The American Way of Poverty: How the Other Half Still Lives (35 page)

SOMETHING MUCH BIGGER IS AT STAKE

Individually, none of these strategies would come close to tackling the scale of hardship in twenty-first-century America. But, taken as a whole, they would move the country a whole lot closer to a coherent, ambitious, new War on Poverty. They would provide a strong foundation upon which an innovative set of reforms could be erected.
Georgetown University’s Peter Edelman, who had cut his teeth as a youngster by working for Senator Bobby Kennedy while he toured the country familiarizing himself with poverty, talked about the need for a range of new policies. He saw a need to shore up dilapidated mental health systems; using the law to ensure that workers received livable wages, as well as to make it easier for workers to organize into trade unions; and to make it the responsibility of states to subsidize childcare for the working poor. A lifetime of work on these issues had taught him how interconnected they were. But they wouldn’t come about, he believed, until people were willing to engage in a more sensible discourse.

People who feel insecure themselves feel threatened by the idea that somebody who’s demonstrably worse off than they are is going to get help and they’re not. They have an instinctive feeling these people are not deserving. There’s been a divide and conquer thing coming from people and interests higher up the income level. We’ve had an unremitting attack on welfare that started in the late ’60s. An unremitting drumbeat saying people who are in need are actually just not trying hard enough, they’re lazy, have become dependent on welfare and it’s ruined their character, and all the rest of it.

Pastor Ed Bacon of the All Saints Church, in the southern California suburb of Pasadena, agreed with Edelman’s urging of a holistic approach to poverty. For the past several years he had been working to build an understanding of these connections amongst his congregation. His team had focused on nine key economic justice themes—from the role of money in politics, through to “the need for taxation in a civilization”; from the influence of the military-industrial complex, through to the disproportionate economic hardship borne by minorities during the post-2007 recessionary years. “We see,” he explained, “the reflection of economic disparity in each of these issues, which means we also see a power disparity. They all contribute to
structural violence—where you get things like the school-to-prison pipeline.”

As the economy worsened, more and more of Pastor Bacon’s congregants had hit the skids. They felt, said one of his colleagues, ashamed; they wanted to hide their hardships. Instead, Bacon decided to bring them out into the open. His church began holding what he called “Life and Livelihood” meetings to talk about these problems; they began linking up destitute church members with families who were better off, who could afford to dole out some aid to the needy; they began encouraging the unemployed to network for jobs within the church community. After a while, the church even began acting as an informal healthcare exchange, linking up the newly uninsured with doctors who would be willing to treat them at a discounted rate.

For Bacon, the economic cataclysm unleashed on so many of his congregants couldn’t be reduced to party politics or to sound bites about which side cared more, or less, for the plight of the poor. “It really must transcend partisan identity,” he argued. “Something much bigger’s at stake. For me, it’s the well-being of the human family.” In his theology, when one person was hurt, all suffered. His hope was that an increasing number of anti-poverty programs would be crafted so as to minimize the population’s overall economic misery rather than, simply, to pinch pennies. Clearly, with programs like TANF that was no longer the case. With other parts of the safety net, however, there was still some room for optimism.

Let’s now return to our central observation here: Welfare systems work best when they expand automatically during economic downturns—in the technical jargon, they act as “automatic stabilizers”—rather than relying on acts of Congress or state legislatures to do the right thing by the nation’s poor.

That’s how SNAP works—and has worked for forty years, as the country has moved from county-by-county buy-ins to food stamps to a nationally mandated system. It’s been remarkably successful. In addition to keeping people fed, it has also improved the long-term health of recipients. University of California at Davis economist Hilary Hoynes had studied health outcomes in counties that adopted food stamps in the early days compared to those that came into the program later. The earlier food assistance was offered, she found, the better the health indicators for those ultimately provided food stamps. Early adoption resulted in adults decades later having fewer sicknesses such as diabetes and heart disease. Delayed adoption, and the resulting malnourishment or reliance on cheap and unhealthy foods, stacked up health problems for residents down the road.
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That’s also how the original Aid to Families with Dependent Children program was designed. The formulas by which the program allocated money to the states meant that as unemployment and poverty rose, so too did the number of AFDC clients. As we’ve seen, at the height of this program’s reach, more than three-quarters of impoverished families with children received assistance. But when federal programs are redesigned as block grants to the states—with a set amount of money allocated per state, and with the states given tremendous leeway to raid these funds for alternative uses—the poor generally end up shortchanged. That’s what happened with welfare; it’s what will happen with Medicaid too if the healthcare program is turned over to the states. It’s an effective way to ensure frugality; it’s an appalling way to ensure that poor people’s needs are met.

