December 23, 2005
There will be poor always
The middle class is disappearing by getting richer. Only 9% of American families had an inflation adjusted income of more than $75,000.00 back in 1967. Today 27% do. The average American family’s net worth (assets minus liabilities) is more than $100,000.00, according too Census Bureau figures. The median American household income is over $54,000.00. We have come a long way.
But the poor just stay poor. People with inflation adjusted incomes of less than $5000 make up 2.5-3.5% of the population. It doesn't change much in good times or bad. These guys essentially don't work at all. Many people lack money and pass through poverty. Others stay there. They behave in ways that prevent them from becoming successful - a culture of poverty.
Neither liberals nor conservatives have much incentive to address the culture of poverty.
The liberals threw money at the problem with disappointing results. President Johnson declared war on poverty. Poverty won and got even more spiteful. Great Society style programs concentrated the poor. One naer-do-well family in a functional community is a nuisance. Crowding them together creates a self-perpetuating menace where nasty habits are exacerbated like a strengthening virus as they pass around the community. Gangs replace families; illegitimate births become common and crime is everybody's part time job.
Conservatives think it is the fault of the poor themselves and they should just stop it. This is true, but not useful because left to their own devices the culturally poor can't escape poverty. They don't know how and they are not even sure they should. They need help and maybe government programs to get them out. The problem is that they don't need the kinds of government programs they have been getting.
Government is like a bad parent who both spoils and neglects its children. What can be done?
The first step is to acknowledge the problem and to understand that it is not primarily economic. Next we need to recognize that nobody but the poor themselves can extricate them from their circumstances, but that they cannot do it alone. Finally we have to admit that many of the poor do not want to change the behaviors that keep them poor. Like alcoholics who prefer to drink and blame others, they slip into hopelessness and complacency. The culturally poor are figuratively and literally immobile.
Sometimes an external shock cracks this immobility. Katrina was a cruel shock, but it may have contained a lesson. It broke up dysfunctional communities and may have provided the kick start some needed to find jobs and a better life in a better place. The government side of the equation was the travel money, temporary subsistence and loans.
Maybe that is how government should help. Programs that encourage the poor to stay in their dysfunctional communities don't work. Most government programs have that effect, even if it was not their design. Other Americans move. Immigrants come and go, but the permanent poor abide, which is one reason they are permanently poor.
Why not make the poor mobile. Don't tie their benefits to places and don't concentrate them. What can the poor learn from each other? They already know how to hang around. Sometimes the solution is just to get out of town.
So let's work to solve this problem, if it can be solved. Maybe there will be poor always, but let's give them and ourselves a chance.
ok Jack,
but if it is alright with you I’d like to expand your initial proposition beyond the closed confines of a single national economy like the US of A to a global system. Economically speaking it is just no longer valid to only consider the internal workings of an single national economy and ignore the elephant of global trade.
Before I do that, I’ll just say that sure the basic tenant you have put forward that people have to be prepared to help themselves in order to get out of their own predicament is 100% right. Some on the left(but only some, who can be just as loud as silly people on the right) will continually overlook this, but if you examine the political trend across the world over the last 2 or 3 decades, left of centre political parties have moved out of that narrow mindset (see Tony Blair & New Labour as the perfect example).
I will contend that you can’t simply point the finger at the poor and say that they only have themselves to blame, it’s more complex than that. Now I know you were very careful to avoid the topic of race so I’ll try and do likewise, even though I want to bring up the issue of (non-specific skin colour)-flight when an upwardly mobile family of a different skin colour move into a that neighbourhood, followed by others to the point that the very first mobile family get pulled back into the environment they were trying to break out of as all the original inhabitants go elsewhere… responsibility to deal with poverty lies with more than just the poor.
Now. Here’s where I want to add a little spice. As an economic liberal myself (as well as subscribing to the rest of classical liberal thought), and pretty sure that there are still a few similarly minded economic liberals in the Republican party, what do you have to say about the interference of government in the decidedly un-free market approach to global agricultural trade, specifically trade in cotton? Yes, I know the Europeans and Japanese are guilty of the same sin. My frustration applies to them equally.
Wouldn’t it be better to avoid this big government approach, let the free market allow people the world over to lift themselves out of their own predicament via their own efforts? On the specific issue of cotton, there are all those farmers in Africa who then get the chance to move from living on a $1 a day, to perhaps $2. The US tax payer money currently funnelled into agriculture can be used elsewhere, maybe into pensions, or even a tax cut.
The poor don’t even deserve what they have. Nowhere on Earth do people get away for being such a waste. Only in America can the poor own five televisions and eat KFC on a daily basis. Great article Jack.: )
Posted by: jackrocks at December 24, 2005 03:02 AMHi Jack,
My First comment, Unfortunatly “the Real World” Kinda Suck’s and is a cold and cruel place. This often kicks those who are already down and then spits on them, Often resulting in further despair and all around feeling of being “Held Down” or left back, Social programs often do more to cripple those already with a weak spine and unwillingness to survive on their own. Lets start at the beging shall we IE:Public Education “Not Everyone can be a MD or a lawyer someone has to clean the toilets behind them, so we created “Social Promotions” in school, and lowered expectations “so they dont get left behind” only crippling them as they get older by saying its ok not to try, so why bother you can still get by. Then We teach “Sex Education” and tell them about sex at around 12, oh and tell them, but dont do it! but then turn around and give them condoms and birth control behind their parents back. Again saying well its ok you can still have your cake and eat it too, and watch them as they slip by year after year. they start loosing hope at an early age as they start having bad relationships based on sex and not true family values. They are turned out into the world often barely able to use basic reading and writting skills, toss in a kid or two, and you have started the perfect family, struggleing to get enough money to pay bills and then have the government hook them on Alcahol or cigarettes to help shorten their lives a few years so they will never live long enough to see that magic carrot down the road of “Social Security” cripple them further with hand outs “section 8 housing” why work when the government will pay your medical bills, Housing, food, and utilities. then we as a socioty wonder why do they end up selling drugs or prostitution, and help solidify there on demise. I see this everyday and why you ask because I am a product of that very system. My parents were endoctrinated in the mid 70’s on “social Programs” which they live on to this day sucking the life from the system which is a joke beacase everyone in it is laffing at the government for how well they monitior it for misuse and fraud, I Feel bad for my parents but their will to try died years ago now they wait eagerly every month on the 1st for thier meger handouts just enough to keep em alive but not enough to lead them out of poverty. I quit school at 14 after being social passed 2 or 3 times to get a job, I Had 2 before I was 15 and why? might you ask a small leason I learned by watchin the system go along “Helping” I watched cripple my closet freinds as they got trapped in the endless cycle of baby after baby or drug addiction’s from loosing hope, And a few simple words from my dad…”Please Son dont end up with a 3rd grade education like me waiting for your check, do better than me” The only real way to help people out of poverty is real education, Hope, and our leaders not just throwing bones to the poor instead of giving out a check, make them work for it yes there are consequences to pre marital sex and drug addiction and the host of problems faced by the poor but instead of giving them everything make them earn it help the gain basic skills, budget control, abuse resistance and give them a reason to leave the system volontarily and not just give up. I did I work now as a manager I take home enough Pay to feed my family and provide a nice life, its not an MTV Crib but it will do, a swift kick in the pants and a liitle motivation in the right direction as well as limited help will lead more away from poverty than any amout of cash you can throw at it.
Posted by: Rickey at December 24, 2005 03:25 AMJack said: “Others stay there. They behave in ways that prevent them from becoming successful - a culture of poverty.”
You are right. A huge percentage of them are mentally ill and homeless, the non-violent ones. The violent ones help fill our prisons. Part of the problem of poverty in the U.S. is our nation’s almost complete and total ignorance (Verb) of the mentally ill in our country. And our prisons have a huge population of the mentally ill.
Any attempt to deal with poverty in America has to include recognition of the GROWING mental illness rate in our population.
I find it bizarre Jack, that your reference to those earning less than $5000 constitutes your only reference to the poor. Is this a blatant attempt to minimize the reality of the problem? A family of 3 living on less $35,000 a year is poor in my opinion, not having the ability to simulataneously, live in a safe house in a safe neighborhood, keep private health insurance, allow for transportation for two persons to work, save for those many unexpected expenses especially if they have a child, and accomodate economic fluctuations like unemployment or spiking energy costs without huge negative and worsening effects on their economic status.
