Signals of Coming Disruption

Big change doesn’t just click on. It occurs over time, starting out often as weak signals of the change to come. Sometimes it’s like the old frog in the boiling water story. Put the frog in when the water is cool and turn up the flame and eventually the frog realizes its plight, just too late to adjust, to escape.

For years, donor giving has been changing. Charities have become increasingly dependent on larger gifts from fewer donors. As the economy has served to increase the income and wealth gap between the small numbers of wealthy and the rest of everyone else, we have seen food bank use escalate and a growing number of workers living pay check to pay check. Job security is no longer a reasonable expectation for a growing number of people, much less the chance for advancement. Employee supported pensions are no longer the norm and health and dental benefits are harder to come by for low income workers and many who do not yet qualify as “low income” workforce members.

imagenoise_signalmlab2The adaptations charities have taken have been focused on how to grow revenues through different sources of revenues. Funders are looking at alternatives too, given their inability to fund all the good things that come their way. Crowdfunding, social enterprise, impact investing, social purpose businesses are among the more recent options in financing social good.

GDP growth has been slowing, 80% of Canadian incomes are not increasing or if they are, at far less a rate, the restructuring of the job market is creating more insecure and benefit-less employment. the ratio of workers to seniors is dramatically decreasing. Key drivers like oil prices are in turmoil. Consumer debt keeps increasing. The numbers of people making $15 or less are growing as businesses work harder to cut back on expenses in order to feed more profits to investors. Continue reading

What’s wrong? People are suffering.

I never understood “don’t shoot the messenger” as the stereotypical retort the messenger must use to defend her delivery of a message. Maybe we need a new cultural utterance like “You know how the messenger shoots those who don’t listen.”

Sometimes the message is actually a question, albeit unsettling in that the inquiry is unanticipated or more often, unwanted. We tend to prefer questions we can answer from our current inventory of answers. It allows us comfort and stability.

Even when we craft something new or design an innovation, all too often we end up creating newly painted replicas of what we say we are changing.

Nevertheless, the human condition is not a singular reality. It is rife with influences and contradictions and the unexpected.  This is why our affinity for comfort often rules the day. Truly changing what we do invariable means changing how we think and how we behave.

Remember that old story about the frog and the boiling pot of water. If you throw the frog in he will jump out, but if you put the frog in cold water and then turn on the flame, he won’t realize his fate until it is too late. To maintain our stasis, our comfort, we have the ability to adjust our comfort zone to small changes, but if we wait too long, we may face a challenge we can no longer meet.

In that story, we are the frog and the water is the environment we have created and that, if we are honest, we want to simultaneously change and sustain. Change is good until it enters our room, enters our space and says, “Your turn.”

There are thousands of people devoted to ending poverty and homelessness. As much as has been accomplished, each day more people show up in need of — and deserving of — a better life than they are living.

Too many people live in poverty. And there are many more living pay day to pay day, existing on the edges of poverty and homelessness. Living on the edge of disaster and the spiral down to despair that tends to grab hold of the vulnerable.

Too many jobs are insecure, pay less than a person requires to live on, and offer no benefits, nothing for the health and wellness of their employees. I know. Some businesses can’t afford benefits or living wages, but there are many who can afford it, but choose not to.

There are so many social programs in our communities taking care of poverty for the rest of us. They feed the hungry, give away clothes, and let the homeless hangout in drop in centres. We need them. There are so many people who need these programs. It’s sad, don’t you think?

It makes me mad sometimes.

Not just about all the bad things we have done in the past to the disenfranchised. But also about right now and how we – I mean all of us – choose to not do enough to end the suffering.

I am not saying we don’t do a lot. I am saying we don’t do enough. You see, the problem looms so much larger than our current efforts can address. This vast divide between problems and their solutions is not going to be addressed by funding reform, logic models, more collaborations, or even world class innovations.

Collective Impact initiatives (i.e. large scale community collaborations) may have promise, but not if we bring the same old  mindset to the common table.

I believe we have to turn the tables when it comes to addressing the deprivation and suffering experienced by so many people in our communities. We tend to refer to such things as “social problems” and then we use terms like that so frequently, they become generic representations of something vague and elusive. Now what exactly what was it anyway we were trying to fix?

People are suffering.

They are next door, around the block, standing behind you at the pharmacy. They go to school with your kids. They wear the clothes you gave away. They are co-workers. They sit on park benches. Everywhere.

People are suffering, everywhere.

