In The Cause of Urban Poverty, Economic Education Or Economic Activism Are The Choices.
It was recently announced that the United Way CEO of a major Midwestern city has created a new initiative. A local news Special Report states that the objective of the United Way is to fight poverty; and the report summarized the problems related to urban poverty, the root cause of those problems, and it explained the new solution designed to eliminate both.
Defining the Five Conditions of Poverty
The main problems facing the urban poor are broken down into these five areas:
Housing – “Renter families are ‘housing insecure,’ meaning they are spending more than 50% of their income on rent and utilities.”
Families – “More than 75% of the children in poor families are not ready for kindergarten.”
Violence – “People in poverty have a higher exposure to violence.”
Subsistence Living – “Minimum wage workers struggle to cover the cost of housing, food, health care, and childcare.”
Despair – “No one wants to live like this, but they cannot afford to break free of the cycle.”
Ready, Fire, Aim
Of course the first step toward solving a problem is to admit there is a problem. The new CEO “remembers the exact moment he realized that his organization was no closer to solving the issues that give rise to poverty than it was when it opened its doors more than a century ago.” Problem acknowledged.
And successful problems solvers are adept at crafting effective solutions, recruiting a team, and implementing the plan. “The answer became clear, striking him like an epiphany: an ambitious collaboration between government, non-profit agencies, foundations, and the private sector.” Solution prescribed.
Discovering the root cause generally requires scientific testing and evidence, “And United Way’s role? Tapping into its unique power to raise money, to convene the conversation, and to condemn the racism that fuels social disparities.” Cause identified?
Which begs the question – Does this mean a century of futility could have been avoided if only for a fresh idea like government and non-profit agency collaboration, all funded by the private sector?
The Smartest Folks at the Institute
So finally, “media outlets have supported the United Way in its effort to direct investments toward finding solutions.” To guarantee the success of this new Institute, “representatives from the county and other local governments are guaranteed seats at the table. Others will “have proven track records of collaboration, creativity, and offering wrap-around services. In addition to convening the conversation and inspiring philanthropy, the Institute will shape public policy to disrupt systemic racism.” This is a sweeping vision.
As economist Thomas Sowell explains in his book The Quest for Cosmic Justice, “the more sweeping the vision – the more it seems to explain and the more its explanation is emotionally satisfying – the more reason there is for its devotees to safeguard it against the vagaries of facts.”
So what is this racist system? How can we disrupt it? What good would that do? How is success measured? At whose expense? What is the track record of these inspiring and creative collaborators, fundraisers, and policy shapers for issuing disruptive condemnations?
The Peculiar Institution Redux
Coincidentally, historian Kenneth Stampp used the same five problems listed in the Special Report to describe the living conditions of slaves on southern plantations. His classic book on the subject is The Peculiar Institution: Slavery in the Antebellum South. Of course living conditions for 19th century slaves were horribly worse. Systemic racism was a root cause, as it has been throughout human history; but is it also the root cause of our modern urban plantations?
The history of the modern problem can be traced back to 1964. Dr. Thomas Sowell addressed the five living conditions of urban poverty in his article – The War on Poverty Revisited.
Housing – “Brand-new government housing projects almost immediately became new centers of crime and quickly degenerated into new slums.”
Families – “The black family, which had survived centuries of slavery and discrimination, began rapidly disintegrating in the liberal welfare state.”
Violence – “The murder rate had also been going down, for decades. Then the new 1960s policies toward curing the “root causes” of crime began.”
Subsistence Living – “The economic rise of blacks began decades earlier, before any of the legislation and policies that are credited with producing that rise.”
Despair – “In various skilled trades, the incomes of blacks relative to whites more than doubled between 1936 and 1959 — that is, before the magic 1960s decade when supposedly all progress began.”
Is the system in question really the political apparatus of the War on Poverty? Is the racism in question embedded in this system?” Will this new Institute become an unwitting agent for the status quo?
Of Political Visions and Scientific Visions
The CEO of the United Way has set in motion a political vision, and Dr. Sowell compares that with the scientific:
Visions are not inherently dogmatic. Einstein’s vision of the universe was at least as revolutionary in science as Lenin’s was in politics. Yet Einstein insisted from the outset that his theory of relativity must be checked against observable facts before it could be accepted – and so it was, by scientists around the world.
The facts observed politically in this case are limited to the racial component of existing conditions, meaning circumstantial evidence. The political root cause is nebulous at best.
The facts observed scientifically are long-term data sets of complex systems. The scientific root cause is a specific set of government policies that were implemented just before the problem mushroomed and began to metastasize.
The United Way CEO describes the real problem eloquently: “I know it seems obvious. But a lot of big organizations think they have the secret solution to everything. And we don’t.” Yet his political solution is more and bigger. Iconic social commentator W. C. Fields had a cure for this common definition of insanity, “If at first you don’t succeed, try, try again. Then quit. There’s no point in being a damn fool about it.”
As Hunter Hastings has written, the scientific solution is a decentralized one . “Economics is the essence of civilization, the moral science. It can teach kids to deal with the circumstances of the world around them, to sustain themselves as individuals.” For proof, Sowell observes that “The poverty rate among black families fell from 87 percent in 1940 to 47 percent in 1960, during an era of no anti-poverty programs.” Now is the time to replace government monopoly activist education with economic education in the marketplace of ideas.