The Poor & Poverty (I)
Jesus, the Poor, & Poverty
Two successive articles in yesterday’s and today’s The Orange County Register caught my attention. On January 3, 2006, Jay Ambrose wrote a column entitled, “Hate the rich, hurt the poor” (Local, Opinion, p. 7). Apparently in a previous column Ambrose had put the idea forward that “…it seemed to me a misreading of the New Testament to suppose Jesus favored socialism, as some contend.” What was Ambrose’s reasoning in that previous article? He tells us: “I certainly urged that people care for the poor, I said, adding that it struck me as ludicrous to suppose he was also advocating an economic system that actually made people poorer.”
He goes on to say that a woman—with a theological degree no less—emailed him saying that he must be rich. Obviously, they didn’t teach logic where this woman got her theological degree. Why should someone jump to the conclusion that the author must be rich simply because he’s stating his position? There are a number of people who are not “rich” who hold to the same position. Of course, there are also reasons why this woman wrote what she did. You can, for example, hold that Jesus was a quasi-socialist because you attended a liberal theological seminary that taught that in its “Ethics of Jesus” course. Such a conclusion could be the result of faulty exegesis. It could be that the woman is a left-wing Democrat, Greenie, or Loopy that despises Bush and his tax cuts for the rich.
What we need to look at, however, are just a few of the distortions that some Americans have about the rich. Unfortunately, a portion of the hatred is derived from the endless demagoguery that one hears on the radio or watches on TV. There are, no doubt, rich people who are greedy and despicable people, but that can’t be the real reason for disliking them because poor people can also be greedy and despicable. Another way of looking at the “rich” is that they got where they are either by inheriting a ton of money (Paris Hilton), bilking others through scams, or getting rich off of insider stock trading (former DNC chairman Terry McAuliffe).
The mantra today, however, is that the rich just keep on getting richer and the poor just keep on getting poorer. But is that true? When I ask that question, I’m not looking for an emotional response, but a factual one. Even some of my colleagues as pastors fall into the trap of being overly concerned about the poor without getting the facts first. It’s an easy trap to fall into because as a pastor who are supposed to be willing to give anyone money anytime for almost anything. This is why some make a living on going from church to church to get money. The stories are oft-repeated and predictable. “I’m from out of town and my car broke down and my wife and kids got nothing, man!” “My phone has been shut off and I just need $50.00 to make the payment.” “We’re living in a cheap hotel and my kids need food.”
Don’t get me wrong: I know there is real need in the world and I also know that the Church of Jesus Christ has an important role to play in caring for the destitute. My questions in this issue are: 1) what constitutes destitute and 2) what are the facts about poverty today. I ask these questions for a number of reasons not the least of which is that the modern Church and liberal theologians (i.e., Jim Wallis) are making pleas for us to go into the inner cities, to have compassion on the down-and-out, and to think about “global” poverty. Okay. Those are legitimate areas of concern, but we must not run off half-cocked and simply throw money at the problems like the liberal Social Gospel tribe did.
So if we’re going to address the issue, let’s do it right. Let’s get the facts and put emotive statements or distortions on the back burner.
Fact number one: cutting taxes stimulates the economy.
Fact number two: the wealthy in this country pay the lion’s share of the taxes. Consider this following information: The Top 50% pay 96.54% of All Income Taxes The Top 1% Pay More Than a Third: 34.27%. ( CBO Report: Effective Federal Tax Rates Under Current Law, 2001 to 2014.)
As you can clearly see, the top 50% of American taxpayers contribute almost 97% of all income taxes. That’s significant.
Fact number three: the wealthiest in this country provide the jobs for those who are poorer. In other words, the wealthiest are the entrepreneurs that provide the jobs for those in the work force. When was the last time you saw one of the teenagers in your neighborhood offering jobs?
Fact number four: The poor in America aren’t actually getting poorer despite what the ideologues want us to think. This is where some are going to knee jerk, but before you start name calling or thinking me to be insensitive, consider some hard facts.
This brings me to the second newspaper article. In The Orange County Register of January 6, 2006, one of my favorite economists, Walter Williams, wrote a column entitled, “The poor aren’t getting poorer” (Local, Opinion, p. 7). (For those who have had very little in economics or find it “boring,” please allow me to suggest that you buy, read, and devour books by Thomas Sowell and Walter Williams on this topic.) Williams begins, “Despite claims that the rich get richer and the poor get poorer, poverty is nowhere near the problem it was yesteryear—at least for those who want to work.” (Emphasis mine.) The caveat is: for those who want to work. Note well, because that tends to be a problem often overlooked when we’re talking about poverty.
Williams is correct when he observes, “Talk about the poor getting poorer tugs at the hearts of decent people and squares nicely with the agenda of big-government advocates, but it doesn’t square with the facts.” (Emphasis mine.) If you are not concerned with those who are truly destitute, then you don’t have a pulse. However, our concern must be tempered by fact. What facts does Williams offer to support his position?
