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Posts Tagged ‘Poverty’

The Sequester and You: WIC

Alyson Chadwick · May 18,2013

The program known as “Women, Infants and Children” (WIC) is officially the Special Supplemental Nutrition Program for Women, Infants, and Children.  Their web site can be found here.  The site describes the program this way:

“The Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) provides Federal grants to States for supplemental foods, health care referrals, and nutrition education for low-income pregnant, breastfeeding, and non-breastfeeding postpartum women, and to infants and children up to age five who are found to be at nutritional risk.”

The program serves approximately nine million people.  As the sequester kicked in a few months ago, this is one of the programs whose funding will be impacted.  It’s solvent through the end of the fiscal year (30 September 2013) but its future after that is not so certain.  There are few examples more clear of how we expect the people who can least afford it to pay for our government’s irresponsibility.

The Center on Budget a Policy Priorities has released this report on the impact the cuts will have on this program.  The cuts to the program’s budget come at a time when increases are needed to maintain it for the 8.9 million people who depend on it.  While it appears, the United States’ economy is recovering, for too many people recovery is a long way off.  WIC is an incredibly successful and effective program.  To do anything but increase its funding will make it turn people who need the services away.

All of this because Congress can’t do its job.  The sequester was supposed to be so bad that no one would let it actually be enacted but it was.  Congress even passed “no budget, no pay” requiring both sides of Capitol Hill pass budget resolutions by 15 April or forfeit their salaries.  Sounds good, right?  Not so fast.  Both chambers passed budgets — a big deal in some ways, the Senate has not passed one since 2009 but at the end of the day, it means almost nothing.  While both chamber met the bar set to keep members getting their salaries, the next step — appoint conferees to work out the differences between the two budget– has not happened.

It’s time for Congress to stop wasting time passing bills to repeal Obamacare and do something to help people who need it.

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Margaret Thatcher Took My Milk

Ben Cohen · April 09,2013
Screen shot 2013-04-09 at 1.04.03 PM
Thatcher: "No such thing as society"

Thatcher: “No such thing as society”

I grew up in London during the 1980′s — a Thatcher child if you will. My memories of the first female Prime Minister are not fond ones. When I started going to school we used to get fresh milk during break time — a result of the government’s effort to help poor children get adequate nutrition. Then all of a sudden, the milk stopped. “Maggie Thatcher Milk Snatcher” we used to sing in radical defiance to the Tory leader’s cost saving measures. I also remember having several friends with learning difficulties have their assistant teaching hours cut dramatically. The result? They never learned how to read.

So no, I’m not a huge fan of Margaret Thatcher.

Watching the reaction to the death of former British Prime Minister Margaret Thatcher from America has been fascinating to say the least. The media has largely painted the ‘Iron Lady’ as a titan of British politics, a controversial but revered figure who left Britain in a much better place after her 11 year rule. Wrote David Frum in The Daily Beast:

She promoted talent regardless of background and opened the way to an entrepreneurial Britain where acumen mattered more than accent. Thatcher was a woman of fierce principle. Yet – and here contemporary conservatives can take another lesson from her – she lived by facts, not theories.

There is no doubt that Thatcher was a hugely influential figure, not only at home, but abroad. While she made sweeping changes to the British economy and political culture, she did much to project British power abroad. Her invasion of the Falkland Islands and aggressive support of the United States during the Cold War helped redefine Britain as a military super power and a country to be reckoned with. Thatcher reveled in her persona as a woman not to be messed with. “I am extraordinarily patient,” she once said. “Provided I get my own way in the end.”

But while Thatcher’s image, carefully maintained by adoring fans, is one of power, success, and principle, the truth about her legacy is far, far darker. While conservative commentators like Frum believe that Thatcher lived by facts and not theories, the reality is that she was a hardened ideologue who ignored facts and ruled by theory. A proponent of Milton Friedman Libertarianism, Thatcher set about ripping up the welfare state in Britain and implemented market reforms that had catastrophic consequences for the economy and the British people. And these are not theories – these are facts. As Polly Toynbee writes:

When she [Thatcher] walked into Downing Street promising harmony instead of discord, only one in seven children was poor and Britain was more equal than at any time in modern history. But within a few years, a third of children were poor, a sign of the yawning inequality from which the country never recovered.

