Sunday, August 30, 2015

Edin & Shaefer, $2.00 a Day

Discussions of income inequality usually focus on the gap between the stagnant, amorphous middle class and the rich or, cast more broadly, between the 99% and the top 1%. Little attention is paid to the very bottom of the scale, occupied by people who under the best of circumstances barely scrape by, who ricochet from one crisis to the next, who may receive some government benefits but have no money. In $2.00 a Day: Living on Almost Nothing in America (Houghton Mifflin Harcourt, 2015), Kathryn J. Edin and H. Luke Shaefer, both academics, tell the stories of eight families who live(d) for at least part of a year on no more than $2 a day, one of the World Bank’s metrics of poverty in the developing world.

According to Shaefer’s analysis, “in early 2011, 1.5 million households with roughly 3 million children were surviving on cash incomes of no more than $2 per person, per day in any given month. That’s about one out of every twenty-five families with children in America. What’s more, not only were these figures astoundingly high, but the phenomenon of $2-a-day poverty among households with children had been on the rise since the nation’s landmark welfare reform legislation was passed in 1996—and at a distressingly fast pace. As of 2011, the number of families in $2-a-day poverty had more than doubled in just a decade and a half.” (p. xvii) Contrary to most stereotypes, more than a third of these families were headed by a married couple, and nearly half of them were white.

Shaefer’s study didn’t include SNAP benefits because they can’t legally be converted to cash; these benefits (if counted as cash) would have reduced the number of $2-a-day families by half. Even when he added tax credits the household could have claimed in the prior year plus the cash value of housing subsidies, the number of “developing country” poor American families still showed a 50% rise since 1996. Clearly, the United States cannot declare victory in its on-again, off-again 50-year war on poverty.

Welfare reform, the authors argue, replaced America’s cash welfare program with “one that provides a powerful hand up to some—the working poor—but offers much less to others, those who can’t manage to find or keep a job. This book,” they continue, “is about what happens when a government safety net that is built on the assumption of full-time, stable employment at a living wage combines with a low-wage labor market that fails to deliver on any of the above.” (p. xxiii)

The case studies in this book are numbingly depressing. If they are lucky, after extensive job searches, people get marginal jobs, often requiring 24-7 dedication yet with unpredictable hours—say, 35 hours one week and 5 the next, that don’t pay enough to support their families. They then either lose these jobs or, often for defensible economic or personal reasons, quit.

Housing subsidies can be hard to come by, forcing too many families into temporary homeless shelters and then into sometimes even worse quarters with relatives. As the authors say, “their kin pull them down as often as they lift them up.” (p. 60)

Sometimes the desperately poor barter SNAP benefits for cash, at a steep discount. It’s harder to engage in SNAP trafficking than it used to be, but it still happens. Many of the $2-a-day poor have tried collecting cans, others sell plasma twice a week, some sell their children’s Social Security numbers to people looking to declare more dependents come tax time, still other desperate mothers sell sex. There are few respectable, legal ways for the down-and-out to get by.

The authors make recommendations for integrating the desperately poor into society, some involving the government, others focused on employers. They agree with the central idea behind the 1996 welfare reform, that work opportunity is vital. Their approach “is guided by three principles: (1) all deserve the opportunity to work; (2) parents should be able to raise their children in a place of their own; and (3) not every parent will be able to work, or work all of the time, but parents’ well-being, and the well-being of their children, should nonetheless be ensured.” (p. 159)

Unfortunately, the desperately poor always seem to be the last in line—both for jobs and for the attention of politicians.

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