If you work hard, you get ahead. That’s the American Dream in a nutshell — no matter what your race, color, creed or economic starting point, hard work will improve your life and increase your children’s opportunities. Yet, this widely held dream is out of reach for an increasing number of working Americans.

Roger Weisberg’s alarming and heart-wrenching new documentary, "Waging a Living," puts a human face on the growing economic squeeze that is forcing millions of workers into the ranks of the poor. Shot in the Northeast and California, the film profiles four very different Americans who work full-time but still can’t make ends meet. Despite their hard work and determination, these four find themselves, as one of them observes, "hustling backwards."

One in four American workers — more than 30 million people — are stuck in jobs that pay less than the federal poverty level for a family of four. (i) Housing costs, to name just one of several essential living expenses, have tripled since 1979, (ii) while real wages for male low-wage workers are actually less than they were 30 years ago. (iii) But the new face of the working poor is overwhelmingly that of a woman struggling to support her children. Only 37 percent of single mothers receive child support, and that support averages just $1,331 per year. (iv) Nearly a quarter of the country’s children now live below the poverty line. (v)

What do these numbers mean in human terms? What is it really like to work full-time and remain poor? "Waging a Living" provides a sobering answer. Filmed over three years, the documentary offers intimate profiles of four working Americans — Jean Reynolds, Jerry Longoria, Barbara Brooks, and Mary Venittelli — as they struggle to lift their families out of poverty.

Good-humored and strong-willed, Jean Reynolds is a 51-year-old certified nursing assistant in Keansburg, N.J., who supports three children, including her cancer-stricken eldest daughter, Bridget, and two of Bridget’s four children. She receives no help from her ex-husband. After 15 years working at the same nursing home, providing care to the infirm and dying, Jean earns the maximum wage the home pays — $11 per hour. Without health insurance, Jean is losing the battle to cover her daughter’s medical bills and her own everyday household expenses. It isn’t the life she was born into, and Jean grieves that she can’t give her children what her parents gave her. Ironically, Jean leads a successful drive for wage increases that do not ultimately benefit her; she’s already at "the max." So when she is forced to take emergency custody of Bridget’s two other children, her situation becomes dire. Evicted from her home, with seven dependents in tow, Jean desperately turns to public assistance for the first time in her life and receives emergency aid. As grateful as she is, Jean knows all too well that the reprieve is only temporary.

Jerry Longoria is a 42-year-old security guard, whose $12 hourly wage barely covers the basics, including a tiny room in an SRO hotel in a blighted San Francisco neighborhood. A recovering alcoholic and drug addict, now four years sober, Jerry is nothing if not a dreamer. He dreams of finding better work, meeting someone special and finding a decent place to live. Although he manages to make child support payments every month, his fondest dream is to see his children in North Carolina after a nine-year absence. Jerry also jumps into union activism, speaking at rallies and meetings in support of a successful campaign for regular, yet modest, pay increases and health benefits for the city’s security guards. With remarkable discipline, Jerry saves enough money to travel cross-country for a warm reunion with his children, but when he returns home, he loses his job after an argument with his boss. He finds another job, but at lower pay, and laments that it will take eight years just to get back to the salary he used to earn.

Barbara Brooks is a 36-year-old single mother of five living in Freeport, N.Y. Her story most graphically illustrates the hazards of what she calls "hustling backwards." Barbara, raised in abusive and homes, is poised and determined. In "Waging a Living," she’s in a grueling struggle to balance her responsibilities as a mother, full-time worker and student. As a counselor at a juvenile detention facility where she herself was placed as a teenager, she earns $8.25 per hour and relies on a range of government services to make ends meet. Barbara dreams of a better life, which is why she continues her education despite the almost unbearable demands it places on her. The first blow comes when a favorable job evaluation brings her a promotion to $11 per hour, but the additional $450 she earns each month will cost her $600 a month in lost government aid. Though being off government assistance is part of her dream, she is falling behind financially even as she succeeds at work. More determined than ever to find the answer in education, Barbara earns her associate’s degree and gets a $15-an-hour job as a recreational therapist at a nearby nursing home. But, once again, she finds her income gains are wiped out by the elimination of government benefits. Unable to support her family on her new salary, she returns to a grueling work-and-school schedule, this time to earn a bachelor’s degree.

