Libertarian Anti-Poverty Policy
2019-03-23 · Guest: Michael Tanner (Cato Institute Senior Fellow) · 50:32
Curing poverty through an inclusive economy
Bob Zadek interviews Michael Tanner of the Cato Institute about his book, The Inclusive Economy: How to Bring Wealth to America’s Poor. They discuss why traditional government anti-poverty programs fail by treating symptoms rather than causes, and how structural barriers like occupational licensing, poor schooling, and the criminal justice system prevent the poor from building wealth.
Topics: Poverty, Welfare Reform, Occupational Licensing, Criminal Justice Reform, Success Sequence, Cato Institute, Inclusive Economy
Speakers:
- Bob Zadek — Host
- Michael Tanner — Senior Fellow at the Cato Institute
- Caller (Michael) — Listener
Introduction [00:00]
Bob Zadek: Hello everyone, welcome to the Bob Zadek Show, the longest-running live libertarian talk radio show on all of radio. As the intro said, the show of ideas, never ever the show of attitude. Thanks so much for listening this morning.
The intro to our show pointed out to our listeners and followers that we have, I like to boast, the smartest guests on radio. And this morning we deliver that promise in spades. I’m happy to welcome to the show this morning for the entire hour, of course, Michael Tanner. Michael is a Cato Institute Senior Fellow. He has written extensively on domestic policy, including poverty, social welfare, healthcare, and Social Security.
Michael has written extensively and published many books. In fact, most of my listeners probably have, or if not, they should have, a shelf on their library—if they have those things called paper books—or a file on their digital reader devoted solely to Michael’s writing. Michael has written books including Going for Broke: Deficits, Debt, and the Entitlement Crisis, also Leviathan on the Right: How Big Government Conservatism Brought Down the Republican Revolution, Healthy Competition: What’s Holding Back Health Care and How to Free It. Michael is a prolific writer and brings so much wisdom to the topics of social policy and welfare.
More to the point, Michael has written the seminal work on poverty and how to get rid of it. We can introduce this show as a libertarian’s view on how to cure poverty. Michael’s book is called The Inclusive Economy: How to Bring Wealth to America’s Poor. It’s available on Kindle, on Amazon, and in hardcover. Michael will explain to us this morning what the government is doing wrong—and that is a long list—and what the government is doing right—that is a short list, but there are at least some items on the list. You will learn all you need to know about the sources and, more importantly, the cures for poverty in America. Michael, welcome to the show this morning.
Michael Tanner: Well, thank you. It’s an absolute pleasure to be with you today.
Defining Poverty Beyond Subsistence [02:46]
Bob Zadek: Now Michael, The Inclusive Economy: How to Bring Wealth to America’s Poor. So, your book is about poverty and how to cure it. My first question is: Is the goal to cure poverty, that is, to give people more money? Because the cure to poverty is simply to take money where other people have it and give it to the poor people, and instantly, with the stroke of the pen, you have cured poverty. So, is your book really about curing poverty or something deeper than that?
Michael Tanner: I think I use a much broader definition of poverty, if you will. Too much of our policy today is focused on how to make poverty less uncomfortable, if you will. It’s designed to cure those very basic needs that people have—make sure that no one is starving, that people have a roof over their head. But I argue in this book that that is not really getting people out of poverty. What we really want to do is create the type of economy where everyone can participate and where people who are poor can thrive. The goal of public policy should ultimately be human flourishing. And that means we want everybody to be able to rise as far as their talents can take them, to be self-sufficient, self-supported, and to basically be fully actualized as a human being. And that is not what our current policy does.
Bob Zadek: Michael, it’s so interesting you said that—that the goal of many government programs is to alleviate the temporary negative effects of poverty, which is to give people a meal, give them housing, give them clothes. When I was thinking about this issue in light of your book, I analogized the government programs today as being equivalent to using a painkiller to cure a disease. A painkiller will cure one of the byproducts of the disease, but never the disease. It just gets rid of the pain, but not the disease. Similarly, most of the anti-poverty programs, they cure the pain, which is manifest in hunger, bad health, clothing, and housing. It eliminates some of the negative byproducts of poverty, but it doesn’t cure poverty itself. And that’s one of the great geniuses of your book. You’ve drilled down. You don’t want to make the pain go away; you want to make the illness go away.
