The American Way of Poverty: How the Other Half Still Lives (25 page)

Then the oil spill hit, and the oyster industry all but died. All along the Gulf Coast, the already-battered economy took another beating.

“We have no little oysters, we have nuttin’ to look forward to,” the oysterman, 57 years old when we met in late 2011, explained glumly.

We’re looking at years to recover, and there’s nothing really we can do about it. We don’t have the funds to rebuild ourselves again.
Katrina, we borrowed money, we scraped, we did what we had to do to recover from the hurricane. Now five years, six years later, we have to recover again, from a disaster which to us was worse than Katrina. We’re sitting here with a situation, another disaster, we don’t have no way to go to work. The oysters are dead. This community is an oyster community. Without the oysters, this community cannot survive. We’re making ten-twelve sacks a day, as a company there’s no profit to it. But these are my family. They have to pay their light bills. By the time you pay fuel, boat, groceries, there’s nothing left. No way I can catch more than fifteen sacks a day. Right now, they’re wondering what’s going to happen at Christmas. Most of them have to go home and face their families. So do I. I have to buy my grandkids presents, can’t do that this year. I just had to have that conversation with my kids. Most of them just barely scraping up enough money to pay their light bill, if that. This season that started a few weeks back, it’s over. It was over when it started. There’re no oysters. They’re dead. There are no little ’uns to leave there. How am I gonna retire? With what? What am I gonna leave my kids? Bills? Most of the fishermen in this business are in their forties, fifties. Then this. What are you gonna leave your kids? A boat with a bill? You get depressed, because there are people sitting up here selling a bad bill of goods. I’ve been to London; heard the lies; and they’re still going. You’ve destroyed these people’s way of life.

For Byron’s younger cousin, Elton, aged 54, standing on the docks in blue jeans tucked into rubber boots, his galoshes crunching against a carpet of discarded shells accumulated over the decades, times were as bleak as he had ever known them. “The only people doing this are people who come from a family of generations doing this. Some like it, some didn’t. I love it. It was good for me.” Elton started making his living with oysters when he was 17, back in the mid-1970s. “We were wiped out [in Katrina], but since then you get a little hustle here, a little hustle there. We took it day by day, took a little assistance, lived as best you can.”

Then, with the oil spill, “we stopped for a year or so, maybe more. Here comes this year’s season, we were able to think we could make enough money to get back up—at least $800, $900 per week. [But] you can’t make $150 to $200 right now. It take us two days to make twenty sack of oysters. I ain’t making no money. I sleep on the boat, because I can’t travel back and forth when I’m not working. It’s something I have to go through, till it get a little better, you know. It ain’t cuttin’ the cake, you know what I’m saying? I eat, but I don’t know about other needs, keeping insurance on my truck, running back and forth. I don’t see it getting any better no time soon. I see it getting worse. That’s the way it goes, man, I don’t know. Just bad times ahead.”

In 2005, insurers paid out $61.9 billion to cover natural disasters in the United States. Hurricane Katrina, of course, America’s costliest-ever natural disaster, figured most prominently amidst the catastrophes.
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Five years later, the oil spill that followed the explosion of BP’s Deepwater Horizon rig, in the Gulf of Mexico, resulted in more than $40 billion in damages and cleanup costs,
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with the livelihoods of thousands of Gulf Coast fishers destroyed. In 2011, a year of epic tornadoes throughout the mid-rift of the country, tens of billions of dollars in damage was done to homes and businesses—insurers paid out $35.9 billion in what the industry terms “catastrophe losses”—and thousands of jobs disappeared as large swaths of towns such as Joplin, Missouri, were literally obliterated. In late 2012, super storm Sandy devastated much of coastal New York, New Jersey, and states further north along the eastern seaboard, resulting in several tens of billions of dollars’ worth of damage. Seven of the ten most costly natural disasters in American history have occurred since the year 2000, a product of over-building in vulnerable areas; climate change; and a cavalier failure to both upgrade man-made levees and other protections, such as flood control mechanisms for the New York City subway system, against nature, and also to protect nature’s own defense systems—mangrove swamps, wetlands, and the like.

With the exception of the Northeast, for which Sandy came as a shocking example of the impacts of climate change on everyday lives,
these are parts of the country long used to the forces of nature intruding on, and often ending, lives. Hurricanes, floods, tornadoes, all occur with enough regularity that their presence has been somehow factored in to the daily calculus of life. Yet, as wetlands have been destroyed to make way for tract housing, as the number of fragile trailer parks in tornado zones has grown, as the quantities of marginal people living in marginally served neighborhoods has increased, so the vulnerability of these regions to nature’s dark side has grown too.

When they’re hit by hurricanes and tornadoes, these communities rely on the Federal Emergency Management Agency (FEMA) for rescue efforts, the provision of emergency shelter, potable water, and myriad other daily needs. Where insurance companies fall short, as they do especially in poor, underinsured neighborhoods, FEMA’s responses are frequently all that stand between devastated communities and mass destitution. Hence the horror felt when FEMA trailers provided to the newly homeless in post-Katrina New Orleans were frequently uninhabitable, with stories of units being left unconnected to sewage lines, water pipes and the electricity grid, and with many of them showing signs of formaldehyde contamination.

