What You Should Think About Poverty

October 15, 2008

“For the first time in our history it is possible to conquer poverty.”

–Lyndon B. Johnson

Almost forty-five years ago, the President of the United States declared a War on Poverty.  Like the War on Drugs or the Global War on Terror, that militant metaphor ultimately proved misleading and counterproductive.  Unlike the War on Drugs or the Global War on Terror, our nation showed a stunning lack of resolve in dealing with this issue.  As Red Scare propaganda crystallized into an ideology of free market fundamentalism, the War on Poverty was displaced by an agenda that might be characterized as a war on the impoverished.

At the heart of this is a form of political opportunism that demonizes large groups of people by focusing on exceptionally bad, exceptionally rare, conduct within that group.  Often it is children who pay the price.  The typical beneficiary of Aid to Families with Dependent Children was a single mother who started her family with every intention of paternal involvement.  The scope of this need would be much reduced if there were no deadbeat dads.  Yet the political dialogue that killed AFDC was dominated by the hateful distortion holding that the program was nothing more than a meal ticket for “welfare queens” who became pregnant repeatedly for no other reason than pursuit of a government check.

Because of irrational hostility toward the very idea of welfare, this nation has traded a program that enabled poor mothers to focus their energies on parenting for a program that compels poor mothers to labor in unskilled jobs.  In some of the worst cases, child care expenses required to enable this makework approach outweigh the value of the work itself.  Even in the best cases, the policy change compounds the disadvantage of being born into poverty with the disadvantage of decreased parental involvement in the upbringing those children.

The present debate about immigration is similarly distorted.  The typical illegal immigrant is eager for honest work and reluctant to engage in criminal activity.  It is the lack of a viable alternative, not a preference for lawbreaking, that drives the illegal component of their activities.  Worse still, many politically vocal Americans are obsessed with the relatively rare phenomenon of “anchor babies.”  Their hatred for people who exploit our laws see their children born as U.S. citizens becomes an excuse for counterproductive malice in the framing of policies meant to govern the inevitable (and thoroughly useful) flow of foreign workers into our economy.

The theory capitalist extremists espouse is that “nanny state” largess somehow weakens our people and our economy.  The facts would beg to differ.  At the close of World War II, the average height of the Dutch had stagnated.  Growth dating back to a 19th century prosperity surge gave way to the devastation of brutal military occupation.  Yet generation by generation since, they have risen to become the tallest nation on Earth.  A major factor in the change was a body of social policy that insured no citizen of the Netherlands went hungry but for the choice to do so.

Progressive social minima, including universal health care and robust poverty relief, are not economic liabilities.  To the contrary, they provide economic stimulus on many levels.  In the most immediate sense, an uplift in public morale created by alleviation of domestic hunger, homelessness, and ailments is good for business.  So too is the increased productivity generated by direct beneficiaries of sensible welfare spending.  Coupled with a long term commitment to minimizing domestic deprivation, the intergenerational result is a markedly healthier, happier, and more productive national workforce.

This is not simply some theory crafted to manipulate voter behavior.  The Dutch example is the clearest of many.  Global happiness surveys routinely turn up the best results in Scandanavia.  I have a hunch those results are not on account of the weather.  Right wing protestations about the certain failure of the welfare state are soundly repudiated by its many real world successes.  Besides which, recent events should make as clear as day that cutthroat capitalists are in no position whatsoever to criticize the democracies of Western Europe in the arena of fiscal responsibility.

It may well be the case that individualism has, even deserves, a special place in American culture.  Yet this raises the question — what is truly more useful to the purpose of enabling American individuals to pursue happiness in their own fashion?  Is the entire answer nothing more than big guns and small taxes?  Might instead there be a wide range of constructive actions that can be taken to promote broad-based economic growth while giving our least fortunate citizens options they otherwise would be unlikely to experience?

The ideology of supply-side economics was evidently corrupt at first blush.  Yet it has taken thirty years of disastrous public policy, punctuated by events taking place just this year, to provide overwhelming hard evidence to support that conclusion.  For decades, some citizens upheld the private sector as intrinsically superior to the public sector, without any regard for technical specifics.  Those same people also insisted free markets were sacrosanct ideals that ought be held inviolate.  These beliefs went beyond “regardless of the cost” and to the extreme of “the idea that there is any price to be paid for this form of extremism is unthinkable.”

