I came across this article on FOXNews of all places regarding how the "Great Recession" is having a huge impact on the poverty rate within the U.S. It's worth a read even if it's not quite "Fair & Balanced"
Sunday, September 12, 2010
Sunday, September 5, 2010
My Current & Evolving Points of View on The Subject of Poverty
Update 9/21/10:
I just wanted to put this note at the top of my blog because I have decided that instead of creating new blog posts as my thoughts on the topic of poverty evolve that I would update the original post. Feel free to comment on whether you find this confusing or if you think that I should not do this? My thoughts are that it would be easier to revisit my earlier thoughts....
Who Do I Think Is Poor Both In The U.S. & Globally?
To me someone is poor when they are unable to provide the very basic necessities for themselves and their families. They may not be able to afford to feed themselves and may be malnourished or they may not be able to afford adequate shelter and are possibly homeless. I believe there are varying degrees of poverty and that this is a subject where there is no clear line of delineation between those that are poor and those that are not. An example would be the "working poor". According to the U.S Bureau of Labor Statistics nearly 29% of all of those employed within the state of Georgia are employed in an occupation whose annual salary is below the poverty threshold of $21,834 for a family of four. So these are people who are working and are stuck in low paying jobs without much hope for wage or career advancement. I think that these facts can be extrapolated both nationally as well as internationally, with a considerable margin of error of course. The point being that this is not just a problem in Georgia it is a problem throughout the U.S. as well as globally.
Update 9/18/10:
Those who are poor are those that cannot afford to actively participate within society. It was once thought that one of the root causes of poverty was not related to economic behavior but rather to "individual misbehavior". I believe that this misconception was actually due to in part or in whole to a lack of any real poverty measure being used up until the late 19th century. There are various methods that can be used to determine what defines poverty as well as who is considered poor. The official poverty measure that is used within the U.S. is commonly referred to as the "poverty line". This measure basically sets a threshold based upon the "lowest cost food plan" and compares a families income to this threshold. The current official poverty measure would be an example of an absolute measure meaning that these thresholds remain constant over time. The poverty rate within the U.S. for 2009, which was just released this past week, currently stands at 14.3% which is highest overall poverty rate since 1994. This statistic really emphasizes how the economy as opposed to a persons behavior can force a family into poverty. Bare in mind that this is an absolute measure and does not include "near-money" benefits such as food stamps, housing subsidies and other non-cash subsidies. I suspect that had an NAS style of poverty measure been used that we would have not seen such a dramatic rise. I believe that what defines someone as being poor is that they are sufficiently deprived of income that they are no longer able live within the norms set by society. As Iceland states,"those whose resources are significantly below the resources of others, even if they are physically able to survive, are marginalized from mainstream society."
Update 9/21/10:
I have been doing a lot of thinking about this recently with the political season heating up and the unemployment rate in Georgia hovering around 10%. The facts that as they are laid out by Iceland in the text with regards to how the U.S. fares when compared to the wealthiest nations is eye opening. The U.S. has the highest average income per ca pita in the world second to Luxembourg yet we have one of the worst overall absolute poverty rates. According to usgovernmentspending.com the total federal budget for FY10 for welfare programs is $557.3 billion....that is a lot of money. In contrast to the 2.8 billion people in developing nations who live on less than $2 per day. The fact that the U.S. is spending so much money on welfare programs yet absolute poverty within the U.S. has remained fairly constant since the 1970's to me seems as though the money that is being spent is being mismanaged of abused. Comparing what it means to be poor within the U.S. to what it means to be poor in say southeast Asia is world's apart. "Poverty in the United States qualitatively differs from that in the developing world, where poverty is measured in terms of having sufficient resources to stay alive" I (Iceland, 2006, p. 59). What is described as a serious hardship of "dissatisfaction with kind of food" (Iceland, 2006, p. 45) seems petty when compared to the severity that exists in developing nations. Within the United States, a country that has nearly seven times the amount of billionaires than any other country in the world to have such high poverty rates is appalling.
Why I Believe People Are Poor Both In The U.S. & Globally??