From the Children’s Defense Fund: (PDF)
However, today 37 million people, including 13 million children, are living in poverty. Although this number is lower than when the “War [on Poverty]” was declared, it represents an unacceptable figure in the richest country in the world.
A 2005 report released by the Center on Budget and Policy Priorities shows that investing in poverty-reducing programs lifts millions of children and families out of poverty. In 2003 social insurance and means-tested public benefits lifted 27 million people out of poverty, including 5 million children. Despite the noteworthy success of public benefit programs in lifting Americans out of poverty, unacceptable numbers of families and children remain in poverty and poverty rates in the United States exceed those of other wealthy industrialized nations. Many more children and families could be lifted out of poverty if government programs were strengthened and if more families accessed the programs for which they are eligible. A report by the Urban Institute found that if families with children had full access to government programs designed to lift them out of poverty, poverty would decline by more than 20 percent, and extreme poverty would be reduced by 70 percent. Instead, millions of families with children eligible for these programs do not receive the benefits and continue to live in poverty.
Child poverty takes a huge economic toll on our nation. All Americans pay the price — a price that is far higher than the cost of eradicating poverty. We all have a stake in improving the lives of children in America. …
In 2004, a family of three was considered to be living in poverty if it had an income of less than $15,219 a year. For a family of four, the poverty level was $19,157.
The very first thing Democrats and Republicans need to do to address poverty is come up with a realistic definition, one which does not minimize the scope of the problem.
The very first reality for politicians to face is that for a family with one parent raising two children, the average annual costs for basic needs sums to $29,976, which is a 2004 figure (ibid) already outdated by rising property rental rates and energy costs. I don’t hear any politicians trying to raise the spectre of that reality confronting the future of America. This is a reality which Republicans in Congress refuse to acknowledge or address.
But Politicians today, are ALL ABOUT minimizing the negatives aren’t they? Therefore, our current poliitical system will not even take the first step to define the severity and scope of the problem. And failing that, they can’t devise realistic programs to effectively deal with the problem, now can they?
I applaud immensely the Newt Gingrich Republicans efforts to tie gov’t. benefits to recipient efforts to improve their condition as well. It was a great start to dealing with the institutional problem of poverty, and they even got a reluctant Democratic President Clinton to climb on board of that policy.
But before you knew it, the Gingrich reform crowd was out, and the neocons were in, and the policy shifted for a helping hand up, to hiding the problem in the closet behind meaningless statistics designed to minimize and hide the magnitude of the problem. This of course served neocons need to divert revenues from social programs to war, military buildup, and over seas nation building and anti-poverty programs in places like Pakistan and Iraq.
The reality is, Republicans have abandoned any real efforts to deal with poverty in America, preferring to deal with poverty overseas where it spawns breeding grounds for potential enemies of Americans. How can they be so stupid as to think they are not creating a breeding ground for enemies of the status quo right here in America. Have they forgotten the urban riots, burning, looting and murder in America from 1967 through 1972 resulting directly from poverty conditions in America? Apparently. History is not a strong suit for the current Republican Party which prefers ideological theory to realistic pragmatism.
That period in our history spawned, through Lyndon B. Johnson, the greatest reduction in poverty in America since the post depression era and WWII. Regrettably, it also spawned the greatest dependency upon the welfare system in our history. But, social policy dealing with poverty was a very new social science at that time. We know far, far more about the dynamics of poverty today than in LBJ’s time, on issues ranging from housing projects to aid without jobs. But what good is this new body of knowledge?
And Jack, your figure of less than $5000 per year doesn’t even begin to represent the magnitude of the poverty problem in America.
Posted by: David R. Remer at December 24, 2005 04:14 AMOnly in America can the poor own five televisions and eat KFC on a daily basis. Great article Jack.: )
Yeah, what’s up with that? I’m poor as hell and have one television and plan my meals 5 days in advance. However, the people that are being spoken of (in comment above), don’t really have five televisions and KFC every day. I see variations of this behavior in sections of my county, but as the only thing “most of them do is sit around and collect checks” theory is wrong.
What I’m seeing now is families struggling w/o gov’t assitance, myself included, and I live in what is considered the “snooty” part of town. Remember Bush in the debates? Saying those displaced or whose jobs were outsourced could “retrain” at the community colleges he is so fond of? Where the hell was Cheney on the education side of that one two days ago? That was loans, not handouts. There’s a difference between a handup and a handout.
Bridge to nowhere.
Posted by: MyPetGoat at December 24, 2005 05:40 AMMePetGoat, thanks for sharing your personal experience, and I sincerely hope it will improve for you. There is no freedom where there is poverty. I know that from personal experience, as does anyone who has every been very poor.
One has to ask, with so many 10’s of millions of poor in America, if our government isn’t just paying reelection lip service to freedom, all the while limiting freedom for so many and increasing power over them by so few? There couldn’t be a more important question for America’s future than this.
Considering the fact that Republicans are once again planning to cut Student Loans, Public School Funding and most benefits for single-income homes, I can see the GOP raising the next generation of poor people. The line, “Its the Poor who make themselves poor.” is already patented.
Posted by: Aldous at December 24, 2005 06:08 AMThe “Poor” will always be among us is a quote made by Jesus a long time ago. However, he never did define what “Poor” is, only that it included the Sick and Lame. While over the last 40 years, America has acted like it wanted to help our poorest citizens, the truth of the matter is that neither the Democrats and Republicans wanted to make it so that our citizens could grow out of the problem.
Program abuse, cuts, and policies in Welfare led to President Clinton and Congress to replace Welfare with Workfare aftrer the Welfare roll raised to over 14 million Americans. Although the problem of the “Poor” staying “Poor” has for a generation meant that anyone who finds themselve in need of such services has been forced to give up any wealth they had and forbidden to collective wealth at all. Furthermore, due to the low wages and lack of enefits that are paid for “Societal Jobs” in our Service Economy denies this group of citizens access to the Market which would of allow them to help themselve get back on their feet. To be frank about it, since the 70’s this Welfare group of citizens has always taken the backseat to the Corporate Welfare that has always been a part of the American Principle of Capitalism.
Yet, why is both sides wrong on this issue in the way they want to handle and view the problem. Donald Trump is “Poor” in our Society compared to Bill Gates. This fact of word assoc. is only compounded further when one realizes that although Mr. Trump is “Poor” he does add positively to the function of society. However, as A Society should we be held to accept the fact that Mr. Trump is entitled to welfare of any sort? No! Because he has become Economically Viable and Financially Independent
This “Bench Mark” of Freedom for an Individual and his family in our society should not only be celebrated loudly for it allows Legally the Freewill of Nature to begin, but permits Society to legally be free from the burden of taxes. Eliminate the problem and why should or better yet, how can taxes be collected for something that does not exist?
Jack is right about the need for Welfare to change due to Congress’s failure to push through a requirement of a 40 hour work week for recieptants of such generousity(sp). Because since when did being an American mean not working hard at whatever your Trade of Labor is that gives you the Capital required to meet your Individual Simple Productive Lifestyle and Invest in a Manner that looks out for the Inherent Best Interest of All Consumers wrong? The higher question placed before us today is what is each consumer’s equal and fair share? What are the rewards and punishments for not working toward that goal? And most important of all is how do we create a global economy that will encourage that all humans have the capability to pay for what they consume without the need for government control and regulations.
Posted by: Henry Schlatman at December 24, 2005 07:45 AMAmong the factors associated with poverty, perhaps one of the greatest is living in a single parent family. A U.S. Census Bureau report shows that in 2004, 6.4% of people living in married households lived below the poverty line, while 13.8% in single male households and 30.5% in single female households lived below the poverty line. Census Bureau report
There’s little we can do to stop divorce, but addressing out-of-wedlock births could have a huge impact on poverty rates.
As has been stated, the right tends to blame the poor, while the left tends to see the poor as victims. Naturally, it’s far more complex than that. Yes, the poor are the only ones who can pull themselves out of poverty. But they can’t do it unless they know how to do it and believe they can.
Learning how to pull oneself out of poverty is more than getting a good education. It’s learning the life skills that make one successful in the workplace - reliability, dedication, productivity. How can they learn these things when there are so few role models to learn from? As Jack said, perhaps a Katrina-style relocation will prove to be beneficial as people are exposed to new circumstances. But I cannot see how we could enact that on a widescale basis, given both the cost and individual rights implications.