It was not only children who suffered. Thatcher’s economic reforms plunged the UK economy into recession as soon as they were implemented, creating levels of unemployment not seen since the Great Depression:

This actually happened twice under Thatcher’s tenure, and as Time Magazine reports, “GDP never rose by more than a couple of percentage points annually, even during the 1980s boom years.” All the while, inequality spiralled as the rich got richer and the poor got poorer. Just take a look at this graph charting the astronomical rise in inequality during the Thatcher years:

When the realities of Thatcher’s economic policies are seen in graph form, it is incredibly difficult to argue that ‘she left Britain in a much better place’. She did not, and every economic indicator conveys that.

When asked what she felt her greatest achievement in power was, Thatcher replied, “Tony Blair”. In other words, Thatcher shifted the political landscape so far to the right that the Labour Party was forced to elect a politician who essentially carried on the radical conservative agenda of mass deregulation and privatization.

As a child of Margaret Thatcher and John Major, and a teenager of the Tony Blair years, I think my assessment of the cultural impact of this agenda carry some weight. My recollection of Britain in the eighties and nineties is pretty vivid, and I was well aware of the rapid cultural changes going on around me. Britain was, in not so many words, a bit of a crap place to live. The food was horrible, the service culture atrocious, and there wasn’t a whole lot to do in terms of entertainment. A fantastic weekend for me consisted of going to a slightly run down and unhygienic public leisure center to have swimming lessons, then eating a plate of soggy chips (fries) with ketchup afterwards. My cousins would then come over and we’d watch horrendously bad television on one of the four channels available.

The area I lived in was solidly middle class. There were a couple of streets with some quite rich people, and some surrounding government housing projects that weren’t so well off. I would go to school and visit friends in both ends of the reasonably narrow spectrum. Although I was middle class, I don’t recall feeling particularly different to any of my friends who lived in the housing projects. While everything was a bit run down and there wasn’t much to do, it was a fun time to grow up. We played outside, did sports, had friends from a variety of backgrounds and didn’t think too much about money.

Then it all changed.

The area got nicer as coffee shops and fancy wine bars opened. Housing prices skyrocketed and many of my friends moved to different cities where their families could live better for cheaper. My area got noticeably whiter and richer, and my group of friends started to split according to wealth – the poorer ones went to the crumbling local state schools while the wealthier ones moved to fancy private ones. Crime then began to sky rocket – we had our car stolen from outside our house, several neighbors had their doors kicked down in the middle of the night and their houses raided, and street muggings spiraled out of control (my brother was robbed in our street, along with virtually everyone else I knew). If you were a middle class kid in the late 80′s and 90′s in London, you lived in a constant state of fear of being mugged or picked on by kids from the housing projects. And who could blame them? As the rich started to build custom driveways to park their BMWs and buy their kids Nintendos, the poor saw their wages stagnate and their benefits being cut. Growing up poor in the 80′s and 90′s in London was not much fun, and it created a sense of social alienation that tore what was once quite a cohesive culture apart.

To me, at least, that is what Margaret Thatcher’s legacy represents. I was the beneficiary of the new economic model imposed upon Britain during the 80′s. The value of my family’s properties boomed, my dad rose to the top of an industry that benefited hugely from deregulation, I went to private schools and had private tutors, we had foreign holidays and all my college costs were paid for. My dad worked incredibly hard, but he’d be the first to admit he was also in the right place at the right time. My life has been great, but the memory of what Britain used to be still haunts me. Whenever I walk around my neighborhood in London, I see faces from an era that no longer exists – a community that has been broken by economic division and the imposition of a culture of greed. We recognize each other and nod knowingly, saying silently – ‘I remember you and how it used to be here. It’s not the same anymore’.  I look through the windows of my new neighbors whose lifestyles and aspirations are alien to me and everyone who grew up there.

And that is why Margaret Thatcher remains such a reprehensible figure to so many people. As Thatcher famously stated, “There’s no such thing as society”. She not only took away our milk, she took away our communities.

 

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The Poverty Epidemic the Media Won’t Cover

June 19,2012
Screen shot 2012-06-19 at 9.18.47 AM
Poverty

Poverty in America: Not glamorous enough to cover (Photo credit: Teo's photo)

By Ben Cohen: When faced with a serious problem, it is always crucial to understand exactly what you are dealing with in order to change it. The first step is an awareness of the problem itself – if you don’t see it, you can’t fix it, and the problem remains. And if everyone is telling you the problem doesn’t exist in the first place, it can get so bad there’s a chance the consequences could be irreversible.