Michael Tanner: You know, I think that’s a terrific analogy. It really is. And if you look at what we do in terms of fighting poverty today, look, we spend about a trillion dollars every year at the federal and state local level on anti-poverty programs. And there is no doubt that the poverty rate is lower than it would be in the absence of those programs. But yet you can’t walk through a community like Sandtown in Baltimore or East Fresno or Owsley, Kentucky—the poorest community in America—and say that those communities are thriving, that the people in them are flourishing. And that really needs to be our ultimate goal: how we can get those people to become part of the mainstream of American economic progress.
The Welfare Trap and Incentives [06:54]
Bob Zadek: So I think your message is: while it is important to make sure people have food and housing and clothing—that is a laudable goal—but the message of your book is: let’s give them the wherewithal to fix those problems themselves rather than to fix it for them. Because as you point out, government programs build, just like painkillers build dependency, i.e., addiction. Well, poverty programs build their own addiction, their own dependence. And you rail against the addiction of these poverty painkillers and you argue for curing the disease. So give us some examples of how government interferes with its own goals by building dependency and, at the same time, when you build dependency, you decrease self-reliance and the ability to work your way out of the problem.
Michael Tanner: Well, we do know that many of these programs actually create the wrong set of incentives. We talk a lot in Washington, for example, about high marginal tax rates. And we know that if tax rates get too high, they discourage investment and entrepreneurship, they discourage work, and so we worry a lot about how high the tax rates get. But the highest marginal tax rates in America are not actually on the rich; they are on somebody who leaves welfare and starts a job. You start paying payroll taxes on the first dollar you earn, you start losing your welfare benefits as soon as you earn a dollar outside of the welfare system, and you incur the expenses of going to work—childcare and transportation and clothing and so on. You can actually end up worse off financially by taking that job than by being on welfare. So we create all the wrong incentives within the existing welfare programs.
Bob Zadek: And the lesson is, of course, all humans, all rational humans, respond in a predictable manner to incentives. Whatever the incentive is, whether it’s provided privately in a relationship or by government, whatever the incentive is, humans who are rational will respond quite predictably to the incentive. If the tax is very high on the next dollar of income—that’s what Michael means by marginal tax rate, what is the tax on the very next dollar you earn—if the marginal tax rate is too high, the incentive is to not earn it, it’s just not worth it, or to earn it off the books in the underground economy. And Michael points out that the welfare system, although not a tax system, in effect, the income that a welfare recipient loses by that next dollar of income is so high, it’s just not worth it to work, or at least not on the books. And that’s what Michael is referring to as the marginal tax rate.
Structural Barriers to Wealth [10:31]
Bob Zadek: Now, besides the very structure of the welfare system, give us some other examples, because your book is replete with them, some other examples of how government policy mitigates against individuals being able to work their way out of poverty.
Michael Tanner: Right. What I suggest in the book is that rather than having the same sort of sterile debate that we’ve had for too long about whether or not we should increase poverty spending by a billion dollars or cut poverty spending by a billion dollars, we actually should be looking at those government policies that make people poor.
In particular, I look in this book at things like our criminal justice system and the way that the unfairness of the criminal justice system and the over-criminalization of American society pushes people into poverty. I look at our failed government-run school system and the way that that leaves people unprepared for the economy of today and can let them slip further and further into poverty. I look at the way government housing policies drive up the cost of housing beyond affordability where rents become too expensive for poor people to afford. How we discourage savings among poor people and encourage consumption, which we know is the wrong way to get out of poverty. And how we block poor people with many policies from participating in the economy—things that range from occupational licensure and zoning to minimum wage laws that actually prevent poor people from getting a start in the American economy.
The Success Sequence and Historical Context [13:00]
Bob Zadek: Now Michael, in your presentation this morning, you mentioned that we spent a trillion dollars collectively, a little less than a trillion perhaps, on various anti-poverty programs. And you conceded, grudgingly of course, you conceded that to some degree those programs work. I always focus on the word “work” when applied to government programs, because you only can say a program is working if you describe first: what is the measure of whether a program works? And these trillion dollars of anti-poverty programs—they’re not labeled that, but they are in effect, that’s why they’re there—the trillion dollars does put money in the pockets of the poor, but I dare say, if the goal is to get people permanently out of poverty, to make them self-sufficient, even very little of the trillion dollars actually works.
And the problem is—and this is a distinction between the Left and the Right that I’d like to have you expand upon—the problem is that the very goal of these government programs is the wrong goal. Therefore, yes, they work, but they work towards the wrong end. And they put money in somebody’s pocket but don’t get them out of poverty. Now, give us an example. The Left and the Right both, of course, have as their goal or aspiration to cure—whatever that means—poverty. How are the approaches different on the Left and on the Right, and why are both approaches missing the boat?
