The holiday season gets to me. I become awash in the noble thoughts of good will to all. I look in on the merriment at the Cratchit family, remembering that this is but one of many households not favorably endowed. And I wonder, what would it take to spread the cheer of the season to the entire population for a full year?

In 2024, of American workers 16 years and older, with earnings (income from work), half of them enjoyed less than, and half more than $46,949 for the year. More fortunate were those who worked full-time, year-round with median earnings of $61,583.

Many who study income and poverty seem to agree that $60,000 a year is about the amount needed to support a family of four in most places today. The problem is that 36% of full-time, year round workers make less than $50,000, and 39% make over $75,000.

What if employers decided to adjust matters themselves? Voluntarily. Without any minimum wage legislation. Without any intervention by government, private employers would choose to end poverty. It’s a dream, but not inconceivable when the fever of self-interest in America declines.

What would it take? Increase the earnings of those 44.6 million workers under $50,000 annually by decreasing the earnings of 30.5 million who earn $100,000 or more per year.

This might raise some prices while lowering others. For example, used car prices might rise as those now driving unsafe vehicles might get better used cars; however luxury vehicles might take a cut in demand and lower the prices of new cars.

Currently, I estimate those with earnings of $100,000 or more enjoy 44% of all earnings; that would be reduced to 37%.

If the Indiana rule applied, equal percentages of sacrifice, it would mean the folks earning a million dollars would give up $70,000 and those at the $100,000 level would be cut back by $7,000.

Why should we do this? Because low wages reduce spending on health measures such as rent for housing in structures with good insulation. These home are better for students in winter and summer.

Because low wages make two jobs necessary, denying children the benefits of fulltime parents while denying parents the joys and lessons of parenting.

Because low wages destroy economic dignity.

Good housing and good parenting contribute to more success for children. That can reduce crime, improve learning, and provide us all with a more civil and prosperous society.

To the extent we can reduce the punitive and other services currently absorbing taxes, we can increase the productivity of the work force and increase tax revenues. We’d all be better off.

But isn’t this contrary to economic reality? Why would firms raise the earnings of the less productive and reduce the earnings of the more productive?

Perhaps our calculus is wrong.

It may be that those we judge to be less productive are worth more than they are currently paid. It may be the person who collects the garbage provides more value than the resident who puts that garbage to the curb. We may be suffering from a cultural misalignment of values.
Morton J. Marcus is an economist formerly with the Kelley School of Business at Indiana University. His column appears in Indiana newspapers, and his views can be followed his podcast.

© 2025 Morton J. Marcus

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