This Administration today, here and now, declares unconditional war on poverty in America.
- President Lyndon Johnson
It has been fifty years. Anyone with a television set knows that we are not winning this war. Drive twenty miles north of my house into the city of Baltimore and even on a good day, in fact, it seems pretty clear we are losing. When Johnson declared his "war" the poverty rate in the United States was 17.3 percent. Since then, despite the expenditure of $22 trillion, more than the combined cost of every war America has ever fought, that rate has remained effectively unchanged.
The recent riots in Baltimore were about a lot of things. Cases of police misconduct certainly added fuel to the fire, as did the general feeling that the police force is not representative of large portions of the city it polices. Fundamentally, though, the anger displayed in those days of rage was about something a whole lot deeper. It was about a feeling of hopelessness, of abandonment, of being walled off from the American Dream and forgotten.
This is what Johnson's war on poverty was supposed to address. It was designed not to strike "at the causes, not just the consequences of poverty." The aim was "not only to relieve the symptom of poverty, but to cure it and, above all, to prevent it." Half a century on it has done none of that. It has devolved into an endlessly expanding hodgepodge of federal and state programs, which do nothing to lift people out of poverty and, at best, simply make life slightly more comfortable for those effectively abandoned to lead lives of unemployment and despair.
There are a lot of reasons. That welfare programs often discourage marriage and remove the incentive to work is among them. On a much more basic level, though, the failure of the war on poverty is the product of one simple truth. None of the programs have anything to do with the root causes of poverty nor do they do anything to help people lift themselves out of it.
Drive around Baltimore City and the nearby Dundalk and Essex areas of Baltimore County, and you will see mile after mile of row houses and small, detached single-family homes. These dwellings were built in the middle of the 20th century to house the workers who flocked to what was essentially a giant mill town churning out products for the entire world. The shipyards, factories and steel mills that formed the foundation of the Baltimore that was are gone. Those people with the ability to do so have long since moved away. Those that remain, unemployed workers, their children and now their grandchildren, inhabit the shell of an economy that no longer exists.
What these people need is not handouts or more empty promises. They need assistance in lifting themselves out of poverty, building lives and making their own futures. There may be a number of pieces to that equation, but the two largest are pretty straightforward. They need an economy that is creating good jobs that pay a living wage, and they need the education and skills to land those jobs.
An ongoing series of protests and civil disorder began the day after the fatal shooting of Michael Brown on August 9, 2014, in Ferguson, Missouri. As the details of the original shooting event emerged from investigators, police established curfews and deployed riot squads to maintain order. There was looting and violent unrest in the vicinity. | Photo: Archives |
The ever-expanding list of federal entitlement programs does nothing to address either of those things. In fact, the overall progressive agenda associated with those programs probably does quite a bit to ensure that no solutions will be found in either regard. Let's consider as illustration the scorecard in Baltimore in regard to both employment and education.
For young black men between the ages of 20 and 24, the unemployment rate is almost 40% in Baltimore City. Unemployment among white males the same age is 10%. The unemployment overall in the surrounding State of Maryland is a little over 5%. As a consequence, nearly 24% of Baltimore's population is living below the poverty line. Break that down by specific neighborhoods, and you find that in some areas the poverty rate is easily double that for the city as a whole.
There are jobs. If you are a doctor, a software designer, a banker or a financial analyst. What has vanished are virtually all of the solid, blue-collar jobs that used to be the mainstay of the economy. You can live well in a condo overlooking the harbor if you have a college education and solid, technical skills. If not, you are relegated to fighting over a relative handful of jobs in the service industry, running a vacuum, making French fries or working a cash register.
We need to rebuild the sector of our economy that creates solid jobs in manufacturing. That does not mean trying to bring back the buggy whip industry. That means building laptops, telecommunications equipment, satellites, spacecraft and other high tech items here in America. And the way to do that is not through the creation of some new government agency or the creation of some convoluted bureaucratic imitative. It's by crafting a national policy on the economy and industry, which is designed to stimulate growth and create jobs.
As a starting point, such a policy needs to include a fundamental overhaul of our corporate tax structure. We tax corporations 35% on their earnings. The average for other industrialized nations is 25%. If you were designing a tax policy to discourage investment in the United States this would be it. Fix it. Lower the rate. Encourage economic growth.