I think MyPetGoat raised an interesting point:
What I’m seeing now is families struggling w/o gov’t assitance, myself included, and I live in what is considered the “snooty†part of town.
I think we are going to see more and more of that as healthcare costs increase, our manufacturers face more offshore competition and we start to feel the effects of almost certain higher long-term interest rates due to our federal deficits. These are structural challenges we face that are made worse by a changing world. Though some may argue otherwise, they cannot be solved simply by raising or lowering either government spending or taxation.
Conservatives think it is the fault of the poor themselves and they should just stop it. This is true
Yeah…all you poor…Stop It! Stop being poor right now!
Merry F’ing Christmas to you too, Jack. What a Scrooge!
Posted by: Burt at December 24, 2005 09:36 AMJust because Jesus said the poor will be with us always is no reason for the U.S. government and others to make more people poor by government policies that benefit only the rich.
Posted by: Lynne at December 24, 2005 09:36 AMJack,
Qucik question: Are you a fan of Jesus Christ Superstar?
Posted by: LawnBoy at December 24, 2005 09:41 AMHi Jack,
To a large extent you’re right about people needing to get themselves out of poverty.
We tend to underestimate idiocy as a cause for many of problems of the world.
On the other hand having Americans starving to death isn’t a good position for us to be in. Some people need help.
I’ve encountered plenty of people who I want to say “Your problems are mostly due you’re own stupidity” but that’s not really a solution.
Welfare has caused an amazing amount of harm in this country. The out-of-wedlock birth rate in some areas is a tragedy and welfare is one of the root causes.
Posted by: LouisXIV at December 24, 2005 10:05 AM
Jack,
“The middle class is disappearing by getting richer. Only 9% of American families had an inflation adjusted income of more than $75,000.00 back in 1967. Today 27% do. The average American family’s net worth (assets minus liabilities) is more than $100,000.00, according too Census Bureau figures. The median American household income is over $54,000.00. We have come a long way.”
I hate to bring it up, but because no one else has, I will.
While these figures may seem amazing, you leave out the fact that in 1967, both parents didn’t need to work full time jobs to make ends meet. Latchkey kids were few and far between. You could still buy a car for under $5,000. Hell, you could buy a 3,000 square foot house, in a good neighborhood for under 40 grand.
There were no VCRs, no CD players, no X-Box, no cell phones, no computers and color TV had only been around for a few years, and most homes, if they had a TV at all, had a black and white.
There was no health or dental insurance, but you could actually pay for your doctor or dentist visit without taking out a morgage.
Oh, and BTW, gas was 35 cents a gallon.
American society has become extremely materialistic in the fourty years since ‘67.
Posted by: Rocky at December 24, 2005 10:17 AMOK… but why to you run with a direct comparison to net worth from 1967 to now, but then look at the poor with inflation adjustments. Of course there are more middle class now above the $75,000 that 40 years ago, but taking inflation into account, how do those numbers look? Also, look at recent stats, and then study the number of families in poverty now that were not there 5 or 10 years ago. How many people in 1967 (population %) were at or below poverty level? Compare that to now.
How many people consider Jesus when filing their taxes? If you can make ends meet and then decide your tax dollars still are better spent on you rather than those in need… can you still call you self a Christian?
Where the hell do you get the insane idea that poverty is the fault of the poor? (1/3 of our nations poor are military vets… who better to deserve our unquestioned support?) What about people with mental and physical issues that will never allow them to get out of poverty or maintain their own needs without support?
Posted by: tony at December 24, 2005 10:36 AMConsequences don’t seem to be a reality anymore. I think that without the govt’s welfare safety net, perhaps people would have more initiative to making better choices in their life(styles). Unfortunately there always seem to be innocent children involved, and lazy selfish parents who would have them do without, than themselves. My dad’s family was extremely poor growing up (7 kids) and my grandfather didn’t do much more than complain about the “woes of the little guy”. My dad learned from these mistakes, and made a decent and hardworking upper middle class life for himself and our family. Unfortunately, many of his siblings did not, and continue struggling to make ends meet to this day.
Posted by: Buffie at December 24, 2005 10:37 AMWelfare, for too long now, has had reverse incentives for the people in need. The more children a woman has out of wedlock, the more money she makes; the longer someone stays unemployed, the more money the make (only losing monetary compensation if the gain employment). I say reverse this trend and reward those who help themselves and make good decisions. If a single woman with child chooses to work part time and not become pregnant again, give her more money and aid to help lift her up. If someone unemployed chooses to accept a part time job, reward them with more aid and financial help. Conversely, if someone continues to remain unemployed and makes poor decisions; why not stem back the financial assistance and only offer job and financial counseling. Money is usually a very prime motivator.
Posted by: Jay at December 24, 2005 11:00 AMyou leave out the fact that in 1967, both parents didn’t need to work full time jobs to make ends meet.
This is directly due to the increase in taxation during that time. If you were to revert the tax rates back to what they were and then also include the cost of having a job (travel costs, child care, etc) most families would find that they would retain more of their income by having one of the spouses stay home.
Yet another self-fulfilling prophecy of overbearing taxation to pay for our government reighning tyranny on it’s own citizens.
Posted by: Rhinehold at December 24, 2005 11:18 AMJay - please link to these ‘facts’ you are stating… You have a very skewed version of reality. One quick point, the average person spends 16 months on government assistance - hardly a ‘lifestyle.’ Also, the fastest way to get people out of poverty it to force employers to pay a livable (non-poverty) wage. The majority on poverty - families on government assistance are working fulltime jobs. A fulltime job @ minimum wage is less than $11k a year.
Your idea that women have children because they get more money is a complete falsehood. You can only receive financial assistance based on the size of family you enter welfare on. Certain assistance goes up - food stamps and Medicare, but the actual assistance wage does not increase. (The average payment is less than $500 per month.)
Do you consider food stamps and daycare assistance a luxury? How do people work jobs without these assistances? But don’t worry too much, if a family goes over $18k per year, they loose their assistance.
Please - get a real sense of the issue… these falsehoods you spout are doing real harm to people who CAN NOT afford the bubble you live in. (Sorry to sound harsh… but better be harsh to you than them.)
Posted by: tony at December 24, 2005 11:31 AM—-
This is directly due to the increase in taxation during that time. If you were to revert the tax rates back to what they were and then also include the cost of having a job (travel costs, child care, etc) most families would find that they would retain more of their income by having one of the spouses stay home.
—-
But the point is that this argument dismisses inflation.. so the idea that there are more middle income families making more money now that 40 years ago is false.
Posted by: tony at December 24, 2005 11:33 AMDavid
The reason I went so low is to talk about the culturally poor.
Is also very hard to measure poverty because the statistics don’t include non cash aid such as food stamps, Medicaid housing assistance are excluded. Food, rent and medicine are a big part of most people’s expenditure. That is why the lowest fifth of the American population reports and income of only $8201 a year but spends $18,492.
Most analysis misses the mobility of society. I have been in all five of the quintiles at some time in my life. It is not an uncommon experience in the U.S. to move among the income levels. This goes for the poor too. Only 2% of the American poor remain in poverty long term (more than four years). Those 2% are the real problem.
Burt
The rest of the paragraph talks about how the poor cannot do it alone. I have no doubt that a person in reasonable health, with a decent education and the right attitude can have bad luck and become poor. But I am equally sure that he won’t stay poor very long. I think we should look for ways to make sure most people are reasonably healthy, have a decent education and the right attitude. I would be willing to spend government money to do that. But we have to have sticks as well as carrots.
Lawnboy
I listened to Jesus Christ Superstar when I was young. I didn’t like the movie.
Louis
I have never heard of an American starving to death in my lifetime unless he willfully avoided getting help. The biggest problem for the poor these days is obesity.
Rocky
Your first point (about two earners) is valid. I also agree that we have become more materialistic. The poor of today enjoy a higher material lifestyle than the middle class of 1967, but feelings of poverty is relative. The Economist ran an article comparing a poor guy in Kentucky with a successful surgeon in the Congo. They make almost the same money and could buy the same lifestyle, but the doctor enjoys his status.
