Poverty War
Posted on January 8, 2014
50 years ago, President Lyndon Johnson declared a “War on Poverty,” in the Chamber of the United States of Representatives.
Johnson had only been in the Oval Office for three months, and the country was still reeling from the assassination of John Kennedy.
The Texas Democrat clearly wanted to change the subject from lingering concerns about who killed his predecessor. Nobody would have guessed that the Dixie politician would have put forward such a bold and liberal plan, but Johnson’s ambitions were seemingly boundless.
The War on Poverty speech immediately yielded the Economic Opportunity Act of 1964, which authorized the creation of Community Action Agencies in local communities and big cities.
These Community Action Agencies almost immediately became controversial. They were big pots of money that Big City Mayors and liberal activists both wanted to control, and in cities like Chicago, the fights between the politicians and the activists threatened to split the Democratic coalition.
You can still see the remnants of many of these agencies, and when Barack Obama became a “community activist,” he was undoubtedly working for one of them.
Republicans immediately saw these agencies for what they really were, a big waste of money, and they campaigned hard against them in 1966 and 1968, winning huge gains in the midterm elections and capturing the White House amid the tumult of the Viet Nam war.
Liberals will tell you that the reason these agencies failed was because Johnson diverted too much money away from his poverty programs and to the war, but there is little evidence, given the inherent political nature of the Community Action Agencies, that any amount of money would have worked to actually fix poverty.
In 1965, fresh after a landslide victory, Johnson launched the Great Society, which boldly and broadly expanded the size and scope of the federal government. He created the Department of Education, which increased dramatically the power of the Federal government into what had traditionally been a state responsibility. He created the Medicare and Medicaid programs, which now take up a huge percentage of the federal budget. He also liberalized the requirements for people on welfare and expanded the food stamp program. Improbably, as long as he was going to expand government, he took the opportunity to create the National Endowment for the Arts and the National Endowment for Humanities (I guess there were a lot of starving artists back then).
Johnson did all of this as he rapidly escalated America’s military presence in South East Asia. When given the opportunity to choose between guns and butter, he chose both, and as a result, America started down the path of deep debt.
50 years later, the poverty rate remains largely unchanged. The nation’s schools have gotten worse, not better. The biggest threat to our national security is our debt (as former Joint Chiefs of Staff Mike Mullen once put it). The Community Action Agencies still waste money. More people are on Food Stamps than ever before.
Unquestionably, some of the safety net programs signed into law by Johnson serve an essential function. Medicare is a popular program with senior citizens and is part of the fabric of American life. Medicaid has its problem but serves a critical lifeline for poor Americans. Supplemental Nutrition program feeds hungry folks.
So, while certain aspects of the War on Poverty have failed, other aspects are serving the purposes that they were designed to serve.
The question today is how do we move forward?
How do we make real progress in healing broken communities that have never been able to pull out of the poverty death spiral? How do we fix broken schools? How do we get people back to work or get them in shape to be able to productive members of society?
What are the real ailments that afflict the long-term unemployed? How do we protect the taxpayers who have to foot the bill for all of these programs? How do deal with long-term debt problems that just might catch up to us?
How can we redesign federal programs to bring them into the 21st century? What opportunities come with new technologies and what challenges are created as new technologies destroy old-line jobs? What about the macro-economic trends that provide both opportunities and challenges? How does globalization help and hurt? Is free trade a job-killer or job-creator?
Does inequality really matter? Who cares if the rich get a lot richer, as long as the poor get richer too? Or do the rich steal from the poor in a zero sum game?
What can the rich teach the poor about wealth accumulation, family stability, personal responsibility, and the importance of staying off drugs?
Let’s take a serious look at what causes poverty. Not everybody is poor for the same reason. Some folks have faced racial discrimination, and live in dangerous neighborhoods with inferior schools. Others come from a long line of dysfunctional families. Still others have profound mental and physical handicaps that are difficult to overcome.
Studies show that if you come from a single-parent family, you are much more likely to live in poverty. If you have a drug addiction or if either of your parents have a drug addiction, you are much more likely to live in poverty. If you don’t graduate from high school, you are much more likely to live in poverty.
