Starvation wages

Last week I ate at a roadside Pupusa stand with three of my coworkers.

(Pupusas are a handmade dish, originating from El Salvador. They're basically thick tortillas stuffed with cheese, beans, or pork which are fried and then covered with tomato sauce and a spicy coleslaw topping. They're delicious, but fairly irrelevant to this story.)

Anyway... as we sat there, the Pepsi distributors arrived to restock the soda fridge. Then they started hanging price tags on the display bottles... Q4 each (about 53 U.S. cents). "Hey" I said, choking on a bit of cheese, "didn't the sodas cost Q3.50 yesterday?" My coworkers nodded in grave agreement.

Sadly, this one instance of inflation-in-action is by no means the exception. On the contrary, prices everywhere are skyrocketing. Even the pupusas shot from Q5 to Q5.50 each!

It's painfully obvious that the insane price of gasoline (roughly $3.50 per gallon here) is responsible for the cost of damn-near-everything taking a permanent hike upwards.

According to the National Statistics Institute (INE) the cost of the "canasta básica de alimentos" (the absolute minimum food items required for a typical family in Guatemala) has risen to Q1,440.40 or $190 per month. The "canasta básica vital" which includes food, goods, and services (such as health and education costs) that a family of five requires for subsistence costs Q2,628.40 or $345 per month.

Here's the kicker... minimum wage for city workers is Q1,190.00 ($156) per month, and for agricultural workers it's Q1,158.00 ($152).

You don't have to have a calculator handy to figure out that those numbers just don't add up. This is the mathematics of poverty... where the equations aren't hypothetical, but rather reflect the needs and struggles of men, women, and children.

The danger doesn't end at the family level. As the gap between income and the cost of survival grows, Guatemala tumbles ever nearer to the abyss of political instability and social explosion.

Even CACIF (an ultra-conservative business alliance that includes commercial, industrial, agricultural, and financial interests) recognizes this not-so-latent threat. For the first time in 15 years they are actually recommending that the government raise the minimum wage!

Their proposal of a 7-10% hike is clearly insufficient to bridge the gap, and is admittedly designed to head off a congressionally-mandated raise... but it is also a recognition that this is a crisis that urgently needs to be addressed.

A conclusion, sadly, that the Berger administration has yet to reach...

Tags: Guatemala, Minimum Wage, CACIF