I know it sounds melodramatic to use words like “suffering.” We prefer words that are not so provocative, and of course easier to accept. It’s much easier to talk about issues and problems and gather around terms like “social inclusion,” “best practice,” and “developmental evaluation.”

People are suffering.

The hungry girl in school trying to stay awake is suffering.

The old man having delusions on the street corner is suffering.

The mother with two young children beaten by her husband is suffering.

Being unable to buy your child medications causes suffering.

The drunk man begging for quarters outside the 7-11 is suffering.

The teen-age girl raped by her father is suffering.

Those who live daily with racism and discrimination are suffering.

This is not just about poverty as defined as a lack of money or as a social problem  costing society billions of dollars. It’s not just that the homeless guy flying on crack is a pain when he swears a blue streak at us as we walk by. It’s not just about the unpleasant aesthetics of ragged clothes, grocery carts full of cans and bottles, and vomit in the middle of the sidewalk.

It’s about human beings being deprived of their humanity.

And that’s wrong.

It’s wrong that so many people in our community are suffering.

It’s not just wrong for them; it is wrong for all of us.

Before we label all of this as a complex social problem, let’s start with it’s wrong.

It’s wrong.

And we are all a part of why it’s wrong.

Until we accept that, all of our plans and programs, all of our collaborative designs, all of our policy reforms, all of our actions, no matter how deeply we believe in them, will keep us from fixing what is wrong.

 

 

What does “living” mean in a Living Wage?

The Edmonton Social Planning Council just published research that indicates the living wage in Edmonton should be $17.36 per hour for a two-parent family with young children and both parents working 35 hours per week. The monthly budget prepared for this sample family assumes both workers are making $17.36 per hour.

Before going further, setting a living wage is a complex undertaking. No matter what number the Council came up with, people can quibble. It’s easier to pick at the budget the Council did for the family or point at suppositions that unduly biased the formation of a recommended number.

There are two major qualifiers to the recommended living wage. First, the monthoneofthekeyly budget for this family is a “conservative estimate,” according the Council. I agree but add that sometimes there are budget lines that seem to be more barebones than conservative (e.g. health and dental costs, school fees, to name two). Also, as the report notes, certain expenses were not included in the development of the family’s budget: debt payments, savings for the children’s education, retirement savings, any type of vacation (no matter how frugal), and it seems very little to support family recreational activities.

One might quibble about recreational expenses being included, although one of the fundamental principles of setting a living wage is to factor in the costs of “belonging” or what jargon-heads like me call “social inclusion.”

That said, how realistic is it to assume people who need a living wage have no debt and why would saving for retirement or for the education of children be viewed as unessential to “living?”

My remarks are not criticisms of the Council’s research, which as usual, is very well done. The authors used respected sources and produced a living wage recommendation based on accepted methods of doing so. By being consistent with how other provinces and cities are determining their living wages, the Council is able to provide a local version of a living wage based on best practice.

However, I am questioning the presuppositions of the research that allow best practice to ignore debt, education for children, and retirement as legitimate “living” expenses. Sometimes I wonder if we actually see a living wage through a welfare lens. That lens would have us ensure that recipients of welfare type programs don’t live large off the public purse. Typically that sentiment results in income security benefits being too low and in some cases so low the benefit is more akin to punishment than resembling anything close to “security.”

A living wage is not a welfare program. It should be based on what it costs to live a reasonable quality of life. A living wage should allow parents to invest in the future of their children. If people don’t save for retirement, they will cost society more later on. Shouldn’t a living wage be about now and tomorrow?

The other big question we may wish to consider is this: the recommended $17.36 per hour living wage is actually a subsidized living wage for a family of four. That family would require $1,100 per month in government transfer payments and child care subsidies to break even each month. To pay their own way completely, these two parents would have to average roughly $21.00 per hour each to live without any subsidies or transfers.

Oh yes, the question: which is the real living wage? $17.36? Or $21.00?

The lower of the two wages results in the family costing the “system” $13,000 plus per year. At $21.00 they would be paying taxes of about $10,000. That’s quite the turn around.

I am a proponent of government transfer payments and subsidies for child care, but believing these are needed programs does not mean we shouldn’t wonder about when they should and should not be deployed. It can’t just be carte blanche and on the flip side the answer isn’t to abolish them. Also, we should look into who benefits from the transfers and subsidies. I suggest it is not only the two parents in the above example.

