Tag: war on poverty
5 Lies Paul Ryan Needs You To Believe About Poverty

5 Lies Paul Ryan Needs You To Believe About Poverty

The only thing more disturbing about hearing Jeb Bush say that George W. Bush is his closest foreign policy advisor is having to endure Paul Ryan pretending to care about about alleviating poverty.

Paul Ryan doesn’t just get the facts about poverty wrong — “Mr. Ryan’s poverty report, like his famous budget plan, is a con job,” The New York Times‘ Paul Krugman wrote — he creates a narrative that purposely stigmatizes the poor.

When he released his first budget plan that would send millions below the poverty line, he often referred to the safety net as a “hammock,” as if poor Americans were lounging around waiting to live off the supple fat of $4 a day in food stamps. Casting doubt on the poor’s willingness to work is a core principle of “dogwhistle” politics meant to divide the deserving poor from the rest of us who benefit just as much from government help, but in ways that are far less obvious. As many have noted, some white folks have been calling black people lazy ever since black people stopped working for free.

Ryan has revised his rhetoric a bit and wisely opened up his thinking to consider some criminal justice reform, as long as it doesn’t touch on the root of the “New Jim Crow” — The Drug War. But his argument is basically the same: Poor people choose to be poor because they don’t know better. Cut their government support and give them life coaches so we can afford huge new tax breaks for the rich, who have never been richer.

The prophet George Carlin said, “Conservatives say if you don’t give the rich more money, they will lose their incentive to invest. As for the poor, they tell us they’ve lost all incentive because we’ve given them too much money.”

We’re crawling out of almost 40 years of that “logic.” After massive tax cuts for the rich, we created about 20,000 jobs a month under George W. Bush, about 65,000 a month if you don’t count his disastrous last year. Under Barack Obama we’ve raised taxes on the rich and passed Obamacare, the biggest and most effective attempt to reduce inequality in at least a generation. And we’ve seen 98,000 new jobs a month… 182,000 if you don’t count his disastrous first year, which was severely hampered by the mess Bush’s disastrous last year left behind.

But facts only get in the way when your agenda is to undo progress. Republicans have to say the policies they oppose have failed because it’s the only way to argue against undeniable conservative failures. Here are five lies that conservatives insist on you accepting so we can redouble our efforts the help the people who truly need our help — the rich.

1. The “War on Poverty” didn’t work.

This lie is so invidious even some conservative writers have started pushing back against the idea that government spending hasn’t made a dent in poverty. But it’s the basic premise of Ryan’s attack on our safety net and it’s been repeated recently by GOP presidential candidates Jeb Bush and Mike Huckabee.

Conservatives compulsively ignore that many measures of poverty are taken before adding government aid into the equation. A new study shows that government programs are even more effective than previously thought at keeping Americans out of poverty. In 2012 alone, we lifted 48 million of our neighbors out of extreme need with the safety net.

The idea that the War on Poverty doesn’t work should be most offensive to seniors.

elderlyspm

 

By any measure, we’ve cut the percentage of elderly Americans living in poverty by more than half since Lyndon Johnson declared the War on Poverty some 50 years ago. And they are the only group that didn’t see a spike into poverty due to the Great Recession.

Ironically, seniors are now the core of the GOP’s political power in America, and the only reason Republicans are able to pursue savage cuts to the stability we’ve created for our grandmothers and grandfathers.

2. The poor are lazy.

This is the true gospel of the right. It’s how they justify opposing every government program including Medicaid expansion, which only helps Americans who earn too much to qualify for regular Medicaid. And it’s built entirely on a misunderstanding of who the poor are.

Demos’ Matt Bruenig looked at census data and found that the vast majority of the poor in America are children, the elderly, the disabled, and students.

Who-Are-the-Poor_0

Sadly, 20 percent or so are working poor who would likely be pushed out of poverty if the minimum wage were raised.

Ah, what about the “Rest”? They sound lazy! They must be the shiftless hammock dwellers whose main goal in life is to suckle at the taxpayer teat. Yeah. Notsomuch.

nonworkingpoor87

 

Bruenig found that the vast majority of them are occupied with “Caring” for children or another loved one. That leaves fewer than 1 out of 10 poor Americans as the sort of jobless moochers conservatives would like you to believe all poor Americans long to be.

