In this issue, questions for Paul Ryan on poverty, philanthropy led bail reform, the need for new socialism, creative class gentrification, and the Vatican does impact.
This week, House Speaker Paul Ryan held a townhall on CNN in which he was press on a number policy issues including a challenging question by a nun on GOP plans for the poor:
I know that you're Catholic, as am I, and it seems to me that most of the Republicans in the Congress are not willing to stand with the poor and working class as evidenced in the recent debates about health care and the anticipated tax reform. So I'd like to ask you how you see yourself upholding the church's social teaching that has the idea that God is always on the side of the poor and dispossessed, as should we be.
RYAN: Spoken like a great Dominican nun. Look...Sister, you may -- this may come as a surprise to you, but I completely agree with you. Where we may disagree is on how to achieve that goal. As you know, we all exercise prudential judgment in practicing our faith. And for me, the preferential option for the poor, which is something that's a key tenet of Catholic faith, that means upward mobility, that means economic growth, that means equality of opportunity. That to me means working with this guy over here at Gateway Tech to make sure that we can close the skills gap, to make sure that every person who wants a career and job can get the benefits.
We actually just passed this bill in July. Before that, we passed another skills bill. That means to me taking this 20th century poverty program that we have, which is -- we're in the 32nd year of the war on poverty. Trillions spent, and guess what? Our poverty rates are about the same as they were when we started this war on poverty 32 years ago.
The Nation's John Nichols says the exchange "revealed Ryan’s startling ignorance regarding not just poverty but the antipoverty programs he seeks to diminish and dismantle":
[N]o one except Paul Ryan thinks the war on poverty started 32 years ago. 2017 minus 32 is 1985. That’s the middle of Ronald Reagan’s presidency...The official poverty rate is currently in the middle of that range, around 13.5 percent. So, in addition to getting the timeline wrong, Ryan got the measures of results wrong.
Poverty dropped dramatically when antipoverty programs were initiated in the mid-1960s and it has not returned to the levels that existed before the launch of the war on poverty. Should poverty rates be lower? Absolutely. But it is not war-on-poverty programs that keep the rates from dropping. It is the failure to maintain the commitment to “curing” and preventing poverty that LBJ and the Democratic congresses of the late 1960s evidenced.
Esquire's Charles Pierce found the exchange highly patronizing especially Ryan's contention that current safety net programs disincentivize work:
First of all, a great many poor people work their asses off, and in the private sector, too, and they're being patronized by a guy who hasn't spent 15 seconds in the private sector since he went away to college. His family got rich building roads on government contracts. His father died, and he went through high school on Social Security's survivor benefits, a program that the budget proposed by the president* would eviscerate. Since then, he's been a congressional aide and a congressman. My question is that, when he was going through high school on my nickel, and the nickels of millions of other Americans, including the poorer ones, why wasn't he "disincentivized"? How did he avoid the terrible trap of the government "hammock"?
You might be interested in this survey from Demos on voters' appetite for a broad economic agenda and messages that most resonate with them, check out thise chart:
NBC News offers this in depth look at whether a data system funded by philanthropies such as the Laura and John Arnold Foundation can fix the prison bail crisis that over burdens the poor:
ACROSS THE COUNTRY, reformers are chipping away at money bail, arguing that it discriminates against the poor, ruins innocent people’s lives, fuels mass incarceration and contributes to wrongful convictions. The movement is part of a much broader effort to end abuses across the criminal justice system, from biased policing to burdensome court fees to mandatory minimum prison sentences.
Philanthropic organizations are funding projects in more than three-dozen states to eliminate bail and adopt algorithm-based risk-assessment tools. Judges are pushing similar efforts in Maryland, Arizona, and Indiana. Lawmakers are the driving force in a handful of other states, including Illinois and California.
Civil rights organizations have challenged bail-based systems in a dozen local jurisdictions, arguing that they violate constitutional protections of equal treatment and due process. The targets range from tiny Calhoun, Georgia, where the U.S. Justice Department has argued that the town’s use of cash bail was unconstitutional, to Harris County, Texas, where in April a judge ordered authorities to stop detaining people charged of low-level crimes.
In the Washington Post, Matt O'Brien offers some cautionary analysis on why state-sponsored lotteries are bad for poor people and why we should be seeking alternative solutions:
It's not that poor people don't understand that the lottery has a near-zero chance of making them dynastically wealthy. It's that they think everything else has an actually-zero chance. That's why, as Thompson highlights, people making less than $30,000 are 25 percent more likely to say that they buy lottery tickets for money than for fun, while it's the opposite for everyone else. State lotteries, in other words, don't just prey on poor people's dreams—they do that for everyone—but rather on desperate dreams...[T]he worst part about lotteries is that they continue even though we know what we should do with them: abolish them and replace them with prize-linked savings. What's that? Well, it's an idea so good that it seemed destined to only exist at think tank conferences. It's a system where instead of each person earning interest on their savings, all the interest is pooled together and then raffled off. So in the worst case, people have saved money that they otherwise would have lost on lottery tickets, and in the best they won a nice little cash prize on top of their little nest egg.
Finally you might be interested in this New York Times article on why the opiod crisis needs an official national emergency declaration to free up federal aid such as more Medicaid dollars.
