Institute Notes: A Dialogue on Overcoming Hunger and Poverty

Studs Terkel

Studs Terkel passed away on Friday at the age of 96. Studs is not someone you might expect to read about on this blog, but I was big fan and can’t help noting his passage.  And I do think there’s something any social justice type can learn from what he had to teach us about the dignity of all people.

The obituaries over the weekend described Studs as one of the preeminent chroniclers of the average American guy and gal. His books are mostly collections of interviews, many distilled from his radio show that ran for decades, syndicated out of his home town of Chicago. Studs had as much right as anyone to call Chicago his town, and I'm sure he will be memorialized there as one of its great native sons.

The interviews that appear in his books were carefully edited, but they always sound as natural as if they were taking place at that very moment. I first learned of Studs in some college writing courses I taught way back when I was a graduate student. A Studs interview was a mainstay in the anthologies writing instructors use to demonstrate examples of fine writing. One of the perks of teaching college courses is the publishers of these anthologies send you volume after volume in the hopes you’ll use one instead of another, although they all pretty much serve the same function equally well.

My favorite of his books is Working: People Talk About What They Do All Day and How They Feel About What They Do. I have to admit this book was an inspiration for me when I was working on the Institute’s 2008 report, Working Harder for Working Families. The interviews with Renee Musser Hummell that appear in each of the chapters were deliberately intended to convey a person’s real experiences with hunger and poverty.

What distinguished Studs Terkel was his uncanny ability to draw people out and let them tell their own story. That’s an obviously important quality in an interviewer, but its remarkable how often interviewers on radio or television are more interested in hearing themselves speak instead of the people they are interviewing. Working was a collection of interviews Studs did with plain old working folks, lots of them working class, people who were not all that articulate but had the most incredible things to say about their lives and the worlds they lived in. Studs's interviews support the belief that everyone is a unique soul. 

I’ve tried to use what I leaned from Studs whenever I interview people for the hunger report. I genuinely believe we can learn more about poverty and hunger by listening to people talk about what it means to live in these conditions than any other form of research. I wouldn’t call Studs a researcher. He connected us with people, all sorts of people, and helped us to understand them and what it is like to live in their skin. For me there is nothing more valuable a researcher could aspire to than that. This is called telling the truth.  

Poverty and Development

Lately, the news media has been buzzing with stories about measuring poverty, and that’s a good thing because it’s a long time coming that the federal government does something about measuring poverty more accurately. Most of the news has been about Mayor Bloomberg’s new poverty levels for New York City. Bloomberg raised the poverty level for a family of four in New York City from $20,444 to $26,138. Anybody who has spent some time in New York City, in fact, it’s not even necessary to have spent time there, knows that $26,138 for a family of four still leaves a lot of families out who otherwise could be described as poor. Nevertheless, we should applaud the mayor for his effort to raise poverty levels closer to reality. It’s an important step forward.

Dispatch from Santa Ana, California

The sunny weather and towering palm trees in the big blue skies of Santa Ana, California belie the incredible stresses cracking the foundation of this community. Hunger and poverty here are widespread. When students at the area schools register each year, one of the questions on the form their parents are asked to complete is will the kids be living in a car. Families pile up in the small bungalow houses. To pool their resources, families will rent out the garages to turn into living spaces. The average cost of a two-bedroom apartment is $1,400 per month, more than what many Santa Ana families earn in a month.

Working Families and Economic Insecurity

A new report on economic security and working families in the United States appeared this week from the Center for Economic and Policy Research (CEPR). The full title is Working Families and Economic Insecurity in the States: The Role of Job Quality and Work Supports, and it is well worth everyone’s attention.

First, some basic framing is necessary: the researchers are using a measure of economic security defined by whether families have sufficient resources to meet basic needs. This is different from how the government comes up with its official poverty data. The Institute has discussed the inadequacy of the Census measure—we dedicate an entire chapter to this in our own report Working Harder for Working Families.

A basic needs budget “takes into account the actual costs of goods and services needed to have a decent standard of living as well as the variations in these costs depending on where one lives.” Basic needs include housing, utilities, food, health care costs, transportation, and child care. We’re not talking entertainment and new furniture.

