The Problem With Wealthy Philanthropists

…With a decaying social welfare state, more and more public amenities exist only as the result of the hyper-wealthy donating them. But when the commons are donated by the wealthy, rather than guaranteed by membership in society, the democratic component of civic society is vastly diminished and placed in the hands of the elite few who gained their wealth by using their influence to cut taxes and gut the social welfare state in the first place.

It’s much like how in my former home of Pittsburgh, the library system is named for Andrew Carnegie, who donated a portion of the initial funds. But the donated money was not earned by Carnegie; it trickled up from his workers’ backs, many of them suffering from overwork and illness caused by his steel factories’ pollution. The real social cost of charitable giving is the forgotten labor that builds it and the destructive effects that flow from it.

— Why the Rich Love Burning Man, Jacobin

To be clear, the issue isn’t so much about individual elites donating their wealth to humanitarian efforts; no doubt at least some of them are benevolent and sincere, and their money often goes a long way for certain causes. But the problem lies in the aggregate, when entire societies — from their political and economic systems, to their media and public education — are at the mercy of a small class of individuals that determines what resources go where, based on what conditions. Being beholden to a handful of elites is not much better than to an overpowering state; indeed, often times it is often indistinguishable.

What are your thoughts?

Has Technology Done More Harm Than Good for Job Growth?

Advances in technology, ranging from the 19th-century cotton gin to the latest cutting-edge robots, have long been cited as leading factors in the decline of both employment and quality of work. But a recent study from Deloitte, a major consultancy based in the U.K., has challenged this common narrative, arguing that on the contrary, technological innovations have created far more jobs — and far better lives — than are credited.

From The Guardian:

Their conclusion is unremittingly cheerful: rather than destroying jobs, technology has been a “great job-creating machine”. Findings by Deloitte such as a fourfold rise in bar staff since the 1950s or a surge in the number of hairdressers this century suggest to the authors that technology has increased spending power, therefore creating new demand and new jobs.

Their study, shortlisted for the Society of Business Economists’ Rybczynski prize, argues that the debate has been skewed towards the job-destroying effects of technological change, which are more easily observed than than its creative aspects.

Going back over past jobs figures paints a more balanced picture, say authors Ian Stewart, Debapratim De and Alex Cole.

“The dominant trend is of contracting employment in agriculture and manufacturing being more than offset by rapid growth in the caring, creative, technology and business services sectors”, they write.

“Machines will take on more repetitive and laborious tasks, but seem no closer to eliminating the need for human labour than at any time in the last 150 years”.

Citing a century-and-a-half of historical data from the U.K., the researchers found a precipitous decline in “hard, dull, and dangerous” work — such as agriculture and clothes washing — to less physically intensive jobs focused on “care, education and provision of services to others”. Continue reading

U.S. Government Rules Against Bans of Homeless People Sleeping Outside

Boise, Idaho is one of a multitude of cities across the United States that prohibits homeless people from sleeping or camping in public spaces. Following a lawsuit against the city brought by the National Law Center on Homelessness & Poverty (NLCHP), the U.S. Department of Justice weighed in with a statement of interest that could greatly impact local policy towards homeless people well beyond Boise.

The crux of the DOJ argument is that these bans violate the Eighth Amendment’s protections against cruel and unusual punishment. The reasoning is as follows:

When adequate shelter space exists, individuals have a choice about whether or not to sleep in public. However, when adequate shelter space does not exist, there is no meaningful distinction between the status of being homeless and the conduct of sleeping in public. Sleeping is a life-sustaining activity—i.e., it must occur at some time in some place. If a person literally has nowhere else to go, then enforcement of the anti-camping ordinance against that person criminalizes her for being homeless.

According to the New York Timesthis is the first time in twenty years that the Justice Department has gotten involved in this “still-unsettled” area of law. In doing so, the federal government is basically warning cities across the nation to treat homelessness more humanely. Either lift the bans, or ensure that there is adequate shelter space and housing so that homeless people do not have to sleep outside in the first place. Continue reading

No Matter What You Do, a Living Wage is a Must

Amid demonstrations and public pressure by lowly paid fast food workers, the state of New York has become the latest jurisdiction to increase the minimum wage, this time to $15 an hour. In response, many grumbled upon the unfairness of having burger flippers and fry cooks make as much as EMTs, firefighters, and other “more important” occupations.

In response to this pushback, a paramedic publicly shared his own thoughts on the matter, which have since gone viral. Here it is in its entirety.

Fast food workers in NY just won a $15/hr wage.

I’m a paramedic. My job requires a broad set of skills: interpersonal, medical, and technical skills, as well as the crucial skill of performing under pressure. I often make decisions on my own, in seconds, under chaotic circumstances, that impact people’s health and lives. I make $15/hr.

And these burger flippers think they deserve as much as me?

Good for them.