The $75,000 is adjusted for inflation, so the relative prices don’t come into play.
Re dentists and health care - there is a very interesting development since 1967. Back then, most dental care meant filling and pulling teeth. Now it is braces and cosmetic. Fluoride and better toothpastes mean that kids don’t get cavities. My three kids (14,17 & 19) have never had even one cavity among them. Health care has also moved to higher levels.
Tony
It is inflation adjusted (see above)
I don’t think it is the fault of the poor, but it does result from their behavior. It is a subtle but important distinction.
Interesting. I was curious because the title of your post is an exact line in the musical. I wondered if it was a reference.
Posted by: LawnBoy at December 24, 2005 11:48 AMLawnboy
It was a reference to what Jesus said about the poor. I quoted from memory so it may well be the reference. I read the New Testament in English and in Greek and if my memory goes instead of the original formulation to rock music I heard a long time ago, it shows the power (and insidiousness) of popular culture.
That is something to think about. The actual quote is “For ye have the poor always with you;” Matthew 26 v 11.
I guess,”the meek shall inherit the earth, but not the mineral rights” is also wrong.
Posted by: Jack at December 24, 2005 12:07 PM—-
Tony
It is inflation adjusted (see above)
I don’t think it is the fault of the poor, but it does result from their behavior. It is a subtle but important distinction.
—-
Sorry for misreading the $75,000 above. I would suggest we look at the % of families in poverty and in middle class (then and now,) not just picking a basic number.
Please tell me how families in poverty who work fulltime jobs are behaving inappropriately. Same goes for military vets who are homeless. I will agree that I have met some people who will always have ‘bad luck’ and coninute along the poverty level… but there are vast numbers of households living the proper way… what would you say to them?
Posted by: tony at December 24, 2005 12:14 PMTony
The whole distribution has been moving up.
The $54,000 MEDIAN income is a good example. Half of all families make more and half less, so it is not affected by the super rich or abysmally poor.
The stubborn part of the distribution has been the poor. As the majority of Americans moved forward, some of them stayed the same. Some is a statistical artifact. You can’t make less than zero income, so that will always be the base. But those that stay poor for long times are clearly doing something that keeps them there.
Re veterans, I don’t know about that statistic. Statistics about homeless are unreliable. Veterans are entitled to many benefits unavailable to ordinary Americans and a career soldier has a guaranteed pension even if he is only 38. So you could argue this various ways. If the stats are true, increased government entitlement programs would seem not a viable option, since they don’t work to help this test segment.
Re general wealth and poverty - most people will not have enough money to buy what they want. This is the natural condition and nothing can be done about it. Most people will have to make some hard choices. For two solid years, I ate potatoes or beans almost every meal. I know that you can feed yourself for almost nothing if you eat these things and you can afford vegetables, fruit etc. too. You just can’t by luxury foods and you can’t drink much. At that time I went to school full time and ran almost every day. It was very healthy on that diet. Even if you adjust for inflation, you can have that diet for a couple dollars a day. Do you want to eat like that forever? Maybe not. But the knowledge of how and what to eat and the discipline to do it allows you to live cheap.
I find this a completely appropriate republican response to christmas. Merry Christmas!!
Posted by: chantico at December 24, 2005 12:41 PMLife since the inception of Reaganomics. Bush I called it voodoo. The charts say it all.
Posted by: Rick at December 24, 2005 12:43 PMWhile such data are impressive it is simply meaningless to publish such comparisons without relevant costs comparison relating to costs of living.
Posted by: Ed at December 24, 2005 01:14 PMI have absolutly no problem with helping someone that’s poor out of poverty. Provided they are trying to help themselves. The problem I’ve seen so far is that most don’t want to help themselves. They want the Government to do everything for them.
I have offered jobs to unemployed folks. Out of around the 30 to 40 I have done this with I’ve only had 3 take the job. One is still with me and a very good worker. In fact I just promoted her to supervisor of the shipping department.
One went to another job more to his liking and is doing very well in it. He has just bought his 1st home and moved his family in it in time for Christmas. The 3rd one I fired because she didn’t want to work. She was calling in 2 or 3 times a week. And didn’t work when she was there.
Both women were on welfare when I hired them. The man had been employeed before but lost his job due to alcoholism. He hadn’t worked for about 6 years. He was trying to clean up his act and needed a break. The women that is still with me decided that there had to be a better life than she had and wanted a better one for her kids. The other women was a product of the Clinton welfare reform. The only reason she looked for a job was because the welfare department told her she had too.
The difference here is that 2 wanted something better. And were willing to work for it. One said she wanted out of provety. But what she really she wanted was someone to give her everything need to get her out without working for it. I believe this is the mind set of most that are in provety. They want better but aren’t willing to work for it.
Hello,
I have thought that the Republian Party’s main tenet was, first prove to us that you do not need help and then we will help you. Like the large oil companies, pharmaceuticals, and the like. I am aware mental illness and other psychosomatic problems affect more than the 2.5 to 3.5 percent of our population.
America is only as strong as our middle class, and that is getting smaller because of mumerous beliefs and actions of people in power. Righiousness and judgement will not solve problems. Only working together and alowing change to address need will ensure a possibility of successfull outcome. I do not have the answers to tomorrows needs for a better standard of living.
I am willing to learn. A fool knows everything and a wise person is willing to learn. Is an opportunity an opportnity if the person that would benefit the most from the opportunity does not trust or believe it is?
I always realize there is very little effort going to be done when individuals lable, “they” instead of “us”.
tony
Unless you live in NYC, Chicago, or San Francisco, you can live pretty good on $75,000. You may not be driving an Mercedes S600 and living in a $500,000 home. But you can buy a home and a pretty nice car. And still feed and clothe your family.
You are taking the quote out of context. The above use of “for ye have the poor always with you” implies that Jesus is either speaking prophecy (there will always be poor people) or describing God’s will (i.e. that a percentage of the population being poor is part of the order of things).
But if you read the passage you see that it has a whole different meaning. I won’t go into the whole story (you can read it yourself if you desire), but the point is that Jesus was telling his disciples (please forgive the crass paraphrase): you will have more opportunities to help the poor, but this is the last time you’ll be seeing me.
Looking at all of the teachings of Jesus, it is incredible that anyone could use his words to imply that we should ever be content to accept poverty among our fellow men. It is for each of us to examine what is inside our own minds, but those who claim to love Jesus and feel free to use his words to promote a point of view that is in stark contrast with what he preached should spend some serious time reflecting this Christmas day.
Posted by: Joshua at December 24, 2005 02:28 PM—-
Unless you live in NYC, Chicago, or San Francisco, you can live pretty good on $75,000. You may not be driving an Mercedes S600 and living in a $500,000 home. But you can buy a home and a pretty nice car. And still feed and clothe your family
—-
What does this have to do with anything? My point is that there are more families living in poverty today. There are middle class families falling into poverty. People working fulltime jobs live at or below poverty.
Please Ron - prove your point or find a new reality:
“I have absolutely no problem with helping someone that’s poor out of poverty. Provided they are trying to help themselves. The problem I’ve seen so far is that most don’t want to help themselves. They want the Government to do everything for them.”
Exactly who are you talking about? Do have facts and figures to back this up? Are these people you have met? Do they exist outside your reality? You keep saying that you don’t mind helping people who try to help themselves. The majority of poverty and homeless have a fulltime job, are women and children or military vets. Exactly who in this group do you see as unworthy of our help?
Posted by: tony at December 24, 2005 02:55 PM—-
We the People of the United States, in Order to form a more perfect Union, establish Justice, insure domestic Tranquility, provide for the common defense, promote the general Welfare, and secure the Blessings of Liberty to ourselves and our Posterity, do ordain and establish this Constitution for the United States of America.
—-
‘Promote the general welfare’… so why do so many feel that this is outside the scope of our government?
Posted by: tony at December 24, 2005 03:01 PMTony and Mary
The Middle class is getting richer, not falling into poverty. All the quintiles have gone up in INFLATION ADJUSTED dollars.
The income cutoff to be considered middle class back in 1967 (i.e., the middle-income quintile) was between $28,000 and $39,500 a year. Now that income range is between $38,000 and $59,000
So there are fewer people making the middle class wages of 1967 because they are doing better. They are making the better middle class wages of 2005. It is nothing to be sad about.
