The Working Poor
Listen to an audio podcast of this interview here or download the file (MP3, length: 59 minutes, filesize: 21 MB)
David Jones: I want to congratulate Mayor Bloomberg and Linda for what they've undertaken. I've certainly been one of the great pests on this particular panel already, as Linda knows. But I think what the mayor is undertaking is unique. We can't find a record of any New York administration that's ever even attempted to raise the question of poverty. I think the difficulty the mayor faces and the commission faces, however, is that no one is going to escape the issue of poverty in the city of New York now. There are approximately 1.8 million people who are living below the federal poverty line in the city of New York, an additional 1.6 million who are near poverty, meaning that they live below 200 percent of the poverty line, and in total, that constitutes about 40 percent of New York's population.
The prognosis, I'm afraid, is not good, because you have to link different factors together that are contributing to poverty. We have a city that's increasingly black and Latino and Asian; we have an education system which Mayor Bloomberg, Chancellor Joel Klein and others -- unlike some other mayors in other parts of the nation -- have come to realize has been particularly unsupportive of poor children; we have less than 10 percent of black and Latino children who graduate with a Regents degree from the city of New York, with a 50 percent dropout rate. That means we're pumping out tens of thousands of young people who have no skills to participate in the workforce and with no means to get beyond a low wage, and we've been starting to get an understanding of that through a number of techniques. We at Community Service Society (CSS) began using a national pollster, Lake Snell & Perry, which does national polling, to actually start talking to people who are living at or below poverty.
We've been told there are no polls of the poor in the United States going on that we can find. Obviously the credit card companies don't think that the poor are worth it, and the population at large doesn't think the poor vote. We've been conducting the poll for four years, and the outcomes have been rather frightening. The poll is called the Unheard Third, because we don't think they're being heard very much, and the picture they're painting confirms much of what Jean and Linda have talked about. Overwhelmingly, these are working poor people; overwhelmingly, they spend about 65 percent of their income just on rent; they have approximately 30 dollars a week for everything else, including food; and they're not getting ahead. They're literally locked into poverty. Health care is driving them to the wall. About 50 percent have been unable to fill prescriptions and get needed medical care. They find themselves relying increasingly on food pantries for their basic needs. And again, they don't see much movement and hope.
The difficulty we're facing, I think, is that this poverty we're dealing with is a process that's going on at a time of an upward-climbing economy in New York. My concern is that we haven't seen a real economic dip yet to roll this out, and without a safety net, we're in for some very troubled times for the city of New York and for other major cities. As I talk to my counterparts everywhere from Detroit to L.A. to D.C., the same pattern is beginning to emerge: There are larger and larger numbers of people, particularly young people, who are coming out of an education system that has been rather slipshod, especially when it comes to poor children of all races, and this education system is not equipping them with skills for anything other than low-wage work, which increasingly does not have enough income to support them.
Rather than leaving you with those thoughts, I do think there are a couple of things we have to discuss going forward. Clearly we have to push for -- and I think this is something that's been off the table for a long time -- low-wage workers to be unionized to bring political power to bear, then make sure they can at least have a hope for their children and themselves to get adequate benefits and health care.
We also have to recognize that this poverty situation is not stable for a city like the city of New York. It is politically unstable and it is unsafe. There is a problem of a growing group of people who are working hard but don't have adequate resources to support their children and themselves, as well as an education system which is systematically under-funded andunde- supported. Every report we see goes the same way. The recent report stated that there's been the sharpest drop on record in terms of participation of blacks and Latinos in the elite high schools of New York. If you visit the nonacademic high schools of New York, which I think Education Chancellor Joel Klein is the first one to have really undertaken, there's a night-and-day difference between what poor black and Latino children are offered and what the students who are getting elite education are offered. We can't find operating laboratories in many of the places where that's a Regents requirement, and clearly we have a reform message that is going to have to start with prevention, particularly for young blacks and Latinos, and particularly for males, but also generally for kids who are on non-academic tracks in a highly competitive economy where low-wage workers are really having struggles. Again, I think this is not the worst challenge New York has been up against, but we better get about it. I think the mayor's initiative has to be driven far beyond just his term, and it is a question of what large cities are going to do with this problem of poverty, as so much of their population is mired in this structural problem of working hard and still being poor.