Let’s face it. The living wage “debate” is contentious. Businesses that pay low wages are generally against raising the minimum wage in Alberta to $15.00, much less consider paying a true living wage. One argument is that businesses will have to raise prices to maintain their operations and that consumers will have to pay for the increase anyway or that jobs will be lost.

Another argument is that low costs drive profits which fuel the economy and benefit everyone. It’s one of the most common arguments for maintaining poverty wages. I have to say the argument looks good on paper, but lacks sufficient proof to become an incontrovertible economic principle.

There is a host of data that indicates the economy is working far better for those already making good incomes and hardly at all for the majority of citizens. I think it is reasonable to expect the economy to work for the majority; that doesn’t mean we all make the same thing. But consider the following data from the report or other sources:

  • Just over 100,000 Edmontonians are considered to be living in poverty, based on 2012 data.
  • Three in five of Alberta children living in poverty are from families in which one or both parents are working. That’s the highest rate in at least 20 years.
  • 20% of employed Edmontonians (124,000) earned less than $15 per hour in 2011.
  • Various studies indicate that approximately half of wage earners in Canada are living pay day to pay day and are vulnerable to losing their home if a disaster hit their families (Source: Canadian Payroll Association). In Edmonton, that would be up to 350,000 workers.

These four data points indicate that the economy is not benefiting the majority of citizens, but there is one more piece of data that further drives this home. As noted on page four of the report, “income inequality in Edmonton Census Metropolitan Area (CMA) is growing in line with provincial and national trends. Between 1982 and 2012, the bottom 50% of tax filers saw a 3.3% increase in their real median incomes compared to a 50% increase for the top 1% and a 137% increase for the top 0.1% of the population (Statistics Canada, 2014a).”

profoitsbynatureThere are many obstacles in the way of ending poverty, which means there is no single solution that we can all rally behind. We are fond of saying poverty is a complex problem and it’s true, but complex problems ride on top of diverse perspectives, values, and biases. Agreeing that the problem is complex is fairly easy to do but agreeing on the complexity of solutions is quite another thing.

We end up in polarizing arguments across sectors that disallow sufficient transformational thinking while deepening the ideological divide among sectors, political parties, and community leaders.

Not all social problems are connected to economics, but most are. One of the basic economic principles I think we should talk about is that the economy should work for the majority. If it doesn’t – and admittedly that’s my assessment – then don’t we need to look at how our economy is structured, how workers are treated, and how we can also grow profits to fuel growth and equitable benefits for everyone?

As mentioned before, the proposed living wage of $17.36 is actually a subsidized living wage. It’s easy to identify how the government transfer payments and child care subsidies help families make ends meet. But don’t the subsidy/transfer arrangements also benefit employers and in particular businesses that earn big profits?

I saw a tweet a bit ago from a business leader who said something like “businesses set prices to achieve the highest ROI.” If that’s a fundamental position of business leaders, then wages become a cost centre more than an investment in people and the general feeling about costs is to keep them as low as possible.

And if the desire for the highest ROI means that wages are kept so low to help produce higher and higher profits, don’t the subsidies received by our two parent family also subsidize the costs of business operations?

I understand that many businesses cannot pay a $21 per hour living wage. No doubt some would go out of business; others would scrape by instead of producing a reasonable profit. Special interest groups like Chambers of Commerce will say it isn’t fair to do that to businesses.

But… is it fair that tax payers pick up the difference?

Again, many of the same special interest groups decry raising taxes, especially corporate taxes.

These two positions seem incongruent to me. In an economy that is growing wealth for the wealthy and relying on subsidies and transfer payments to top up wages that are inadequate for workers to live on, who is supposed to pay for that?

One of the key questions in the living wage debate should be at what point are tax payers subsidizing insufficient wages paid by profitable businesses? And once we understand what that point is, how do we feel about that?

There is a lot of data that indicates a strong correlation between social and health problems and the growing income gap across the world and in our country. Generally speaking the greater the divide the more we see persons of low income imprisoned. Health problems, including mental health issues, increase as does social isolation. None of these things are good for the economy, are they?

If our community is serious about ending poverty – and I do believe a growing number of people across all sectors are serious about it — we won’t accomplish this noble goal without questioning and changing our perceptions and values around terms like “healthy economy,” “profits,” and “return on investment.”

The challenge is not to create equal income across the population. There will always be those who benefit more from the economy than others. In fact, we need income variances in order to fuel economic growth. The more risk one takes, the higher the rewards should be. The question is how far is too far in terms of the growing income gap in our country and across the globe?

