The debate over the 'culture of poverty' is at the heart of a liberal divide

Jonathan Chait and Ta-Nehisi Coates have been having an epic debate about a culture of poverty, which has not only exposed liberal rifts on the questions of race, but on questions of policy also. It is essentially a battle between neoliberalism of the Clinton variety and what you could call classical liberalism.

If I can be so bold as to summarize the two views in their basic form, they go something like this: Chait says, in line with President Obama, that growing up in an impoverished and violent setting, itself a product of a long history of racism, has lingering side effects that poor black people must try to overcome, the better to have a chance at clawing their way into the middle class. Chait says Obama is justified in exhorting blacks to lift themselves up, while also recognizing that efforts must be made to address the root causes of the crisis: racism and poverty.

Coates, on the other hand, holds that central, overriding problem is racism itself — that Obama's lecturing can accomplish nothing (and is offensive) because it fails to recognize a pervasive oppression that continues to keep blacks in poverty. And the way to fix that, simply put, is to eliminate poverty and oppression. Nudges don't work.

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Personally, I’m much more persuaded by Coates. But what's also interesting is that liberals have had this debate before — and the Coateses of this world lost.

Starting with Bill Clinton's third way politics and culminating in the Welfare Reform Act in 1996, liberals have largely abandoned efforts to help the poor directly. The dominant theory has been that we need to improve the poor out of their position by imposing work requirements for welfare, by stringently means-testing food stamps, by investing in work training and relocation programs, and above all by focusing on education.

The last one has become a kind of tribal totem among elite liberals. Education Secretary Arne Duncan and Obama apparently believe (with Michelle Rhee) that education is ultimately the only effective way to significantly decrease poverty, and the center-left spends an enormous amount of time worrying about it.

Now, education is important, but when it comes to poverty this is a fallacy of composition. Individuals can increase their chances of getting a decent job by becoming educated, but the number of overall jobs and how much they pay has almost nothing to do with education. We can see this in the fact that educational attainment rates have increased enormously since the 1970s and poverty rates have actually gone up.

I've previously written that we should make a direct, simple attack on poverty. How? By using direct cash transfers to raise up everyone below the poverty line, which is basically how Social Security works. And in this case, it would have the added benefit of determining whether there really is a culture of poverty in this country.

Consider the evidence: good old Social Security reduced poverty rates among the elderly by 71 percent! And when we look internationally, transfers are largely how big poverty reduction is achieved.

Matt Bruenig has calculated that the amount at stake is something like $175 billion. Though any realistic policy would probably be mediated through programs like the EITC or a more costly cash transfer to all citizens (to avoid excessive labor market drop-outs), the point is that this number is easily within the grasp of the United States economy.

We've tried the Clinton-Obama way. Now it's time to give a different, older approach a shot.