The High cost of living in the Third World

The High cost of living in the Third World market

by

Serve the People

(llco.org)

Comrade Serve the People wrote these words in response to a First Worldist who claimed, without evidence, that the difference in wages between the US and Ghana was due to the difference in cost of living. As Comrade Serve the People shows, the cost of living in Ghana, and the Third World more generally, is actually high and cannot possibly justify the low wages paid there. First World countries live at the expense of the Third World; they eat the flesh and suck the blood of the Third World masses.

When this article was written, the minimum wage in the US was $5.15 per hour. As of 2011, it is $7.25 per hour. Many US states set the minimum wage even higher, as high as $8.67 per hour. The following slightly edited text was originally published by Serve the People on Dec 02, 2005:

Well, all right, let’s look at the cost of living in Ghana. Here’s a list of prices (a month or two old) in cedis:

http://www.ghanaweb.com/GhanaHomePage/economy/market.prices.php

Some of these prices are hard to use because they are in vague units such as “bag” or “large basket,” and many prices are missing. Also, some of the commodities are Ghanaian things that I’ve never even heard of. Still, we have some useful data. I’ve converted them to U.S. dollars using the current rate of 1000 cedis = $0.11.

First of all, the minimum wage is 13,500 cedis per day. That’s US$1.48. In hourly terms, that’s $0.19 an hour for an 8-hour day. Compare it to a minimum of $5.15 an hour (more in some cities and states) in the U.S..

A live chicken (broiler) costs 60,000 cedis ($6.58). It would cost less in the U.S., where a processed chicken would be less than $5 (and even a roasted chicken wouldn’t be $6.58). The minimum-wage worker in the U.S. could buy that chicken in less than an hour. In Ghana, one would have to work for 4.5 days to buy it.

A bottle of beer (”Club”), 1 liter, is about 8000 cedis ($0.88). A comparable product might be 3 times as much in the U.S.. But we’re comparing half an hour to five.

You mentioned bread. The most recent price given at that site is 6,000-10,000 cedis in 2003, when the exchange rate was about 8500 cedis to the U.S. dollar. Suppose that a loaf of bread costs about the same, $1 (9100 cedis at current rates), today. In the U.S., it is about twice as much for bread of good quality. The U.S. worker earns 2.6 loaves in an hour. In Ghana, about 2/3 of a loaf in a day.

This article claims that a decent lunch at a “chop bar” would cost 30,000 cedis ($3.30), which is more than twice the minimum wage for a whole day. It says that no one can afford to rent a room (not an apartment, a room) and eat on that low wage. The author calls for raising the minimum wage to 25,000 cedis per day, which still would not be enough for lunch at a chop bar. The U.S. worker could have an extremely nice dinner in an elegant restaurant for his day’s wages of $41.20.

This article refers to the price of gasoline and the minimum wages in Ghana and the U.S.:

http://www.ghanaweb.com/GhanaHomePage/features/artikel.php?ID=79434

A gallon of gas costs 30,000 cedis ($3.36). In the U.S. it was $2.25 (20,250 cedi), but I’m going to make that $2.70 (24,300 cedis) because Ghana uses imperial gallons, which are about 20% larger than U.S. gallons. A U.S. worker can buy that gallon of gas in half an hour. A Ghanaian worker would have to work for more than 2 days to buy it.

Here’s a Christian publication from the West that discusses the living conditions in Ghana and the cost of living:

http://gnmagazine.org/issues/gn36/livemonth.htm

It speaks of rent as being $7/month. Sounds cheap? It’s for one room in a run-down old building. The kitchen and the bathroom are communal. Often even the room itself is shared. Such housing can hardly be found in the U.S. (and I bet the condition of the building in Ghana would be enough to get it condemned in the U.S.), but let’s compare housing as a percentage of wages. That’s what a Ghanaian earning the average got for 30% of his or her salary. A U.S. worker spending 30% of the minimum wage on rent would have $265, which is enough to rent a decent apartment with roommates in many places. Also, just paying tuition (even at a public school) for one child cost about $6, or some 25% of an average Ghanaian’s earnings. Tuition at the public schools is free in the U.S..

I could go on. I’ve already spent too much time on this. But don’t you see that the cost of living in Ghana is not less than that in the U.S.? Maybe a few items are cheaper in Ghana. But the time needed to earn them is much greater. And we haven’t even talked about the cost of major items that people in the U.S. easily buy. The site mentioned 10,000,000 cedis ($1100) for a Samsung air conditioner. I don’t know what sort of air conditioner they mean, but presumably it’s a small window unit, the kind that might cost $200 in the U.S.. The Ghanaian price is higher than the U.S. price. In any case, you can bet that the Korean manufacturer isn’t selling those air conditioners to Ghana for less than the going rate.