What do we believe an economy should look like that has equitable benefits to all citizens?

I have worked for years in the human services sector and my primary focus has been on serving the poor and the homeless. On occasion over the course of my career I have experienced people who point to food bank users driving away with their hamper in a late model vehicle. Some tell stories of people on welfare driving the proverbial Cadillac. These stories are invariably used to demonstrate that the poor are not really poor and worse, they are something akin to a gold digger.

The inference is tax payers shouldn’t have to subsidize that kind of expenditure. And to be honest I agree with them, though their outrage is sourced in a very, very small minority of “poor” people.

whatdowebelieveThere is a flip side to such simplistic analysis. Why is it we don’t wonder why tax payers should subsidize workers so that CEOs and business owners can pay workers the minimum possible while driving their Mercedes to their mountain cabin?

Please understand I am not pitching that the for-profit sector is nefarious or driven primarily by greed or a lack of concern for employees. But I am trying to offer some balance to many voices that cite gloom and doom at a $15 per hour minimum wage, which I assume will only resound much louder at the living wage proposal of $17.36.

Poverty is not just a social problem or the result of personal defects. It is very much an economic problem and if we don’t address that in significant ways, let’s stop thinking we can end poverty through more collaboration and collective impact initiatives and leave the economy as it is.

But also let’s stop thinking that an economy that increasingly benefits a few will be sustainable. There is a tipping point and I think we all would be better served to avoid it.

bus

Why Not Free Public Transit? (Updated)

The first posting was in March 2014. Time for an update.

The first posting was in March 2014. Time for an update.

Update Introduction: This is the first time in my long career in the non profit sector that I actually believe a Task Force will make a big difference. I am talking about the Mayor of Edmonton’s Task Force to Eliminate Poverty. Because of Mayor Iveson’s consistent leadership and voice on this matter and because of the integrity he brings to his office, I hope to be walking along side of him and many others to do exactly that: end poverty. I mention this because I am taking a position on free public transporation that is not shared by other bright minds who sit on the task force with me. 

I believe to take a position one must be certain enough of one’s rationale to do so while also being open to being wrong. Maybe I am wrong. But right now, I don’t think anyone is really looking at free public transportation as a real possibility. That’s really my purpose here: to create more interest and momentum in looking into this before we just write it off. 

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What would it take to make public transit a universal benefit to Edmontonians?  The cost of a bus or train ride or a monthly pass has become an obstacle for too many people and families.  If you are making the minimum wage in Alberta, a monthly pass, currently $89.00, is more than a day’s pay.

Reality Check
Imagine if that worker had two kids and a spouse who needed monthly passes. Each adult pays $89.00 and each child pays $69.00 for a grand total of $316.00. At the minimum wage of $9.95 per hour, it would take one of the earners in that family spending a week’s wages for the monthly cost of the family using public transit.

With more than 100,000 people living in poverty in Edmonton and an even larger number living pay check to pay check, we cannot allow public transportation to become a barrier to employment, health care, shopping for basic needs, and participating in community life. Continue reading

Premier Prentice – My Two Cents about the Budget

UPDATE… at the request of the Edmonton Journal, I rewrote the piece below and the EJ published it HERE.

Dear Premier Prentice:

We met west of Edmonton at a BBQ when you were campaigning for your position. I appreciated your speech and remember thinking you could be a strong Premier and move our Province forward in a variety of ways. I am sure you weren’t all that happy that shortly after winning the post you faced plummeting oil prices and the prospect of $7 billion or so in lost revenue.

I imagine you have a few voices offering up their advice about what to do now. I filled out your online form about the budget. I hope many, many other Albertans did, too. At the risk of being one more voice amongst the din of thousands, here’s mine, written from the perspective of a boomer who has held numerous leadership positions in the community sector as well as operated a couple of businesses. I will try to be as concise as possible.

We have a revenue problem
I would suggest that the loss of $7 billion in revenue represents a revenue problem, not an expenditure problem. It’s a structural problem in our economy – too much dependency on oil. Markets can be volatile and cyclical; we need a more diverse and optimally reliable revenue mix. I know you know that, but I encourage you to do more than release an annual budget. We need a long-term plan that doesn’t allow for a knee-jerk reaction to our revenue issue to rule the day in year one of that plan.