A 41-year-old single mother of three living in southern New Jersey, Mary Venittelli once led a comfortable middle-class life until it was derailed by a bitter divorce. When Mary re-enters the workforce, the only job she finds is a waitress position paying $2.13 per hour plus tips. In her own version of "hustling backwards," Mary must now hire babysitters who eat up a major portion of her earnings. There are nights she comes home with $30 in tips and owes the sitter $28. Without financial help from her husband while the divorce is being settled, she relies on local food pantries to feed her family, borrows money from friends and runs up $15,000 in credit card debt. She loses her car and is in danger of losing her home. She also sees the impact the situation is having on her children, especially her son Quinn, who begins throwing violent tantrums. At the last possible moment, a divorce settlement and a new relationship help prevent Mary and her kids from joining the ranks of the working homeless. But Mary, having experienced how easily the coin of middle-class life can flip, is determined to rely on herself to secure her future. She returns to school to acquire new computer skills.

"In making ‘Waging a Living,’ I wanted viewers to understand what it’s like to work hard, play by the rule and still not be able to support a family," says producer/director Roger Weisberg. "It’s easy to take for granted the janitors and security guards in the offices where we work, the waiters and bus boys in the restaurants where we eat, and the nurses and caregivers in the facilities where we place our children and elderly. I wanted to bring viewers inside the daily grind of the nameless people we encounter every day who struggle to survive from paycheck to paycheck."

"My goal," he concludes, "was to get people to take a new look at the prevailing American myth that hard work alone can overcome poverty."

"Waging a Living" is a production of Public Policy Productions in association with Thirteen/WNET New York, with funding provided by the Annie E. Casey Foundation, Ford Foundation, David and Lucile Packard Foundation, and the Corporation for Public Broadcasting (CPB).

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(i) Thirty million Americans make less than $8.70 an hour, the official US poverty level for a family of four. Source: Business Week, May 31, 2004 p.61. Authors relied on Economic Policy Institute and the Census Bureau for their statistics.

(ii) Housing costs have tripled since 1979. Source: Kaufman, Leslie. "Surge in Homeless Families Sets Off Debate on Cause." National Report, The New York Times, Tuesday, June 29, 2004. Statistics from Economic Policy Institute.

Mortgage payments, percent change graph (for families with children): increase 282 percent btw.1978-2001. Source: "Working Families with Children: A Closer Look at Homeownership Trends" by Center for Housing Policy, May 2004, p.5 graph.

Annual new home prices: 1980: $64,600 2003: $195,000. Source: National Association of Home Builders, "Annual New Home Prices, 1980-2003" www.nahb.org.

Annual existing single family home prices: 1989: $89,500 2003: $170,000. Source: National Association of Home Builders, "Annual Existing Single Family Home Prices, 1989-2003" www.nahb.org.

(iii) Real hourly wages for male workers in the bottom quintile: 1973 = $9.70; 2003 = $9.22. There has been a decrease of 4.95 percent, or 5 percent. Source: Conlin, Michelle and Aaron Bernstein. "Cover Story: Working and the Poor," Business Week. May 31, 2004. Statistics from the Economic Policy Institute.

(iv) In 1997, only 37 percent of custodial mothers received child support from nonresident fathers, and the amounts they received were small, averaging only $1,331 for the entire year (Lerman and Sorensen 2001). Source: Johnson, Richard and Melissa Favreault "Economic Status in Later Life among Women who Raised Children Outside of Marriage," The Urban Institute, February 2004, p. 4.

(v) Number of low-wage workers: 28,280,343; Total number of workers: 116,288,910. Source: The State of Working America, Table 5.12: Characteristics of low-wage workers, 2003. Economic Policy Institute.

PBS

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This week brings us the release of several important economic releases for the bond market to watch. This will also be a shortened week in the bond market as a result of the Labor Day holiday next Monday. There are seven reports along with the minutes from the last FOMC meeting between tomorrow and Friday. This makes it quite likely that we will see a fair amo unt of volatility in the financial markets this week.