Of course, the price is enormous beyond words.  To many Americans, every homeless schizophrenic, every undernourished child, every undermedicated senior citizen, and every serious medical condition left untreated constitute a great failure.  To turn Stalin on his head, behind each of those statistics is a staggering number of personal tragedies.  Each of them is heartwrenching.  Most of them are preventable.  That we as a nation should eschew efforts to engage in that prevention is abominable.

Obviously there are limits to our resources.  Yet those resources are part of a dynamic system that thrives under sound stewardship.  This same system withers when abused or neglected.  Trickle down economics endorsed a philosophy of deliberate neglect and fostered an environment of rampant abuse.  An ideal replacement would be a paradigm that transcends all ideology.  Yet if the ideal is unattainable, the least we can do is formulate a replacement ideology that fully recognizes the lessons to be learned by the realities of social spending around the world.

Just as Republicans never held any monopoly on patriotism, they also hold no monopoly on promoting economic growth.  Their leaders are quick to speak of growth as a justification for even deeper descent into the bowels of voodoo economics, but their ideas have been shown to create a false sense of prosperity amidst a backdrop of enormous fundamental problems.  Refusal to address those growing problems over such a long span of time is a big factor contributing to the crisis our economy faces today.  If we are ever to get serious about eliminating American poverty, we must first transcend the poverty of ideas afflicting this nation for the past few decades.

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What You Should Think About Fairness

July 28, 2008

“Though force can protect in emergency, only justice, fairness, consideration, and cooperation can finally lead men to the dawn of eternal peace.”

–Dwight D. Eisenhower

Do men like Bill Gates make this country great?  Does this country make men like Bill Gates great?  Is Bill Gates a great man?  Hopefully even the Microsoft founder himself has matured to the point of understanding these are not at all simple questions.  Yet for many Americans, the analysis is painfully simple, “Bill Gates received a tremendous amount of personal income.  He has not been convicted of a major crime or implicated in a breach of traditional values.  Therefore, Bill Gates is a great man.”

The self-made tycoon is a popular American archetype.  It is so deeply woven into our culture that The Pursuit of Happiness was never questioned as the title for a biographical tale about the pursuit of riches.  It is so deeply woven into our public policy that few debates are not clouded by the assumption that investors are the alpha and omega of American economic activity.  The consequences for entrepreneurs and shareholders are weighed carefully in all matters, while the consequences for working families with no substantial investments are often dismissed as a distraction from the vital business of lowering taxes, promoting trade, subsidizing industry, etc.

It is fair to argue that the United States has experienced generally good economic progress in the last thirty years.  It is also fair to argue that a position of such eminence could have and should have been parleyed into much greater national gains.  However, the immensity of the global economy prevents any of these opinions from rising above the level of pontification.  I suppose the most honest assertion that approaches the level of fact would be to look at our history of growth and conclude, “it could have been worse, and it could have been better.”

Yet it does not seem at all fair to argue that entrepreneurs and investors were exclusively responsible for these gains.  Even with contemporary Wall Street flimflam — the argument that widespread participation in mutual funds imparts universal status on the special interests of investors — it remains the case that many hard-working Americans carry debts far larger than the value of any investment portfolio they may have accumulated.  Of those prepared for a comfortable retirement, many still find the best decades of their lives shaped much more by levels of earned income than by investment outcomes.

Thus it is that, for more than thirty years, four out of five Americans have been effectively shut out from participation in economic growth.  The theory of trickle down economics is soundly repudiated by the profound failure of any real wealth to actually trickle down.  Some might argue that this is because corrupt public officials have not really put these ideals to a true test.  How is that any different from the argument that human beings are “too greedy” to sustain an economic commune the size of a large nation?*  I dispute the idea that trickle down economics was a good thing in principle.  Yet even those who romanticize it must face the cold hard fact that it does not produce the intended results in practice.

Of course, this assumes the intended results did not involve confining economic growth so narrowly as to promote the emergence of a new American aristocracy.  Hereditary titles, uselessly large personal fortunes, social climbers jockeying for appointments — only a feudal tradition is lacking.  Perhaps that is actually a bad thing, considering the role noblesse oblige played in feudal life.  Our economic elites can purchase a different standard of justice, exert extraordinary political influence, and still have time to accumulate vast amounts of real estate for personal use while the nation’s homeless rate continues along an alarming increase.

