When the U.S. adopted welfare reform in the 1990s, it did so on the following assumption:
Some kind of work is available to virtually everybody who wants it.
Maybe the work is poorly paid. Fine. Take the job anyway, and the government will top up your wages with an Earned Income Tax Credit.
By the late 1990s, we were discovering the limits of welfare reform. Because of substance abuse, mental health issues, disability, and cognitive impairments, some people were not going to participate in even the tightest labor market since the mid-1960s.
What to do about this hard core of unemployables? Should the government intervene more directly in their lives? Might churches and religious groups do better? If so, could and should government support them?
The poverty problem of the 2010s looks like the poverty problem of the 1930s.
These were the poverty policy debates of a dozen years ago. Today, poverty is no longer a problem reserved only for the hardcore.
The collapse of the American job market has pushed the poverty rate to the highest level since 1993 — back before welfare reform was even enacted. The poverty rate touched bottom in the year 2000 at 11.3 percent. It has now surpassed 15.1 percent. More than 46 million Americans now count as poor, including more than one in four black Americans and more than one in four Hispanics.
This recessionary surge in poverty is driven by one old-fashioned fact: Joblessness.
These new poor may be less educated, less skilled, less motivated, less who-knows-what than the non-poor. But the fact remains: So long as the U.S. economy functioned more or less normally, they were able to hold their lives together enough to emerge from poverty. When the economy failed, so did they.
You sometimes hear it said that all an American needs to do to avoid poverty is (a) finish high school, (b) refrain from having a child before marriage, and (c) get a job.
That's a valid description, but it's not very useful advice during the worst jobs crisis since World War II. How are they supposed to get that job in the first place?
There was a time when the challenge of persistent poverty could be usefully separated from the larger problems of the economy. I miss that time! But the poverty problem of the 2010s looks again like the poverty problem of the 1930s: A problem not inherent in the personal qualities of the poor themselves, but in the same failings of economic management that have battered almost all Americans except for a very fortunate few.
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