Can liberalism save the poor?

kw: book reviews, nonfiction, poverty, policy

Jesus told his disciples, "The poor you will always have with you" (Matt. 26:11 and Mark 14:7), and some think this means God favors some amount of poverty. Instead, we must understand that this phrase expresses God's sad understanding of human nature. It is not to be taken as a prophecy that must be fulfilled. The Old Testament contains frequent admonitions to relieve the poor, and specific provisions for their debts to be forgiven, such as the Sabbatical Year and the Jubilee. In the New Testament we find that, when Judas went out to betray Jesus, the other apostles thought he might be going to give alms, and this tells us that Jesus would send Judas (the group treasurer) to do so from time to time.

Today, what do we find? In the richest nation on Earth (for the present), poverty continues to increase, not just in number, but in proportion. This in spite of the famed "war on poverty" launched by President Johnson nearly 50 years ago. Poverty, as defined by the government, had been decreasing already in the mid 1960s; it had been over 18% (8 million) of families in 1962, and continued to a low of 8.7% (4.8 million) families in 1973. After some gradual swings up and down, the figure currently stands at 11.8% (9.5 million) families. There is a defined threshold for each family size; for a family of 3, it is about $18,000 yearly. Folks, that isn't much!

Curiously, in Washington, DC public schools, spending per student is nearly $19,000, yet the education received is better in "mid-continent" schools (in the Central time zone), where yearly spending is $6,000-9,000. Hang onto this thought.

A few years ago, two prominent liberal activists, Tavis Smiley and Cornel West, launched "The Poverty Tour: A Call to Conscience", a bus tour of 18 cities in 8 states. They write of their experiences and findings in The Rich and the Rest of Us: A Poverty Manifesto. The recession of the past four years has pushed many in the middle class toward the poverty threshold, without necessarily taking them right across it. By grouping the near-poor with those defined as poor, the authors can state that the numbers of struggling Americans is 150 million, "the greatest number in five decades".

After presenting a "Portrait of Poverty", which focuses on poverty as a fact (the lack of sufficient money, and nothing more) the authors present five aspects of poverty: Opportunity, Affirmation, Courage, Compassion, and Imagination (or, in particular, the lacks thereof). Poverty of Affirmation is a particularly insidious difficulty. The (still) well-off have a nearly overwhelming tendency to think that the poor "deserve it". However, one's politics affect this outlook. People with a more liberal attitude expect government to solve problems, and have low rates of charitable donation. People with a more conservative attitude do not expect government to help in a sufficient or useful way, so they give on average four times as much to charity as liberals.

Let's back up to some of the figures above. What would it cost to raise the effective income of those families below the poverty line to, say, $30,000? With no knowledge of the income distribution, I can guess that it doesn't exceed $10,000 on average, for those 9.5 million families. So that is $20,000 times 9.5 million. That comes to $190 billion. Then, for those above the line, but making less than $30,000, we can roughly estimate another 50% added, for a total of about $285 billion. That is substantial, but it is one-third of the money wasted on the TARP programs, just in 2009. However, total charitable giving in 2011 was nearly $300 billion. While most of this went to church programs, some amount was given to organizations such as "missions" that help the poor directly, and many churches pass on funds that come to them to support such efforts.

Government spending on about 50 "war on poverty" programs totaled more than $475 billion last year. Clearly, that hasn't resulted in America's poor living at a $30,000+ level (per family of 3). By far the greatest part of it stays in the pockets of the huge army of civil "servants" who administer and carry out the programs.

The book hardly touches on figures like this. The authors call for more spending. I'd think the focus ought to be on "right spending". I'd prefer a manifesto, a demand, for a simple criterion: that governmental organizations be required to have at least 75% efficiency. Thus, three fourths of every dollar that passes through the hands of every such agency must go directly into the pocket of a poor person, either as direct cash, or as whatever kind of "food stamp" is currently in fashion, or as some other kind of voucher to cover living expenses. But be sure to make welfare frauds such as amassing vouchers for multiple dead persons, punishable by death.

