$40 trillion. That is the figure James Freeman spent the week admiring in the Wall Street Journal, and the figure the Cato Institute spent the week endorsing. They admire it the way a man admires the ceiling of a barn his grandfather built — as a fact, an inheritance, a structure that will outlive him. They are wrong about it being a problem. They are right about it being an opportunity. I have spent 30 years collecting the dividend. Let me show you the gift.
Lorene is a brisket on the second shift at the boxed-beef plant I own outside Hereford, Texas — a brisket, which is to say a 41-year-old woman who has run the brisket knife along the bone at 17 seconds a cut for 8 years, and whose shoulder I have not inspected. The polite word keeps her out of the dinner. The honest word would require me to think about her shoulder between the second and the third course, and the third course is where I would rather be.
She earns $14.60 an hour. She has earned $14.60 an hour since 2019. The line runs at 91 head an hour. Her hand makes $0.16 a head. Her hand makes your brisket tender. Your brisket is what you set on the table on Sunday. You pay for the shoulder. You have always paid for the shoulder. I have simply arranged for the payment to land somewhere you were not looking.
I do not pay Lorene a wage that would feed her children between checks. I pay her a wage that lets her qualify for Medicaid and SNAP and the EITC. It’s the design. The state covers her son’s doctor visits when his breathing goes wrong in the dust storms. The state covers her groceries when her hours are cut to 28 in the slow months. The state covers her rent when her car dies and she can’t get to the second shift. The state covers what I have declined to fund. I keep her yield. The state keeps her alive. That has been the arrangement in this country since the alphabet of the Great Theft.
The One Big Beautiful Bill Act added an 80-hours-a-month work requirement to Medicaid for able-bodied adults. Cato calls it sound fiscal policy. The Trump officials call it sound. Mr. Freeman calls it an excellent first step. I call it a dividend. The 80-hour rule disqualifies exactly the workers we have been subsidizing. Able-bodied adults with children. Able-bodied adults whose only fallback was a card. The card was the wage the government has been paying our workers so that we wouldn’t have to.
Before the OBBBA, of the women who could run a brisket line in Deaf Smith County, roughly a third had a card. The card was the gap between my wage and their hunger. Now they don’t. Hunger is God’s first payroll department. The pool came to me. I have not raised the wage. I have not needed to.
Let me put a number where you can see it.
$0.73 an hour. That is what I would have had to add to Lorene’s wage to keep her whole after her Medicaid card stopped covering her youngest. $0.73 an hour. Times 40 hours. Times 52 weeks. Times roughly 47 women. $71,449 a year. That is the sum I keep by saying nothing at the regulator’s hearing. That is the sum Mr. Freeman’s excellent first step saved me. Thank you for it. Truly.
The figure does not require a confession. It does not require an apology. The line will keep moving at 91 head an hour.
Now I want to show you the law the math proves.
The 1934 Sterling was the planter who fed the slave from his own estate. The 1965 Sterling was the manufacturer who paid the worker a wage and let the worker buy his own food. The 1995 Sterling — me — was the operator who paid the worker a wage that did not buy food, and let the state buy the food, and called the worker free. That was the trick. Free labor, fed by the taxpayer, working at my wage. The New Deal was the bargain. I pay you less than you need to live. The state tops it up. You call the arrangement dignified. Every employer in Hereford has run that arithmetic since the EITC and the Medicaid expansion landed.
The One Big Beautiful Bill Act is what happens when the bargain ends. The state stops topping up. My wage is what my wage is. Lorene’s shoulder is what my wage is for. There is no longer a taxpayer between me and her. I have to admire the legislation. It is the first time in 90 years that the United States has asked me, and not the Treasury, to keep my workers alive.
Servants, be ye subject to your masters with all fear; not only to the good and gentle, but also to the froward. — 1 Peter 2:18
Scripture anticipated harsh masters. It did not authorize a committee. It did not authorize a benefits cliff. It authorized obedience, which is what the OBBBA delivers, and which is what I require.
Move 600 miles and change the product. The principle travels. Nadia is an able-bodied adult. The questionnaire says so. She’s 61. She makes the premade salads that keep your lunch unspoiled in the cold case I run, and she beds down the chicken. Her knees, I’m told, are bone on bone. But the questionnaire doesn’t have a box for “her knees are bone on bone,” so Nebraska doesn’t either. The salad is your lunch; the box is the rope; the bookkeeping is clean, praise God.
I own the contract that administers the 2-page questionnaire for the state of Nebraska. I keep $26.42 per head per year for running it. I employ two dozen people in a call center in Omaha to process the form, and the state pays me a $10 bonus for every case I close without a hearing. 84% of the people we assess come back deemed able-bodied and lose an average of $312 in benefits for a missed form. The savings the senator is celebrating were always someone’s kneecap. Need is the contract. I hold the contract for the need itself.
Nadia got checked at 32 hours a week. That’s over the 30-hour threshold. Over the threshold means under the threshold, to me. Able to work 32 hours means no Medicaid and no SNAP, which means the knee replacement will be disarticulated through a charity hospital if she becomes disabled. She lost her food stamps in March for not showing up to a work and training orientation. The notice went to her brother’s address because she couldn’t verify her unemployment from her brother’s address at a prior worksite. She got a letter in the mail saying she’d been deemed employable. It’s the same letter she got last year, and the year before. But she has to re-file for it, in person, between the hours of 10 and 2 on the first Tuesday of the month. She did, and so she’s in the system. Her food stamps were $39 a month before. They’re $4.83 now. The laborer is worthy of her hire. The hire is the form. The form is the check. The check is the absence of a check. Scripture is satisfied without the wage ever moving.
Tess sits at the headset in the Omaha call center I run, and her own form cut her SNAP to $4.83 in March. The form processed its own operator without pausing. She is 47. She has 3 kids. Her knees are fine. Her problem is the form, and the form is hers, and the form doesn’t take a picture of whose hands are on it. I see Tess twice a week at the all-hands. Her SNAP case closed in March. I haven’t raised it. The all-hands is throughput. These are the habits of a life.
Able-bodiedness is a procurement line. I am the bouncer. The body that cannot work is the body the budget cannot see, and I decide which bodies the budget cannot see. The form predates me. The bouncer predates me. The gate predates me. The deficit is going down.
I am told the labor pool has a new floor. I have not walked the floor. I am told the women whose cards left them have moved on. The brisket is on your Sunday. The salad is in your fridge. I have what I came for. I look forward to your letters on what your own facilities saved.
— Sterling A. Varice
Sterling A. Varice holds the Hayek-Friedman Chair and serves as Dean of Instruction at Warden University’s College of Business and Economics in Richmond, Virginia. He is the author of three textbooks: Divine Mandates for Labor Utilization, Social Obligations for Profit Maximization, and Calibrated Deprivation: A Manager’s Guide to Employee Motivation.