The Working Poor Have Bigger Problems Than Single Parenthood

I was tempted to dissent David Brooks' recent piece on how boys are faring in school, his comparison of an unruly boy, chained down by "culturally homogenous schools", to Henry V as depicted by Shakespeare - first as a wild child in Henry IV, later as an accomplished leader in Henry V. According to Brooks, it seems schools would prefer to be teaching "a reflective Hamlet".

By about the third week of nursery school, Henry’s teacher would be sending notes home saying that Henry “had another hard day today.” He was disruptive during circle time. By midyear, there’d be sly little hints dropped that maybe Henry’s parents should think about medication for attention deficit hyperactivity disorder. Many of the other boys are on it, and they find school much easier.

What say you, Charles Pierce?

At which point, Henry IV, in all of his parts, and being pissed off with that whole Percy family squabble, would have the nursery school teacher drawn and quartered, her head hung on Traitor's Gate for a month, and I probably shouldn't give our country's school "reformers" any ideas.

But as tempting as it was to respond to Brooks' editorial with full-bore sarcasm, what I found problematic was less his dubious resort to Shakespeare and more the fact that he has difficulty maintaining a consistent thesis. Instead, by the end he becomes somewhat incoherent:

Schools have to engage people as they are. That requires leaders who insist on more cultural diversity in school: not just teachers who celebrate cooperation, but other teachers who celebrate competition; not just teachers who honor environmental virtues, but teachers who honor military virtues; not just curriculums that teach how to share, but curriculums that teach how to win and how to lose; not just programs that work like friendship circles, but programs that work like boot camp.

Seriously - the way we're going to engage a young Henry V in school, keep him out of trouble, keep him from rebelling, is by sending him to a school that embraces "military virtues" and resembles a "boot camp"? Is this a half-hearted defense of KIPP-type schools with their extensive behavior codes? Brooks seriously believes his young Henry V's will go unmedicated and be educationally successful in such schools?

But the incoherence runs deeper. This is the same David Brooks who has lectured us that a small child's ability to resist marshmallows is a harbinger of his future. In the past he proposed that schools focus on teaching children "to master the sort of self-control that leads to success". That's consistent with the military model he appears to be half-endorsing, but again that's not going to work with a Henry V.

The rich, privileged, self-indulgent Henry V can grab as many marshmallows as he wants, as his future is assured - he doesn't have to care about the rules. The less intellectually gifted, less economically fortunate Henry V is not going to take well to "marshmallow resistance training." Either way, while doing an admirable job of criticizing the current educational system for not catering to a Henry V (while nonetheless doing very well by way of boys like David Brooks and Hamlet), Brooks doesn't actually explain how we could create schools that can simultaneously inspire Henry V to resist marshmallows while also inspiring a young David Brooks to strive for the day he can take an AP literature class focused on the works of Shakespeare.

Brooks has also told us what he, himself, thinks of kids like Henry V:

Similarly, in every high school there are jocks, cheerleaders and regular kids who vaguely sense that their natural enemies are the brooding poets who go off to become English majors. These prom kings and queens may leave their adolescent godhood and go off to work as underpaid sales reps despite their coldly gracious spouses and effortlessly slender kids, but they will still remember their adolescent opposites and become conservatives. They will experience surges of orgiastic triumphalism when Sean Hannity eviscerates the scuffed-shoed intellectuals who have as much personal courage as a French chipmunk in retreat.

French chipmunks in retreat... Funny, right?

Brooks' subsequent column inspired me to revisit the subject. You won't believe this but, according to Brooks, over the past thirty years rich people have come to have a lot of discretionary income, and poor people have not. Seriously!

Affluent parents also invest more money in their children. Over the last 40 years upper-income parents have increased the amount they spend on their kids’ enrichment activities, like tutoring and extra curriculars, by $5,300 a year. The financially stressed lower classes have only been able to increase their investment by $480, adjusted for inflation.