If there was one statistic to look at, it would be the median. The average can be affected by inequality and the rich. The median cannot. The median is now over $54,000. That isn’t poor.
The problem with trying to show that everyone is becoming poorer (besides it being incorrect) is that it distracts us from addressing the real problem of the poor. Ordinary people benefit from programs that help them make more money. That is good and I am not saying we should not do that.
But the long term poor are largely immune to these programs. In N. Virginia we have an unemployment rate of less than 2.5%. Firms go all the way to West Virginia to recruit unskilled labor and of course non-English speaking immigrants find work. Yet across the Potomac in DC unemployment stays above 6% and there are calls for government to create jobs. We have a decent mass transit system and from March to October you can ride a bike. What is the problem? It is habit and training.
The long term poor are not unworthy of our help, but the usual big city welfare programs don’t help them. I am not interested in keeping them poor. We need the workers; they need the work. Let’s figure out how to make the connection.
Jack,
A couple of points and I will do my best to prevent my response from devolving into a diatribe:
This entire discussion on the poor has missed the largest constituent group - the disabled and their families. That no one has mentioned disabled persons just screams the ignorance of posters on this discussion.
Leaving racial and cultural stereotypes aside, the easiest way to become “one of the poor” is to have a physical or mental disability or to have a family member or child who is physically or mentally disabled.
The median income of disabled families is 39,155, 30% below the 54k number you quoted (if the disability is mental, median income drops another 10%). With all the additional expenses of caring for the disabled, this groups wakes up each day with at least two strikes against it.
The disabled have unemployment rates almost double the able population and are out of the work force at four times the rate.
How many families are we talking about? 28% of all families - 20.8 million families as of the 2000 census.
The rest of the poor -
the chronically poor: I’m from NYC and worked in Harlem for years - this is the smallest segment and the ones that Republicans point to every time they want to steal from the poor by eliminating a needed program from the overwhelming majority by pointing at those few “bad apples”;
single mothers: another group with the odds stacked against it which needs programs just to get by - in a United States where dual income households make up more than 70% of all married family households, single mothers don’t have a chance;
immigrants without valuable skills: I’m first generation and this is the group I worry about the least - while poor by comparison, many are getting ahead by their standards. Where illegal immigration is the primary reason for poverty, though I am liberal, I don’t believe in subsidizing illegal immigration.
Anyway, that leaves the unfortunate and the unlucky, neither wishing to remain poor nor, in many cases, capable of making it without assistance.
So, what do we do with them?
Jack, how does your equation or approach change?
tony
I miss read you post. I thought you were saying that $75,000 wasn’t enough to live on. Sorry.
While I don’t have any figures availible I do go on what I see and from talking to people. And my experiences.
I stated that I have offered 30 to 40 jobless people, all but a couple are on welfare, a job. I only had 3 takers. Now what conclusion would you draw from that? If these folks really wanted to work wouldn’t they take the job offered? I’m not talking about a minimum wage job here. I start my employees out at $9.50/hr to $10.50/hr depending on experience. That’s $380 to $420 a week. You can’t make me believe that they get more on welfare. Why don’t they take these jobs? The only reason I can think of is because they want the Government to take care of them and don’t want to work.
I don’t know right off what the poverty level is. But I would guess that in order to be living in poverty that someone would have to be making minimum wage. I know that they raise the poverty line depending on the number of people in a household. However most people make more than minimum wage. So I have a problem with your accertion that middle class families are falling into poverty.
Jack-
I’d ask you one simple question: Is it getting more expensive to live a middle-class lifestyle? Can you honestly tell me there aren’t expenses and infrastructural needs that have sprung up in the last few years?
Beyond that, I’d ask you whether or not prosperity is worth much if it’s built on unstable ground, like that of massive debt or an economy that’s leaking jobs elsewhere. How robust is this economy.
It’s not that I hope things are going wrong. Indeed, I would very much like to see a good economy running. But two things bug me about the modern perception of economy- This overemphasis on numerical, rather than observational measures of things, and this uncritical appreciation of economic policy that seems to haunt modern politics.
Neither Pessimism nor Optimism are warranted here. What we need is a more critical approach, one that doesn’t abstract successful numbers without looking at the sources they’re supposed to represent.
Posted by: Stephen Daugherty at December 24, 2005 05:22 PMRon Brown-
You presuppose a lot. Transportation, hours, personality conflicts, folks at home in need of care, other jobs, etc. can all be causes of their not taking you up on the jobs.
This is the trouble you get into when you read such moral factors into things. People’s lives are more complicated than that.
Posted by: Stephen Daugherty at December 24, 2005 05:26 PMJack
I noticed you gave no statistics on the actual plight of these hardcore poor, only stated that it was their fault. However, when you tote up the percentage of different debilitating afflictions that people face, it is quite remarkable that the percentage in poverty is that low. As you probably know, but fail to acknowledge, the main reason people fall into and stay in poverty is due to illness, either physical or mental. Although it is comforting to those of you who feel we should not make any special effort to help the poor through government to believe they merely earned their poverty, you would be hard pressed to produce any statistics that support that belief.
But, you know, what would Jesus do and all that.
Merry Christmas, man.
Posted by: Mental Wimp at December 24, 2005 06:02 PMI forgot to mention the other specious part of Jack’s carefully crafted misdirection. By comparing the 1967, the statistics ignore the retreat that has happened over the last 5 years, during Jack’s hero’s administration. Basically, the success of the “welfare state” in lifting everyone is now being reversed. The only reason we are still so far ahead is that the increase was so large. Given our current trajectory, however, that will be erased in a decade or so.
Don’t every trust a gerrymandered set of statistics like Jack produced. You have to look at the trends over time, by year or quarter or whatever, or they can be susceptible to misrepresentation, as Jack has so ably demonstrated.
Posted by: Mental Wimp at December 24, 2005 06:07 PMStephen Daugherty
First off, NON of these people had jobs. Non of them lived to far to walk. I had a man one time that walked 2 hours to get to work. I’m not sugesting that anyone do that. But if they want to work they CAN find a way there. I run 2 shifts and try to be as felxible as possible on them. However hours might have been a problem with a few of them. If single mothers can find someone to take care of their kids while they work, and I don’t mean day care centers, then anyone else should be able to find someone to take care of anyone else that needs care. Usually relitives are willing to help. But I’ll give you some might have had problem with this. Also non of these were handicapped in any way that would keep then from the safe performance of their job.
So we might have eliminated maybe 4 or 5. What about the rest? Like what are the chances that most or all had these problems?
BTW, when I found out about the man walking 2 hours I helped him get a car. Of course I won’t do this for someone just starting as I cosigned a loan for him. But he’d been with me for 5 years and is a reliable employee.
The middle class is disappearing by getting richer. Only 9% of American families had an inflation adjusted income of more than $75,000.00 back in 1967. Today 27% do. The average American family’s net worth (assets minus liabilities) is more than $100,000.00, according too Census Bureau figures. The median American household income is over $54,000.00. We have come a long way.
Not at all. What you’re seeing is the effects of 38 years of currency inflation, thanks in large part to Nixon taking us off the gold standard in 1971 and the mind-boggling deficits of Bush 43. In 1967, $75,000 was a sizeable income. It’s still not bad but nowhere near as hefty as back then. You’ll also find that in 1967, those $75,000 family incomes entailed one wage earner whereas now two-earner families are the norm. That $100,000 net worth figure probably counts the market value of the home, which have been in a bubble lately.
I know what you’re going to say: the Fed and the BLS assure us there’s no inflation. But their books are cooked worse than Enron or Worldcom ever dreamed about doing. The simple fact is that, adjusted for inflation, things have gotten worse, especially recently, not better. I’ll address the other points in a later post.
Posted by: spongeworthy at December 24, 2005 06:43 PMThe simple fact is that, adjusted for inflation, things have gotten worse, especially recently, not better. I’ll address the other points in a later post.
Posted by: spongeworthy at December 24, 2005 06:43 PM
And of course it’s nothing that won’t magically get better as soon as there’s a Democrat Congress and President. Right? Kinda like the ‘92 election.
CP
You would have to delve a little more into that disabled category. We all picture the armless, the legless, the blind, the insane. But if you look at that category you find also a lot of the obese, the “tired”, the difficult to define back problem etc. The way we define disability makes a difference. Everyone is disabled in some sense and everybody is able in some sense. Many people are disabled in the sense of doing many kinds of heavy industrial work. Most people are not disabled when it comes to sitting at a sales counter.