Michael Tanner: Sure. Well, I think the Right generally puts the responsibility for poverty on the poor themselves. They suggest that basically the poor are poor because they make poor choices, poor decisions in their life; they live in a culture of poverty. They point specifically to something that’s called the “success sequence.” And this is something that there’s a very strong statistical correlation for, that says essentially that if you graduate high school, you get a job, and then you get married before you have children, you are unlikely to end up in poverty. And it’s true; fewer than 3% of people who follow that sequence actually are going to be poor in the long run.
The Left says, well, that’s good as far as it goes, but you also have to understand that we live in a society that still suffers from endemic racism, gender-based discrimination, there’s economic dislocation, there’s a great many structural societal problems that can influence those choices. I think there’s truth to both those arguments. I think you can suggest that poor people are—you can’t sort of strip them of agency, you can’t pretend that their choices don’t matter and have no consequence, that they’re nothing more than chaff blown by the winds of fate that have no control over their own life. That’s a very demeaning way to look at the poor. But you also have to understand that economists will tell you all our choices are governed by constraints. And poor people and people of color in this country face a very different set of constraints than do, say, rich white men in the suburbs. And they’re therefore going to make different sets of choices and decisions, and you have to understand the pressures that lead to those choices and decisions. Many of those are government policy.
Generational Wealth and Systemic Loss [16:39]
Bob Zadek: One of the interesting aspects that I learned from your book is when you mentioned how the Right tends to blame the victim. That is their default excuse or explanation of poverty. And that, of course, there’s some truth to that, but it’s infinitely more complicated. But you pointed out something that I found fascinating, Michael, in the book. There is this discussion that blacks in America deserve some kind of special consideration because they descended from slavery. Obviously, many of them did; many did not, of course, but many of them did, or some of them did. And I found myself saying to myself, “I don’t think so. Slavery was hundreds of years ago, they had plenty of time to work out of it. Other ethnic groups, when immigrants come to this country, they started as being peasants in their country of origin, they come here, and they have no trouble overcoming those cultural barriers, and in one generation their children are going to Caltech or MIT or studying to be doctors or lawyers.” So I tended to dismiss that. And I learned from you that that was inaccurate; the data belied my point of view. So tell us about—because it’s very provocative—tell us about what the data shows about those who descended from slavery hundreds of years ago, but they still have tangible negative consequences of that.
Michael Tanner: Sure. We should understand that we aren’t sort of born de novo today, where the situation and what our situation in life sort of starts fresh on this day. It is all basically carries consequences from the past, both good and bad. And in the case of many African Americans, what you see is that the wealth that they would otherwise have today was stripped away over the years. You can go back to slavery, and there’s studies out there by Julian Simon and others that suggest that about $7 trillion in African American wealth was lost because of slavery. That that wealth would exist today in the African American community, but it basically was stolen through slavery.
And that doesn’t count—you then had the years of Jim Crow that went on, and of course you still have discrimination that goes on today and damps down African Americans in many ways. That lost wealth is money that’s not available in the African American community in many ways. You also have legacies of things like in the Jim Crow South, African Americans who got educated were killed. They were lynched for the crime of being educated. That means you’re not going to have the same legacy of educational attainment that you have in some other communities. And you had the flip side of that, which is white communities that actually gained wealth in many cases from businesses over the years that exploited African Americans, either through slavery or by paying them lower wages or other things over the years. And that has built up inheritance that many white people have. So you actually have a situation in which we’re not starting on an equal playing field. And as Nozick pointed out with his rectification principle, if wealth was not gained justly in the first place, then you can’t necessarily say it’s always theft to redistribute it.
Policy Implications and the Marriage Pool [20:43]
Bob Zadek: So given the fact that data indicates that indeed blacks today, some blacks today, suffer today in the economic marketplace because of slavery that happened hundreds of years ago, the hard question, Michael—the really hard question, at least to me—is: therefore what? Does that then lead to a conclusion about policy, or does it merely suggest increased understanding about the source of the problem but does not invite a policy conclusion or a policy change?
Michael Tanner: Yeah, well, I think it mostly involves an understanding of the problem. And it means that we should look at the decisions that people make, that people of color make, and not necessarily judge those decisions the same way we would for people who were under very different sets of circumstances.