3. Government help creates dependency.
Who ends up on welfare in America? About half of us. And of the 1 out of 2 Americans who gets government help, only 5 percent end up taking that help for 10 straight years.

“The idea of welfare dependence is an utter fabrication invented by rich Republicans to gut the social safety net,” Demos’ Sean McElwee wrote. “But this safety net has actually been incredibly effective. Which is why these rich Republicans want to get rid of it.”

Otherwise, we many not be able to afford the help we give to people who don’t need it so badly — like tax breaks for vacation homes, gluttonous business lunches, and private jets. Too bad the poor don’t enjoy such luxuries, or those too might become “hammocks.”

4. A lack of morals is the problem, not a lack of cash.

It’s always a little freaky when conservatives who don’t believe government can fix roads think it can fix “culture.” But this is the exact argument of the right whenever there’s an event like the riots in Baltimore that unearth the horrors of what it’s truly like to be poor in this country.

Crime is way down in America, as is teenage pregnancy and most other “immoral” behaviors that we measure, which makes you think the “morality” the right wants to see is a more theocratic and controlling government with more say in what women do with their bodies, and less of that “helping the poor” crap.

Bruenig points out that America has some of the worst poverty in the industrialized world for one simple reason: We spend less than the countries — like the Nordics — that have nearly eliminated poverty. “If you want serious anti-poverty policy that targets actual poverty,” he wrote, “and not stereotypes of it, then what you want is welfare-state expansions targeted at vulnerable populations.”

5. Cutting help to the poor will help the economy.

It hurts everyone when the poor don’t have the basic essentials to live.

“The societal cost of hunger, for example, is $167.5 billion per year as a result of factors such as lost economic productivity, the increased costs of poor educational outcomes, avoidable health care costs, and the increased costs of charitable assistance,” The Center for American Progress’ Joey Moes wrote in an analysis of Ryan’s 2012 budget.

Republican policies are especially bad for the poor. But they’re also bad for everyone else, except the very, very rich.

Still, Paul Ryan has done a lot to help poor people. For instance, he helped Mitt Romney lose.

Photo: Gage Skidmore via Flickr

The War On Poverty Then And Now

The War On Poverty Then And Now

It’s been 50 years since the late Michael Harrington published the Other America, about poverty in the wealthiest country in the world (that’s us folks). In many ways, according to Sasha Abramsky of the Nation Institute, we still have the same problems and worse. The American Way of Poverty: How the Other Half Still Lives “shines a light on this travesty. Sasha Abramsky brings the effects of economic inequality out of the shadows and, ultimately, suggests ways for moving toward a fairer and more equitable social contract. Exploring everything from housing policy to wage protections and affordable higher education, Abramsky lays out a panoramic blueprint for a reinvigorated political process that, in turn, will pave the way for a renewed War on Poverty.”

As Elections Loom, Capitol Hill Is Latest Front In War On Poverty

As Elections Loom, Capitol Hill Is Latest Front In War On Poverty

By William Douglas and David Lightman, McClatchy Washington Bureau

WASHINGTON — The war on poverty returns to Capitol Hill as lawmakers prepare to wage a battle this week that’s a likely preview of what’s to come on the campaign trail this election year and in 2016.

Fifty years after President Lyndon Johnson declared his intent “not only to relieve the symptoms of poverty, but to cure it and, above all, to prevent it,” key congressional Republicans and prospective Republican presidential candidates are hammering away at some of his Great Society programs. They label them well-meaning failures that have done more to strain the federal budget than to slow the cycle of poverty.

House Budget Committee Chair Paul Ryan (R-WI) is expected to continue the theme Wednesday when his committee convenes for an update on Johnson’s goal, a follow-up on a scathing report on Washington’s anti-poverty efforts that Ryan unveiled last month.

“For too long, we have measured compassion by how much we spend instead of how many people we get out of poverty,” Ryan said in a statement last month. “We need to take a hard look at what the federal government is doing and ask, ‘Is this working?’”

Democrats, meanwhile, are looking to increase the nation’s minimum wage as a key strategy for reducing poverty and helping to narrow the income gap between America’s rich and poor. As Ryan’s committee meets Wednesday, the Senate is expected to take a key test on a measure to raise the minimum wage from $7.25 to $10.10 an hour.