I take you point about disability. But the problem also remains what to do about it?
The other thing is that there are often lots of excuses. What I tell my kids and employees about being sick it this: stay home if you are contagious. Otherwise if you would leave for a vacation feeling the way you do, stay home. Otherwise come to work. A lot of people seem to have no trouble getting to their entertainment can’t get to work.
Stephen
I don’t agree that it is getting harder to stay in the middle class. Our definitions have risen. We expect to have two cars and nicer houses. People expect to travel and have vacations. I think we should have these things too, but my parents didn’t.
Life is not supposed to be easy. You should have to work and sacrifice to get what you want. Some people have forgotten that.
Where’d ya get your numbers, Jack, from the EIB web site? This census bureau site doesn’t quite agree with your 27% earning > $75K number for today. It also says nothing about the data being adjusted for inflation.
Posted by: spongeworthy at December 24, 2005 07:21 PMRon Brown sez:
And of course it’s nothing that won’t magically get better as soon as there’s a Democrat Congress and President. Right? Kinda like the ‘92 election.
Where did you get the idea I either said that or hinted it was true? But since you brought it up, I do stipulate that the Dems are unlikely to do a better job and are actually prone to making things worse.
However, the two most egregious causes for the currency inflation we’ve experienced since then are in fact 1) going off the gold standard and 2) the huge federal deficits our nation is currently running. Had the Dems or even an independent been responsible for those misadventures, the results would have been the same.
I have just one more question for you: why can’t any government/policy issue be discussed with you in particular and with Republicans/conservatives in general without the canned response “Dems/Libs are worse.”?
Posted by: spongeworthy at December 24, 2005 07:38 PMI got it here - http://online.wsj.com/article/SB113513427028228173.html?mod=opinion_main_commentaries
I didn’t link because it is a premium site.
I looked at your figures and the confuse me (I am easily confused by numbers.) I don’t know if they are the same source information. I am not sure if the figures include all sources of income or how they adjusted.
When I add up household incomes on your chart, I get -
75-99 = 11.1%
100-149 =9.4%
150-199 = 2.9%
200 + = 2.7%
Total of 26.1%
It is a little less than the 27% in the article, but not much.
The family income over $75K is higher than 27%
We got
75-99 = 13.5 %
100-149 = 12.0%
150-199 = 3.7%
200 + = 3.5%
This total is 32.7%. Which is higher than the article, but not much.
When I Googled median income, I came up with a census bureau site that showed $65,093.00 (higher than the figures) http://www.census.gov/hhes/income/4person.html.
I am not sure what figures the article used. But it is clear that the general idea is correct. With your tables, we can go from a low of 26.1% to a high of 32.7% but it looks pretty good in any case.
The numbers of families making more than 75K is about the same as those making less than 35K.
Sponge
We went off the gold standard in 1933. You are probably thinking of the breakdown of Bretton Woods in 1971. But the problem with inflation was that we had it already. The fall of the gold standard was the effect, not the cause.
We are not experiencing much inflation now, BTW.
Posted by: Jack at December 24, 2005 08:52 PMThe cruelest thing you can possibly do to a child is to raise them with the values that only “chumps” work. I have taught school or counseled in many low income communities and worked in corrections most of my life. I am increasingly amazed at the subtle ways that children can be “taught” not to value work, never to feel the feeling of accomplishment and quiet self worth that comes from a life-long habit of not only work, but of learning to size up a job and to prioritize tasks.
In a way, child labor laws are evil when they prevent apprenticeship, the ancient practice by which most of mankind was ever educated. The thing about apprenticeship is that it not only puts the student directly at the mercy of the employer, it puts the student right on the front line of the market demand for the goods or services being produced. The smart students soon figure out what really makes the customer part with their money and they learn to value their own economic freedom after being exploited in their learning years.
In America we have tended to put a huge middleman between the student and the employer, the educator. We have the most lavishly funded, liberally conceived education system in the world. Yet many of the students who most desperately need the free public education that the system is trying to stuff down their throats become bored, become frustrated, just become lazy, and soon up to 50% of them drop out!
Why? I have thought about this many decades and concluded that an education system that doesn’t hire people who deeply believe in loving and serving others isn’t going to work very well. Not only must educators have the sterling qualities of love and service burning in them, they must also be absolutely technically competent in the subject matter they are trying to teach. If you are trying to teach a student to make Japanese black lacquered furniture and you don’t have a clue how to do it yourself, you had better be an extremely nice person or students will immediately figure out not to respect you, as they should.
It is a tricky business interposing this education establishment between students and employers. My experience is that those teachers who really didn’t like teaching and weren’t very good at it are the ones who zoom to the top of school administration. In almost every public school the salary schedule is inversely related not only to the actual student contact hours being put in, but to subject matter knowledge as well. It used to be that the head master still saw at least the brightest students, and also was theoretically the best academician of the teachers. If you read the word processor product of many American public school administrators (which I unfortunately have had to do) you realize that even with spell check they can’t spell, can’t use grammar correctly, and really are not very well educated generally.
And these administrator folks reign over a work force of teachers that are highly unionized and politically potent, teaching a curriculum that is always five to ten years behind the demands of the workplace. If all that isn’t enough, in America any indignant parent can storm into the school and, with enough persistence and some legal savvy, turn the whole program upside down and inside out to prioritize servicing THEIR child over the needs of the greater good.
In a rapidly changing world we are in, I often dream about eliminating that corrupt middleman entirely. Maybe directly delivered computerized instruction combined with some way of recognizing and empowering the truly dedicated and loving teachers that are out there, in combination with apprenticeship programs that take students by the necks and force their little noses right into real, completely real, work.
Posted by: Michael L. Cook at December 24, 2005 10:15 PM
We are not experiencing much inflation now, BTW.
I disagree. The only way you can even ingenuously say that we’re not having price inflation is if you can swallow without vomiting the Fed’s contorted numbers which factor out food, housing and energy, then factor in hedonic multipliers (i.e. cars today are 6 times faster, more efficient, safer, more comfortable, etc. than those in 1967, so if they only cost 6 times as much as the 1967 models, there’s no inflation).
As for currency inflation, i.e. the amount of spendable US$ available in circulation, we’re experiencing historically unprecedented, massive currency inflation since Bush 43 took office. You simply have no leg to stand on trying to argue against that. Just the off-budget expenses in Iraq and Afghanistan are enough to cause that.
As for going off the gold standard in 1933, I’m not sure what you mean by that, but I do know that as of 1971, foreigners could walk up to the treasury building in DC, hand in their dollars and walk out with bullion. For all practical purposes, Nixon’s closure of the gold window was the end of any hope for price stability and the beginning of fiat currency. Statistics bear out that we’ve experienced worse price inflation since 1971 than ever in US history.
It’s too bad you can’t show us where you got the 1967 numbers and how they were inflation adjusted. As an amateur economist and professional statistician, that 18% change in the number of households earning more than $75K is very, very fishy.
This total is 32.7%. Which is higher than the article, but not much.
A 6% variance is not much? Wow. That’s all I can say.
But I digress.
When I Googled median income, I came up with a census bureau site that showed $65,093.00 (higher than the figures)
65K is 11K (about 16%) higher than the 54K you quoted, hmmm. Interesting. But what’s 16% between friends, right?
But the problem with inflation was that we had it already.
In 1971 we did have some inflation, but nothing like what we’ve had since. The closing of the gold window in 1971 was no way a result of the mild inflation we had then, it was the result of most of our accumulated gold leaving the country due to trade imbalances.
Posted by: spongeworthy at December 24, 2005 10:24 PMCheck this page for a discussion of the CPI provided by the government compared to a more realistic one. Also, note the approximate doubling of CPI beginning about 1971 (quoting): The CPI rose at a compound annual rate of 2.7% from 1959-1971, and jumped to 5.2% from 1972-2000.
There is also a discussion of currency inflation here.
