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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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U.N. Finds Vast Decline in Global Poverty, Though Big Challenges Remain

Last Monday, the United Nations published details from its final report on the results of the Millennium Development Goals (MDGs), a set of targets established 15 years ago to improve the lives of the poor. The eight goals covered every dimension of extreme poverty, from eradicating hunger and child mortality, to improving environmental sustainability and gender equality.

As the New York Times reported, the results were mixed but nonetheless encouraging.

Dire poverty has dropped sharply, and just as many girls as boys are now enrolled in primary schools around the world. Simple measures like installing bed nets have prevented some six million deaths from malaria. But nearly one billion people still defecate in the open, endangering the health of many others.

“The report confirms that the global efforts to achieve the goals have saved millions of lives and improved conditions for millions more around the world”, the United Nations secretary general, Ban Ki-moon, said Monday as he released the report in Oslo.

In fact, though, how much of those gains can be attributed to the goals is unknown. The sharp reductions in extreme poverty are due largely to the economic strides made by one big country, China. Likewise, some of the biggest shortfalls can be attributed to a handful of countries that remain very far behind. In India, for example, an estimated 600 million people defecate in the open, heightening the risk of serious disease, especially for children.

Continue reading

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

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Worker-Owned Companies Begin to Take Off in the U.S.

Amid rising inequality, stagnating wages, and the increasingly inefficient (to workers) nature of traditional corporate hierarchies, more and more workers are experimenting with an alternative method of organizing businesses that has been around for some time, yet is only recently catching on (at least in the United States): worker-owned cooperatives.

The Atlantic explores this intriguing idea as it begins to gain both public attention and viable

Worker cooperatives are equally owned and governed by employees, who also earn money from the profits of their labor. There are no CEOs here making multi-million dollar salaries while workers receive minimum wage. Nor are there CEOs with decades of experience and education to successfully guide the company through the up and downs of the dog-eat-dog business world.

In worker cooperatives, decision-making is democratic, so each worker has one vote, and policies can’t be determined by an investor whose only priority is profit. (Most profit-minded investors probably wouldn’t touch a worker cooperative with a ten-foot pole anyway.)

In a typical workplace, “there’s a pretty clear hierarchy at work, where power and wealth are concentrated at the top and decisions tend to flow from the top down”, Carlos Perez de Alejo, the executive director of Cooperation Texas, an Austin-based resource for cooperatives, told me. “We end up with the results of those decisions without really knowing where they came from”.

In Austin alone, there are worker-owned green cleaning cooperatives and collectively-run thrift stores, worker-run brewpubs and worker-owned Internet hosting cooperatives. Taxi drivers, threatened by Uber and Lyft, are talking about starting a taxi cooperative.

Though a fairly progressive island within one of America’s most conservative states, it is still pretty interesting to see this “socialistic” concept become successfully incubated in a part of the country where big business, low wages, and lack of workers’ rights are all deeply entrenched. It goes to show that when push comes to shove, and governments fail to act, the people take matters into their own hands — albeit up to a point. Continue reading

Finland and the Netherlands Experiment With Basic Income

Finland became the first country in Europe to announce plans for the implementation of a basic income program, according to the Basic Income Earth Network (BIEN). (To recap: a basic income is a universal, unconditional form of payment to individuals that covers their living costs. It allow people to choose to work more flexible hours and devote more time to non-work related activities, from caregiving and volunteering, to studying and leisure.)

The commitment consists of one line: ‘Implement a Basic Income experiment’, in the ‘Health and Welfare’ section of the programme.

The main party of government, the Centre Party and the new Prime Minister Juha Sipilä, are known to be supportive of Basic Income, but his new government partners, the populist Finns Party and conservative NCP have not spoken publicly on the issue. The scant reference to Basic Income raises some doubts about the government’s commitment to the policy.

So while it is far from a done deal — especially as the government has yet to release any further details, including a timeframe — it is nonetheless a big step, as few other countries, even in socially progressive Europe, have ever made such a formal, nationwide commitment.

Meanwhile, the fourth largest city in the Netherlands, another country that has been mulling over a basic income, is set to implement a plan of its own. The intention is not only to determine if a basic income will help people in absolute terms, but to see how its efficiency compares to the status quo of welfare payments. From The Independent:

University College Utrecht has paired with the city to place people on welfare on a living income, to see if a system of welfare without requirements will be successful.

Alderman for Work and Income Victor Everhardt told DeStad Utrecht: “One group is will have compensation and consideration for an allowance, another group with a basic income without rules and of course a control group which adhere to the current rules.”