“This raise only gets people out of poverty. That’s all it does,” Senate Majority Harry Reid (D-NV) said last month.

Driving all this debate is some very crucial political calculus. Voters can expect to hear more of how each party would address income inequality as this year’s congressional elections and the 2016 presidential contest approach, political analysts and poverty experts say.

But for all the talk, people shouldn’t expect political action soon, they warn. Democrats are well aware that their efforts to raise the minimum wage will go nowhere in the Republican-controlled House of Representatives.

The House, meanwhile, passed a Ryan-written budget that includes cuts and big changes in entitlement programs, such as Medicare, knowing that it’s dead on arrival to the Democratic-held Senate.

“I think all this stuff is a prelude to 2016,” said Eugene Steuerle, a former top Treasury Department official who’s an expert on taxes and Social Security at the Urban Institute, a Washington research center. “I think right now you have a stalemate between the parties, with the Democrats trying to complete the (President Franklin D.) Roosevelt agenda with universal health care — trying to protect the Affordable Care Act. Republicans are trying to protect gains of the past in trying to keep tax rates moderate.”

Johnson announced the war on poverty at his 1964 State of the Union speech. It became defined by a series of programs design to help the poor, among them food stamps, Medicare, Social Security and housing assistance.

Like Ryan, critics of the program think that much of the money spent over the last half century has been wasted. A recent study by several Columbia University economists argues otherwise, citing a revised method by the U.S. Census Bureau that was used to calculate the impact of federal poverty programs.

“Our estimates … show that historical trends in poverty have been more favorable — and that government programs have played a larger role — than (earlier) estimates suggest,” the report said. “Government programs today are cutting poverty nearly in half … while in 1967 they only cut poverty by about 1 percentage point.”

The national poverty rate stood at 15 percent in 2012, according to a the Census Bureau report last September, with 46.5 million people earning at or below the federal poverty line of $11,170 for an individual and $23,050 for a family of four.

The figures represented the second consecutive year that the number of people below the poverty line and the poverty rate showed no significant change. However, the rate was 12.5 percent in 2007, the year the economy began its descent.

Though they aren’t the issues topping most voters’ lists of concerns, both parties see potential benefits at the polls in raising the issues of poverty and income inequality.

“It’s a get-out-the-vote issue” for the Democratic base, said Jennifer Duffy, Senate analyst for the nonpartisan Cook Political Report.

Republicans apparently think so, too. In addition to Ryan, Sens. Rand Paul of Kentucky, Marco Rubio of Florida and Ted Cruz of Texas — all potential GOP presidential contenders — have spoken at length about poverty or recently toured poverty-stricken areas to tout their approach to the problem.

“Raising the minimum wage may poll well, but having a job that pays $10 an hour is not the American dream,” Rubio said in January in a speech commemorating the 50th anniversary of Johnson’s pledge to attack poverty. “And our current government programs offer at best only a partial solution. They help people deal with poverty, but they do not help them escape it.”

Paul’s speaking tours in urban areas and other places viewed as traditionally non-Republican recently earned him a story in the National Journal headlined, “Rand Paul’s Compassionate Conservatism.” It likened his efforts to those of the late Rep. Jack Kemp (R-NY), a conservative supply-side economics devotee who maintained good relations with the African-American community.

Democrats hope not only to prod their own base but also that enough Republicans will be moved by the need to close the income gap that they’ll look at Democratic candidates.

A Pew Research Center survey in January found that Republicans are split over how, and even whether, to deal with issues of poverty and income inequality.

Democrats are more unified, as 90 percent thought government should do something about the issues. The challenge for Democrats is to make people care.

Pew’s survey found that 49 percent of all those polled listed “dealing with the problems of the poor and needy” as a top priority. That was down 8 percentage points from a year ago, and the latest figure was well behind strengthening the nation’s economy, mentioned by 80 percent, and improving the job situation, 74 percent. It ranked 11th, after reducing crime.

“People see in their own communities and families people losing jobs, not income inequality,” said Juliana Horowitz, Pew senior researcher.

Republicans are torn on how to proceed. The Pew poll found that while 4 of 10 conservative Republicans thought government should do a lot to reduce the rich-poor gap, 6 in 10 moderate or liberal Republicans felt that way.