The reason I am belaboring the point is that, not only does the impact of inflation destroy the premise of your thesis that most people can break the bonds of poverty thanks to our wonderful economy, in fact inflation is often likened to an invisible tax that makes us all poorer, but especially those who are poor to begin with. Inflation gives us all the incentive to spend now and forget about saving; to think that much of the inflation we are now experiencing can be traced to the un-conservative tax cuts without offsetting spending, then to hear you, Jack, try to portray this as some kind of economic miracle is nothing more than trying to lie with statistics.
Posted by: spongeworthy_us at December 24, 2005 10:51 PMHere’s a publication I’ve found on the census site that might be pertinent.
I especially like this graph that, to me, tends to indicate that education, especially a college degree, is integral to escaping poverty. The result actually looks better to me than razing large areas of a major metropolitan area. Note it is in 1997 adjusted dollars.
Posted by: spongeworthy at December 24, 2005 11:20 PMSponge
The guys who wrote the article I mentioned crunched the numbers. It is from the WSJ. You can get the article if you go to the December 21 WSJ in your library. The article is called “Great American Dream Machine”. The authors are economists. I trust what they did. I can’t link to it, or actually you can’t get it unless you have a subscription, but you can check it at your library.
Either way we have good news in the U.S. The way I crutched them, actually makes a stronger case than the authors’ original numbers did. By their numbers 27% of Americans make more than 74k. By yours it is 32%. Americans are even better off.
The median income I found in Google is also HIGHER. This means we are better off.
If you want to prove I am not optimistic enough, you succeeded. Thanks. But it destroys your down side. So between us friends, America is a better place.
We went off the gold standard in 1933. Roosevelt did it. Americans could no longer redeem their dollars for gold and were not even allowed to own gold except as jewelry of collectible coins. Most of dollars were held by Americans and our trade was not a big percentage of GDP so that is what made the difference.
After WWII Breton Woods agreement pegged other currencies to the dollar and the dollar to gold. It works as long as the U.S. was willing to absorb the consequences of lower currencies (as the Chinese are doing now). There were differential is purchasing power in 1970. The same thing happens today and it results in changes for the market rate of currencies. We needed a more flexible system.
I don’t know what inflation you are suffering. Inflation just means that things cost you more in dollars. The price of my combo at Quiznos has not changed in the last year.
Inflation was high in the 1970s. It declined in the 1980s and it not high now.
But we have strayed from the subject.
You have proven that the U.S. is doing well. I accept that I may have underestimated our prosperity. But some poor remain. What to do about that was the main theme of this post.
Sponge
The education figures are also very good news. What are you trying to prove. Education should pay off. It provides social mobility.
Posted by: Jack at December 24, 2005 11:25 PMThe median income I found in Google is also HIGHER. This means we are better off.
It means nothing other than that your numbers are suspect. Finding a 16% higher number for supposedly the same variable in two different places puts both numbers in question. You don’t get to pick the one you like and say it’s right.
The price of my combo at Quiznos has not changed in the last year.
Which would prove nothing unless a Quiznos combo was all anyone in the US ever bought. So, I’m guessing you’ve bought no gasoline, natural gas, cereal or a home in the last year, is that right? If you had, you would have known that all these things have increased in price substantially, as they have done for some years now.
As far as what to do about it, as I put in a previous post, it looks like we need to improve the educational system in a rational way.
Posted by: spongeworthy at December 24, 2005 11:33 PMWell, good night and Merry Christmas, Jack. Hope that doesn’t offend you or anyone else.
Posted by: spongeworthy at December 24, 2005 11:41 PMEnergy is higher this year, although gas has declined in price since September.
Cereal has not gone up. Rents have actually declined in my neighborhood. The price of beer and Coca-Cola is stable. The local coffee shop actually lowered its price to compete with a Starbucks that opened nearby.
Re the numbers, I told you where I got them. You can suspect them all you want. Your numbers are better than mine, so you can suspect them too, but you have nothing to show it is worse now than before.
I am sorry that you are becomming poorer. Yours is not the usual experience. I shop at my local Giant and my grocery bills are not much higher this year. I don’t actually drive much. The price of a metro ticket is the same as last year.
Posted by: Jack at December 24, 2005 11:44 PMGood job Jack. Thanks and Merry Christmas. I’ve been getting more into politics and economics over the past few years and found this site. I love your optimism and agree with most of your views. Again, Merry Christmas and am looking forward to your next post.
Posted by: andy at December 25, 2005 01:45 AMI am sorry that you are becomming poorer.
It’s not just me, we are all made poorer by the inflation we are currently experiencing, even you, although I can’t seem to help you understand that.
Granted, someone like me whose salary has quadrupled since 1985 (25K->100K), or someone like you who apparently has acquired a good-sized forest recently, feels the effects much less than someone who has not had the good fortune in life we’ve had.
I know that on your micro scale, you see no inflation. On a macro scale, even the government admits to some inflation using its contorted and distorted methodology. As the articles whose links I’ve posted earlier explain, the government has a lot of incentives to downplay inflation so they do. Analogously, there are a lot of incentives for the WSJ to spin their numbers to make things look good, and I’m sure they do.
Admittedly, I’ve not yet posted numbers to dispute your 18% reduction in households earning more than $75K, but only because I’ve not had the time to navigate the governemtn web sites to find the data.
I’m willing to bet that although you claim the WSJ numbers are inflation-adjusted, that an error was made on that somewhere.
I always find it hilarious to hear Republicans make the inferential leap that if they don’t personally experience something, nobody experiences it; and if they personally do experience something, everybody else does too. It reminds me of Ronald Reagan.
Again, a Merry Christmas to you.
Posted by: spongeworthy at December 25, 2005 10:41 AMSponge
I would have to admit that I cannot understand what you mean.
My own experience with the things that I buy or see advertised indicated modest inflation. Fuel prices have gone up. Rents have gone down. My grocery bills are similar.
Statistics back this up. Inflation will be a little more than 3%. Unemployment is low (about 5%). Economic growth is good. The U.S. dollar has increased in value against the Euro this year. Interest rates are higher than last year, but still lower than they have been for most of my adult life.
My problem is that the statistics agree with my experience. You and some others keep on telling me how rotten life has become. I don’t see it.
I know that some people are having a harder time. Some people are poor all the time. I have tried to propose some ideas that would help the poor. We can complain about how hard life is for some people or try to figure out how to fix it.
One objection I have to the formulation you made. You talk about good fortune. I have been lucky, but success is not random. It is not true that the poor are just unlucky. Life is not a big lottery. Choices matter. People who remain poor for long times are either phenomenally unlucky (a small number) or are making bad choices. If you want to help the poor, help them improve the choices they have available and those they make.
The fact is if you want an education bad enough you can get one. If you work hard enough you can pull yourself bup by your boots. People who live a lifestyle in which no real incentive to succeed is given,are the ones i feel sorry for. Learning that it is not ok to succeed and that you are somehow selling out your own people by getting an education and caring about your future is poison. Allowing your children to live immoral lives and have kids out of wedlock when they themselves cannot care for themselves is another lack in resposibility. I hear all the time how bad single mothers have it in life. Well there ya go! You would think by now that even a moron would know this and avoid this trap. However, when you allow people who make these kind of mistakes to be enabled to continue on and reward them with even more money if they have another child, you get what you ask for! Sad that someone like me who asks that people take responsibility for thier own actions and pay the consequences be considered heartless and less compassionate. Simply put i would think that with all the money being handed out every day to the poor people who wallow in the gutter drinking and doing drugs is not helping. It is simply enableing them to get another fix. Natural selection is my belief and as far as i am concerned it is long past time for the no hackers to be weeded out!
Posted by: G at December 25, 2005 03:15 PMPeople that make poor lifestyle choices should not expect the taxpayer to continually bail them out. As far as the lazy people go, any able bodied person who won’t work should not eat.
Posted by: Bob at December 25, 2005 07:27 PMFor those wanting to adjust for inflation. Adjust this.
In 1967 the median income was around $5,000. You could buy a new Chevy or Ford for around $3,000. A differnce of $2,000.
Today the median income is $54,000. You can buy a new Chevy or Ford for around $30,000. A difference for $22,000.
In 1967 most people made about $2.25/hr. Gas was $.35/gal. A $1.90 difference.
Today most make $10/hr. Gas is $2.13/gal. a difference of $7.87.
But your right, we’re worse off today than we were int 1967.
For those wanting to adjust for inflation. Adjust this.
In 1967 the median income was around $5,000. You could buy a new Chevy or Ford for around $3,000. A differnce of $2,000.