Look, if any job is going to take up someone’s life, it deserves a living wage. If a job exists and you have to hire someone to do it, they deserve a living wage. End of story. There’s a lot of talk going around my workplace along the lines of, “These guys with no education and no skills think they deserve as much as us? Fuck those guys.” And elsewhere on FB: “I’m a licensed electrician, I make $13/hr, fuck these burger flippers.”

And that’s exactly what the bosses want! They want us fighting over who has the bigger pile of crumbs so we don’t realize they made off with almost the whole damn cake. Why are you angry about fast food workers making two bucks more an hour when your CEO makes four hundred TIMES what you do? It’s in the bosses’ interests to keep your anger directed downward, at the poor people who are just trying to get by, like you, rather than at the rich assholes who consume almost everything we produce and give next to nothing for it.

My company, as they’re so fond of telling us in boosterist emails, cleared 1.3 billion dollars last year. They expect guys supporting families on 26-27k/year to applaud that. And that’s to say nothing of the techs and janitors and cashiers and bed pushers who make even less than us, but are as absolutely crucial to making a hospital work as the fucking CEO or the neurosurgeons. Can they pay us more? Absolutely. But why would they? No one’s making them.

The workers in NY made them. They fought for and won a living wage. So how incredibly petty and counterproductive is it to fuss that their pile of crumbs is bigger than ours? Put that energy elsewhere. Organize. Fight. Win.

Writing for EMS1.com, an online network for emergency medical services (EMS) personnel, Arthur Hsieh weighed into the subsequent debate about who deserves a decent salary or wage.

Continue reading

The Return of the American Slum

From The Atlantic comes yet another sobering confirmation of America’s economic and social decline. As rising inequality, government austerity, and declining employment continue apace, poverty is naturally rising, becoming more concentrated and self-perpetuating than ever.

The number of people living in high-poverty areas—defined as census tracts where 40 percent or more of families have income levels below the federal poverty threshold—nearly doubled between 2000 and 2013, to 13.8 million from 7.2 million, according to a new analysis of census data by Paul Jargowsky, a public-policy professor at Rutgers University-Camden and a fellow at The Century Foundation. That’s the highest number of Americans living in high-poverty neighborhoods ever recorded.

The development is worrying, especially since the number of people living in high-poverty areas fell 25 percent, to 7.2 million from 9.6 million, between 1990 and 2000. Back then, concentrated poverty was declining in part because the economy was booming. The Earned Income Tax Credit boosted the take-home pay for many poor families. (Studies have shown the EITC also creates a feeling of social inclusion and citizenship among low-income earners.) The unemployment rate fell as low as 3.8 percent, and the first minimum wage increases in a decade made it easier for families to get by. Programs to disassemble housing projects in big cities such as Chicago and Detroit eradicated some of the most concentrated poverty in the country, Jargowsky told me.

As newly middle-class minorities moved to inner suburbs, though, the mostly white residents of those suburbs moved further away, buying up the McMansions that were being built at a rapid pace. This acceleration of white flight was especially problematic in Rust Belt towns that didn’t experience the economic boom of the mid-2000s. They were watching manufacturing and jobs move overseas.

Another reason for this growing problem are ineffective, if not counterproductive, policies at both the state and federal level.  Continue reading

The Richer You Are, The Richer You Think America Is

This recent Washington Post article comes well-timed following yesterday’s post about America’s large and growing child poverty rate. Citing a study published in Psychological Science by Rael Dawtry and Robbie Sutton at the University of Kent, and Chris Sibley at the University of Auckland, it explains how pervasive and entrenched socioeconomic segregation is at the heart of the U.S.’s high and widening inequities.

The wealthy, surrounded by other wealthy people, generally believed the U.S. population was wealthier than it actually is. It’s easy to imagine why they might make this mistake: If you look around you and see few poor people — on the street, in your child’s classroom, at the grocery store — you may think poverty is pretty rare.

The communities we see immediately around us, the authors argue, shape our sense of how rich America is. And those perceptions, in turn, can influence how we feel about government policies for the poor. In this study, wealthier people who overestimated the extent of wealth in the U.S. were also more likely to perceive the economy as fair and more likely to oppose redistribution policies.

This implies that attitudes about programs like welfare aren’t based solely on political ideology or self-interest (if I have a lot of money, I don’t want to be taxed more). They’re also influenced by cues we get from the environment around us. That means that the wealthy don’t just lack information about what it’s like to be poor; they also lack basic information about how pervasive poverty is.

The study’s conclusion sum up how and why the U.S. can continue to tolerate unjustifiably high levels of poverty, indebtedness, and hunger despite so much economic growth and potential; and also how mounting evidence of the worsening state of the country do not put a stop to opposition to better wages (whether privately or legally mandated), more investment in infrastructure and education, more affordable housing and healthcare, and so on.

These results suggest that the rich and poor do not simply have different views about how wealth should be distributed across society; rather, they subjectively experience living in societies that have subtle—but important—differences. Thus, in the relatively affluent America inhabited by wealthier Americans, there is less need to distribute wealth more equally.

