The American Way of Poverty: How the Other Half Still Lives (14 page)

And the list goes on.

That the unions found it so difficult to fight back at least in part had to do with the past sixty-plus years of history. In the late 1940s and 1950s, when Western European nations were distributing a range of social benefits to their populaces, America’s progressives fell victim to a McCarthyite political culture that denounced comprehensive federal safety net systems as being somehow “Communist.” McCarthyism ended in the mid-1950s, but it left a toxic rhetoric in its wake, one that was particularly hostile to big-picture safety net reforms. From debates around full employment policies during the Truman years to debates over universal healthcare in the Obama years, large-scale attempts to smooth out the market’s rough edges have routinely been denounced as somehow anti-American.

Hence the kluge-like, makeshift nature of the American safety net. It existed, but it was neither uniform nor elegant. Rather, it was something that had managed to eke out a survival against the odds, that had managed to weather McCarthyism and a series of successor movements, and that somehow continued to exist despite the vibrancy of the notion that a country of “free men” didn’t need or want large-scale government interventions in the economy. It was, wrote historian Michael Katz, a “rickety, uncoordinated welfare state.”
¹⁹

That this welfare state was rickety didn’t, however, minimize its significance. In fact, over the decades, many millions of lives were bettered by its existence.

In the 1930s, the federal government, drawing on progressive ideas that had been percolating on both sides of the Atlantic for at least half a century, created viable templates to stimulate employment, to keep people from starvation, to provide the elderly with Social Security, and so on. The economist John Maynard Keynes provided a theoretical justification for governments to borrow money during downturns to plow back into the economy via public works
programs, infrastructure investments, and the like. He argued that the best way to revive a stagnant economy was to boost consumer spending, and that the most effective way to do that was to use the tools of the government to circulate money back into corners of the economy that weren’t thriving. Give poor people money, Keynes realized, and they would spend it. And that would increase companies’ revenues, stimulate employment, and ultimately boost the government’s ability to raise taxes. Keynes’s intellectual successor, John Kenneth Galbraith, went further. Even in flush times, he theorized, a vibrant safety net—a welfare system that served to keep the unemployed out of destitution—and a tax structure that functioned to limit income inequality would help create virtuous circles in which more money circulated, more people flourished, and fewer people at the bottom of the pyramid fell through the cracks.

Keynes had argued that government spending, and in some circumstances borrowing, was good. His prescriptions, considered heretical by many conservative critics at the time, had enabled America to find its way out of Depression in the 1930s, and, after World War II, into decades of broad-based economic growth. In fact, by the 1950s, wrote Richard Parker in his well-received biography of Galbraith, so widely diffused was American affluence that the overwhelming majority of economists were focused on how to grow the economy even more rather than how to distribute its fruits more fairly. Poverty was something old, a thing of the past, an unpleasant reminder of the long-gone Great Depression. When a government-commissioned academic tried to generate a complete list of publications in which contemporary economists wrote about American poverty and inequality, he found it impossible to make his bibliography stretch more than two pages.
²⁰
Galbraith wasn’t buying it. Throughout the 1950s, he was one of the few curmudgeonly voices warning Americans that poverty was still very much alive, albeit hidden, in their midst. Armed with this insight, he set about issuing prescriptions as to how the government ought to spend money in order to tackle economic hardship.

In 1964, Galbraith’s work paid off when he was appointed to the White House Task Force in charge of putting down the basic template to fight the War on Poverty. As a result of his work, combined with the journalistic writings of Harrington, poverty once again took center stage in the national discourse. By 1970, that flimsy two-page bibliography of works related to poverty had exponentially grown to more than 440 pages as economists around the country started rediscovering narratives of economic hardship.

In the 1940s, the government had created a healthcare system for military veterans. In the 1960s, in an attempt to tackle one of the great sources of poverty in America, the government expanded access to medical coverage for the destitute and the elderly. In the 1970s, food stamps were made a critical part of the safety net, as were a raft of other nutritional assistance programs, and, at the same time, the nation’s network of food banks, backed by USDA surplus, took off.

Some of this was simply about responding to the ongoing memories of the Great Depression, assuring a generation that had grown up in the hardest of hard times that the government had their back. Much of it, though, was about mediating the worst excesses of markets—excesses that left significant sectors of the population at risk even absent the conditions of a Great Depression—and about recognizing that complex modern societies had needs that transcended the profit motive. “Within the nation,” wrote Karl Polanyi in 1944, in his book
The Great Transformation
, “we are witnessing a development under which the economic system ceases to lay down the law to society and the primacy of society over the system is secured.” A Hungarian-born sociologist living in exile in London at the end of the war, Polanyi pondered the new world that, he hoped, would emerge out of the ashes of the old. The refugee-historian saw a future in which regulations would be carefully used to buttress the well-being of workers. Such codes of conduct, he argued, far from limiting freedom, as was claimed by theorists such as free-marketeer Friedrich Hayek, could be used to increase freedom for the great majority of laborers. “Not only conditions in the factory, hours of work, and
modalities of contract, but the basic wage itself, are determined outside the market; what role accrues thereby to trade unions, state, and other public bodies depends not only on the character of these institutions but also on the actual organization of the management of production,” he noted in the final chapter of
The Great Transformation
.