Poverty in the US is now so bad that it could be a permanent function of American society. If greater awareness isn’t raised, it may well become an acceptable norm that the political classes no longer believe needs redressing. The economic crisis in 2008 hit most people in America badly, but minorities and the working poor were dealt a devastating blow that has reduced their wealth in dramatic fashion. As the Nation reports, the crisis has reached epidemic proportions in 2012, and it’s not getting better:

More than a quarter of blacks and Latinos live below the government-defined poverty line (about $11,000 per year for an individual, $23,000 for a family of four), compared with 12 percent of Asian-Americans and slightly less than 10 percent of whites. Among African-Americans and Latinos, the slide into poverty has been marked by a concomitant collapse in assets. This past July the Pew Research Center released an analysis of government data that concluded that the median wealth of white households was a staggering eighteen times that of Hispanic households and twenty times that of African-Americans. Fueled by disproportionate home foreclosures and underwater mortgages among these minorities, this trend indicates a reversal of decades of progress toward reducing such inequalities. “From 2005 to 2009, inflation-adjusted median wealth fell by 66% among Hispanic households and 53% among black households,” says the report, “compared with just 16% among white households.”

Worse than this, according to the Pew Research Center, more than 20 million Americans are living in what is referred to as “deep poverty,” -  a term used to describe those with incomes lower that 50 percent of the poverty line. More than 16 million children in the United States (or 22 percent of the country’s children) live in poverty, the largest number since 1962 and the highest percentage in almost 20 years. This ‘deep poverty’ is so serious that it means millions of Americans don’t actually know where their next meal is coming from. The nonprofit Feeding America, a network of more than 200 food banks around the  country reports, one in five children are at risk of hunger. For children in African-American or Latino households, the number is closer to one in three.

While the stats are getting dramatically worse at the bottom end of the economic spectrum, they are getting dramatically better at the top. From the LATimes:

The rich got richer over the last three decades — and the very rich got very much richer — according to a new government study.

The top 1% of households saw their after-tax incomes grow by 275% from 1979 to 2007, said the study by the nonpartisan Congressional Budget Office. That was more than quadruple the growth of the rest of the top 20% of the population during that period.

While the economy grew for everyone as a whole, it doesn’t mean a great deal when wages have not kept pace with inflation, meaning the poor may be richer in actual terms, but their purchasing power decreased. There is no sane explanation for millions of children not knowing whether they will eat three meals a day in a country where billionaire’s wealth has almost tripled over the past three decades.

Why is there no major outcry over this gigantic inequality and spiraling poverty? Why aren’t the major news networks covering food insecurity and interviewing the people actually affected by foreclosures? News networks spend a great deal of time following the back and forth between Republicans and Democrats and covering dramatic foreign wars, but not a lot of time on people suffering in their own country.

I remember an interview I did with Rolling Stone’s Matt Taibbi about his book ‘The Great Derangement’ that spent a great deal of time looking at poverty in America. I put that question to him and I’ll never forget his answer. He said:

Well poverty certainly is something you don’t get a whole lot of information about, for the simple reason that poor people turn off advertisers. That is strictly an economic decision with the media. I know this, I cant really get into the specifics of it too much, but let me just say that I do know a lot of TV reporters, who for instance, let me give you an example: I knew one guy who was doing a story and it involved a murder in a small town in Georgia, and there were a lot of poor people involved who were characters in this story, and they were talking a lot on camera in his version of the story. When he took it to his editors they told him to re-cut the story, and take the poor people out and have him do stand ups instead so that he would be on camera more and the poor inarticulate people would be on camera less. This is something that goes on all the time in the media, and it’s not because they have a political bias against the idea that there are lots of poor people in this country, it is just that it is a fact of economic life that when people see wealth on TV, they are inclined to buy more and when they see depressing images, they are inclined to buy less. That’s why golf, for instance, is such a popular sport on television because it is a sport where you tend to see lots of upper class people in upper class settings in country clubs, and you’ll notice that corresponding advertisements for golf are always luxury cars and luxury perfumes and colognes and those sorts of things. And you can’t sell those things when you have a lot of people without teeth on TV, it’s just a fact of life. That’s why you have that, it’s strictly an economic thing.

This self censorship is a function of the corporate media system that exists in America – the sole motivation for news networks is to increase ratings and increase profit, and if reporting on poverty and poor people means less advertising revenue, it simply won’t get covered.

As a result, much of America’s politically active population is not aware of how dire the poverty situation is – they don’t see it on their television sets and are never given statistics about how bad it has gotten. With no context, most people just assume that poverty is a part of American society and there is little that can be done about it.

