can’t afford to pay your workers a just wage. The Church has never and will never set a “Just” figure since it really can not be uniform given the differeing circumstances and situations.
All that Pope Leo’s encyclical is advocating, is the use of good will. Whoever lacks that, can keep quoting his words or any other words for that matter, but it really amounts to nothing. And, yes, I speak from experience, I did run my business and I wasn’t falling behind one bit by paying my workers more than what “the law” allows. The bonuses I received were their faithfulness, honesty, friendship and most importantly, God provided for more than I thought he will. I’m not advocating that people should do that (that is for the individual to decide), but I was one of many Catholic business owners who did use the model I described, without suffering any losses.
Maybe the problem is that we need to re-examine our understanding of what Justice really is about.
Did you have institutional investors who owned major blocks of shares?
If you did, you would understand what happens if you don’t meet your earnings targets.
By the way, I, too, believe in paying my employees as much as I can possibly pay them while still staying afloat. And I agree that sticking by your employees during tough times. However, when you have your boss asking you the hard questions…then decisions have to be made. Do you ask people to take a pay cut, do you lay some staff off, or do you press on and risk divestiture by the larger corporation?
Trust me, if you haven’t had to do so while you ran your business, it isn’t fun laying somebody off, particularly if you’ve worked with the person for years and they did nothing to deserve it. It’s far easier firing him/her for cause.
It’s even tougher when you see your corporate headquarters come in and shut a division down and lots of people are gone in one fell swoop.
But that kind of thing happens when a publicly held corporation doesn’t make its earnings targets. The trouble is that if the CEO doesn’t direct those kind of actions, the board will hire somebody who is more than happy to do so.
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LumenGent
Guest
I suppose that is directed at me, may I ask how in your opinion I appear to not understand whichever doctrine it is you are refering to?
No, it was a small business that never was on the stock exchange. I must say that as a small business, there is always more leeway, since it isn’t the shareholders who run the show and all the scrutiny that comes with it. When you are your own boss, you get to choose how things are done, and for me, that was taking into consideration that a fixed wage was useless considering the efforts and circumstances of some people. As I said earlier, I’m not the only one to have done it.
Generally, publicly held companies have the prime interest of their share holders and not the quality of the product, neither the value of the worker. If this weren’t the case, why are there so many faulty products out there? 20 years ago, a fridge would last a lifetime, now the best fridge won’t last a few years before it begins to manifest some problems. The same can be said of cars and all electronics, yet aren’t we supposed to be advancing in technology? The problems you described are evident in public companies, because the priorities are not balanced effeclively.
Isn’t it also questionable that profits are rising in many companies, yet workers who contributed to that growth receive no pay rise? If the Just wage is dependant upon the value of a worker, why doesn’t it increase in proportion to the productivity increase?
Do we expect Nike to advocate the Catholic social justice doctrine in China where the majority of it’s apparel are manufactured by workers that are payed $1?
And why all of a sudden are we facing so many economic crisis if it were not for human greed? That is exactly what the last two Pontificates have been clearly stating. The gap between rich and poor is expanding and all of that is a clear demonstration that in practice, there is no such thing as a Just wage.
Anyway, I think I’ve made my point. It is a good discussion, but I really hope that something good happens for the sake of the struggling families and individuals.
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markomalley
Guest
This is exactly the point.
Personally, I see a lot of what is wrong with current corporate America is as a direct result of the massive rise in institutional investors that occurred in the 1980s.
In the wake of the retirement scandals that occurred in that era, retirement schemes were expected, more and more, to be fully funded. Those retirement schemes then started to invest in the market. We also see the rise of the 401(k) during that same era, where individuals built their own retirement upon mutual funds managed by professional fund managers.
What happens? Investors are interested in returns, not in the performance of the companies in which they’ve invested. In fact, I would wager that the vast majority of investors do not even know which companies they partially own. I may own Vanguard, Fidelity, or Black Rock fund shares. Do I know for a fact which firms those funds have invested in? Chances are, no. I may own GNMA shares, but do I know which homes I have helped finance? No. Do I care? Chances are, no. I only care about the performance of the funds. And if performance doesn’t meet my desires, I divest from that fund and invest in one that performs to my liking.