“Our data shows that less than 1.5 percent abuse the welfare, but, before we get into all kinds of principled debate about whether we should or should not enter, we need to first examine if basic income even really works.

“What happens if someone gets a monthly amount without rules and controls? Will someone sitting passively at home or do people develop themselves and provide a meaningful contribution to our society?”

It is not surprising that the Dutch would lead the way in this experiment, given that they already have a well-established fondness for less traditional work environments — 46.1 percent of the labor force works part-time, the highest proportion in the European Union, and the nation is nonetheless broadly prosperous, with a high rate of life satisfaction. This is a country that already leads the way in work-life balance, so it would be interesting to see how this endeavor goes and whether it will catch on elsewhere in the country or beyond.

Finland and the Netherlands are the first developed nations to experiment with a guaranteed basic income since the 1970s, when Canada conducted a pilot project dubbed “Mincome” in a small town, with great results. Other experiments have been performed more recently in India, Namibia and Brazil, each one of them reporting measurable, positive outcomes in everything from poverty reduction to healthcare and general wellness.

As BIEN notes, there is an increasing interest in Basic Income worldwide, as well there should be: from mounting inequality to a dearth of well-paying and sustainable jobs, there are plenty of good reasons to consider at least trying out this streamlined and promising approach to alleviating poverty and improving quality of life.

The Countries With the Greatest Well-Being

According to the most recent Gallup-Healthways Well-Being Index, Panama once again takes the top spot in the number of people reporting high personal well-being, followed by Costa Rica in second place and Puerto Rico in third.

In fourth place was Switzerland, the top European country, which along with Austria (in ninth place) was the only non-Latin American country in the top ten.

The United States came in at No. 23, one spot behind Israel and one ahead of Canada.

This is the second time the report has been compiled (see the first one’s results here). It looks at how more than 146,000 randomly selected adults, spanning 145 countries and areas, respond to questions about five areas related to their well-being: purpose; social; financial; community; and physical. Here are the specific questions, courtesy of NPR. Continue reading

What If Students Stopped Paying Back Their Loans?

That is the provocative question posed by Vice to Professor Andrew Ross, who teaches Social and Cultural Analysis at New York University. As one of the founders of debt resistance groups like Occupy Student Debt and Strike Debt; a member of the Debt Collective; an advocate for the rights of debtors; and an author of Creditocracy and the Case for Debt Refusalhe is clearly something of an expert on the subject. His answer?

A strike of any kind is a tactic. It’s not a solution. It’s a tactic towards a goal, and the goal here ultimately is for the US to join the long list of industrialized countries around the world that make it their business to offer a free public higher education system. None of these other countries are as affluent as the US; there’s no question that this country could afford to do so. In fact, we produced an estimate not that long ago about how cheap it would be for the federal government to cover tuition at all two and four-year colleges. There are several estimates in circulation, and a few years ago that kind of proposal was dismissed out of hand. But now we’re beginning to see it pop up on Capitol Hill in various forms. It’s a proposal that’s part of Bernie Sanders’ campaign for president. It’s a proposal that pushed President Obama in the direction of making community colleges free, at least for two years. It’s becoming a little more respectable to talk about [solutions for student debt], on Capitol Hill and in the public sphere in general. None of that would have happened without a student debt resistance.

Read the rest of this illuminating interview here. Given the mounting economic and social consequences of this issue, one can expect the public debate about student debt and the cost of higher education to only intensify.

The 800th Anniversary of Magna Carta

Widely considered to have been a watershed in the conception of political rights and the rule of law, the 800-year old Magna Carta — Latin for The Great Charter — is credited with having introduced proto-democratic principles to the United Kingdom and beyond, inspiring even the seminal U.S. Constitution and Bill of Rights many centuries later. To this day, the 13th century document — drafted to make peace between rebellious nobles and their unpopular king — is subsequently revered by lawmakers, scholars, and jurists across the world (especially in the Anglosphere).

Among the many then-radical concepts Magna Carta introduced was the promise for the protection of church rights, the prohibition of illegal imprisonment of barons, the provision of formal justice, and limitations on feudal payments to the Crown. Though it applied only to a very small percentage of the population — the notion of civil rights for all humans was still a long way off — for its time, limiting the arbitrary power of the monarch was a pretty big deal.

Or so the myth of Magna Carta would suggest. As The New York Times reports amid many commemorations of the document, many scholars believe the Great Charter’s legacy is overblown. Continue reading