Friday, December 16, 2011

The Visible Hand

WASHINGTON — "Another 2.6 million people slipped into poverty in the United States last year, the Census Bureau reported Tuesday, and the number of Americans living below the official poverty line, 46.2 million people, was the highest number in the 52 years the bureau has been publishing figures on it.

Economists pointed to a telling statistic: It was the first time since the Great Depression that median household income, adjusted for inflation, had not risen over such a long period"

One of the defining debates in American politics revolves around this simple question: "Does the ever expanding wealth of the rich come at the expense of the middle class and poor?"

That the richer are getting exponentially richer is a fact. That the middle class is shrinking and the poor are getting poorer is fact.

Many people, especially rich people and conservatives, argue that there is no connection between the rich getting richer and the poor getting poorer. In fact, they argue that everyone benefits from the rich getting richer. I am waiting for data that seems to never come before I get on board.

Many others, myself included, think that the rich are getting richer, in many cases, at the expense of the rest of the populace. We think it is great when people accumulate wealth - just not so much and so rapidly and so often at the expense of others. As an example, the highest salary in the U.S. last year, $154 million, was for a health care CEO. Should leveraging illness and the efforts of people who have taken the Hippocratic Oath be the basis for generating vast sums of personal wealth? In this example it is seems obvious to me that his wealth comes at the expense of others, in the form of the massive insurance and health care costs that are ravaging peoples budgets in the U.S. - and making health care unaffordable for far too many. The health care industry is great for a few investors and executives, but it is a house of horrors for the rest of us, often at our time of greatest need.

Regardless of whether there is a cause/effect relationship between enormous wealth being focused in a few hands and poverty being focused in many hands, it is undeniable that the poverty is exploding in America.

The Census Bureau has announced that one half of all Americans are classified as low income or poverty level. 

I thought some figures would be in order to put this into context.

If you earn the federal minimum wage of $7.25 an hour, work 5 days a week, 52 weeks a year (let's assume you aren't taking a lot of vacations when working for the minimum wage), you never get sick or need to stay home with a sick child, your earnings before deductions for the year will be $15,080.

If you are single, you will be above what the government somehow considers the poverty level of $11,161 per year. If you are not single, the poverty level for a family of four is considered to be $22,214. Good luck staying out of a shelter living on either of those incomes.

Low income thresholds for the U.S. for a single person are $16,335 per year and for a family of four the figure is  $33,525. Folks at those levels aren't buying a lot of big screen TVs or making $10,000 bets.

To meet the rent on the average two bedroom house in the U.S. and still be able to pay other bills, a salary of $37,105 per year is necessary (Center for Housing data).

People debate about whether we are in a recession or even a depression, and political conservatives are becoming more open about suggesting that poor people are simply lazy and that wealthy people are simple people that are smarter and harder working.

The statistic don't lie. One half of the people in the U.S. are low income or in poverty. The possibility that they are poor because of laziness or choice seems insultingly improbable to me, and to believe so does nothing to resolve this terrible problem.

Read more:      Poverty Level Rises       NYTimes
Read more:      Are CEOs 300 Times More Valuable Than Workers?     David Francis
Read more:      Do You Think the Poor are Lazy?     Anat Shenker-Osorio
Read more:      Is the System Rigged for the Rich?    David Francis
Read more:     The Lazy Poor?     Don Hall

Hold onto your hat for a view from a subset of American thought:  The Lazy Poor     Karen Pansler-Lam, J.D.