In the New Republic, John Judis author John Judis says America needs a new redefined socialism to find a path to power in 21st Century America: "American socialists need to do what the Europeans did after World War II and bid goodbye to the Marxist vision of democratic control and ownership of the means of production. They need to recognize that what is necessary now—and also conceivable—is not to abolish capitalism, but to create socialism within it."
Meanwhile in the Pacific Standard, Brooks Rainwater argues that cities need a new social welfare system to meet today's challenges of an on-demand workforce:
Think about the "good" jobs of the past. Whether it's a much-lamented coal miner or a factory worker that pops in your head, what made their work good? It wasn't the day-to-day tasks themselves, but the economic security it provided—not just the benefits and pay, but the stabilizing value it brought to individual households, communities, and society itself. In short, the good jobs of yesterday strengthened the safety net...
On-demand and contract work has become increasingly common in the modern economy. Freelancers now make up 35 percent of the workforce, and since these gig-economy jobs don't have benefits tied to employment, portable benefits are an option whose time has come. These benefits are connected to individuals rather than employers, and typically include paid leave, health insurance, worker's compensation/unemployment, and some sort of retirement fund matching. Proposals for this type of system vary. Some suggest that benefits should be universal and administered by the government or a public/private institution created for such a purpose. Others say they should be administered by non-governmental community-based groups. Either way, portable benefits have the potential to support those who work outside the realm of the traditional 9-to-5 economy.
In Jacobin Magazine, researcher Richard Florida is admitting he was wrong about the creative class being the sole key to revitalizing beleagered cities:
He argues that the creative classes have grabbed hold of many of the world’s great cities and choked them to death. As a result, the fifty largest metropolitan areas house just 7 percent of the world’s population but generate 40 percent of its growth. These “superstar” cities are becoming gated communities, their vibrancy replaced with deracinated streets full of Airbnbs and empty summer homes.
Meanwhile, drug addiction and gang violence have spread to the suburbs. “Much more than a crisis of cities,” he writes, “the New Urban Crisis is the central crisis of our time” — “a crisis of the suburbs, of urbanization itself and of contemporary capitalism writ large.”
Florida’s offered solutions are modest. They range from the specific — more affordable housing, more investment in infrastructure, and higher pay for service jobs — to the vague — “engage in a global effort to build stronger, more prosperous cities in rapidly urbanizing parts of the world” and “empower communities and enable local leaders to strengthen their own economies.”
Finally Linda Tirado is back to explain over at Talk Poverty offers food for thought on the white working class and racism:
We tell ourselves little lies to make the world make more sense. Sometimes it’s because we’re looking for reason in madness, sometimes it’s because we’re telling ourselves pretty little falsehoods to avoid guilt. We lie to ourselves and each other about how the nation works, who’s at the top and bottom of various ladders. We find scapegoats for societal ills, to make them into something separate from ourselves...If poverty were a causal effect for racism, then you would not expect to see quite so many virulent racists in the upper classes. David Duke and Richard Spencer were both children of some privilege. Stephen Miller didn’t grow up in straitened circumstances. These are the men who stoke the fears and resentments of the lower classes, who manipulate and misinform.
Lyndon Johnson famously said, “If you can convince the lowest white man he’s better than the best colored man, he won’t notice you’re picking his pocket. Hell, give him somebody to look down on, and he’ll empty his pockets for you.” He wasn’t wrong, and that strategy has been used to great effect over the centuries. It’s why we have de facto segregation, it’s why we pushed through welfare reform using the boogeyman of the “welfare queen,” and it’s why the same crime gets you a different sentence depending on what color you are. Find a bit of structural racism, and behind it you’ll find a white politician pandering to the worst parts of human nature to gain or hold power.
But there is a difference between misinformation and hate. I know many good people who support bad policies; they are well-intentioned but misinformed. I don’t know many good people who take pleasure in terrorizing others, who would join hate groups and call it a fight for utopia.
You might also be interested in this check in from the CEO that promise a $70,000 wage floor to his employees whose company Gravity is still growing revenue and employment.
Be sure to check out Heron's new web page on explaining the methodology for its holding the U.S. Community Investing Index, which it has developed over the last decade along with partners. The public equity index is designed to identify companies that contribute positively to the communities in which they source and operate.
The Economist reports on the Vatican-led effort for Catholic institutions to become impact investors:
Some Catholic institutions with assets to invest—including the Jesuits, the Franciscan Sisters of Mary and Ascension Investment Management—have earmarked a part of their investments for impact funds.
Meanwhile, new Catholic impact funds have been formed, such as ones under the Oblate International Pastoral Investment Trust, which is entrusted with the financial resources of more than 200 Catholic organisations from over 50 countries. Others have joined co-operative efforts to align their investment strategies. The Catholic Impact Investing Collaborative, for example, groups 30 American Catholic institutions, with $50bn in assets under management (of which a small fraction is devoted to impact investing). To encourage public involvement, new “retail” impact funds have been set up, allowing donors to buy a share for a small outlay—say $30.
Meanwhile, CNN reports on the growing number of wealthy families taking up impact investing via The ImPact.