Naturally, cost of living varies depending on where you live and how large a family you have. For a family of three, basic needs can be met in Arkansas with an annual income of $12,775, whereas in New Hampshire it takes $25,047. According to the Census Bureau, it makes no difference which state you live in because costs of living are irrelevant. You see the problem.

The numbers in this report tell a compelling story. CEPR finds 22 percent of working families suffer from economic hardship. That’s almost double the official poverty rate.

Announcing Half in Ten

The Center for American Progress (CAP) is leading a new campaign to cut poverty in half within ten years. The campaign is called Half in Ten and the frontman for it is none other than John Edwards, former Democratic presidential candidate and senator from North Carolina. Edwards was also the only candidate in both parties to raise poverty to the top of his issues agenda.

The Half-in-Ten campaign is promoting four main solutions:

• Expanding the Earned Income Tax Credit and the Child Tax Credit;
• Raising both state and federal minimum wages;
• Increasing the number of low-income families receiving child care assistance;
• Increasing eligibility for unemployment insurance.

These are spot on and should be on anybody’s list of what to do to reduce poverty. We promoted these policies in Working Harder for Working Families, and I have used this blog recently to write about the importance of the Earned Income Tax Credit and the Child Tax Credit.

Honoring King and Looking Forward

Today, 40 years after Martin Luther King, Jr. was slain, it’s an appropriate time to take stock of where America stands on the issues that King gave his life for. In 2008, an African American man has a legitimate chance to be the Presidential nominee for one of the two main political parties. In 1968, this would have been inconceivable. Indeed much has changed since 1968, thanks to King and other figures in the civil rights movement, but many challenges remain, including the persistence of unnecessarily high levels of poverty.

Yesterday, April 3rd, King’s son, Martin Luther King III, published an article in the Atlanta Journal Constitution, “Speaking Truth to Poverty” in which he asks the next President, whomever he or she may be, to appoint a cabinet-level poverty czar. In the 1960s there was a position like this, although not a cabinet-level one, held by Sergeant Shriver during President Johnson’s War on Poverty. King doesn’t talk about Shriver. Instead, he likens the position he is calling for to the one created by Mayor Bloomberg of New York City in the Office of Financial Empowerment. I don't know much about the Office of Financial Empowerment, but what I've heard of Bloomberg's overall anti-poverty campaign is good and it sounds very ambitious. King's vision of what this poverty czar will be doing, barely sketched out in this article, would be much more ambitious than what we're used to from the federal government.

Going far beyond New York’s model, the national poverty office would investigate public policy that could boost income, increase savings, encourage asset building, protect consumers and work to bring about systemic change in the war on poverty. An emphasis would be placed on coordinating with the public, private and civic sectors to develop institution-based and action-oriented solutions while setting measurable benchmarks for success. 

King emphasizes the importance of collecting data:

With real data, the office can generate meaningful reports on the causes and effects of poverty that will raise the profile of poverty as a national issue and highlight successful anti-poverty policies that can be promoted to Congress, the president and the public. In a nation heavily influenced by our market-based principles, we pay attention to what we can count. So it’s time to start counting correctly.

Obama and Race

We should all be thankful to Barack Obama for the thoughtful speech he gave two days ago. It seems about time Americans started having a frank discussion about race, and I can’t imagine who else is going to be the catalyst for this right now.

I hope the speech will provoke a deeper discussion about race in this country. I realize however this could make many people uncomfortable, both white and black, so I’m not holding out a lot of hope. But the opportunity is here for us now, and it would be a shame to let it pass.

Race relations are an ever unfolding saga in the United States. So many past chapters are painful and ugly. For that reason, few presidents or presidential candidates have been willing to address race overtly. Obama’s candidacy and this conversation he has initiated suggests some real national healing could occur, and that’s why I think it would be a shame if our squeamishness forces us to clam up.

Dealing Wisely With Recession

Robert Reich, the former Secretary of Labor in the early years of the Clinton Administration and now a professor at Berkeley, and for my money one of the smartest commentators on the US economy, has a terrific editorial in the New York Times today about why the widely anticipated U.S. recession could be far more painful and prolonged than previous ones. Fortunately, Reich also has some good advice for policymakers about what they can do to address the situation wisely.

According to Reich,

To get the economy rolling again, we need to get inject money into it, but where will it come from. The tax cuts in the stimulus package put forward by the Bush Administration and Congress is not likely to do this.

