In Case You Missed It: The Precariously Possibly Poor

In Case You Missed It

In this issue, the Bilderberg discussion on endangered workers, Adam Smith's views on inequality, a newish Paul Ryan poverty plan, and the "appifying of philanthropy".

 Precariously Possibly Poor

So um, yeah this super secret group of ultra-wealthy folks that meets every year in some random place in Europe to discuss global things met again this week. This time the discussion point was the so-called precariat and the middle class, reports Jason Karaian:

The what? The “precariat” is a term popularized by British economist Guy Standing, describing a growing class of people who feel insecure in their jobs, communities, and life in general. They are…

…the perpetual part-timers, the minimum-wagers, the temporary foreign workers, the grey-market domestics paid in cash… the techno-impoverished whose piecemeal work has no office and no end, the seniors who struggle with dwindling benefits, the indigenous people who are kept outside, the single mothers without support, the cash labourers who have no savings, the generation for whom a pension and a retirement is neither available nor desired.

This marginalized group—“alienated, anomic, anxious, and angry,” according to Standing—is fueling the rise of populist politicians like Donald Trump in the US and similar rabble rousers in Europe and beyond. (Discussing this group alongside the middle class, which isn’t doing great either, is telling.) The resulting turmoil in politics, markets, and economics is a factor in nearly all of the Bilderberg meeting’s other agenda items.

Check out this 2015 chart of how many young people are in temporary work positions in Europe as reported by the Financial Times:

Over at Raw Story, the University of Leicester's Martin Parker argues the global Bilderbergs conspiracy theories (which kind of have a similar mystique to the Illumanti) might have some merit:

Rather famously, Adam Smith (beloved of free-marketeers) once said: “People of the same trade seldom meet together, even for merriment and diversion, but the conversation ends in a conspiracy against the public, or in some contrivance to raise prices.” ... These politicians and businessmen (because they are, mostly, men) do have common interests after all. These are the success stories of transatlantic post-war capitalism. What do they know of the “precariat” they’re supposed to be discussing?

If you spend much of your life occupying the first class compartment on aeroplanes, it doubtless becomes logical to assume that there is some virtue to the system that put you there. Your fillet steak always tastes better if it has been accompanied by a small side-helping of self-congratulation. So the 120-150 members of the elite who get together every year – two thirds of the participants from Europe and the rest from North America – are undoubtedly not terribly motivated to change much.

Smith's views on inequality and why it is less about money than about morals and public sentiment:

Smith held, people sympathize more fully and readily with the rich than the poor: “the rich man glories in his riches, because … they naturally draw upon him the attention of the world,” while “the poor man goes out and comes in unheeded, and when in the midst of a crowd is in the same obscurity as if shut up in his own hovel.” Not only are people far more likely to notice the rich than the poor, according to Smith, but they are also far more likely to approve of them, to admire them, and to emulate them; indeed, he devoted an entire chapter of The Theory of Moral Sentiments to demonstrating that this is the case.

What’s more, Smith saw this distortion of people’s sympathies as having profound consequences: It undermines both morality and happiness. First, morality. Smith saw the widespread admiration of the rich as morally problematic because he did not believe that the rich in fact tend to be terribly admirable people. On the contrary, he portrayed the “superior stations” of society as suffused with “vice and folly,” “presumption and vanity,” “flattery and falsehood,” “proud ambition and ostentatious avidity.” In Smith’s view, the reason why the rich generally do not behave admirably is, ironically, that they are widely admired anyway (on account of their wealth). In other words, the rich are not somehow innately vicious people. Rather, their affluence puts them in a position in which they do not have to behave morally in order to earn the esteem of others, most of whom are dazzled and enchanted by their riches.

Meanwhile, over at Talking Points Memo Donald Cohen of In the Public's Interest discusses why privatization might be expanding inequality:

[A]fter 50 years of attack on government, privatization is a standard conservative response to tight public budgets, a key pillar of attacks on government, and a lucrative market opportunity for domestic and global corporations. Large corporations operate virtually every type of public service including prisons, welfare systems, infrastructure, water and sewer, trash, and schools...

In the last decade, much of the battle over privatization has shifted to states and cities across the country. Obama’s initiatives incentivize privatization, but state and local governments are making it happen – more aggressively by red-state politicians motivated by ideological and political aims, but also by politicians in blue regions facing budget constraints.

Today, privatization is weakening democratic public control over vital public goods, expanding corporate power and increasing economic and political inequality. Domestic and global corporations and Wall Street investors covet the $6 trillion in local, state and federal annual public spending on schools, prisons, water systems, transit systems, roads, bridges and much more.

Impossibly Poverty Politics

So House Speaker Paul Ryan has yet another version of his plan to reduce poverty. Over at the Washington Times, Newt Gingrich argues it "is a bold, ambitious, and badly needed rethinking of the nation’s poverty programs":

The Ryan plan is built around five pillars: rewarding work, matching benefits to individual needs, improving skills and schools, making it easier to save for the future, and insisting on evidence and results.

These principles lead to a number of creative ideas. For instance, the plan would extend the work requirement to federal housing programs, since there is evidence that more than 40 percent of those receiving rental assistance who could work actually don’t. In addition, the proposal would also strengthen or institute work incentives for the Supplemental Nutrition Assistance Program (SNAP), as well as TANF, among other entitlements.