A great effort is also needed to improve education, primarily by doing away with most of the administrators and other non-teachers. In the 1950s, my grade school, with 600 students, had about 20 teachers (class size was about 30), plus a principal, an assistant principal, a secretary, and the janitorial staff. There was no cafeteria staff, as we all brought our lunches. However, in schools that had food programs for poor students, it was handled by the teachers. The grade school our son went to in the 1990s had so many "junk" administrators, that only 40% of the roster was teachers, and their rate of pay was less (adjusted for inflation) than a teacher's salary in 1955. I shudder to think what the situation is now, after another 15 years. I do know this: while a number of my son's teachers, in most years, were very good, there were also a distressing number of "bottom of the barrel", tenured fools in the classroom. We need to get rid of all the vice-assistant-this and that, and apply the money to the salary budget for teachers, and apply realistic accountability for teachers to keep their jobs.

The lowest rate of publication spending is $6,000 per student. Times 20, that is $120,000 per classroom. Suppose we paid 60% of that directly to the teacher? Do you think we could attract some higher-quality teachers? There are other significant problems with public education, but I'll leave them for a different rant.

Here is my greatest area of agreement with Smiley and West: Predatory CEO's make way too much. It seems de rigueur now for a company head to receive at least $1 million per month, and often much more, just in base salary, plus they usually get stock options that can earn them even more than their salary (and how is this not insider trading?). How much is a million a month? Of course, they don't work a 40-hour week. Many are workaholics that stay at their desks 70-80 hours. So, a typical working month might contain 325 hours. That comes to more than $3,000 per hour. Quite frankly, I don't think anybody's time is worth more than about $300-400 per hour, no matter what they do (except maybe a bomb squad guy who saves a few thousand lives—he deserves an extra large bonus). I once walked into a law office to ask about their terms. This was no hotshot agency, just a small practice of four lawyers. There was no free first consultation. The first visit would require a $3,600 retainer, and their rate was $550 per hour. I didn't even smile as I walked out. I found a lawyer who did a fine job at less than half the rate, and the first visit was free.

I used to subscribe to Utne Reader. I don't know if it is still true, but Eric Utne once wrote that they followed a company principle, that the highest paid person could make no more than seven times as much the lowest paid full time worker. I am on the board of a nonprofit organization, that pays its director about $75,000. That's plenty for a good director; it is in the top 20% of national salaries. The receptionist gets something like the mid-$20s, so the place would qualify as a "good" organization by the Utne rule even if the director were paid twice as much.

The book's title is mainly there as a provocation. The only discussion of the rich is similar to the prior two paragraphs, plus a call to prosecute the predatory bankers and congresspersons who actually caused the recent recession. This shows that politics don't matter to a President, only money matters. Both Mr. Bush and Mr. Obama have protected the guilty at every turn.

A lot is made these days about "choice", whether related to abortion ("it's a choice that must be protected") or homosexuality ("it isn't a choice, it is genetic, and must be protected"), or another half dozen areas. More and more of us must realize that poverty is not a choice (except for a few ascetics). The Bible uses the words "oppress", "oppressed" and "oppression" more than 120 times, most frequently in the sense of a rich person taking advantage of a poor person. This is something God particularly hates. This is the core of the problem that Smiley and West are discussing. We have a system that protects the oppressors and oppresses their victims. They suggest 12 points to deal with this. You and I know that none of the 12 points has a breath of a chance of passing Congress or being signed by any President, of whatever party. It will take a renewed civil rights movement to, at the very least, force governments to allow people to escape the direst forms of such oppression, such as by re-occupying foreclosed dwellings that are left vacant by the banks. I just don't know whether such a renewed movement can go forward with as little violence (on the part of the protesters) as was seen 40-50 years ago.