As Governor Calvo announces a new round of layoffs one must ask the questions:
WILL IT RAISE FAMILIES OUT OF POVERTY OR SINK MORE FAMILIES INTO IT? In order to reduce GovGuam’s budget by $43Million approximately 1,400 workers will lose their jobs. Without that income these families will more than likely sink into poverty forcing them onto to the ever growing roles of SNAP (food stamp). It will cause many of these families to lose their houses and cars and ruin their credit for years to come.
WILL IT IMPROVE OUR ECONOMY OR MAKE IT WORSE?
It will make it worse, a lot worse. Economists tell us that every dollar paid to a worker circulates in our economy 10 times which means that Guam’s business that cater to local customers (restaurants, movie theatres, clothing stores, cell phone and cable companies etc) will lose out on $430M a year in sales. This means that they will have to lay off workers due to the decline in business forcing more families into poverty.
WILL IT IMPROVE ANYBODY’S QUALITY OF LIFE?
Yes. People that own supermarkets will do ok. According to an email from Governor Calvo’s office the Federal Government gives Guam’s poor $66Million per year in SNAP benefits and by adding 1,400 families to SNAP Guam will receive an additional $6.4M per year which will be spent in Guam’s supermarkets. On top of this it will free up Public money that can then be shifted into private pockets by leasing new offices and building more outrageously expensive buildings like JFK the most expensive high school in the nation.
IS THERE ANY OTHER WAY TO BALANCE THE PUBLIC (GOVGUAM) BUDGET WITHOUT LAYING OFF WORKERS?
Of course, raise the minimum wage. Raising the minimum wage by $1/hour would generate an additional $770Million per year in Guam’s economy which would produce more than enough additional revenue to cover the $43Million shortfall with some extra left over that could be used to fund our public educational system and other underfunded public institutions.