POVERTY IN AMERICA: WHERE DO WE START AND WHO SHOULD ADDRESS IT?

We’ve been talking among ourselves and with others about income inequality and poverty in America. Many 2020 Democratic presidential candidates indicate they plan on making income inequality a major part of their campaigns and we see poverty as part of that. We will discuss these issues often in this space in the months ahead.

We begin by laying out some dimensions of the problem and by considering who bears responsibility for attacking it. As we’ve talked about the poverty part of the issue, we’ve realized we must consider the wide divergence in how Americans see what we should do about poverty and who should do it.

Poverty: What is it?

The U.S. Census Bureau’s 2017 estimate put the poverty rate at 12.3 per cent of the population (39.7 million Americans) with the poverty threshold set at an income of $17,330 for a family of two adults and one child. The statistics show the dimensions of a problem affecting all races and ethnic groups . Over 17,000,000 white people, nine

million black people, and nearly 11 million Hispanic people live in poverty. That doesn’t count those living in “near poverty.” Including that metric, some students of the subject say, puts the poverty number at nearly 100 million people, almost one-third of the U.S. population.  

Poverty particularly affects people of color and children. An Annie E. Casey Foundation study reported 33 per cent of African American children, 33 per cent of Native American children, and 26 per cent of Hispanic Children live in poverty. Eleven per cent of white children suffer the same fate. Few would argue this issue does not require attention. But who should address it?  We hear different answers to that question.

A Chorus of Solutions

Deciding who bears the greatest responsibility for reducing or eliminating poverty depends on one’s experience, political orientation, and social outlook.  Consider:

*The religiously focused – Many religious leaders and their faith community followers assign responsibility to individuals and institutions that attack poverty through charitable giving, community outreach, and group action. This philosophy emphasizes making and collecting donations of money, food, clothing, and household goods for distribution through churches, food banks, and private social service organizations. Such organizations deliver goods and services directly to impoverished people. Both liberals and conservatives endorse and support this approach, though many liberals view it as only a partial solution that cannot substitute for governmental action on tough, systemic problems.

*The politically driven – Such individuals, usually, but not

always, progressive in their political orientation, believe we can only reduce poverty through public policy. They favor expansion of entitlement programs like Medicaid and Medicare and believe in a higher government-mandated minimum wage. They argue for a more progressive tax system that puts a greater burden on the rich and reduces in on middle and lower income taxpayers. Better enforcement of civil rights laws and more emphasis on combatting race discrimination attracts significant support among advocates of these approaches.

*The individualists – Often politically conservative, people in this category believe first and foremost that individuals bear responsibility for their own economic circumstances. They advocate limited government intervention in the economy and often resist entitlement programs that directly support low income citizens. Advocacy of income and wealth management training at an early age and a rugged individualism approach to life often characterize the views of many in this group.

No One Best Way

As we’ve contemplated and discussed America’s income inequality and poverty issues, it appears these approaches are not mutually exclusive. We think it unlikely any one of the above orientations – or others—used alone will solve the problem.  For one thing, the problem is too big and involves too many parts of the American economy.

No matter how much charitable giving increases, the structural concerns that go with many elements of America’s poverty problem will eventually overwhelm the contributions. Charitable giving does not, for example, eliminate systemic and institutional racism that condemns people of color to generational poverty and prevents accumulation of wealth.

President Roosevelt signing New Deal

Public policy based solutions also go only so far.Beginning with The New Deal in  the 1930s and continuing through the War on Poverty in the 1960s, we’ve tried government programs as a way of eradicating poverty, yet poverty remains with us. Lots of reasons account for this. Some argue the country

scrapped these programs too soon and they should have been refined, not eliminated. Additionally, other government policies have widened the income and wealth gaps. We also recognize government is a blunt instrument that ill serves people in need of things government isn’t very good at supplying and developing, like individual incentive and work ethic.

Individualists don’t have a monopoly on wisdom on this set of issues either. Learning wealth management, for example, does not address a lack of job skills, or the problems of a family saddled with a mountain of debt and facing poverty because of an illness insurance didn’t cover.

America’s income inequality and poverty problems remain complex issues with no magic bullet solutions.  We’re happy the 2020 candidates talk about them now.  We hope they will make intelligent comments and proposals, rather than just produce noise and platitudes.  A candidate who does that would deserve all our votes.