Polanyi believed that unfettered markets had a tendency to destroy the cultures and institutions out of which they grew—a process that, he believed, had led to World War I and then to the disastrous chain of political events and economic crises that had culminated in the rise of Fascism and the catastrophe of another world war. Rein markets in, Polanyi warned, or risk collapse. By all means, nurture and preserve the dynamism that markets injected into society, the theorist argued, but don’t for one minute be fooled into thinking that all societal problems, all of the tensions generated by poverty, upheaval, hunger, or uncertainty, would,
or even could
, disappear as markets expanded into all corners of life.

Polanyi’s ideas would have been familiar not only to liberal American presidents such as Lyndon Johnson, but also to conservative leaders such as Richard Nixon, men who came of age during the Great Depression and the run-up to world war, who served in that war, and who knew firsthand the horrors that had been unleashed by economic chaos. In the halls of power in the postwar decades, a broad consensus held that one of the state’s core functions was to either slow down the destruction of markets unfettered or to subsidize the incomes and benefits of those whose livelihoods had been irrevocably damaged, or stunted from the get-go, by sweeping market changes.

Skip forward forty years, however, and in many political circles that concern with addressing the needs of the worst-off, and with wrestling with markets’ imperfections, had largely vanished.

In the post–Cold War world—a triumphalist environment that the political scientist Francis Fukuyama notoriously labeled “the end of history”—there were, quite simply, few to no breaks placed on the machinations of markets. The result was both a philosophical and
practical breakdown in many of the networks of laws, regulatory agencies, and cultural practices designed to tame markets. The crisis that ensued is as much an existential one—of identity—as a practical economic mess. Increasingly, we have lost the language to explain exactly
why
market-generated inequality is a problem—and, by extension, why widespread poverty poses a challenge to the body politic.

WALLING OFF THE POOR

In part, America’s poverty epidemic is a failure of imagination—we haven’t invested enough energy into understanding the causes and the manifestations of poverty in today’s United States, or into imagining alternatives. In part, though, it’s a failure of empathy—we haven’t as a society worked out
why
we should care. Too many people either believe they have no obligations to the broader community or do not understand the consequences that follow when public infrastructure is allowed to crumble. That is the point raised by then–Harvard Law School professor Elizabeth Warren, whose work led to the creation of the U.S. Consumer Financial Protection Bureau, in her critique of businesspeople who didn’t want to pay their fair share of taxes and who didn’t believe that the state played any role in their success. Even a self-made man, she explained to an audience in 2011—at the start of her successful campaign for the U.S. Senate—used publicly funded roads to truck his goods to market, hired workers educated in publicly funded schools, and relied on publicly funded police forces for security and firefighters for putting out fires. “Part of the underlying social contract,” she continued, “is you take a hunk of that [profit] and pay forward for the next kid who comes along.”
²¹

This point should be easy to grasp. But too often those connections aren’t made. The sense of a community bound together both in good times and in bad eludes us. Tom Costanza, executive director of the Office of Justice and Peace at the Catholic Charities chapter in New Orleans, commented on the dispiriting poverty data routinely generated by the Big Easy, explaining of poverty’s growth,
“it should ring alarms all over New Orleans, and the nation really. We’ve had systematic poverty before, here in New Orleans. But poverty is increasing nationwide.”

Costanza talked of low-income communities inundated with returning prisoners and drug dealers, of neighborhoods swamped by violence, of huge numbers of kids whose mothers and fathers were behind bars. And he also spoke of the desperate need for more investment in the people and infrastructure of these neighborhoods, in mentoring programs for children, and in job training and education, rather than simply in the building of more prisons.

You might have heard of the term “the checkerboard neighborhoods.” In a lot of ways, New Orleans is strong that way. We’ve lived together. But we absolutely have pockets of poverty—and now it’s spreading more to suburban areas—to Jefferson Parish, to the suburbs. Also rural poverty; we have a fairly large diocese. The percentage of poverty is higher in the rural counties and parishes. It’s a serious concern for us, say, in Washington Parish, where there’s not much economics driving things. We have challenges geographically. It’s spreading; it’s not just an urban phenomenon. We see the homeless population increasing; food banks run low. If you talk to our food bank directors, they’ll tell you it’s a continuing challenge to keep the banks stocked.

In our imagination, we hermetically seal off this kind of saga from the broader American story. We like to think that the “pockets” of poverty referred to by Costanza are just that: isolated pockets in a land of plenty. That sense of the poor being somehow “different” probably had a lot to do with how the food pantry worker outside of New Orleans could answer my query for people to interview with the disclaimer that too many minorities were coming to her pantry from New Orleans, were taking food and clothes, and were then selling them in flea markets in the Big Easy. Alternately, she believed, they were taking clothes only to ship them to relatives in
Latin America. It was, she informed me bitterly, a journey, dealing with racial minorities on a daily basis. They were manipulative, untrustworthy, out to make a quick buck. She wanted to introduce me to the
right
kind of person—which I got the strong impression meant the
white
kind of person—not to any old riffraff. And yet, despite her distrust of racial minorities—her fear that black and brown people just wanted to rip her, and her community, off—day after day she returned to volunteer at the pantry. At some subconscious level she realized that the stories of the people she worked with just couldn’t be hermetically sealed off from her own life experiences. The poverty she saw terrified her and stoked up a host of bigotries and stereotypes. But at some level she recognized how intricately her own story was tied up with that of the destitute people of whom she was so scared.