And I think when the folks on the Right then look at, for example—let me give you one example. We have a lot of concern about women who have children outside of marriage. That non-marital birth is generally an entry into a lifetime of poverty. That you’re about five times more likely to be poor if you have a child when you’re not married than if you wait until you get married before you have children. So that’s led a lot of conservatives to say, well, it’s the immorality of minority women in the inner city, they’re having all these children, they’re not married. The question would be: exactly who are they supposed to marry? Because it’s not like there’s this pool, giant pool of wealthy computer programmers sitting in the inner city waiting to marry them. As William Julius Wilson from Harvard and others have pointed out, you have a million and a half young black men who have been stripped out of the marriage pool because they’re tied up in the criminal justice system. And that means you’re going to have a whole different set of pressures and decisions that are going to affect these inner-city women than if they’re, say, wealthy white people in the suburbs.
Bob Zadek: So when I visited Cuba a couple of years ago and I asked about the Cuban economy and Cuban society from our guide leaders, the answer we got was with a smile: “It’s complicated.” With a big smile. And that’s the explanation of the Cuban economy and the Cuban society. And the same applies to poverty. It is so tempting to look for simplistic one-line solutions, buzzwords and the like, like “blame the victim.” But all of these problems, as you’ve explained, are intertwined.
And what strikes me as being so interesting is—and we’re going to get to this as soon as we come back from our break—is that so many of the problems that you alluded to just in your last comment are problems caused by government, and caused by government one way or another in the name of curing poverty. So the problem of poverty in America, which I conclude from your book, is substantially not the fault of the victims, but the fault of misguided programs that focus on the wrong issue. And the problem is, Michael—and I’ll ask you to explain when we come back from break—is that as you pointed out, the policies look to putting money in somebody’s pocket, but not curing poverty in the long run. And your book has many specific cures as to how government should change their focus from wealth transfers, which are easy to do—you throw money at somebody and you get their vote, no problem, but it doesn’t cure any problem, you have just made a gift of money. I’ll ask you when we come back from break to explain, give us examples of government programs that work opposite, accomplish the opposite conclusion of what they should be doing.
This is Bob Zadek. I’m speaking with Michael Tanner. Michael has written an important book, an important book for libertarians, for all Americans: The Inclusive Economy: How to Bring Wealth to America’s Poor. We are discussing how a libertarian, Michael, and his organization, the Cato Institute, would approach the task of reducing—you can’t eliminate, it’s impossible—but reducing poverty in America. And by poverty, we do not mean putting money in somebody’s pocket. By poverty, we mean having people who are poor join the economy and share in its richness. We’ll be back in 30 really short seconds. Please stay tuned.
[Sponsor Break - KSFO 560 AM San Francisco - OMIT]
Occupational Licensing as a Barrier [27:22]
Bob Zadek: Welcome back to the Bob Zadek Show, the longest-running live libertarian talk radio show in all of America. The show of ideas, never the show of attitude. This morning I’m speaking with Michael Tanner. Michael has written The Inclusive Economy: How to Bring Wealth to America’s Poor. Michael’s book is the seminal work on the analysis of how our government has programs which exacerbate the issue of poverty, even though they are well-meaning.
And Michael, I’d like to start off this half hour by bringing in an acceptable approach of government to accomplish a goal. Every once in a while, a governmental agency, a city, a state, or the federal government wants to accomplish something in a hurry, something important. And what do they do? They create an agency whose job it is to clear the way, speed up all the licensing processes, get rid of all of the bureaucracy, just push government aside to get the job done. In other words, government concedes they are part of the problem, they delay things, and this agency created ad hoc for a special purpose will get government out of the way.
In learning the lessons of your book, I learned that there are so many government programs that do not accomplish the goal that you see as the important goal. So I would suggest what we need is—this is not going to scare you, Michael—another government agency. But the agency’s task is to go through the federal governmental programs and eliminate any program which does not accomplish the goal of getting people back into the workforce. And that agency would find that the problem is not we don’t have enough government agencies, but we have too many working at cross purposes. So tell us the agencies or the policies of government that most directly, and you point them out in your book, delay or impair the poor from getting into the workforce.
Michael Tanner: Sure. Many of these are actually at the state and local level. It’s surprising that a lot of these are not federal programs, although the federal government does have an enormous number of anti-poverty programs, as you point out, more than 100 different federal anti-poverty programs overseen by nine cabinet departments and six independent agencies. So you certainly have simply a bureaucracy problem.