The explanation for this is, once again, Brooks' theory that poor people have bad morals.

A long series of cultural, economic and social trends have merged to create this sad state of affairs. Traditional social norms were abandoned, meaning more children are born out of wedlock.

Wait a minute - aren't we supposed to support Henry V's sowing of his wild oats? Or is the "traditional value" at issue the notion that Henry will do so at the whorehouse while "good girls" remain chaste? "Guard your marshmallows, girls, Henry V is on the prowl."

Their single parents simply have less time and resources to prepare them for a more competitive world.

So the only children struggling are those from single parent homes? There are no "poorer kids" from two family homes? Fascinating stuff.

Working-class jobs were decimated, meaning that many parents are too stressed to have the energy, time or money to devote to their children.

What Brooks apparently means is that working class jobs that support a middle class lifestyle have been decimated, even if that's not quite what he says. How did that happen? Who knows? Perhaps it has something to do with single parenthood?

Affluent, intelligent people are now more likely to marry other energetic, intelligent people.

Unlike past eras during which intelligent, affluent people sought out unintelligent, indigent spouses?

They raise energetic, intelligent kids in self-segregated, cultural ghettoes where they know little about and have less influence upon people who do not share their blessings.

The rich now live in ghettoes? Oh, life is so cruel. Remember, back in the day, when the rich and poor lived near each other, sharing land and crops, or on different floors of the same opulent building? Ah... memories.

The political system directs more money to health care for the elderly while spending on child welfare slides.

So... the solution here is to spend less money on sick old people? To increase spending on programs for poor children - and if so, what programs?

Brooks insists that to change the unfortunate status quo, people will "have to make some pretty uncomfortable decisions":

Liberals are going to have to be willing to champion norms that say marriage should come before childrearing and be morally tough about it.

Yes, because once liberals get serious about teen pregnancy, like red state conservatives, we'll see... huge increases in teen pregnancy? But wait, David, I thought that was a big part of the problem. (I know, I know - when you get you facts wrong it's a joke. You're kidding the liberals.)

Conservatives are going to have to be willing to accept tax increases or benefit cuts so that more can be spent on the earned-income tax credit and other programs that benefit the working class.

If we're talking Republicans, let's see... what will they choose. Oh yeah, benefit cuts.¹ That bit about "spending more on the poor" is apt to get lost in the wash.

Political candidates will have to spend less time trying to exploit class divisions and more time trying to remedy them — less time calling their opponents out of touch elitists, and more time coming up with agendas that comprehensively address the problem.

You mean, by identifying a social problem and deciding it can be cured by throwing money at it? Yeah, there's no chance that Brooks' proposal for spending more "on the earned-income tax credit and other programs that benefit the working class" will be demagogued....

Political candidates will have to spend less time trying to exploit class divisions and more time trying to remedy them....

So at the end of a dissertation on the poor morals of the poor, and how we nonetheless need to spend more money trying to help poor children, Brooks believes that we can propose taxing wealthier people or cutting their benefits to pay for those new programs without anybody raising the specter of class warfare? No concerns about giving money to undeserving bleah people?

...less time calling their opponents out of touch elitists, and more time coming up with agendas that comprehensively address the problem.

Why not both? Seriously, Brooks wants to clean up some of the over-the-top rhetoric in modern politics. Fair enough. But it's not like that's either new or the real problem. The problem is that one party is doing a middling job at creating the policies necessary to help our nation avoid significant future problems, and the other party is actively obstructing the little that might otherwise be accomplished.

There is absolutely no reason why Brooks cannot call on politicians from both parties to start addressing the issues, and take them to task if they offer rhetoric or demagoguery instead of actual policy proposals. It wouldn't hurt if Brooks offered some policy proposals of his own as a starting point but, I guess, that would be above his pay grade?
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1. I'm reminded of the old Far Side cartoon... "Conservatives are going to have to be willing to accept blah blah blah benefit cuts blah blah blah blah blah blah blah blah blah."

