Poverty in America

One in seven Americans live in poverty now.

Discuss?

And yet the government is spending record amounts trying to get that number down.

Time to come to the realization that government doesn't solve such problems?

It seems naive to think that that poverty only has one cause.

^ It's even more naive to think it has one solution called the government.

Maybe the government is still a component of an eventual solution?

It's even more naive to think it has one solution called the government.

About as naïve, I'd say. It's the same thing, looking at a complex phenomenon and thinking that something simple must be responsible.

Maybe the government has been constantly stonewalled in its attempts to help the poor and therefore has been unable to reverse trends already set in motion?

Or maybe it's time to actually try to solve the problem instead of just using every event as an opportunity for political dogwhistles?

Tangent's right. There are multiple contributing factors that made this all happen in the first place. Some we can't control; some we can only indirectly control. Government is about the only one we can directly control, so that's logically going to be a large part of the solution.

Maybe the government is still a component of an eventual solution?

Depends on the government's role in said solution. You can't legislate poverty away. No amount of wealth redistribution, regulation, and intrusion/intervention will eliminate the impoverished and the homeless.

But there is a point where such things literally kill a once prosperous economy and send it into nigh perpetual economic depression. Communist states at one point were experiencing this. Some such as the case with Cuba still are.

edited 16th Sep '10 2:15:38 PM by MajorTom

Tom, at a certain point, you could dump enough money on people that they are no longer considered to be living "in poverty". I doubt that any economy in history has ever reached that level, though, so the point is kind of moot.

In its absence, your argument that dumping money to support people in poverty leads to recession/depression requires a hell of a lot more proof than your say-so. Redistribution of wealth per se has never been a direct cause of recession, because no matter who's spending the money, you still have demand.

Your scenario requires a theoretical situation in which the rich give up and throw in the towel and stop producing things because they can't earn enough money from it, a ridiculous proposition if ever there were one.

Recession occurs when demand drops below supply, starting a downward spiral where job losses fuel lower demand, which causes more job losses. Demand is driven by the supply of purchasing power in the marketplace. Whether poor people or rich people have money, they are still spending it on things. The focus of any government's economic policy, therefore, needs to be to prop up weak demand by boosting spending, by infusing the economy with whatever purchasing power it needs to fill the gap.

I recognize that this viewpoint is fundamentally Keynesian, but the "top down" approach is an utter failure according to history.

It could certainly be argued that the government is a horribly inefficient way of solving problems, and thus should be used sparingly. However, to take the leap from that to thinking it can never solve problems is a bit far.

^Moreover, in the absence of other ways to solve problems, an inefficient way is superior to doing nothing.

Well, government won't do it, and business won't do it (the unemployment rate having gone up far in disproportion to how poorly business is doing), so it's pretty obvious that nothing will do it.

edited 16th Sep '10 2:53:00 PM by Nobodymuch

In 2009, the poverty level was $21,954 for a family of four, based on an official government calculation that includes only cash income before tax deductions. It excludes capital gains or accumulated wealth, such as home ownership.

Hm, I did not know that about the exclusions.

Tom, at a certain point, you could dump enough money on people that they are no longer considered to be living "in poverty".

No, not really — that's only assuming they're using the money responsibly and want to get out of poverty. And by "want to get out of poverty" I mean "give up all the attachments I have to living in poverty and learn not to act in such ways that will keep me in poverty". It may help some people, but definitely not all of them.

Alas, many of these "attachments to living in poverty" involve social networks with other poor people, as a means of finding jobs or services in order to scrape by.

Yep, which is part of the reason why giving up on the lifestyle — any lifestyle, really — is actually a lot harder than most people think it is.

It also doesn't help that most people tend to feel more comfortable around people that are like them, which means its not always likely that people in poverty will have an easy time making friends with people not in poverty. Heck, even if they leave there's a chance they won't get away for long, because even if they move away and create a new life for themselves, they'll still want to connect with people who are living in poverty.

Uh, what's wrong with making friends with people who live in poverty? I definitely didn't feel like I'm economically dragging my friends down back when I was even poorer than I am now.And my aunt still lives in a tumbling shack that stinks of cat shit, but I definitely don't think that we're getting poorer by keeping in contact with her.

Wait, wait, wait. Capital gains don't count? Apparently it turns out I'm poor.

That occurred to me as well. If Bill Gates decides to quit his job and live off his stock profits, he falls below the poverty line. I think. I'm not great at interpretation.

Wait, are we talking about poverty as a state of mind or poverty as not being able to feed your family, buy clothes, etc.? Because I think if you gave people enough money, most would choose to feed and clothe themselves adequately.

You've managed to pull a double insult: accusing people of being too stupid to use money they're given, and accusing them of wanting to stay in poverty. Certainly there are freeloaders in the system, but the overwhelming majority of people are in poverty due to unemployment or underemployment.

I believe they were suggesting that people in poverty develop bad habits that inhibit getting out. Hanging out with other people with these habits reinforces them. I don't know much of what they are other than a few of them.

So part of our objective is not only to provide them with resources to escape poverty, but also a support structure to get out of the associated bad habits. That's again just a matter of resources. There are no insurmountable problems, only the question of whether the will exists to deal with them.

Remember that our current poverty problem is due in large part to high unemployment. Unemployment is a symptom of weak demand. Unless demand increases, it doesn't matter how much money you dump on the poor; there are no jobs for them to take. However, motivating them to spend money increases demand, which subsequently creates jobs.

I was reading an article about the unemployment situation the other day. Part of the problem is not just a lack of jobs, but ironically a lack of job skills. There are plenty of jobs available, but those jobs require specialized skills that the average worker simply does not have. Experiments have been run to retrain workers for the jobs that are available. Nearly all of those workers subsequently found employment.

There's a very large skill gap right now in the economy. To take an example from my own company, if what I need is a Microsoft Access specialist, I can interview as many people as I want, but if they can't develop in VBA and manipulate recordsets, I can't hire them no matter how willing to work they are.

^ I heard that from college professors last year. Every time there's a recession, their enrollment jumps significantly.

But job skills is a definite lack. Long gone are the days of being a high school jock and working at a steel mill for 50,000 a year just doing manual labor. The modern economy requires skilled labor to earn a livable wage. Why do you think union membership is at its lowest point in almost two centuries? People are aware of that fact and the unions perpetually stay behind the times just so they can prop themselves up.

Go, Tom, attack the unions! Because the neverending flow of free market rhetoric from your keyboard is ever so amusing. You're like a broken record.