November 11, 2004
TAKE CONTROL (via Jeff Guinn):
The Myth of the Working Poor (Steven Malanga, City Journal)
Forty years ago a young, radical journalist helped ignite the War on Poverty with his pioneering book The Other America. In its pages, Michael Harrington warned that the recently proclaimed age of affluence was a mirage, that beneath the surface of U.S. prosperity lay tens of millions of people stuck in hopeless poverty that only massive government intervention could help.Today, a new generation of journalists is straining to duplicate Harrington's feat—to convince contemporary America that its economic system doesn't work for millions and that only government can lift them out of poverty. These new journalists face a tougher task than Harrington's, though, because all levels of government have spent about $10 trillion on poverty programs since his book appeared, with disappointing, even counterproductive, results. And over the last four decades, millions of poor people, immigrants and native-born alike, have risen from poverty, without recourse to the government programs that Harrington inspired.
But brushing aside the War on Poverty's failure and the success of so many in climbing America's economic ladder, this generation of authors dusts off the old argument for a new era. Books like Barbara Ehrenreich's Nickel and Dimed and David Shipler's The Working Poor tell us that the poor are doing exactly what America expects of them—finding jobs, rising early to get to work every day, chasing the American dream—but that our system of "carnivorous capitalism" is so heavily arrayed against them that they can't rise out of poverty or live a decent life. These new anthems of despair paint their subjects as forced off welfare by uncompassionate conservatives and trapped in low-wage jobs that lead nowhere. They claim, too, that the good life that the country's expanding middle class enjoys rests on the backs of these working poor and their inexpensive labor, so that prosperous Americans owe them more tax-funded help.
Though these books resolutely ignore four decades' worth of lessons about poverty, they have found a big audience. The commentariat loves them. Leftish professors have made them required course reading. And Democratic candidates have made their themes central to the 2004 elections. So it's worth looking closely at what these tomes contend, and at the economic realities that they distort.
To begin with, they follow Harrington's 1962 classic by seeing the poor as victims of forces over which they have no control.
Ms Ehrenreich's book is spectacularly asinine. At one point she ignores the most basic bit of advice a person looking for help could ever be offered:
'Always find a church.'
If you don't enmesh yourself in society then of course you depend on the state. Posted by Orrin Judd at November 11, 2004 2:53 PM
It's amazing how a certain segment of "the poor" managed to send $13 BILLION back to Mexico last year.
Posted by: Sandy P at November 11, 2004 3:44 PMThe left needs the poor to have power, the poor do not need the left to prosper.
Posted by: luciferous at November 11, 2004 4:30 PMCharles Murray wrote a very short review of Harrington's The Other America in 1998 (scroll down halfway), noting that it "prompted the staff work for the War on Poverty." It was published in the same year (1962) as Milton Friedman's Capitalism and Freedom, and Murray concludes that "Harrington's book is a road map for understanding just about everything that went wrong with social policy in the last 30 years; Friedman's is a road map for understanding just about everything that went right."
Harrington's book was, of course, swooned over by the gliteratti and enthusiastically reviewed; Friedman's book was not reviewed by a single major American publication (although the London Economist took a look at it). Yet another reminder of why we shouldn't trust intellectuals.
Posted by: Matt Murphy at November 11, 2004 4:30 PM"When I hear the word 'intellectual', I REACH FOR MY GUN!"
-- Benito Mussolini (it's becoming one of my favorite quotes these days...)
This is part and parcel of what may fatally ail the Democrats--their unquestioning adherence to shiboleths long since shown to produce disasterous consequences.
The health of our political system depends very much on countervailing power.
For all of our sakes, I sure hope the Demos can find a way to step up to the plate.
Current signs are not promising.
Posted by: Jeff Guinn at November 11, 2004 8:33 PMThere is always going to be an underclass, especially if we continue to practice demographic suicide by encouraging them to breed. For many, another kid equals another check.
For most poor people, things really aren't too bad and our society unlike many others does actually create a realistic chance for things to get better for their kids. The fact that economics is not a zero-sum game is what confuses the Harringtons of the world.
Posted by: Bart at November 12, 2004 6:32 AM"The fact that economics is not a zero-sum game is what confuses the Harringtons of the world."
Bart, that was extremely perceptive.
Posted by: Jeff Guinn at November 12, 2004 9:25 AMLiberals live their lives and plan for the future as though the world is static and not dynamic. They apply point solutions to problems that are really small parts of a very large dynamic system. Watching self interest and statism collide is ugly.
Posted by: Perry at November 12, 2004 9:45 AMWell, George Bush wants to give them down payment money, so who's being a statist?
Posted by: Robert Duquette at November 12, 2004 5:54 PMRobert:
To buy their own homes so they won't be dependent on the State. So Democrats, who want them dependent, are of course the statists. You're smarter than this.
Posted by: oj at November 12, 2004 6:31 PMSomeone can either rent or own a home. If they rent and pay for it through their own income, they are not dependent on the state. Thanks to the home buying frenzy, rents have actually been dropping. That is one factor keeping the inflation rate low. For people on limited incomes, renting is a better option, especially now. Thanks to price appreciation, they would end up paying more money for an equivalent home than they could get by renting one, and that's not counting property taxes and the host of new expenses they would incur as homeowners.
Timing is everything. Encouraging people to buy into a market at the top is the worst advice possible. After housing crashes, then I'd be better disposed to helping poor people buy a house. It would help stimulate a down market rather than add froth to a bubble market. Plus it would actually do some good for the people you are purportedly trying to help, by getting them into a home that has the promise of showing appreciation in the near future.
Posted by: Robert Duquette at November 13, 2004 5:56 AMIf they rent with their own income they aren't in the program. If they rent they aren't buildiong equity, so they're on the edge of dependency. Ownership is a liberating force. Statism requires dependency.
Posted by: oj at November 13, 2004 8:06 AMRobert:
People buying $80,000 starter homes in Atlanta or Dallas or Omaha are not at risk of losing equity (not without other serious problems). The most vulnerable to any type of bubble collapse are those owning homes way beyond their means in very specific locations (the Bay area, Boston, NY suburbs, DC suburbs, etc.).
In other words, if someone living in a $750,000 home in Richmond or Memphis loses it all, it will not impact Mr. and Mrs. Torres who live 5 miles away in a new 3-bedroom house.
Posted by: jim hamlen at November 14, 2004 12:21 AMJim
If 30% of those homes end up in bankruptcy because these homeowners are hit by higher interest rates on their variable rate mortgages, or they go to foreclosure and are sold at fire sale prices, then they can lose equity too. We've never put so many credit-challenged people in homes before, you can't compare it to past housing busts.
They wouldn';t have had any equity if they'd been renting either. 70% gain, o % lose.
Posted by: oj at November 14, 2004 11:49 AM