Ross Douthat's Class Warfare

Ross Douthat recognizes that the middle class is in decline:

OVER the last 30 years, the U.S. economy has generated more large fortunes and more stress for the middle class. While the rich have grown extraordinarily rich, median wages have barely increased, the costs of health care and higher education have jumped, and socioeconomic mobility has lagged behind that of other developed nations. Americans have never begrudged the wealthy their success, as long as they had a chance to rise higher than their parents, and perhaps get rich themselves. But our era of diminished expectations is putting that in doubt.

In other words, Douthat is stating that, starting right around the time Ronald Reagan was elected and gave us the gift of trickle-down economics, our nation went down a path that was extremely beneficial to the wealthy and increasingly difficult for everybody else, and that thirty years later the "American Dream" is in doubt. So let's see what he proposes as a solution.

The public-sector workplace has become a kind of artificial Eden, whose fortunate inhabitants enjoy solid pay and 1950s-style job security and retirement benefits, all of it paid for by their less-fortunate private-sector peers. Some on the left have convinced themselves that this “success” can lay the foundation for a broader middle-class revival. But if a bloated public sector were the blueprint for a thriving middle-class society, then the whole world would be beating a path to Greece’s door.

Somebody paid him to write that prattle?

Does Douthat actually know anybody who works in the public sector? Those I know who work in the public sector aren't enjoying the "artificial Eden" he describes. Like those who came before them, they trade lower wages for better job security and better benefits. And although this may shock Douthat, they too pay taxes.

Given enough time and data I expect that you can cherry-pick individuals, or even find small isolated groups of workers, who enjoy an "artificial Eden" of the type Douthat suggests exists for all public sector workers, and no doubt you'll find some people in any given government agency who should have been forced out years ago, but between lazy supervisors and job protections continue to collect a paycheck. But the exception does not prove the rule.

But more than that, didn't he just get through telling us about how wonderful things were back in the 1950-'s, when socioeconomic mobility was high, ordinary workers were well-paid, and we had a robust middle class? Does he truly think that the best way back to the "American Dream" is to sniff at it as being a dream for an "artificial Eden" and destroying what he perceives to be its last vestiges? Well, yes, he does. The Eden he has in mind is apparently the one we've been building in recent decades, with entrenched, generational wealth for a select few and lowered standards of living for everybody else.

Douthat presents a hollow man argument, "Some on the left have convinced themselves that this 'success' can lay the foundation for a broader middle-class revival". Who says that? Anybody? It's always easier to defeat an argument if you fabricate something silly, attribute it to the other side, and bat it down. But it's not honest. It's similarly dishonest to pretend that the crisis in Greece is driven by "a bloated public sector". Its crisis was brought on by excessive debt, that was in turn brought on by extraordinarily (and transparently) dishonest accounting by both its government and large financial institutions, and its inappropriate admission into the Euro zone - something that I suspect gave companies like Goldman Sachs comfort that other Euro zone nations would bail them out if the house of cards collapsed.

Douthat looks back on thirty years of Republican attacks on Social Security and Medicare, successful Republican attacks on both public and private sector unions, Republican-led tax reforms that provided massive tax cuts for the wealthy, and an associated devastation of the middle class, and tells us,

The story of the last three decades, in other words, is not the story of a benevolent government starved of funds by selfish rich people and fanatical Republicans. It’s a story of a public sector that has consistently done less with more, and a liberalism that has often defended the interests of narrow constituencies — public-employee unions, affluent seniors, the education bureaucracy — rather than the broader middle class.