First, he mentions a book co-authored by Dr. Michael Cox (economic advisor to the Federal Reserve Bank of Dallas, TX) and Richard Alm (a business reporter for the Dallas Morning News) called Myths of Rich and Poor: Why We’re Better Off Than We Think. Williams points out that the authors analyzed data from the University of Michigan Panel Study of Income Dynamics (sounds like a exciting group, doesn’t it?), “which tracked more than 50,000 individual families since 1968.” It was an “on-going” study from 1968-1999.
They discovered that only 5% of families in the bottom income quintile (the lowest 20%) in 1975 were still there in 1991. That happens. But their next discovery is also very noteworthy: “Three-quarters (75%) of these families had moved into the three highest quintiles.” (Italics mine.) During that same period, a full 70% of those in the second-lowest income quintile moved to a higher quintile, with 25% of them moving to the top income quintile. That’s significant, but you rarely hear anything like that from Jim Wallis, liberal theologians, the liberal political Left, or on CNN.
In addition, the Bureau of Census reported that the poverty rate in 1980 was 15% and in 1990 it was—want to guess?—15%. What makes this more significant is that “for the most part they are referring to different people.” Cox and Alm’s findings were supported by the U.S. Treasury that found that “85.8% of tax filers in the bottom income quintile in 1979 had moved on to a higher quintile in 1988—66% to second and third quintiles and 15% to the top quintile.” Shazam! How did that happen? Was there some pixie dust? Did someone wave a magic wand? Did a welfare program come into effect that bolstered their incomes? Nope.
History has demonstrated that at every juncture there have been rich, poor, and those in between. There are those who are permanently rich and also those who are permanently poor, but Cox and Alm concluded that the United States constitutes something of an exception. “The percentages of Americans who are permanently poor or rich don’t exceed single digits.” Do you find that hard to believe? Why? Is it because we drank the Kool-Aid? Did we incredulously believe everything we saw on TV or heard on the radio or read in the newspaper?
The cry to overcome poverty in America needs to be tempered by correct information. This means that we have to think a little—which might be a rare undertaking for some. Let’s say a particular group of people is “poor” in 1980, but by 1990 they are no longer considered such. Why might that be? A simple explanation is that someone who is a student at the age of 20 in 1980 is now 30 in 1990 and has a different, steady job. He’s no longer flipping burgers, but he has a steady job after completing college or a trade school. Would anyone today be surprised to read “stats” that 30, 40, or 50-year-olds earn more than a 20-year-old? I certainly hope not, but some don’t think this far.
Williams offers more for us to think about: “Households headed by someone under age 25 average $15,197 a year in income. Average income more than doubles to $33,124 for 25- to 34-year-olds. For those 35 to 44, the figure jumps to $43,923. It takes time for learning, hard work and saving to bear fruit.” (All emphases mine.) And for a number in the U.S. today, this is precisely where the major rub comes in. One of the problems we face in America is that many of our young people are spoiled rotten and would rather hang out at the mall talking on their cell phones or playing video games. There are also some who would rather receive a welfare check than to work for an honest day’s wages.
Williams concludes his insightful article with some handy tips. First, The Federal Reserve Bank of Dallas found that “Households in the top income bracket have 2.1 workers; those in the bottom have 0.6 workers. In the lowest income bracket, 84 percent worked part time; in the highest income bracket 80% worked full time.” Moral: Get a full-time job!
Moreover, “Only 7 percent of top income earners live in a ‘nonfamily’ household compared with 37 percent of the bottom income category.” Moral: Look for a good husband or wife and get married.
Finally, when the FRB did its survey the unemployment rate in McAllen, TX was 17.5% while in Austin, TX, it was 3.5%. Moral: If you can’t find a job in McAllen don’t sit on the pity-potty of life. Get off your duff and move to where the jobs are. What do you think the people did that manufactured buggy whips when Ford invented the horseless carriage? Lay-offs happen all the time. Take charge and do something positive.
So the FRB-Dallas concluded the following: “Little on this list should come as a surprise. Taken as a whole, it’s what most Americans have been told since they were kids—by society, by their parents, by their teachers.”
That was in 1999. Today, however, I’m not so sure the conclusions reached by the FRB are still valid. In principle, they are, but society doesn’t encourage people to strive harder. In fact, a good case can be made that a number of our leaders would love to have America be a socialist state. Welfare keeps people dependent on big government and wards of the state. Socialism—in whatever form is, in the words or Hayek, the road to serfdom.
What about parents and teachers? We are in a crisis with regard to parents being parents and teachers are more ideologues than teachers and rarely allow a fair exchange of ideas in the classroom. Just try to write a science paper on Intelligent Design or against Islam and watch the reaction. But there is hope. This can all be turned around. There is a definite, clear biblical answer to this dilemma as well. In future issues we’ll delve into what the Bible has to say about work and welfare.