I believe people are poor and remain poor for various reasons. I'm sure poverty can be attributed to bad luck, job loss, medical expenses, divorce, drug/alcohol addiction, lack of education, war and many other reasons. My point is that I don't think that one single cause can be identified as to why someone is poor. Often times poverty is passed from generation to generation and this may be due to geography. Coal mining towns in West Virginia come to mind. I think drug/alcohol addiction are sometimes the cause of poverty and are sometimes the effect of poverty. I saw a documentary (it may have been Dateline or 20/20....but that's not important) a few years ago where they showed the extreme poverty in Guatemala and all of these 5-10 year old kids living on the street huffing glue. In this case the addiction is the effect and not the cause. I'm not one of those that believe that it is a conscious choice that someone makes that they say "when I grow up I want to be poor" or "I'm not going to look for a job today, I'd rather just be poor and hungry" I don't subscribe to this way of thinking. I do however believe that some people may become discouraged to the point where they feel that they really don't have much of future and that there lot in life has been decided for them from an early age and unfortunately sometimes this is true. I try to think optimistically but I think that someone that grows up in a situation where they aren't given the proper motivation or tools to succeed are at a huge disadvantage to to those that are. I'm sure there is a study of some sort that can back this up.
Update 9/18/10:
In my initial post I mentioned geography as a cause of poverty. I have learned of (4) different models that help to explain the perpetuation of poverty across generations, I would like to touch on one of them at this time, specifically the "structural/environmental model". This model asserts that "labor market conditions, migration patterns, racial discrimination, and racial and class segregation all play a role in perpetuating poverty across generations." Geography plays a huge role in the conditions of the labor market within an area as "where one lives affects the opportunities one has and the type of living one earns". This also results in the concentration of poverty. I've learned that the suburbanization that began after WWII where upper and middle classes began to move outside of the cities into the suburbs along with government policies that made it more attractive to build new plants and facilities in the suburbs as opposed to rehabilitating urban centers contributed to the formation of extreme poverty neighborhoods.
Update 10/4/10:
I believe that poverty is something that can be quantified, whether it be by relative or absolute measures. Yet I have learned from past readings that poverty is also relative to a particular standard of living or what different people are accustomed to as well as what is socially acceptable. The three factors offered to explain the trends exhibited in poverty measures are "income growth, economic inequality, and changes in family structure" (Iceland 99). While Iceland points out that "we can not say that poverty is caused by changes" in these three factors it is important to realize that they are not mutually exclusive. I would like to think that income inequality plays a significant role in a population being poor, as is exhibited more prevalently in the relative poverty measure. The Gini index which measures the income inequality in a population is not a perfect measure of inequality because it does not take into account where the exchange of income transpires whether it be at the at the top end of income earners or at the bottom...."any transfer in income between two individuals has an impact on the index, irrespective of whether it takes place among the rich, among the poor or between the rich and the poor" (From a World Bank Article "Measuring Inequality"). That being said it is hard to ignore the role obvious relationship that exists between relative poverty measures and income inequality.
Update 10/11/10:
It is evident from the information contained within this session as well as the experience of the budget exercise that the minimum wage is not nearly enough to support a family in Georgia. Below is an itemized "Tax Receipt"....this is the amount of money that is withheld from your paycheck and where it is spent. For the purposes of this exercises let's assume that it can be extrapolated to represent various levels of income.
One of the myths about raising the minimum wage is that it will hurt job growth by raising the costs of operating small businesses, this has been proven to be false. According to the Georgia Hunger Coalition, " States with higher minimum wages have higher small business growth and higher small businesses job creation than neighboring states which have not raised minimum wage". People should be able to earn a fare wage for an honest days work and they should be able to support their families with the money they earn. I'm not one for taxes....but when I read all of the supply side rhetoric that is spewed all over the internet and broadcast news I'm dumbfounded by it. What amazes me is that average income earners are convinced that what these people are selling is going to help them out......tax cuts aren't going to help you!!! You don't make nearly enough money....we live in a country that is governed of, by and for the corporation, not the people. The sooner you realize that the sooner you'll realize that you have no skin in the game. Here is a little factoid that supports my position, according to the Government Accountability Office "two out of every three United States corporations paid no federal income taxes from 1998 through 2005". In fact Forbes notes, "General Electric, which “generated $10.3 billion in pretax income in 2009 ended up owing nothing to the IRS and in fact, it recorded a tax benefit of $1.1 billion.” Where's your trickle down now!!!!