Who are you going to believe - Ross Douthat or your lying eyes. Douthat whines in his column that massive taxes on the richest 1% of Americans won't balance the budget (again hollow-manning, as nobody has suggested either the magnitude of taxes Douthat implies or that higher taxes would solve the nation's problems), but let's imagine his alternate universe in which instead of taxing the wealthiest Americans we strip away from "affluent seniors" (whatever percentage that is - safe bet he's talking about well over 1%) the retirement benefits and health insurance they paid for over the course of their working lives, stop all federal contributions to public education, and ban all public sector unions. How much closer does Douthat believe we'll be to a balanced budget? To an equitable society? To a restoration of the "American Dream"? To a rich man's fantasy?

Slashing Taxes for the Idle Rich

Duly chastened, Newt Gingrich is amending his platform to include massive tax cuts for the idle rich. Your inheritance? Not only does Gingrich want to eliminate estate taxes, he wants to eliminate capital gains - tax free living in perpetuity for the Paris Hiltons of America.

For the rest of us?

"I think these kinds of steps would move us toward a very dramatic job growth, which is the best way to move towards a balanced budget—by getting people off of unemployment, off of Medicaid, off of food stamps, get them back into earning a living and paying taxes," he said.

* * *

On jobs, he said he would allow the unemployed to collect benefits for four weeks to look for a job, then would force recipients into a job training program.

That's right, you middle and working class slackers - get off your duffs and start paying taxes. After all, somebody has to, and if Newt gets his way it sure as heck isn't going to be the wealthy.

Same As It Ever Was

Matt Miller anticipates "class warfare" between the haves and the have-mores:

For several years I've predicted that a new wild card in American life -- the presence of economic resentment at the bottom of the top 1 percent of our income distribution -- would become a powerful force for reform. The SEC's fraud case against Goldman Sachs may be the first shot in what I think of as the revolt of the "lower upper class."

Lower Uppers are doctors, accountants, engineers and lawyers. At companies they're mostly people above the rank of vice president and below the CEO. Their comrades include well-fed members of the media (and even part-time Post columnists who earn their livings as consultants). They include government officials -- and, yes, SEC lawyers -- who didn't make or inherit fortunes before entering public service. Lower Uppers are professionals who by dint of education, hard work and good luck are living better than 99 percent of anyone who has ever walked the planet. They're also people who can't help but notice how many people with credentials much like their own seem to be living in the kind of Gatsby-like splendor they'll never enjoy.

This stings. If people no smarter or better than you are making $10 million or $50 million or $100 million in a single year, while you're working yourself ragged to scrape by on a million or two -- or, God forbid, $300,000 -- then something must be wrong.

Especially when it's clear that many of the Ultrarich are not simply reaping the rewards of the "free market" but of rigged systems that are as likely to reward failure as success.

Miller anticipates that this could rear its head in a "big skirmish" over taxes, leading to a "nightmare" scenario for the "Ultras":

First they're trying to close down our derivatives casino, the Ultras fret. Next they'll turn private equity's dubious capital gains into (more highly taxed) ordinary income. Before you know it, they'll claim the economy will hum along fine even if we raise marginal tax rates on income above $5 million a year to 50 percent! The revenge of the Lower Uppers may have only just begun. . . .

You know, just the other day I was noting that if I had a seven figure income, I could deal with a 50% tax rate. But as part of a discussion about how when you are making big money, taxes hurt a lot less than they do when you're struggling. I did concede that to a Donald Trump type, who "must" have six or seven fully staffed mansions at his disposal, along with at least one private jet for travel between them, such a tax increase may require an "unacceptable" level of sacrifice. But for the rest of us, living on $500,000+ per year, after taxes, wouldn't be much of a trauma.

But I digress.

I don't find any great insight in the idea that these "class warfare" issues may ultimately be resolved among the upper / ruling classes because that's the way they've been resolved pretty much since the dawn of time. Most of the population isn't attuned to politics. A relatively small subset of people who follow politics are sufficiently wealthy or connected to have the ear of politicians. And that's the level at which policy gets made.