Tuesday brings us the first piece of data for the markets to digest. The Conference Board will post this month’s Consumer Confidence Index (CCI) at 10:00 AM. This index measures consumer willingness to spend, which is important because consumer spending makes up two thirds of the U.S. economy. A decline would indicate that consumers may not be making large purchases in the immediate future. That sign of economic weakness should drive bond prices higher, leading to lower mortgage rates Tuesday. It is expected to show a reading of 103.7, which would be lower than July’s 106.5.

Also worth noting about Tuesday is the release of the minutes from the last FOMC meeting. There is a pretty good possibility of the markets reacting to them following their 2:00 PM ET release, especially if they show some divisiveness by its members. It is already known that at least one member voted for another rate increase when the majority voted to not change rates at the last meeting. It will be interesting to see some of the Fed member’s views on the economy and inflation.

Wednesday’s only data is the first revision to the 2nd Quarter Gross Domestic Product (GDP). Last month’s preliminary reading revealed a 2.5 % pace, which was well below analysts’ forecasts. A downward revision should help lower mortgage rates Wednesday. However, an upward revision above the current forecast of 3.0% could lead to higher mortgage rates Wednesday. There will be a final revision issued next month, but it probably will have little impact on mortgage rates.

Thursday is another multi-release day with the release of July’s Personal Income and Outlays and Factory Orders The income and spending data measures consumer ability to spend and current spending habits. It is expected to show an increase of 0.5% in income and a 0.8% increase in spending. Weaker than expected numbers would be good news for t he bond market and mortgage rates.

The second report of the day is July’s Factory Orders data. This report measures manufacturing sector strength and is similar to last week’s Durable Goods Orders, but includes orders for both durable and non-durable goods. This data is expected to show a 0.5% increase in new orders. A smaller than expected rise should lead to lower mortgage rates Thursday, especially if the income and spending report reveals weaker than expected readings.

Friday is going to be a doosy of a day. There are three reports scheduled for release but two of them are highly important to the bond market and mortgage rates. The first is the most important of the three. The Labor Department will post the unemployment rate, number of new jobs added or lost and average hourly earnings for August early Friday morning. The ideal scenario for the bond market and mortgage rates is rising unemployment, a smaller than expected rise in new payrolls an d earnings to remain unchanged. If we are that fortunate, I expect to see mortgage rates drop considerably Friday morning. Analysts are expecting to see the unemployment rate slip back to 4.7% and 125,000 new jobs added.

August’s revision to the University of Michigan Index of Consumer Sentiment is also due Friday morning. It gives us a measurement of consumer willingness to spend. It is expected to show an increase from August’s preliminary reading of 78.7. If it revises lower, consumers were less confident about their personal financial situations than previously thought. This would be good news for the bond market and mortgage rates.

The Institute for Supply Management (ISM) will post their manufacturing index at 10:00 AM ET. This index measures manufacturer sentiment and is expected to show a small increase from last month’s reading of 54.7. A reading above 50 means that more surveyed manufacturers felt business improved during the month than those who felt it worsened. A larger increase in the index would probably cause a rally in the stock markets and lead to mortgage rates rising Thursday, while a reading below 55.0 should lead to lower rates.

Overall, it is a shortened week but probably will be a very busy week. The bond market is expected to close at 2:00 PM ET Friday ahead of the Monday holiday. We will likely see the most activity in rates Friday morning, but Tuesday and Thursday are also important. If we manage to get weaker than expected results in the CCI, Employment and ISM reports, we should see mortgage rates close the week lower than tomorrow’s opening levels.

If I were considering financing/refinancing a home, I would…. Lock if my closing was taking place within 7 days… Float if my closing was taking place between 8 and 20 days… Float if my closing was taking place between 21 and 60 days… Float if my closing was taking place over 60 days from now… This is only my opinion of what I would do if I were financing a home. It is only an opinion and cannot be guaranteed to be in the best interest of all/any other borrowers.

a la mode

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