The fund managers know that and they, in turn, are interested in seeing profit generated from the firms they invest in on behalf of that fund. And if a firm consistently fails to meet its earning targets, the fund manager will divest.
What happens then? Corporate managers, from the CEO down to any single profit center manager, are slaves to the quarterly earnings call. They MUST be concerned with meeting their targets, rather than being concerned with their people or the products/services that those people produce.
The problem is, while individual market timers will do that as well, institutional investors have far greater leverage because of the size of the blocs they control. While John Doe can divest individual shares quickly, his hundred shares won’t make any significant difference to a large corporation. On the other hand, Joe Blow the fund manager may control a million shares on behalf of Vanguard. A divestment of a million shares would make a huge difference.
Obviously, in this economic model, there is no choice for a public company to do anything but maximize profit so they can either meet or beat their earnings estimates on a consistent basis. And that is bad both for the individual worker and for the firm’s ability to make strategic moves that take more than a quarter or two to fully implement. That, right there, is one big reason why we see the off-shoring of our industrial base.
There are some who say “penalize those greedy so-and-so’s through taxation.” All that would do is simply increase costs to the consumer as the additional expenses of taxation get passed on.
Myself, I say that we need to take steps to get investment back into the hands of individuals, even rich ones, and out of the hands of the institutions. That would broaden the base of investment (and, in fact, would help to increase the actual ownership of private property with its privileges and responsibilities…which is, by the way, what the Church sees as the way to go)
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LumenGent
Guest
Yes, that is how it is. 
That is why even in the disparity of circumstances, it would be a safe assumption to make that what the Church has taught is a long away from being implemented in our working society. I always found that a just wage in a corporate world is hardly achievable when returns are the only factor in the equation.
That is why even in the disparity of circumstances, it would be a safe assumption to make that what the Church has taught is a long away from being implemented in our working society. I always found that a just wage in a corporate world is hardly achievable when returns are the only factor in the equation.
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markomalley
Guest
And the funny thing is that the big huge corporations that the “Occupiers” are protesting against are actually sizable financial backers of the politicians that the “Occupiers” favor.Yes, that is how it is.
That is why even in the disparity of circumstances, it would be a safe assumption to make that what the Church has taught is a long away from being implemented in our working society. I always found that a just wage in a corporate world is hardly achievable when returns are the only factor in the equation.
The “Occupiers” are silly enough that they don’t understand that large corporations don’t mind huge government regulation and, in fact, government control of production values. The large corporations have the resources to leverage the increased regulation to their advantage, squeezing out the little guy, while the increased government control means steady income and reliable earnings statements for large corporations.
For example, why else would the health insurance industry largely support the “Patient Protection and Affordable Care Act”? Or Big Pharma? Or Big Hospital? Funny that the only opposition for that act came from the doctors’ groups: the ones who represented the ham-and-egg doctors that run individual (or small partnership) practices – because those are the ones who are going to be hurt the most by the new law.
Pity the “occupiers” weren’t smart enough to see that at the time. Maybe they’ll wise up after the law goes fully in effect starting in 2014.
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LumenGent
Guest
Maybe the first step is to have a centrist party instead of the usual right or left as both don’t seem to uphold the balance that the Church seeks.
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markomalley
Guest
Personally, I’d like to see term limits constitutionally mandated (some states have tried imposing them on their representatives via statute and the statutes have been ruled unconstitutional).
The reason being that most backbenchers seem to go in with some sort of ideals (whether I agree with them or not, they still stand for something bigger than themselves). It seems like after not all that many years, they get sucked in by the power players and get corrupt, regardless of their party affiliation.
The creation of a centrist party would not change that culture of corruption. Developing a true “citizen Congress” would help minimize that. (Also, if a person realized that they would eventually have to go back and live with the laws they create, they’d create many different laws)
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