“We will not grow our economy or put people back to work by expanding entitlements. We will never solve the problems of poverty and inequality through bigger government,” said Rep. Tom Rice, (R-SC).

Ryan learned the political difficulty of addressing poverty when he went on former Reagan-era Education Secretary Bill Bennett’s conservative talk radio show last month and questioned the work ethic of “inner city” men.

“We have this tailspin of culture, in our inner cities in particular, of men not working and just generations of men not even thinking about working or learning the value and the culture of work,” Ryan said on Bennett’s “Morning in America” radio show.

His remarks created a firestorm among African-Americans. Ryan backtracked somewhat, saying he’d spoken “inarticulately.” He’s expected to explain his comments further Wednesday when he meets with members of the Congressional Black Caucus.

“Congressman Ryan is a nice guy, and as such he has tried to frame the comments that he made about inner city folks as just sort of an inarticulate way of communicating,” said Rep. Gwen Moore (D-WI), a member of the black caucus. “His take on talking about poverty is to say that we’ve spent millions or trillions on poverty programs and poverty won. We see that, essentially, as sort of playing with statistics or numbers.”

Crazy George via Flickr

Top Obama Advisor Urges Expansion Of Tax Credits To Cut Poverty

Top Obama Advisor Urges Expansion Of Tax Credits To Cut Poverty

When the modern income tax was first instituted in 1913, it was levied on only the top 1 percent of earners, and when the payroll tax was added in 1937, it started at a rate of only 2 percent. As a result, the tax system effectively ignored low-income households. But a steady broadening of the income tax base and increases in payroll taxes meant that, by the late 1960s, the tax system was adding substantially to poverty by requiring payments from households that pushed some of them under the poverty line and pressed others still deeper into poverty.

A series of legislative measures passed since the 1970s has reversed this trend. In 1975, the earned income tax credit (EITC) was created; in 1997, the child tax credit became law. Since their creation, both have been extended, with an expansion included in almost every major tax bill since the mid-1970s. As a result, over the past century we have moved from a tax code that ignored the poor, to one that exacerbated their condition, to the one we have today that directly reduces poverty for households with children, while increasing incentives for work, education, and advancement.

The recent financial crisis dealt a severe blow to American families, wiping out more than $13 trillion in household wealth, causing median household wealth to fall by 39 percent, and forcing eight million people out of their jobs. Without any tax or benefit policies, the poverty rate measured by market incomes alone would have risen by 4.5 percentage points from 2007 to 2010. That amounts to about 14 million more people, including many from the middle class, who would have fallen into poverty, just based on the economy.

Instead, the comprehensive measure of poverty fully reflecting taxes and benefits went up only half a percentage point — about 1.5 million people. While that amount is certainly lamentable, and we should be doing our best to avoid even that outcome, it is a massive difference from the 14 million that would have fallen into poverty absent those policies.

Moreover, this improvement in poverty was the result of a combination of pre-existing policies and important expansions in the American Recovery and Reinvestment Act, which bolstered tax credits such as the EITC and child tax credit, temporarily expanded SNAP benefits, and extended and temporarily expanded unemployment insurance benefits, in addition to giving states incentives to undertake ongoing unemployment insurance reforms. All told, the expansions in 2009 and beyond were responsible for more than 40 percent of the total poverty reduction from tax credits and benefits.

The EITC and partially refundable child tax credit (CTC) have dramatically altered the impact of the tax code on poverty. In 1967, a household at the poverty line paid about 12 percent of its income in federal taxes all told, including payroll taxes. Paying those taxes pushed millions of families below the poverty line, in turn raising the overall poverty rate by 3.2 percentage points. The impact of the tax system on poverty for non-elderly households with children was even more pronounced, raising the poverty rate by 3.9 percentage points largely because, for those households, the poverty line is somewhat higher to reflect the greater needs of larger families.

The tax system today is dramatically different, working not to increase but to reduce the overall poverty rate by 1.3 percentage points in 2012. Instead of exacerbating the poverty rate for families with children, it lowers the rate — by a total of 3.7 percentage points in 2012. But the tax system still taxes low-income childless households, raising their after-tax poverty rate.