If you have a college degree, if you come from two-parent home, if you aren’t addicted to drugs, it is highly unlikely from a statistical perspective that you live in poverty, unless you choose to.
Sure, some people have had some bad luck, especially during the financial crisis, and persistent, long-term unemployment has hit some families very hard. These families have had to scale back their spending and their expectations, and some have been forced out of their homes because they couldn’t afford their mortgages.
And many of these families struggle to pay the bills every week, and they are worried about how they are going to pay for college for their kids. They are concerned about slipping out of the middle class, and they have every right to be concerned.
But I am less worried about these folks long-term, because I believe that they have the skills to rejoin the work-force and once again be productive members of society. For some of these people, temporary unemployment insurance is an important way to build a bridge from one job to another. But for such an insurance policy to be effective, it has to be temporary.
Making temporary unemployment insurance permanent is a bad idea, because it changes the nature of the program from a hand-up to a hand-out.
Poverty is not just an economic issue. What causes poverty is not just economic determinism. Some Marxist historians will have you believe that it is all about money, but it isn’t just about money. It is also about culture, habits, mental health, safety and education.
So, a plan to fight poverty should include an examination of the cultural aspects of poverty, and it should include both carrots and sticks. It should include incentives to compel better behavior and penalties that punish bad behavior.
It should include funding to make neighborhoods safe from crime and improve schools (or better yet, give kids a choice of schools). It should end the habit of throwing people in jail for minor drug use, and have a heavy component of drug treatment for those who are addicted.
People who have mental health issues should be taken care of, not thrown on the streets.
Kids need to be protected, not only from hunger and from privation, but also from sexual abuse and bad parenting. If a parent can’t properly raise their children (because, for example, they are a crack addict), the state needs to step in and protect the kids. We should look at the concept of state sponsored boarding schools, a refuge for kids, to give them a chance to learn, to place to eat, and a roof over their heads. Boys Town comes to mind as a place where kids could thrive.
Jack Kemp came up with the idea of empowerment zones, low-tax jurisdictions targeted at low-income parts of the inner city. My ex-boss, Denny Hastert, and former Congressman J.C. Watts teamed up with President Clinton to enact a New Market initiative, which took Kemp’s approach and applied it to several inner city neighborhoods.
That worked well in transforming many of those neighborhoods, but it didn’t necessarily help to lift people on some of the toughest neighborhoods out of poverty.
A growing economy has traditionally been the best way to attack poverty, and when the economy crashes, it hits the poorest the hardest.
That has been especially true over the last decade. The President hasn’t focused on an economic growth strategy. He likes to blame Republicans, but his jobs bill was pretty much a joke, and his focus has almost exclusively been on the passage and implementation of his health care law.
We have had two economies in the Obama years. For those in the economic fast lane, things are good. If you have a college education and if you have the right skills, things have been terrific. The stock market is strong, corporate profits are solid, and executives are as well paid as ever.
But life in the economic slow lane is not so good. We have more people on food stamps than ever before, and the percentage of folks who have given up looking for a job is frighteningly high.
If you have the right skills, you are all set. If you have no skills, you are screwed.
And, as it turns out, more and more people have no skills or few skills that give them easy access to the economic fast lane.
A real poverty agenda would address the skills gap. It would also address other issues that have a dramatic impact on our most stressed communities, including helping people with the high cost of child care and high transportation costs for low-skilled workers.
Every dollar spent on behalf of the taxpayer should be measured for its effectiveness. Programs that don’t work should be ended. These Community Action Agencies should be relegated to the ash heap of history. Politicians shouldn’t given the final say as to where the money goes in the war on poverty, because, as it turns out, politicians can’t be trusted to spend that money wisely.
People need to be accountable for their own actions and when they make bad choices, they shouldn’t be rewarded for them. But at the same token, people need jobs, and the government should work with the business community to make sure more jobs are created.
Democrats tend to blame rich people for poverty, while Republicans tend blame poor people for making their own bad choices. In truth, it’s nobody’s fault and everybody’s problem.
Poverty will never be completely eradicated. But we can do a lot better than we have done over the last 50 years.