TIME: Almanac of the 20th Century

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<text> <title> (Nov. 08, 1990) Running Hard Just to Keep Up </title> <history> TIME--The Weekly Newsmagazine--1990 Nov. 08, 1990 Special Issue - Women:The Road Ahead </history> <article> <source>Time Magazine</source> <hdr> ON THE JOB, Page 54 Running Hard Just to Keep Up </hdr> <body> By Sylvia Ann Hewlett [The author is an economist, whose forthcoming book is When the Bough Breaks: The Cost of Neglecting Our Children.] Faster and faster they go, harder and harder they push, but like hamsters on a wheel, America's working families are stuck at the bottom. Clobbered on two fronts, they must work twice as hard to stay even. On the income side, wages have gone down while taxes have risen. On the expenditure side, living costs have soared. Homes, health insurance, college education--the basic ingredients of the American Dream--are increasingly out of reach. The crunch began with a dramatic falloff in earnings, particularly for blue-collar males. Between 1955 and 1973, the median wage of men leaped from $15,056 to $24,621. Then, quite suddenly, it started to drop. By 1987 the male wage, adjusted for inflation, was back down to $19,859, a 19% decline. To shore up family income, wives have flooded into the labor market, but their earning power is low. In 1988 the average family income was only 6% higher than in 1973, though almost twice as many wives were at work. In many households, one well-paid smokestack job with health insurance has been replaced by two service jobs without benefits. Burger King doesn't provide as well as Bethlehem Steel. Higher taxes have tightened the pinch. The acclaimed Reagan tax cuts of 1986, which reduced marginal income taxes, merely shifted the burden to Social Security taxes, which fall heavily on low- and middle-income families. These payroll taxes were jacked up 24% during the 1980s. The true marginal tax rate is now higher for a couple making $14,000 a year than it is for a couple making $326,000 a year! It doesn't help that over the past 25 years the cost of housing has jumped 56% and college tuitions have rocketed 87.9% in real dollars. Joseph Minarik, executive director of the congressional Joint Economic Committee estimates that the typical 30-year-old man buying a median-priced home in 1973 incurred carrying costs equal to 21% of his income. By 1987 this had risen to 40%. For the first time since World War II, home ownership among young families is declining. Complains Karen, a 26-year-old housewife in the Chicago area: "You either buy a home, both of you work and your kids suffer, or one of you works and you live in a rental. Paying rent feels like digging a hole and crawling right in." This squeeze on families bodes ill for children. Twelve million youngsters have no medical coverage; 5 million teeter on the edge of homelessness. Because of poor prenatal care, a baby born in the shadow of the White House is now more likely to die in the first year of life than a baby born in Costa Rica. But perhaps the resource in shortest supply to families is time together. The amount of "total contact time" between parents and children has dropped 40% over the past 25 years, says the Family Research Council in Washington. This is not good news. Researchers have uncovered ominous links between absentee parents and behavioral problems among children. A 1989 survey of 5,000 eighth-grade students in Southern California found, for instance, that latchkey children were twice as likely to use alcohol and drugs as were children supervised by adults after school. How can this situation be remedied? Corporations should be encouraged to design a family-friendly workplace that gives parents the gift of time. Several U.S. firms have shown that it can be cost-effective to create a more fluid work environment. Government could encourage this by granting tax breaks to companies that offer flexible hours, part-time work with benefits, job sharing, parental leave and home-based employment opportunities. To lighten the burden on working families, the tax system should be reconfigured so that relatively more is paid in income taxes and less in Social Security taxes. The government should also subsidize housing for a majority of young families with children. Rent vouchers in sufficient numbers would banish the specter of homelessness that haunts 10 million to 13 million low-income families. As for helping the middle class, the government should act as it did after World War II and offer low-interest mortgages to young families. Beginning in 1944, the Veterans Administration guaranteed 5 million home loans to ex-servicemen with no down payment required and a maximum interest rate of 4%. If something similar were done today, many more families could both buy a house and spend time with the kids. One Gallup poll shows that only 13% of working mothers want to work full time, although 52% of them do so. Often what keeps these mothers at work 40 hours a week is heavy mortgage payments. The U.S. can and should bend its public policies to free time and resources for families with children. With male wages sagging and the divorce rate at 50%, it's hard to spin out a scenario in which large numbers of women have the option of staying home full time. The trick is to spread the burden around. Employers and government both have to pull their weight. This critical task of building strong families can no longer be defined as a private endeavor, least of all a private female endeavor. No society can afford to forget that on the backs of its children ride the future prosperity and integrity of the nation. </body> </article> </text>