Much of the current debate is irrelevant. Even with more tax breaks for business like accelerated depreciation, companies won’t invest in more factories or equipment when demand is dropping for products and services across the board, as it is now. And temporary fixes like a stimulus package that would give households a one-time cash infusion won’t get consumers back to the malls, because consumers know the assistance is temporary. The problems most consumers face are permanent, so they are likely to pocket the extra money instead of spending it.

So what’s a policymaker to do? According to Reich, first let’s get our heads around the causes of the problem. It requires some clear thinking about trends over the last three or four decades, not something Americans are predisposed to do, especially about the economy. Reich's analysis of the precedents that got us to this point are, as I see them, right on.

A valuable new asset-building resource on the web

I want to tell you about the Institute’s latest web resource dedicated to asset-building, launched only yesterday.

If you're reading this blog regularly, you know we often write about asset-building—and that will continue. Our new web resource will provide you with information on asset-building in more convenient and compartmentalized formats, and it will allow you to explore more in-depth analysis with us than we can offer you on the blog.

The new resource focuses on four main areas of asset-building: homeownership, post-secondary education, entrepreneurship, and savings accounts.

We will be updating it with special features regularly. The first feature explains asset poverty and includes a comparison of asset poverty rates with income poverty rates in all 50 states and the District of Columbia. Asset poverty rates typically run double the rates of income poverty.

The next feature will be on the subprime loan crisis and how low-income families in particular have been affected. We’ll include data on the rates of subprime mortgage lending in the poorest areas of the country. We'll also put it all in context for you, explaining the asset-stripping ramifications and how low-income families have been victimized by predatory lending.

Asset-building is about creating opportunity for all people, including the poor.

Opportunity is not equally distributed. Some people are born into poverty and never receive the opportunity they need to begin reaching for their dreams. All their lives they struggle against the forces of poverty and hunger.

Ultimately, we hope the Institute’s asset-building work will establish us as one of the lead anti-poverty groups in this area. The website builds on the work we already started on asset-building in the 2008 Hunger Report, Working Harder for Working Families.

The United States needs a safety net to protect people in poverty, but it also needs a ladder of opportunity. One is there to catch people when they fall, the other to allow them to reach higher levels.
 

After the Stimulus Package

To reduce hunger in the United States, we primarily focus our attention on the federal nutrition programs. It may sound counterintuitive, but I’m not sure currently this is the best way to get the results we want. The jettisoning of the food stamp benefits from the stimulus package agreed on by Congress and the Bush Administration argues for a more nuanced approach to reducing food insecurity. I’m not suggesting we should take our eye off nutrition programs, but I believe better opportunities to increase food security can be achieved in other ways.

Let’s talk about one of those ways, the Earned Income Tax Credit (EITC). Last week, I blogged about the EITC in relation to predatory lending practices. This time I want to speak about increasing the benefit size of the EITC. Now is the ideal time to be focused on this program. It’s a tax program and tax season is upon us or approaching rapidly. When you think about the stimulus package, it was all about tax relief. There was even some tax relief for poor families. I hate to put it this way but if you want to talk in terms of keeping score, tax relief got something, food assistance got nothing. We at least know that tax breaks are something that is always in play.

Once again, I’m going to refer you to the 2008 Hunger Report, Working Harder for Working Families, the chapter on work supports, for a longer explanation of the EITC than I have room for here. Knowing one-click away is still one click away, I will grab some text from the chapter and set it down right here to briefly explain the program.

The EITC is a refundable tax credit that families receive through their federal income tax return, reducing their tax liability and returning a portion of federal taxes. … In 2006, a family with one child received a maximum of $2,747 and a family with two or more children $4,536, while the maximum a single person received was $412.

The EITC was mainly designed to boost the income of working families with children. Those that needed the biggest boost were families headed by single parents. The EITC is widely celebrated for having gotten many single parents (mostly single mothers) off welfare and into the workforce. This issue deserves a lot more discussion than I’m planning to give here, but the point I want to make is while the EITC did do a lot to help single parents, it did far less for two-parent families. A recent study by Gordon Berlin, President of MDRC, puts the problem in perspective, and the rest of my discussion is heavily indebted to Berlin’s ideas.