If only 20% of our citizenry were actually involved in pushing the economy forward, the fact that the other 80% are prevented from enjoying the progress might be fair.  Yet that conclusion can only be reached by starting with the absurd assumption that labor, training, management, research, art, and so much more are irrelevant.  It credits executive leaders, financiers, and the idle rich with exclusive participation in the economic achievements of the past three decades.  Personal incomes in those areas have ballooned to a downright insane extent.

Rational evaluation forbids any conclusion about a failure of industry on the part of the American worker.  Employees are laboring more hours and making larger sacrifices for the very same economic rewards analogous jobs would provide a generation earlier.  The reality of the working American has changed for the worse.  Degradation of opportunity is ongoing.  The labor force continues to become more and more productive, yet it is the corporate elite and old money that continue to receive more and more rewards.

An optimist might view this through the lens of Twain.  Wall Street institutions play the part of Tom Sawyer, reaping the rewards of hard work that others are induced to perform for a pittance.  A darker perspective might be seen through Orwell’s eyes.  There the metaphor of the working class as Boxer remains apt.  Had the President’s plan to significantly privatize Social Security been implemented promptly after it was proposed, would the surge of geriatric poverty suggest the approach of the knacker’s wagon?  Perhaps being frozen out of an entire generation of economic progress is not that dramatic, but surely it is no joke either.

Most ironic in all of this is presence of low points where pinnacles were thought to be built up by trickle down policies.  With decades of growth concentrated in the hands of an economic elite, amazing achievements ought to have emerged from those beneficiaries.  Instead of solutions to energy problems clearly understood in the 1970s, we find parasitism Enron-style.  Philanthropy to promote science, education, and general welfare was expected to blossom from the fortunes supply-side tax cuts would create.  Statistically, this mechanism has also failed to ameliorate the ongoing concentration of American wealth.

Of couse, symbolically it has done much more.  Rare confluences of vision and kindess create a false impression regarding the extent to which this nation’s most fortunate citizens actually give back to the society that facilitated their success.  Just as the self-made tycoon archetype promotes the blatant misconception that America enjoys greater socioeconomic mobility than the societies of Western Europe (some of which actually have feudal traditions,) the high profile philanthropy of Microsoft’s tycoons whitewashes over both the destructive business practices that forged said enterprise and the relatively rare nature of non-token generosity amongst living American tycoons.

Perhaps Bill Gates is a great man.  Perhaps the chef who prepared his dinner the last time he ate out is a great man.  Perhaps the dishwasher who cleaned his plate after the meal is a great man.  Perhaps all three are great.  Whether your definition of greatness involves hard work or loyalty or ambition or talent, who would presume to judge the character, or foretell the destiny, of the dishwasher?  Yet one thing is for sure — decades economic dialogue dominated by supply-side thinking recognize only the worthiness of men like Bill Gates.  Those who work hard without either being born into great wealth or thriving in a cutthroat business environment have labored for thousands upon thousands of days without earning any real gains.

The premise that proposed reforms like universal health care or expanded educational grant programs are somehow unfair to people already able to pay their own way is absurd.  This absurdity comes from the childlike assumption that present conditions were the product of a fair process.  We can continue to practice politics like children, crossing our fingers and hoping that, starting now, there will be no more significant corruption in political life.  Alternatively, we can face the reality we inhabit like adults.  We can recognize what has been unfair in the past.  We can take action to shape a future that brings us closer to fairness.

Of course, progressive economic reforms are not just about promoting the fairness of social justice.  Millions upon millions of Americans would enjoy a real improvement to the quality of their lives as a result of policies that duly consider the merits of demand-side interests.  Everyone would be able to wake up in a society with improved public health and improved public morale.  Even investments would be uplifted as a heavily strained labor force is given greater opportunity for financial security and professional development.  The fundamental fairness of correcting for decades in which four out of five Americans were excluded from any real reward for their part in achieving real growth — consider that icing on the proverbial cake.

*For clarity’s sake, I continue to believe the “communism has never been given a fair shake” argument is legitimate.  The crucial difference between the chance trickle down actually had and any historical regimes employing the term “communism” is the matter of open vs. closed societies.  With free speech, a free press, and a political system that has at times been the envy of the world, our nation still was unable to make supply-side economics work for anyone without personal control over an abundant supply of capital.  When a similarly open society attempts true communism, then it can be said to have been put to a test comparable to the one trickle down economics has clearly failed.