Let me say a bit about the film. I was quite surprised by the film, as I thought it was going to be about working poverty, the minimum wage and those sorts of issues. That's not what I encountered. The people in this film are making wages around twice the minimum wage, so they're considerably above a level that we're normally talking about when we talk about working poverty, and they're above the population that David Jones has just been talking about. The people in the film are people in the lower echelons of the middle class; they're not poor, and they're not non-working poor. These are not the people I spent most of my career writing about. These are people who are definitely employed at well above the minimum wage, and so they're above the level that we normally talk about when we talk about poverty or near-poverty.
At the same time, they clearly have problems. These are people in deep difficulties, and I've wrestled with how to define their difficulties. How, with these sorts of wages, can they be in this much difficulty? Well, I came to a couple of thoughts, and these are not definitive. The most immediate reason is that all four of these people are divorced. They are all single parents, and in three cases they're single mothers who are supporting children without regular assistance from the father. So that's the first thing that stands out. What really struck me about the film was that the source of distress wasn't immediately the economic system or the wage system or the social-benefits system. It was divorce. It was the great family problem that we're all struggling with today.
The second thing that struck me, particularly in reference to Jean's case, was health care. The one thing that seemed to me to jar any idea that this was a normal situation was the fact that, in Jean's case, her daughter was unable to get assured health care for a very serious condition. There were concerns about Medicaid expressed in Barbara's case, and it came up in a couple of the other stories as well. So health care is an issue that is in the background, but seems to me a more acute source of difficulty than wages.
Then I asked myself, what are the implications for public policy? In situations like the ones we see in this film, it's hard to say that wages are the concern that jumps out. After all, these wages are well above any idea of the minimum wage that's been talked about recently. It's not as if government could immediately mandate that all these people make twenty dollars an hour; that's simply beyond possibility. Aside from the politics of it, it would also lead to the destruction of massive numbers of low-wage jobs for people with fewer skills than the people in this story. I actually agree with David Jones. I think unionization is part of the answer here. I think there's something attractive about union action as a way of dealing with low wages. In fact, two of the four people in this story are involved in union activism. One of them is Jean and the other one is Jerry, the man who was the security guard. What's appealing about being in a union is that workers have a sense of what their industries can afford, and then they are accountable for the economic consequences. That is, they have to live with whether the industry is still competitive after the wages are raised. I like that. I think there's something self-reliant about that. I also like the idea that those who need a better shake take action directly to bring it about themselves, rather than have advocates go to government and speak on their behalf.
But the clearest implication has to do with health care. There clearly needs to be some system to rationalize the health care system such that care is available, particularly for acute conditions and serious conditions, and the financing has to be somehow rationalized so that we all pay more reliably than we do, and at the same time we don't have people who are free-riding, and right now there's quite a bit of free-riding going on on the part of many people in the system. Many people do not pay for insurance. They assume they can go to emergency rooms. A great deal of charity care is given. Charity care is in fact alluded to in a number of the stories. I don't have strong views about what the new system should be, but health care is clearly the place where government has the most work to do, and where there is the strongest case for changing what we're doing now.
The other thing that came up, and this was particularly dramatic in Barbara Brooks' story, is the problem of notches -- where people go up in income, suddenly their benefits go down by more than their wages go up. Now I don't think that's typical. I think what happened in Barbara's case was quite unusual, and I'd like to know the specifics about how that occurred. But maybe something has to be addressed here where there's a greater phase in and phase out of the benefits. Part of the story in the three cases involving single mothers was that they went in and out of the benefits system. In a way, what saved Jean's situation was that she went back on to the benefit system. All three women are at the top end of the benefit system where they might get support. So there's an issue there, too. I would say health care and the notches are the places where government ought to focus its attention.