That FEMA performed abysmally in the days and months surrounding Hurricane Katrina is beyond dispute. That the solution to this is to starve the agency of resources is, however, less obvious. Yet, in 2010, FEMA’s budget was cut by more than $700 million. And in mid-2011, Congressional Republicans attempted to cut FEMA’s budget again, this time by a whopping 55 percent.
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They failed. A few months later, however, Congress
did
cut nearly $1 billion from a variety of disaster relief programs, including FEMA, run by the Department of Homeland Security.
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The message of these cuts, layered one atop the other, is none too subtle. To be poor in America is increasingly to be vulnerable: to economic collapse for, say, residents of cities such as Flint or Detroit; to natural disaster for, say, residents of New Orleans’s Lower Ninth Ward, or Staten Islanders left to scare off looters in blacked-out streets
for days and weeks after Sandy devastated their community, and told by FEMA representatives to call 911 when they expressed concern that their unheated residences were unsafe to live in as the New York winter approached. For both groups, to have to rely on government assistance is, increasingly, an exercise in frustration and futility.

CHAPTER SIX

STUCK IN REVERSE

Air force veteran Mark Williams and wife, Theresa, at Oasis Motel, Phoenix, where they live in one room with their three children.

Septuagenerian farm worker Fidencio Fabela in the Sin Frontera Community Center in El Paso.

S
ubprime mortgages might not, on the surface, have a whole lot in common with hurricanes and oil spills. And yet, time after time, commentators—many of whom had made careers out of boosterish rhetoric around property values—described the housing market’s collapse from 2006 on in as utterly unforeseeable, as something akin to an act of God. They were, in this sense, simply following in the footsteps of a slew of theorists who had worked to undermine the social insurance systems built up from the New Deal years onward, and who believed in the inherent,
and desirable
, instability of economic life. While the New Deal had created what Yale University political scientist Jacob Hacker, author of
The Great Risk Shift
, describes as a “security and opportunity society,” in which risk was pooled and social benefits widely accessed, from the 1970s onward risk was recalibrated to fall more heavily on individuals. It was, he argued, the modern American economy’s defining feature.

“Economic risk is a lot like a hurricane,” Hacker wrote a year after Katrina slammed into Louisiana. “Hurricanes strike powerfully and suddenly. They rip apart what they touch: property, landscape, and lives. They are common enough to affect many, yet rare enough still to shock.” Pushing the analogy between natural disaster and individual economic calamity in an era in which the safety net was being shredded, he wrote, “What happens in an instant may change a life forever.”
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And so, ignoring multiple warning signs and past history suggesting the run-up in property values was but the latest in a series of delusional investment bubbles, politicians and economic decision-makers sat out the onset of the crisis. From the sidelines, they issued words of reassurance that turned out to be as hollow, as inept, as did the assurances of politicians in Louisiana in the run-up to the catastrophe that they had the situation under control.

“At present, my baseline outlook involves a period of sluggish growth, followed by a somewhat stronger pace of growth starting later this year as the effects of monetary policy and fiscal stimulus
begin to be felt,” Federal Reserve chair Ben Bernanke told the Senate Banking Committee in February 2008.
²
Also testifying that same day, Treasury Secretary Henry Paulson declared that the economy was “fundamentally strong, diverse and resilient.”
³
Subsequently, as one major part of the financial system after another collapsed in the months following, government statisticians concluded the economy was already in recession when Bernanke and Paulson made their Pollyannaish comments.

Two months later, President George Bush told an audience in New Orleans that the country was experiencing a “slowdown,” not a recession.
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Instead of intervening to cool the overheated market, almost until the day the entire housing market edifice crumbled, the country’s top economic opinion-shapers were encouraging more people to take out ultimately unaffordable loans. Instead of regulating banks to ensure that the mortgages they were “bundling” were actually safe investments with which to flood global financial markets, they sat back and watched as “toxic” assets accumulated in the investment portfolios of pension funds, banks, hedge funds, and the like.

As a result of the inaction, what could possibly have been a controllable, localized problem was allowed to fester. When the bubble finally burst, it brought misery not just to individuals, but to entire communities—with people stuck holding properties they could no longer afford, and with basic public functions, such as adequately funding schools, stressed to breaking point by the lost revenues that followed from declining real estate values combined with rising unemployment.

And yet, even then, with the wreckage in plain view, a startling number of senior figures were attempting to minimize the scale of the disaster. In mid-September 2008, with the stock market in free-fall, with oil prices careening up toward $150 a barrel, with major investment banks collapsing, with the credit markets frozen, and with Congress pondering emergency intervention to keep the banking system afloat, Republican presidential candidate John McCain announced
to a Florida audience that “the fundamentals of our economy are strong.”
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Barely a week later, a humbled President Bush was forced to address the nation, informing a shell-shocked public that the country’s “economy is in danger,” and urging Congress to pass extraordinary measures to shore up the global financial system. The country, its leaders were now telling the public, was closer to a complete collapse of its economy than at any time since the Great Depression.
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