Poverty does not have to be a fact in American society. There are many countries that have far less poverty and far less wealth inequality than the United States, and they don’t come close to America’s overall wealth. There is absolutely no reason why politicians shouldn’t be forced to confront the poverty epidemic and provide real solutions to a problem that isn’t beyond them to solve. But first of all, the public needs to know exactly what is happening in America, and that is down to the media. While covering Mitt Romney’s latest gaffe or Michelle Obama’s newest dress may drive ratings, it isn’t helping the country in the long term. TV networks sell advertising space to companies looking to promote their products. And if poverty in America continues to grow, there won’t be many people left to buy them.

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Legal Loan Sharks in UK Devastate Poor With Payment Schemes

Ben Cohen · December 29,2011

English: Beko Washing Machine. Türkçe: Beko Ça...

The charity 'Barnados' has uncovered a worrying trend in the UK where legal loan sharks entrap the poor into a vicious cycle of debt with high interest payment schemes for basic household goods (via the Guardian):

Its report, A Vicious Cycle: The Heavy Burden of Credit on Low Income Families, highlighted one case where a Beko washing machine cost £780 more when bought through a weekly payment store than at a traditional retailer, while in another a standard fridge freezer priced at £430 on the high street cost to £1,074 through a three-year rent-to-own scheme.

Barnado's said that while banks and standard retailers had been cutting back on the amount of credit they offered consumers in recent years, rent-to-own credit companies like Brighthouse and Buy As You View appeared to be establishing "a small, but significant position in the provision of credit to low-income households".

It said many families it worked with felt they had no choice but to try rent-to-own providers and other alternative lenders, as they did not have access to banks which provide overdraft facilities and direct debit.

This is another example of the free market screwing the poor – with no leverage, low income families are unable to negotiate better rates or simpler payment methods – something the middle classes and rich do with ease. The end result is that the poor pay more for their goods than the rich – the hallmark of modern capitalism and another reason to rebuild our monetary system.

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Britain’s Hidden Tax: Taking From the Poor to Pay the Rich

Ben Cohen · December 27,2011

The Independent uncovers Britain's stealth tax on its poorest residents:

Tax cuts for low and middle-income families in April will be dwarfed by hidden reductions in tax credits, according to a study for The Independent.

The analysis found that the £1bn of tax cuts in April will be outweighed by reductions of more than £2.5bn in the complex tax-credit scheme.

Most of the cuts to credits, which top up the wages of low-income families in work, will take effect from April and could catch families unaware.

The Government's flagship policy of raising income-tax thresholds has been trumpeted by the Liberal Democrats as their main achievement since the Coalition was formed last year – and a major boost for the low-paid.

But the Resolution Foundation think tank, which undertook the study, questions the fairness of the changes.

The report continues:

The foundation said the biggest winners will be those with middle to high incomes: "Overall, the measure remains regressive in the lower half of the distribution… Not only is the change huge overall; it is not widely understood or known about – being made up of a number of small changes to both the child tax credit and working tax credits."

The study concluded: "Low to middle-income households receive 56 per cent of all tax credits in cash terms – and so will be hit disproportionately."

This is typical Tory economics – present tax cuts as a gift to 'working families' while slashing their benefits and shifting money upwards towards the upper classes. Why anyone thinks Tories are suddenly a force for progressivism is beyond me – it's the same old trick disguised behind new gimmicks.

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Study: Being Poor Means Making Worse Decisions

Ben Cohen · June 10,2011

PovertyImage by Teo's photo via Flickr

Having struggled to pay bills at various points in my life, I would always feel drained after having to make decisions based on financial constraints: Should I go out to eat with my friends and maybe not have enough to pay rent? Should I fill my car up and not be able to pay my phone bill? I couldn't put it into words, but I certainly felt that I would be far more productive if I didn't have to worry about basic necessities. I remember long periods of doing nothing due to lack of money (and worrying about it), and feeling less energetic afterwards. It was a vicious cycle and it took a real effort to pull myself out of the slumps I found myself in. 

Thankfully, things are better now, and I feel I am far more productive not having to fret when picking up restaurant checks – I can spend that mental energy elsewhere, namely my career.

It turns out, this is actually a well studied phenomenon. The New Republic reports:

In the 1990s, social psychologists developed a theory of “depletable” self-control. The idea was that an individual’s capacity for exerting willpower was finite—that exerting willpower in one area makes us less able to exert it in other areas. In 1998, researchers at Case Western Reserve University published some of the young movement’s first returns. Roy Baumeister, Ellen Bratslavsky, Mark Muraven, and Dianne Tice set up a simple experiment. They had food-deprived subjects sit at a table with two types of food on it: cookies and chocolates; and radishes. Some of the subjects were instructed to eat radishes and resist the sweets, and afterwards all were put to work on unsolvable geometric puzzles. Resisting the sweets, independent of mood, made participants give up more than twice as quickly on the geometric puzzles. Resisting temptation, the researchers found, seemed to have “produced a ‘psychic cost.’”

