Demos is a public policy organization working for an America where we all have an equal say in our democracy and an equal chance in our economy. Demos’ work is guided by three overarching commitments: Achieving true democracy by reducing the role of money in politics and guaranteeing the freedom to vote; Creating pathways to ensure a diverse, expanded middle class in a new, sustainable economy; and Transforming the public narrative to elevate the values of community and racial equity.

Jul 042013

Privatized public services fund low-wage work and fuel inequality: report.

by Amy Traub and Robert Hiltonsmith

Every day, Americans benefit from public structures that contribute to our quality of life. When we walk into a clean, well-maintained post office; drive on federal highways; send our kids to school knowing they’ll get a hot lunch; or call the Social Security benefits office with a question, we see our federal tax dollars at work, providing public services we rely on.

What most Americans don’t know is that many of the workers keeping our nation humming are paid low wages, earning barely enough to afford essentials like food, health care, utilities and rent. Through federal contracts and other funding, our tax dollars are fueling the low-wage economy and exacerbating inequality. Hundreds of billions of dollars in federal contracts, grants, loans, concession agreements and property leases go to private companies that pay low wages, provide few benefits, and offer employees little opportunity to work their way into the middle class. At the same time, many of these companies are providing their executives with exorbitant compensation.

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