The economy should work for the majority
Please keep in mind that during the boom times, the good times in Alberta, the poor and disenfranchised typically do not benefit, if at all, to the degree of folks like you and me do. The steady rise in the wealth gap provincially, nationally, and around the world indicates that no matter the ups and downs in the economy, it is most often true that those who have wealth continue to grow wealth and those who lack income remain, at best, stagnant. Those in deep poverty are actually worse off than they were a decade ago. This suggests to me that we need leadership that ensures those who are the worst off in our Province should not be pushed further away from what little hope they have of experiencing the Alberta Advantage.

It’s time to raise some taxes and fees
I imagine you know that the Government could raise taxes to generate an additional $8 to $10 billion in revenue and still legitimately claim that Alberta is the lowest tax Province in Canada. That just tells us how much lower we are taxed now.

No one hugs the tax man, but all of us want to benefit from living in Alberta. I hear a sales tax is off the table. Maybe you are right about that, I don’t really know for sure. That said, in Canada, corporate taxes have decreased markedly over the years while personal income tax has not decreased at all. Do you think this requires some review, perhaps a rethink on what corporate social responsibility should be in terms of paying taxes? Corporations create wealth and the wealthy are growing income and assets consistently and significantly.

It’s good to hear that you are concerned about the flat tax we have currently which hurts lower income workers. A progressive tax will help with the revenue problem and lessen the tax burden on those who need every dime they earn to have a decent living.

Isn’t it time to rethink Alberta Health Care fees? We lost $2 billion in revenues when that fee was eliminated. I would think it mostly helped employers because that benefit was typically paid in full or partially by businesses and organizations. It seems to me that it was about that time when our health care system became over-stressed due to a shortage in doctors, and incredibly long waits in emergency wards. There’s some fixing there we need to do.

Public Education needs more support, not less
Teachers are coming out of a three year freeze on their wages. That’s a long time to stay flat as housing, food, clothing and other costs continue to rise. I am not sure we can blame teachers for the looming deficit. Not only do we need to address the wage challenge here, but my sense is some promises made by the Government have not been fulfilled. For example, classrooms now are integrated which means special needs students included as full members in the general student population.

It’s a good thing, but unfortunately this principle of integration has not been supported by the funds required to support teachers in a class room of 35 (which is too big a number) that might have a blind student, a disabled student, three students with learning disabilities and several who don’t speak English. Without the resources, it’s not really integration; it’s more of a gathering of students that teachers must do their best to educate. And by the way, each year our public school teachers spend between $500 and $2500 of their own wages on classroom supplies because our school system has no money to stock classrooms with the basics. Can you imagine the outrage if business forced their employees to spend that amount of their hard earned money on office supplies? Everyone knows this is happening. Time to do something about that.

Don’t abandon the poverty elimination strategy and the ten year plan to end homelessness
The ten-year plan is working and its existence is a prime example of a caring government. If anything, we need a renewed commitment, not the dissipation over time of this incredible and important initiative. We need to end poverty, Mr. Premier. Poverty is wrong and we need to set things right. Hundreds of thousands of citizens are living poor and data suggests that nearly half of the population is living pay cheque to pay cheque. We need a government that pays attention to that because if the economic vulnerability of so many people continues to grow and deepen, we will face decreased consumer spending, impacts on tax revenues, and social unrest.  I know it’s hard right now, but now more than ever is when we need leadership that speaks clearly and boldly about ending poverty for so many Albertans: Aboriginal people, newcomers, youth, single parents, the disabled, the mentally-ill, and the growing number of working poor.

Be careful about what you do to the non-profit sector
Yes, I have a vested interested, given where I work, but please think about this: non-profit organizations are structurally underfunded by governments as well as nearly all community based funders. This means that non-profit employees are paid substantially less than the comparable staff employed by the government and most of the time they receive no pension or RRSP benefits. It’s not that they are not worth the money because often your government departments recruit my staff away and offer them much higher wages. Often these are the same departments that fund our human service contracts and insist on inadequate funding levels. It is often the case that long-term non-profit workers end up retiring into poverty. It’s ironic, don’t you think?

If you cut 9% or 10% to human service agencies doing contract work with you, you are in effect cutting back on contract funds that frankly do not pay the full cost of the contract and haven’t for years. So please be careful because deep cuts here – and for some any cuts at all – will not only harm more low paid workers but will result in less support for those Albertans that need it the most.

I know. No matter what you do, you will be vilified and praised and everything in between. You won’t please everyone and frankly how could you? I am just asking you to consider the above points and then do what you believe is fair and just as you move forward with your budget.

Thanks for listening.

Mark