We also penalize corporations for bringing money earned abroad into the United States. We make them pay whatever the difference is between what they paid abroad and what they would have paid if they had earned the money in the United States. That means that if they paid 25% on their earnings already in the United Kingdom, for example, when they move to bring that money home we tax them another 10%. Not surprisingly, many corporations choose to keep the money abroad and invest it elsewhere. At present, estimates are that US corporations have $2.1 trillion sitting in banks overseas that they have decided not to bring home.
On April 12, 2015, Freddie Gray, a 25-year-old African American man who was a resident of Baltimore, MD, fell into a coma while in transport as the result of injuries to his neck and spine sustained while being transported in a police vehicle and later died. This event led to rioting in Baltimore. | Photo: Drew Angerer | Baltimore, Riot, Violence, Police, Bicycle, Fire, Rage,
Imagine what the economic impact would be of a change to the law that would eliminate the tax penalty for bringing this money home. $2.1 trillion in private "stimulus" money would create a lot of jobs. Lest you doubt the impact of private enterprise, keep this in mind. We cut the poverty rate in America in half, from over 30 percent to 17 percent, between 1950 and 1965, without any federal intervention, based purely on economic expansion and job growth.
Obviously, though, creating jobs is only half the equation. If we are going to make a real dent in poverty, we need to give the children growing up in places like Baltimore the skills they need to land these jobs and to be successful. That means fixing our educational system.
Only a little over two-thirds of Baltimore students ever graduate from high school. The other third are discarded from the system somewhere along the way or opt to stop attending school when they hit the age of sixteen in accordance with Maryland law.
Today's economy is tough for everyone. Imagine what it looks like for a sixteen-year-old who has dropped out of school in Baltimore City. What possible job is this individual ever going to land that is going to give him a prayer of supporting himself much less a family? What prospects does he have for moving out of the ghetto and building a life? Is it any wonder that such large numbers of young men in particular turn to criminal activity?
Even if you graduate from high school, though, your prospects for success are still often dim. Take a look at any set of standardized test scores, and you will see immediately that students in Baltimore City are scoring far below those in other areas of the State of Maryland. In 2013, for example, only 16 percent of the eighth graders in the Baltimore City Public Schools tested at grade level in reading. That same year, only 13 percent of eight graders tested at grade level in math.
Two-thirds of Baltimore City students may graduate. What they have actually learned in 12 years of public education is another matter.
The standard liberal response to such statistics is to demand that we allocate more funding for education in areas like Baltimore City. There's only one problem. We tried that. It didn't work.
Baltimore City Public Schools spend a total of $17,329 per year per student. That is one of the highest per student funding levels in the entire nation. That amount is still increasing. Estimates are that it will be in excess of $18,000 per student this year.
That's college tuition at some very good schools across the United States.
The Baltimore City Public Schools are also flush with personnel. Baltimore schools enroll somewhere in the neighborhood of 80,000 students every year. The school system employs in excess of 5,000 classroom teachers. That means, contrary to popular perception Baltimore schools are not filled with unwieldy classes of thirty to forty children. The faculty to student ratio is closer to 1 teacher for every sixteen students.
A huge amount of Baltimore's money, however, goes to pay for personnel who never see the inside of a classroom. Baltimore City Public Schools employ 1690 "instructional aides," 422 "school administrators," 482 "district administrators," approximately 508 "school administrative support" personnel, approximately 628 "student support services" personnel, approximately 116 "guidance counselors," approximately 86 "librarians" and "media specialists," 75 "instructional coordinators and supervisors," and approximately 1,150 workers providing "other support services."
This is a bloated, inefficient, ineffective structure. There may be thousands of good, hard working teachers in Baltimore's schools, but they are trapped in a system, which seems incapable of reforming itself and whose only plan is to ask us to throw more money at the problem.
The answer to this problem does not lie in allocating more money, creating another federal program or creating another "Czar" in the bureaucracy. It lies in harnessing the imagination and energy that has made America great and encouraging innovation and reform. That means competition, and that means school choice.
Arm the mothers and fathers in areas like Baltimore City with the ability to send their children, and the $18,000 and tax dollars per head currently being spent, to the schools they judge will do the best job of preparing their children for the workplace. Let them sift through charter schools, parochial schools, private academies and the local public schools and decide for themselves, which fits their children best. Give them hope.
We have spent fifty years and more money than most of us can imagine pursuing the fantasy that the federal government can somehow engineer an end to poverty. It is time for a change. Let's give the free market, for goods and ideas, a chance and see what it can achieve. I'm betting that change would do us good.