Poverty USA: The bogus, self-serving notion that poverty is complicated - by Jeff Spross

Poverty is a "mysterious, unknowable, negative spiral-loop that some people find themselves in." So said New York Times philosopher-columnist David Brooks, in the keynote for the release of a Brookings and American Enterprise Institute (AEI) report on poverty solutions.

"Some problems are clock problems," Brooks continued, according to a transcript from sociologist Philip Cohen. "You can take them apart into individual pieces and fix them. Some problems are cloud problems. You can't take a cloud apart. It's a dynamic system that is always interspersed."

This same bogus idea — poverty is so mysterious and complicated! — can also be seen when House Speaker Paul Ryan and GOP presidential hopefuls attribute poverty to everything from the breakdown of marriage to despair and hopelessness and the loss of "friendship, hope, and love." It's why the Brookings-AEI report is a full-court press to promote marriage, tweak the education system, and encourage work all at once.

"We have to be humble" in tackling poverty, Brooks continued, "because it's so gloomy and so complicated."

In this view, poverty is a big social ecosystem. At the individual level, it's all about personal psychology, habits, and values, and how they influence one's ability to be a good neighbor, spouse, parent, and worker. At the community level, there are the cultural values that get passed around, along with the norms and ideas of what constitutes acceptable behavior, which do the same. It's all interconnected with work and the economy in an infinitely complex way. It's a cloud problem.

But is it really? There's a strong argument that poverty is actually a clock problemLet's start with the jobs supply. Conservatives themselves point to having a job as one of the key ways individuals and communities build habits and norms and values. You can "promote" work all you want; it won't matter if there flat out aren't enough jobs. And America has done a terrible job maintaining a sufficient supply of jobs — to a degree that's really shocking, all the more so because it's treated as normal in the public discourse.

Full employment — where the supply of available workers is even with, or lower than, the supply of jobs — has been missing since the late 1970s, other than a brief burst in the late 1990s. We've always had booms and busts, but the booms have stopped reaching full employment for any sustained period. This cycle is especially damaging for the poorest Americans. Economist Lane Kenworthy found that, while the poorest 10 percent of Americans made gains during economic recoveries, recent recessions have wiped out those gains completely.

Moreover, even for people who are working, the absence of full employment means they have no bargaining power, because there's always someone more desperate waiting to take their job. Wage growth stagnates, low wages become more prevalent, and more people are demeaned and mistreated on the job — not exactly ideal, if you're looking to build habits and norms and a social fabric around employment.

The jobs supply comes relatively close to being a "clock problem." We know that a certain set of macroeconomic policies — deficit spending, and loose money from the Fed — boost the supply of available work. The government chose to use these policies to maintain full employment in the mid-century, and then it chose to stop.

Next, let's talk money. If people don't have enough of it, they can't access the necessities of life, and that's what poverty is at the most basic level. But buying necessities also means "buying goods and services." And if people in a community can't do that, then businesses there can't thrive or grow, and there won't be jobs there. On top of that, holding down a job usually requires people to have a reliable place to live, a car, gas, or access to public transit, all of which require money.

If this were a primitive agrarian economy, and someone who wasn't doing anything economically productive wanted to do so, they could just stake out a plot of unclaimed land, start growing or building something, and go. In the modern world — where land and infrastructure is governed by private property rights, where we trade money rather than goods, and where labor is highly divided and specialized — it's much different. People need access to the economic feedback loop to work for pay. They can't just conjure jobs out of thin air by dint of will or work ethic. And paradoxically, getting that access requires already having money, at both the individual and collective level.

This is one of the great under-appreciated strengths of federal spending on the welfare state and general public investment. It acts as an "aggregate demand management system," maintaining a (far too low) baseline for economic activity across America's communities, along with enabling people to buy basic food, shelter, etc.

Now, Brooks regularly claims the U.S. already spends enough on the poor to lift them out of poverty, so the flaw must be elsewhere. But this is just wrong. The U.S. welfare state is too small, too diffuse and too ill-targeted to do it's job. Other Western countries spend gobs more than we do, and get far more poverty reduction.

Heck, as Cohen noted, the very same release event Brooks spoke at held up the decline in elderly poverty as a big American success. Coincidentally, the elderly are the one group in America with a whole government program devoted to cutting them regular checks. It's called Social Security.

In other words, lack of money is even more a "clock problem" than lack of sufficient jobs. You literally just give people money!

So it's incredibly galling when Brooks declares that "surely the solution is to throw everything we think works at the problem simultaneously." Because this is exactly what he and his Brookings-AEI colleagues are not willing to do. Conservatives ferociously oppose including welfare state solutions or jobs stimulus in the list of stuff getting thrown at the wall to see what sticks. So they aren't included.

Beyond that, does anyone actually know how to encourage healthy marriages? In the deep sense? What about how to heal the social fabric, re-engineer whole cultures, or build new norms, habits, values, or whatever? This stuff gets us deep into the murky waters of the human condition. There are a lot of adjectives for trying to tackle these challenges head on, but "humble" isn't one of them.

By comparison, expanding the welfare state and having the government borrow, spend, and print money is easy as pie. That might not be sufficient to heal the social fabric. But it certainly seems necessary.

So maybe we shouldn't define "poverty" in such sweeping terms to begin with. Maybe we should just define it as not having enough money, and by extension not having a job, and try to solve that first.

From:: The bogus, self-serving notion that poverty is complicated