In essence, it is not that wealthy people as a whole are wilfully cruel and callous — although there is certainly a sizeable subset that are arguably are — but rather that they simply do not know any better. Our society has become so divided along so many lines, in both geographic and psychological terms, that it is difficult for people to come around to experiences outside their own. There really are two Americas (and many more if you include race and ethnicity, which intersect with class and economic status) with two very different experiences and understandings informing their policy.

As the WaPo article points out, this is problem is all the more concerning given that economic segregation in the U.S. is worsening; that we increasingly less likely to live near, let alone interact with, people of different incomes levels; and that the economic gap between rich and poor communities — even those not far from each other — is growing.

Moreover, with wealthier Americans and their interests groups having disproportionate influence over our political system, including over policies that could alleviate poverty and inequality, it is hard to see a way out of this self-perpetuating problem — at least within current sociopolitical paradigms.

What are your thoughts?

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More U.S. Children Live In Poverty Now Than During the Recession

Eupraxsophy:

The world’s wealthiest nation by a wide margin, which has experienced steady economic growth over the past several years, which counts more billionaires than any other country in the world (indeed, than the next dozen or so country combined), and child poverty is both stubbornly high and actually growing.

There is not much else to say.

Originally posted on TIME:

In mid-September 2010, almost exactly two years to the date since the monumental collapse of Lehman Brothers, the New York Times published a bleak statistic: the ongoing Great Recession had driven the U.S. poverty rates to their highest in a decade and a half.

Five years of fitful economic recovery have not yet bettered this situation. According to a new report from the Annie E. Casey Foundation, more than one in five American children, about 22%, were living in poverty in 2013. Data for 2014 are not yet available, but the report anticipates that the child poverty rate remains at an “unacceptably high [level].”

The figure for 2008 was 18%.

[newsletter-the-brief]

General terms are insufficient when explaining the economy’s post-recession rebound. There are a number of conflicting statistics — the fall in unemployment versus the rise in poverty, for instance — but even efforts to compare and assess these inconsistencies…

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Most Young Homeowners Have Rich Parents

Yet another big indication of America’s declining social mobility is the fact that most young people who are financially well-off are simply those already born into stable and prosperous circumstances. As The Atlantic points out, the majority of Millennials who enjoy the rare benefits of homeownership, higher education without crushing debt, or ample savings owe such prosperous standing to their parents and families.

To start with, most of those who continue their education after high school have families that are able to help financially. A recent report from the real-estate research company Zillow looked at Federal Reserve Board data on young adults aged 23-34 and found that of the 46 percent of Millennials who pursued post-secondary education (that’s everything from associates degrees to doctorates), about 61 percent received some financial help with their educational expenses from their parents.

And yet, even with this help, the average student with loans at a four-year college graduates with about $26,000 in student-loan debt. Millennials who are lucky enough to have some, or all, of a college tuition’s burden reduced by their parents have a leg up on peers who are saddled with student debt, and they’ll be able to more quickly move out on their own, and maybe even buy their own house.

To be sure, there is no shame in getting help from one’s family. But it is important to acknowledge one’s fortuitous circumstances, and the contributions of others — from loved ones to society as a whole — that helped make it happen.  Continue reading

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Entrepreneurs don’t have a special gene for risk—they come from families with money

Eupraxsophy:

In essence, only people with a lot of money can take the necessary risks required to start their own business. Sure, there are always exceptions, but for the majority of Americans, the entrepreneurial path just isn’t feasible.

Perhaps with more vocational schools, job training programs, and more generous and accessible loans, starting a business would not be so out of reach from most non-wealthy people.

Originally posted on Quartz:

We’re in an era of the cult of the entrepreneur. We analyze the Tory Burches and Evan Spiegels of the world looking for a magic formula or set of personality traits that lead to success. Entrepreneurship is on the rise, and more students coming out of business schools are choosing startup life over Wall Street.

But what often gets lost in these conversations is that the most common shared trait among entrepreneurs is access to financial capital—family money, an inheritance, or a pedigree and connections that allow for access to financial stability. While it seems that entrepreneurs tend to have an admirable penchant for risk, it’s usually that access to money which allows them to take risks.

And this is a key advantage: When basic needs are met, it’s easier to be creative; when you know you have a safety net, you are more willing to take…

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Income Inequality Around the World

Or to be more precise, among the 34 countries that make up the Organisation for Economic Co-operation and Development (OECD), a club of mostly industrialized nations (including many of the world’s largest and most developed economies). Its recent report on inequality shows growing and unprecedented disparity of income across the board, albeit at different rates and levels depending on the country.

Mexico, Chile, the United States, and Turkey fare the worst, while Denmark, the Czech Republic, Slovenia, and Finland perform the best. The chart below displays the results, courtesy of Business Insider

Continue reading