This is precisely why poverty is such a problem in the U.S. and abroad the jobs that are available do not pay enough to meet even a minimum needs budget.
What Is Being Done About Poverty?
I think that there is a lot of government spending as well as non-governmental spending to help deal with the problem of poverty worldwide. I do hold the belief that the amount of money allocated is probably more than enough to make a substantial difference if it were used correctly as well as monitored more closely. I'm sure we're aware of how wasteful our government can be as well as how much suspected corruption exists both within our government and foreign governments. As another one of my classmates has stated on his blog often times people who are receiving food stamps can sell them for cash and then use that money for something other than feeding themselves or their families. Even now that food stamps are now administered on a card system fraud still exists. The welfare system should be a safety net not a supplemental income
Update 10/21/10:
Some of the social safety nets that exist today were created as a result of the Great Depression.
I firmly belong to the camp that believes that "welfare had failed because people weren't getting the skills they needed to go to work". There is clearly a skills mismatch especially if you consider poverty prone areas of the south and northeast where this segment of the population do not have the skills necessary for the jobs that are available. I do believe that traditional two parent households are important but I fail to see where out of wedlock births can be directly linked to welfare problems. I don't believe that the Temporary Assistance to Needy Families (TANF) program is an adequate approach to dealing with the welfare and poverty issues. Had some of the more progressive measures creating personalized plans that would enable welfare recipients to get the training that they need to get the higher paying jobs been included in the 1996 Welfare Reform Act I feel we may have seen better results.
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How Well Is Poverty Being Addressed Both In The U.S. & Globally?
I think that poverty is being addressed on a reactionary level. The solution to the problem of poverty is not to throw money at it which is mostly what is being done in my opinion. So the short answer to this question is that poverty is being addressed but I feel that it needs to be addressed at its root cause.
What I Think Should Be Done Both In The U.S. & Globally?
I think that the U.S. government should look for outside help to assist in the administration of its welfare programs. I believe that they are well funded but poorly managed and an outside NGO can best assist in making sure that the programs and monies are instituted and distributed with less waste and bureaucracy. On a global perspective it seems as though a lot of money gets donated to poorer countries yet it never gets to those in need. I feel that one of the best ways that poverty can be combated would be to focus on education within the communities where poverty seems to persist. I'm not just talking about educating the youth but also parents about the importance of education and how it is their responsibility to help ensure that their children are learning so that they might be able to live a better life. The youth need to be able to develop critical thinking skills so they are better able to adapt to the ever changing landscape of the global economy. Most of the industry within the U.S. is dead, when was the last time you purchased something that was made in the U.S.? The youth need to be equipped with the right tools so they can perform better in a service based economy.
Update 9/18/10:
My thoughts are firstly that we must adopt a quasi-relative poverty measure such as that developed by the NAS. Doing so will generate viable data that can be used to assess the issue of poverty with the goal of identifying those in need and developing and tailoring a plan to provide the help that is needed. There are some municipalities that have already started using an NAS style of poverty measure for example New York City. In their effort to combat poverty they adopted a poverty measure similar to that of the NAS and have found that children were not as poor as originally thought however senior citizens, with higher medical expenses, were struggling more than previously thought. Having this information can only aid in how our society assists the poor.
Update 10/4/10 :
I think that one way to help put the U.S. on the road to improving it's abysmal poverty rate for an industrialized nation is to invest more in education. I read in an article on NPR (http://www.npr.org/templates/story/story.php?storyId=130052776) that stated the the two factors that have contributed to income inequality in the U.S. are education and a decline in labor, to which I take as loss of low skilled jobs. These jobs are never coming back and if we do not retrain these people to better integrate into the current workforce than the income gap will only continue to grow.
Update 10/11/10:
I think that the corporations the reap the rewards from exploiting the work ethic of the American people should have to pay their fare share. Corporations are supposed to be bound by the same rights and responsibilities just like you and I are. But due to the state of our system of government they cards are unfairly stacked in their favor when it comes to taxation. Warren Buffet, one of the richest people on the face of this planet made this statement at an exclusive fund raiser ,"The 400 of us [here] pay a lower part of our income in taxes than our receptionists do, or our cleaning ladies, for that matter. If you’re in the luckiest 1 per cent of humanity, you owe it to the rest of humanity to think about the other 99 per cent". This applies even more so to corporations in my opinion.
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