America’s political leaders are not about to resurrect AFDC; nor should they. What’s past is, after all, past. But new programs, building on what was good about the old system, the better aspects of the newer system that replaced it, as well as entirely fresh innovations for a new era, could, and should, be created.

States could, for example, take a leaf out of the Earned Income Tax Credit book when it comes to crafting welfare policies, temporarily
increasing
welfare checks when a person gets a job, instead of immediately cutting them back. EITC is credited with moving tremendous numbers of people out of poverty precisely because it gives ongoing incentives to people not just to work but to seek higher-paying jobs without immediately risking their cash subsidy. Modern-day welfare programs have done the opposite, looking to move people off the rolls as quickly as possible with far too little thought given as to whether the ex-aid recipients end up with sufficient cash to survive.

Using U.S. Census Bureau tabulations from 1996 to 2005, Randy Albelda calculated that, ten years after welfare reform had kicked in, the poorest 20 percent of single-mother families had seen their total available cash fall. The next-poorest 20 percent were earning more, but almost all of that additional income was being canceled out by declining welfare payments.
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That’s simply a bizarre way to tackle poverty.

Instead of the current punishment-based approach to welfare—find a job at all costs, or you’ll be cut off from welfare—Americans would benefit from, and the country’s best impulses would be showcased by, an incentive-based solution that rewards those who find work with extra help. This help should range from an expanded Earned Income Tax Credit to ongoing childcare assistance, from transportation subsidies perhaps on up to top-up welfare checks from the state for a specified period of time while those who have spent months or years on public assistance navigate the tough early days in a new job. Such a strategy would go far further toward raising low-income families out of poverty—to eliminating the poverty trap traditionally associated with welfare—than a great bundle of sticks each used to whack poor Americans harder than the one before.

None of these fixes would be cure-alls. After all, as Marshall Ganz had said, poverty is merely the “miners’ canary,” alerting the broader
polity to the presence of systemic problems: growing inequality, declining access to quality education, increasingly insecure labor conditions, and a political process too paralyzed to tackle these crises.

But, while repairing and strengthening the welfare system doesn’t provide a larger political-cultural fix, it
would
at least represent a starting point both for getting beyond the era of mindless austerity, especially at the state level; and also for having a discussion about equity, one that can frame poverty as a national problem rather than simply a malaise for the individuals mired in it. It is, in other words, a precondition for a more just economy, but in and of itself is nowhere near sufficient for attaining such an end goal.

We have the knowledge and the technological wherewithal to create flexible, fast-responding, non-punitive, counter-cyclical welfare programs. Such programs would be an amalgam of traditional assistance models, public health and nutritional aid systems, and progressive taxation policies. We have decades of institution-building from the middle third of the twentieth century to look to for guidance, and we have a number of innovative, cost-effective programs being developed locally in recent years to help us on our way as well.

Ultimately, if we cannot work out a language with which to highlight poverty’s corrosive reach, and posit solutions to the problems facing those at the bottom of the economic ladder, our democratic institutions will themselves suffer. In the long run, the cost of inaction will far surpass the price of intervention. Far better to get it right now than to deal with decades of collateral damage from our inaction today.

CHAPTER TWO

BREAKING THE CYCLE OF POVERTY

Ruins of the Packard auto factory in Detroit.

I
mproving a dysfunctional welfare system might, however, be the easiest part of the anti-poverty equation, being both relatively affordable and also building mainly on existing institutions and programs. Far harder is how to break cycles of poverty so that eventually fewer people need to fall back on long-term state aid in the first place. Doing so involves thinking holistically about such big-ticket items as housing, healthcare, education, criminal justice systems, drug treatment, mental health programs, banking, and labor markets.