Maggie's Farm

Poverty is, of course, relative. The functional American poor have cars, washing machines, and cell phones. Poverty statistics themselves can be a snare and a delusion, especially if they are defined as the bottom whatever-% of the population, as the Brits do.

If you use that method, there will always be a bottom whatever-%, no matter what sort of safety net is provided through government, and our amazing abundance of American charities, most of which are desperate to find somebody - anybody - to help.

In fact, if you declare yourself poor in this neck of the woods, 20 government agencies and 20 charities will descend upon you like vultures - if only to justify their existence.

Poverty in the US is defined as below a $20,000 (declared) income, not by a percentage. I include "declared" in parentheses because there is a heck of a lot of black market labor out there where the boss would far rather hand you a pile of bills than put you on the payroll. We all see it, daily, just as well all see folks who will only accept cash.

Is "poverty" a useful concept at all, nowadays? I wonder. Or is it like "global warming" - just a handy excuse to expand government and entitlements? Tools for politicians?

What rankles me is that American poverty figures are driven by political agendas rather than by truth-seeking. Thus American poverty can include recent high school grads in their first job living at home. Or grad students, or hippies living off the land in northern California. Or addicts who don't get to work. Or crusty Appalachian hill-dwellers who don't like to come down to town to work (the original hippies), but poach, grow some stuff, make a little 'shine, and send the wife to town for the monthly check. Or other sorts of voluntarily poor such as those who won't move to where the jobs are, or rural and inner-city single 17 year-old moms with four kids. Or those whose second jobs are paid under the table. Or an unmarried couple where the partner works part-time at WalMart.

The icing on the cake, though, is that American income figures do not include any government or charitable transfers, grants (welfare, Social Security Disability, unemployment checks, etc), housing subsides or the value of subsidized housing, or other benefits such as food stamps, child care, and Medicaid. If that money is not included, there is nothing government can do to change the numbers.

Furthermore, poverty numbers do not take assets into account - just income. Thus I would be a poverty stat by being a 70 year-old Maine potato farmer with a paid-off 150-acre farm, living on Social Security in the big old family farmhouse, and selling $16,000 of potatoes every year. (I like to use Maine as an example because they have high poverty stats, but no-one going hungry or without a pick-up truck.)

The estimable Arnold Kling at TCS makes the case that the only war on poverty that works is the building of character in a capitalist system. One quote:

Our moral and mental development, and the high productivity that accompanies it, have taken place under a system of decentralized capitalism. I would claim that the capitalist system accounts for more than 100 percent of the reduction in poverty that has taken place over the past hundred years.

How can capitalism account for more than 100 percent of the reduction in poverty? Is that mathematically possible?

If we take into account the factors that have retarded poverty reduction, then we can argue that, by overcoming those factors, capitalism accounts for even more than 100 percent of poverty reduction. That is, if world poverty has fallen from 90 percent to 20 percent over the past 200 years, then capitalism would have reduced it by even more were it not for the retarding factors.

Ironically, the biggest factor retarding the capitalist solution to poverty may well be the crusade to end poverty using conscious planning. Certainly if one includes among the planned solutions to poverty the experiment with Communism (and I see no reason why it ought to be excluded), then the case against intentional anti-poverty efforts is rather compelling. Simply compare poverty in North Korea with that in South Korea, for example.

Kling is probably correct about the world in general, but, in the US, I doubt that applies because we are already a wealthy nation with plenty of jobs and no meaningful unemployment. You have to know there is work for everyone when my supermarket now has folks with Down's Syndrome doing shelving and bagging - which I think is wonderful.

But first, I want to know who the poor are, and what they own, and what they do all day. I am not hard-hearted, but I am hard-headed. My guess is that the truly American poor are mainly emotionally or physically disabled, dysfunctional, or exploitative and sociopathic - or the voluntarily poor (which includes new immigrants) or temporarily poor - and thus unlikely to benefit much from any kind of job growth.

Please correct me if I am wrong about any of this.

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