Over the intervening 13 years, these results have been corroborated in more than 100 experiments. Researchers have found that exerting self-control on an initial task impaired self-control on subsequent tasks: Consumers became more susceptible to tempting products; chronic dieters overate; people were more likely to lie for monetary gain; and so on. As Baumeister told Teaching of Psychology in 2008, “After you exert self-control in any sphere at all, like resisting dessert, you have less self-control at the next task.”

This 'psychic' cost can be devastating to vast sectors of the population who spend their entire lives making complex and energy depleting decisions based on severe financial restraints:

Nowhere is this revelation more important than in our efforts to understand poverty. Taking this model of willpower into the real world, psychologists and economists have been exploring one particular source of stress on the mind: finances. The level at which the poor have to exert financial self-control, they have suggested, is far lower than the level at which the well-off have to do so. Purchasing decisions that the wealthy can base entirely on preference, like buying dinner, require rigorous tradeoff calculations for the poor. As Princeton psychologist Eldar Shafir formulated the point in a recent talk, for the poor, “almost everything they do requires tradeoff thinking. It’s distracting, it’s depleting … and it leads to error.” The poor have to make financial tradeoff decisions, as Shafir put it, “on anything above a muffin.”

This phenomenon is cyclical and structural – if you are born poor, the odds are automatically stacked against you based on the energy you will have to expend doing basic things like eating and having a roof over your head. Consequently, coming up with the next big game show or getting the grades to go to medical school isn't likely to be the first thing on your mind.

Obviously, this 'psychic' cost isn't the only factor when it comes to poverty, but if you have ever struggled to pay your bills, I'd bet it explains a lot.

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The Reality of The Supposed Economic Recovery

Ben Cohen · May 30,2011

Poverty

Richard Wolff describes the economic reality facing most people living in post-crash America:

The combination of high unemployment and high home foreclosures assures a deeply depressed economy. The mass of US citizens cannot work more hours – the US already is No 1 in the world in the average number of hours of paid labour done per year per worker. The mass of US citizens cannot borrow much more because of debt levels already teetering on the edge of unsustainability for most consumers. Real wages are going nowhere because of high unemployment enabling employers everywhere to refuse significant wage increases. Job-related benefits (pensions, medical insurance, holidays, etc) are being pared back.

There is thus no discernible basis for a substantial recovery for the mass of Americans.

Of course the banks and super wealthy have not suffered from the mess they created – the government stepped in to ensure their losses were covered and they could borrow cheaply enough to climb back on top. The rest of us however, have had to contend with market forces without the flow of cheap credit or government support. The results have been disastrous for the majority of Americans, the economic divide increasing exponentially and serious poverty becoming an epidemic.

Where does this lead? Societies are too complicated to make accurate predictions, but history tells us that these trends cannot go on forever. There is only so long that the people can be told their country works for them while their earnings go down and savings evaporate. The disconnect is made possible by relentless propaganda emanating from the wealthy, dispersed through their paid for politicians and giant media conglomerates, and swallowed by work weary citizens unable or unwilling to face reality.

Because that reality is so unfair and unjust that only massive action can reverse it – and when couples are working four jobs to put food on the table, there simply isn't the time or energy to face it. 

That is until it gets so bad that people have no choice but to act, and given the alarming acceleration of economic decline, that time may be sooner than we think.

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The Mean Country

Ben Cohen · September 30,2009

TENT_CITY_06_V2 by D.Evans.Photography.

by David Glenn Cox

Last winter I wrote a story about the number of people who were dying
in house fires after having their utilities turned off. I began to do
some research on the growing numbers of tent cities springing up across
America. How, I wondered, will these people deal with the coming months
of winter cold?

But, as I find is so often the case, I start
off on one story and end up doing another. Officially there are over
fourteen million unemployed in America. That is the official number
that the politicians will own up to; in actuality the number could be
as high as twenty million.

I have been unemployed myself for
well over a year. I have twenty years of management experience, and I
have a great track record with a proven record for results. However, I
am over fifty years old and to prospective employers that is the kiss
of death. They perceive you as about to keel over from a heart attack
at any moment.

(more…)

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