Today the median income is $54,000. You can buy a new Chevy or Ford for around $30,000. A difference for $22,000.
In 1967 most people made about $2.25/hr. Gas was $.35/gal. A $1.90 difference.
Today most make $10/hr. Gas is $2.13/gal. a difference of $7.87.
But your right, we’re worse off today than we were int 1967.
Tony, FYI I lived on a poverty income for a long period of time raising two children. I qualified for every program there was and did, for awhile, accept some assistance. I know that “lifestyle” and a lot of those people first hand. I know some women who have had more children for the benefits; they qualify for more aid and programs while there “extended” family helps take care of the kids. I know people who didn’t want to find a job because it would decrease their “eligibility” for programs. The current welfare system is played like a game amongst many and the tax payers are the losers. Re-incentivize the programs to encourage participation, reward performance and re-direct the funding and you will see programs actually designed to lift people up not keep them in the same place. I have seen this first hand Tony, don’t assume I live in a bubble.
Posted by: Jay at December 25, 2005 07:49 PMDon’t forget that there are some goods and services that you have to factor in not only cost inflation, but the increase in value due to sheer progress in utility.
In 1972 I bought a brand new german small car for $1,700. It had a radio and four seat belts. It went 90,000 hard miles and was worn out
In 1997 we bought a nearly-new Japanese car for $15,000, which is what $1,700 in 1972 money would be today. The Toyota came with Am/Fm/tape, A/C, automatic, cruise control, power windows, intermittent wipers, four shoulder harnesses, and two air bags. The Toyota gets about 3 mpg more on average and pollutes much less.
More importantly, the Toyota has 150,000 miles on it and is still going strong. I could make the same type arguments about many appliances in my house and the house itself, actually, especially in regards to energy efficiency and safety.
So, if you are going to talk about standard of living, you have to look not only at costs, but at the relative quality of what is being consumed.
Posted by: Michael L. Cook at December 25, 2005 09:42 PMWith every aspect of society there has been and will continue to be the culture that resides within it. Work ethic is taught and learned through experience. Where it is lacking,so to will be the lack of success!
Posted by: G at December 25, 2005 10:01 PMRon Brown — why are you quoting the raw dollar figures? Your own numbers show that cars and gas were no more expensive relative to income than they are today — we’ve just tacked some extra zeroes onto the prices.
Jack —
Only 9% of American families had an inflation adjusted income of more than $75,000.00 back in 1967. Today 27% do.
Yeah, but in 1967 those were one-income families…
Posted by: Noumenon at December 26, 2005 07:27 AMBecause they don’t lie. And that’s the point. The left wants say that aduusted for inflation we’re worse off today than then. But we’re really better off.
Noumenon
You are right that we have had a change with more people working for pay. But I think it is an error to separate economics from society.
Households were bigger in 1967 because there were more children. So the incomes had to feed, cloth and house more people. Look at the housing of 1967. Couples move into houses that used to house families off eight. And the couples feel crowded. We just have more.
The other variables are labor savings and women’s rights. The non-employed spouse was not living a life of leisure. Back in 1967, women spent most of their time cleaning, cooking and taking care of kids. ( I know they will say they still do, but any honest woman will admit that her mother worked harder at these things than she does.) We had single earners, but it is not like the woman at home was not working.
Materials, labor savings devices and cultural changes mean less work at home. In 1967 few homes had dishwashers and they didn’t work well. If my dishwasher breaks, I use paper plates until it is fixed. People used to iron all the time. Now I have dress shirts (all cotton) that REALLY require no ironing.
So many people are actually working less, but working more for money.
Just to provoke people, but also to say the truth, a couple without children really should not have one partner not working outside the home. There just is not enough housework to do.
We are a lot better off today.
Anecdotal Evidence of Less Prosperity.
In 1955, my Dad held a blue-collar, assembly line job in Minneapolis and was paid $1 per hour or $2,180 per year. My mother stayed at home and raised us three kids. We lived in a brand new 3- bedroom rambler in the suburbs, ate well, had 1 used car, and took family road trips every summer. I’m sure he had to pay high property taxes to support the new and growing infrastructure.
My Dad’s wage would equate to $7.26 per hour, or $15,826.80 today. I’m not a “stats” guy, but it would be impossible to duplicate his accomplishment on that wage today.
Lee
Posted by: Lee at December 26, 2005 08:16 PMLee
$1 an hour was not a low wage in 1955. THe median wage in 1955 was $3552. Wages have risen faster than inflation. Your father made about 62% of the median wage at that time, which would be $33,480.00 if multiplied against today’s median. Not great, but you could still afford a house of about that same square footage you probably had back then. You could afford a used car and take some road trips.
Posted by: Jack at December 26, 2005 10:18 PMJack,
The job that my Dad had would not pay $33,480, or $16.59 per hour today. It would probably pay about $7-11 per hour, ($14,126- $22,198 annual) which still makes it doubtful one could afford a lower middle class lifestyle.
Is the current median wage skewed by the fact that the top income “earners” take hundreds of multiples of the wages that their lowest paid workers make?
Lee
Posted by: Lee at December 26, 2005 11:48 PMJack,
Incidentally, If you know any employers willing to pay $16.59 per hour plus benefits for HS grad trained assembly work, send ‘em to Minnesota— we’ll take all you got!
Lee
C’mon guys, we’ve been through this before. No one claims we’re worse off than in 1967 (strange year to pick; why, Jack?). What has been happening over the last 5 years is that real median income has been shrinking. See this link and this link for the facts.
Which brings up the question, why the spin, Jack? What ax are you grinding? Why choose the comparison you did rather than a more recent one? Why not show the entire history of median incomes and poverty? Is it that it doesn’t support your rosy outlook? You are either being intellectually dishonest by lying with selective statistics or too stupid to be editing this column. Which is it, Jack?
Posted by: mental wimp at December 27, 2005 02:20 AMMental
I am not being partisan on this one, except to say that the policies we followed since about 1980 are working. There have been Republicans and Democrats responsible for them. The median has dropped a little in the last years because of the downturn or 2000-2001. That always happens. Incomes lag economic growth and will rise again, probably this year.
I chose 1967 because that was the base year in the article I read re. I don’t know why they chose it. We could take 1970 or 1965 and come up with similar ideas.
To your point about the changes - many people claim we are worse off today than we were in 1967 (or at least 1972. That is the year they like the best). It is almost an article of faith on the left side that real incomes have not changed since then. I remember the 1970s. They sucked. It is true that we were worse off in 1980 than we were in 1970, but we recovered. Since 1982 we have not really suffered economic hard times.
Posted by: Jack at December 27, 2005 09:23 AMIt is an immutable fact that poverty has increased under every GOP administration in the modern age, dating back to Herbert Hoover, exacerbated under Ronald Reagan and climaxed (?!) under G.W. Bush.
Posted by: Limo Liberal at December 27, 2005 10:55 AMHey, Jack. I really appreciate the dedication you show to interacting with your commenters. Glad I checked back instead of making it a driveby. It does seem like the more facts you know, such as my single-income-vs-double fact and your more-children-per-income fact, the less the statistics need to say standing on their own. Context is good.
Posted by: Noumenon at December 28, 2005 02:58 AMJack
Once again I’m impressed by your measured response to my provocative post. But just so our fellow bloggers know the facts, I am posting the median income back to 1975 from this census website. As you can see, there has been a downturn in the last few years. I hope that our historical momentum can be regained soon, lest our friendly democracy become ever more polarized and invidious.
Historical Income Tables - Households
Table H-6. Regions—All Races by Median Income:
1975 to 2004
Income in 2004 CPI-U-RS adjusted dollars
Year Median
2004 $44,389
2003 $44,482
2002 $44,546
2001 $45,062
2000 $46,058
1999 $46,129
1998 $45,003
1997 $43,430
1996 $42,544
1995 $41,943
1994 $40,677
1993 $40,217
1992 $40,422
1991 $40,746
1990 $41,963
1989 $42,524
1988 $41,771
1987 $41,442
1986 $40,939
1985 $39,545
1984 $38,782
1983 $37,577
1982 $37,800
1981 $37,859
1980 $38,453
1979 $39,688
1978 $39,733
1977 $37,337
1976 $37,127
1975 $36,515
