Matt Yglesias is fond of saying that the best way to help people out of poverty is to give them money—direct cash assistance. His point is very simple: the problem with poverty is not having enough money. Things like drug addiction are primarily a result of poverty, not a cause of it. If you give the poor money they will use it to get healthier and more educated. Generally unstated is the fact that most programs proscribe the benefits to the poor because the power elite think the poor don’t make good decisions.
That’s where we get the whole conservative song and dance about poverty. Poverty isn’t about money and economic opportunity, its about culture. The people in the “inner city” just aren’t going to church enough! Of course that’s just conservative wish fulfillment. They think everyone should go to church (except of course their heroes like Ronald Reagan). And they think that they should never have to spend any money on the poor. Therefore, as always, the solution to poverty just happens to be what they already want to do. This goes along with the conservative response to the Ukraine situation: a war in the Middle East!
This morning, Paul Krugman published a great graph from the Economic Policy Institute. It shows the changes in the wages of males in real dollars from 1973 to 2012. Looking at just men is important because their work patterns have not really changed over this 40 year period the way women’s have. So the result is relatively pure. And what the result shows is that we have a very screwed up society:
Just to be clear here: this shows that the wages of the bottom 60% have gone down over the last 40 years. This is a remarkable result because men are actually more skilled than they were then. They are more educated. And productivity is much higher. It is just that the extra money in the economy is being shared less equitably.
Notice how this goes against the claims of conservatives everywhere. The last resort of people like Milton Friedman was always something like, “The rich may be much richer, but the poor are at least somewhat richer.” Well, they aren’t! Of course, I don’t expect this to change any minds. In general, they will continue to make that argument despite the data. And if pushed, they will just move on to some argument such as looking at households rather than men where instead of a decline there is only stagnation. Or they will go all libertarian and say it doesn’t matter because: “Freedom!”