Although the changes to the tax system since the 1990s have reduced its contribution to poverty among families with children, it has only been since Democrats insisted that the refundability of the child tax credit be expanded as part of the 2008 stimulus that the tax system stopped increasing overall poverty. In 2009, the Recovery Act further expanded the refundability of the child tax credit and made two critical enhancements to the EITC: reducing the marriage penalty that had dramatically cut down on the credit for some low-income people with children who married; and expanding the tax credit for families with three or more children to reflect both their greater expenses and higher poverty rates. Taken together, the anti-poverty policies under the Recovery Act reduced poverty rates by 2.6 percentage points for families with three or more children and 1.3 percentage points for families with one or two children. The EITC and child tax credit policies first enacted in the Recovery Act now benefit 16 million families a year by an average of $900 per family.

The major changes described thus far apply almost exclusively to households with children. As a result, the federal tax rate for a married couple with two children and with income just at the poverty line has gone from 10 percent in 1967 to -16 percent in 2012. But the tax rate for a married couple with no children at the poverty line has been practically constant, going from 12 percent in 1967 to 11 percent in 2012. The same divergent trends appear among single parents.

Overall, the emphasis on families with children has been appropriate. The tax system used to do more to add to poverty for households with children than for households without. And even with these changes, the poverty rate for non-elderly households with children is still 1.8 percentage points higher than it is for households without children, due to those families’ often higher needs — which is why it would not make sense to expand the childless EITC at the expense of the EITC for households with children.

The president’s proposal would double the childless EITC to be worth up to $1,005 and lower the age threshold from 25 to 21 to help more lower-income young people, while also increasing the upper age limit from 65 to 67 to align with scheduled changes to Social Security’s normal retirement age. The household at the poverty line would see its EITC expand from $170 to $842, more than eliminating its income taxes, although it would still pay net taxes on earnings when including payroll taxes. (Note that these workers would receive returns during retirement through Social Security and Medicare.)

The proposal would benefit more than 15 million people by an average of $430, including lifting about half a million people above the poverty line and reducing poverty for 10 million more. The EITC expansion would be fully paid for by closing loopholes that let some high-income professionals avoid income and payroll taxes, including the carried-interest loophole.

Members of both parties have increasingly advocated expansion of the EITC for childless households. Senator Marco Rubio called for an expanded wage supplement for workers without children. Michael Strain of the American Enterprise Institute has said the program should give “more support to childless workers.” Glenn Hubbard, who chaired the Council of Economic Advisers under President George W. Bush, has written that “increasing the credit for childless workers to an amount closer to that for families with children would augment the direct work incentive and help counter poverty among the working poor.”

These arguments have also received support from other conservatives, including Nobel Prize-winning economist Gary Becker and New York Times columnists David Brooks and Ross Douthat. On the other side of the aisle, Isabel Sawhill and Quentin Karpilow at the Brookings Institution recently proposed an EITC reform that would provide a “significant benefit” to childless single individuals. Likewise, the Center for Budget and Policy Priorities and economist John Karl Scholz have long proposed expanding the childless EITC.

If we are to make significant progress that is economically and politically sustainable, we also need to focus on raising wages and increasing incomes.

This is one key motivation for the president’s support for legislation to raise the minimum wage for all Americans to $10.10 an hour. Doing so in 2016 would raise a family of four with one full-time worker above the poverty line. As the president noted in his 2014 State of the Union address, “Americans overwhelmingly agree that no one who works full-time should ever have to raise a family in poverty.”

The goal of raising market wages and incomes is the motivation for much of the rest of the president’s economic agenda, including investments in education, infrastructure, and research as well as business tax reform and trade agreements and other policies designed to expand economic growth and to ensure that the benefits from growth are widely shared.

In 2064, when we look back on the War on Poverty at its 100th anniversary, if America still faces the same level of “market” poverty we do today, regardless of what further successes we have achieved in reducing poverty through our tax and benefit system, we will have failed as an economy and a society. But this does not mean we should turn our back now on reforming and expanding measures like the childless EITC that boost post-tax incomes. In fact, encouraging work and mobility measures like the EITC are part of the broader strategy to raise pre-tax incomes—and working in tandem these efforts can help achieve a more just and more equal America.

Jason Furman chairs the President’s Council of Economic Advisers.

This piece is adapted from an essay in Democracyissue #32, Spring 2014.

Photo: AgriLife Today via Flickr