Yes, if enough people in the top five percent of the population become offended by a policy, even if it's favored by the top 1%, they have the necessary access and clout to press for change. Whatever is (or is not) going on in the streets, the bulk of the transformative moments in our nation's history have been driven by the attitudes of the top 5%. Agitation on the streets may be what inspires the elite to examine an issue, but save for those exceptionally rare occasions when it appears that revolution may follow, mass movements can be placated, ignored or, if necessary, suppressed. Or, if the elites decide that it's time for change, the agitation can be useful.

Perhaps Mr. Miller saw Capitalism: A Love Story, or otherwise came across Citigroup's theory of "plutonomy". Or perhaps it simply occurred to him that if you create a system that's overtly skewed toward showering riches on plutocrats, you will eventually generate significant resentment. The difference between his perspective (the rich will turn on the ultra-rich) and Citgroup's ("labor will fight back against the rising profit share of the rich") is that, in my opinion, he more accurately identifies the segment of the society from which pressure for change would have to come.

As a society, as long as we can convince the guy making $10 per hour that, as long as he works hard every day, he can become rich, we don't have to worry about a mass movement. It's when the people who know better decide to stop defending that myth that the ultra-rich have a problem. Turning to Reihan Salam,

There is at least one structural change that is undeniable: namely that there's been a delinkage between corporate profits and the health of the U.S. labor market. U.S.-based multinationals now look to emerging market economies as engines of growth. At home, these firms continue to aggressively cut costs and produce more with fewer workers. This has meant robust productivity increases, a sign of good things to come. But hiring and expansion is happening where the breakneck growth is happening, and that is not in the United States.

The real danger for Citigroup and other proponents of "plutonomy" is that the top 5% of wage earners will respond not only to the concerns of the middle and upper middle class that their economic future is threatened - that, even with college educations, their children won't do as well as they have done - but that the to 5% of earners will recognize that their own futures, and their children's futures, are being plundered to feed the anti-meritocracy of the "Ultras".

Class Warfare... in Context

When you hear somebody like Senator John Thune whinge about "class warfare", you shouldn't assume that he's an overblown idiot. I mean, that may be the case, but you shouldn't doubt that his concerns are real.

“I think they think if they can create enough animosity toward Wall Street and corporate America, they get into this traditional sort of Democrat rhetoric and tap into the populist anger out there,” Sen. John Thune, South Dakota Republican, told The Daily Caller. “For Democrats to be successful they’ve got to create a sense of class warfare and an us versus them mindset.”

Let's turn to the banking industry itself to remind ourselves of the present class structure, and why Republicans (and no small number of Democrats) fear "class warfare". Writing of the "plutonomy thesis" that acknowledges the disproportionate concentration of wealth among a tiny portion of the population (the top 1% of households receiving 20% of overall U.S. income and possessing 33% of the nation's wealth, representing 40% of financial net worth - more than the bottom 95% of households combined), a Citigroup report concludes

Our whole plutonomy thesis is based on the idea that the rich will keep getting richer. This thesis is not without its risks. For example, a policy error leading to asset deflation, would likely damage plutonomy. Furthermore, the rising wealth gap between the rich and poor will probably at some point lead to a political backlash. Whilst the rich are getting a greater share of the wealth, and the poor a lesser share, political enfrachisement remains as was -- one person, one vote (in the plutonomies). At some point it is likely that labor will fight back against the rising profit share of the rich and there will be a political backlash against the rising wealth of the rich. This could be felt through higher taxation on the rich (or indirectly though higher corporate taxes/regulation) or through trying to protect indigenous (home-grow)] laborers, in a push-back on globalization -- either anti-mmigration, or protectionism. We don’t see this happening yet, though there are signs of rising political tensions. However we are keeping a close eye on developments.

To somebody like Thune, it's not "class warfare" for the wealth gap to continue to grow in favor of the rich - and for the political system to be constructed to favor that outcome. It's only class warfare if the rich are asked to help support the nation that... enriched them in the first place. A true horror.