The plan would give states more flexibility to link and coordinate programs to help them more effectively tailor benefits to the needs of individuals in their communities.

But those on the left remain unconvinced and again have an eyeroll for the Speaker's plans. Over at Vox, Dylan Matthews had this to say:

 [B]ig, ambitious liberal plans to end poverty tend to lean heavily on direct spending initiatives, like subsidized jobs or just handing out cash.

Ryan, the plan makes clear, views this as cheating. Ending poverty by spending money does not, in his framework, address the "root cause" of poverty: Too few people are at work making enough money to support themselves. So his plan is animated by an obsessive desire to reduce reliance on safety net programs and increase the share of low-income people getting by through work.

He's right on one thing: It does appear that work requirements like the ones he's proposing get people to work more, increase their earnings, and reduce their reliance on government programs. But America's experience with welfare reform has taught us that this comes at a significant cost. While requirements boost work somewhat, they're not enough to get a job at a living wage for everyone who can work, and they do nothing for the elderly or disabled who can't work at all. The result is enduring poverty among those who can't work or can't find work.

Slate's Jordan Weissman is even more derisive of the plan, in particular where the plan would eliminate new rules to require investment advisors to put their client interests before their own:

This is silly. Any family that was previously getting ripped off by an adviser steering it into high-fee investment products is almost certainly better off putting its money into a Vanguard retirement fund anyway (and that free bit of insight isn't exactly hard to find online). The basic consumer protections offered by the fiduciary rule aren't going to deprive anybody of essential financial advice, and fighting it is an obvious sop to a powerful industry. Trying to cloak it in the language of an anti-poverty effort is as sad as it is hilarious.  

Meanwhile, television nightly news has mostly ignored U.S. poverty in the 2016 election cycle, check out this chart from TalkPoverty's Jeremy Slevin:

Similarly in the Democratic primary debates, questioners didn't really probe rivals Bernie Sanders and HIllary Clinton about poverty, reports Jeff Stein in Vox. Also check out Larry Mishel's testimony before the Democratic platform Committee on the plight of low and middle income workers.

Possibly Impact

So Massachussetts may have the best public school system and we might learn something from it ... except maybe when it comes to the achievement gap for poor kids, reports Alia Wong in the Atlantic:

The Bay State’s famous successes are juxtaposed with stubborn achievement gaps and concentrations of poverty that have made across-the-board strides all but impossible. Income-based disparities in academic performance have actually grown over the last decade or so, and last year the state’s achievement gap was the third highest in the nation.

“On the one hand, these first-place finishes and so forth—which are all based on averages—are great, we’re proud of it, but it should be a pretty short celebration in light of the deep, persistent achievement gaps that look a lot like they did when we set out on this,” said Reville, now a professor at the Harvard Graduate School of Education...

[Tommy] Chang notably criticized certain district policies in Boston as contributing to those inequalities, including its approach to selective schooling and gifted-and-talented programs. (Chang became the Boston superintendent in July of 2015.)

“In BPS, we start segregating kids at very young ages,” he said, noting that children are separated by ability starting in the fourth grade in ways that often correlate with race and linguistic background. “We have to figure out how we stop doing that at such an early grade level. We are literally tracking kids still.”

In Seattle you can give directly to the homeless via a new app called WeCount. Meanwhile, Ben Paynter looks at "appifying philanthropy" via a new app that is essentially "a free brokerage designed to connect deep-pocketed donors with well-appointed charities interested in child welfare":

A few years ago, one of the tech world’s brightest serial entrepreneurs decided it was time to give back. Why not? Alexandre Mars had already launched a mobile marketing firm that he sold to Publicis Groupe, and a social media management system that got picked up by Blackberry. He was young (not yet 40), rich (net worth: secret, but definitely loaded), and motivated (the son of an ever-volunteering mother).

What he lacked was direction about how to do it. Other friends and business associates admitted they weren’t donating as much as they could because it was hard to figure out which charity might best use it. That, and we live in The Age of Immediate Gratification. To Mars, the entire process for philanthropic giving—donate, wait, then track what happened in some annual report—felt outdated. So he decided to build his own startup to optimize how the donor-recipient relationship works. "We want the world to know that social entrepreneurs are as smart and agile as tech entrepreneurs in Silicon Valley or Silicon Alley," he says.

In this blog post from the McKnight Foundation's Kate Wolford, we have a discussion of why giving locally helps fight climate change:

Both Barr and McKnight have experience supporting local work through direct support to municipal governments. Barr made a challenge grant to the City of Boston to pay part of the salary for someone in a new role to focus exclusively on community energy solutions. This modest investment ultimately attracted a wide range of additional resources that will drive progress on clean energy. Similarly, ­McKnight collaborated with the Energy Foundation to support efforts in Minneapolis to drive energy-efficiency improvements in large commercial buildings as part of the city’s innovative energy-transparency ordinance.

Some challenges are so immense that nobody wants to take them on. Climate change may seem to be one of those, considering its scale, the vast range of solutions needed, and the political obstacles we witness at the national level. Indeed, federal gridlock underscores the potential and value of local and regional action — action that sparks progress, progress that points to success, and success that breeds more success.

Finally, would a new Clinton adminstration be good for philanthropy? Over at Inside Philanthropy, Kiersten Marek and David Callahan look at the philanthropic ties to Hillary Clinton.



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