But many of the problems that affect the poor are actually at the state and local level. For example, zoning laws that prevent the building of affordable housing and land-use laws that drive up the cost of rent for poor people in many areas. It’s about the police forces and the enforcement of the criminal justice code, largely done at the state and local level, that is causing these problems. The school systems, of course, which are still largely state and local run enterprises. It’s about licensing boards that are generally at the state level that prevent people from basically practicing their profession. Between 25 and 30 percent of all jobs in America today require you to get permission from the government to practice your occupation. These are the sort of things that get in the way of poor people becoming part of the economy.
Bob Zadek: And what happens is these are all government programs that have different goals unrelated to poverty, but have as a direct byproduct, as Michael explains in a data-driven book, these various and disparate governmental policies all have the clear side effect of either increasing poverty or, more likely, making it harder for individuals to work out of poverty. On prior shows of mine, I have done a lot of shows on occupational licensing. But Michael, occupational licensing, to pick just one example and to tie in prior shows to your book, explain to our listeners how occupational licensing, since it licenses so many entry-level professions and occupations, how it prevents people from simply working their way out of poverty. And that’s just one example of a government program exacerbating the issue.
Michael Tanner: Well, let me tell you one example that I talk about in the book. That is in the state of Louisiana, the requirement to get a license to be a beautician or a cosmetologist. You have to take a course in order to become a beautician in Louisiana. It’s a very lengthy course. You have to buy the textbook for it, you have to pay for the course, pay for the instruction. You then have to take a test to show that you passed the course. That test is only given twice a year and only in Monroe, Louisiana. And it’s a two-day test. You have to pay to take the test, and of course then you have to—can you imagine a poor single mother who wants to make enough money to be able to get off of welfare? So she says, you know, her friends tell her she’s good at doing makeup and hair, so she’s going to become a cosmetologist. She has to scrape up enough money to take the course, has to find the childcare to watch her kids while she’s taking the instruction. Has to finally then find transportation to Monroe, Louisiana. Have to get a hotel room for two nights. Has to pay for the test. The test actually involves a huge number of questions on things like chemistry. This is not an entry-level test. If she fails it, she has to wait six months and do it all over again. No wonder that she doesn’t do this. These are the type of things that are designed to protect the monopolies of those who are in the profession today, to keep out competition. And frankly, they have a long and racist history of trying to keep out competition by people of color. And they still have that effect today.
Bob Zadek: And what’s interesting about all of these occupational licensing statutes is that almost none of these activities became licensed because the public was crying out for protection. There wasn’t one case where women went to the state capital and demanded they be protected from a bad hairdo and therefore the legislature responded by passing a licensing statute. In almost every case, the sponsors of the legislation to license an activity have been those people who already do it. Well, what do you think their goal is? To keep away the competition.
So states—and there is this principle called concentrated benefits and dispersed costs. While licensing imposes a cost on everybody because the cost of the license is added into the cost of delivery of the product, the fact that you might pay 25 cents more for a hairdo or a shampoo, you’re not going to move out of the state. But the benefits to the licensees are substantial. So the licensees, it’ll pay for them to lobby for the licensing statute. It doesn’t pay for anybody to spend time and effort opposing the licensing statute, so they proliferate. And what’s interesting is the country is starting to wake up to these provisions, and this is bipartisan, as many of Michael’s suggestions are. Both sides, the Left and the Right, would embrace them. And licensing is a perfect example. It is a bipartisan issue that ought to sail through. And there is some movement to that end, but Michael points out in his book how much that suppresses the ability of people to work their way out.
The Economic Cost of Incarceration [33:28]
Bob Zadek: Now Michael, you mentioned very briefly the incarceration. And what’s interesting about most of the proposals in your book is that you are in effect proposing the government spend less, and in spending less, they in effect do more to cure poverty than all the money they spend now in direct giveaways. And in the incarceration problem, which you point out as well as licensing, both reforms would cause the government to spend much less. So tell us about the savings that your proposals would give to governments. And these are savings in order to cure poverty, not spending money but saving money to cure poverty. It’s pretty remarkable.
Michael Tanner: Well sure, we should recognize that things like holding people in prison is expensive. We spend a lot of money putting people in jail, and then we spend a lot of money trying to find ways to keep them out of jail in the future when basically we could simply not put them in jail in the first place. It’s estimated by scholars at Vanderbilt University, for example, that if we were to reform our criminal justice system and decriminalize many of the offenses that we have today, that we could reduce poverty by about 20 percent. That’s a huge savings in the cost of incarceration, it’s a huge savings in the cost of welfare.
But if you take young men and you arrest them for something like a drug crime, tag them with a criminal record that will follow them around for the rest of their life, it makes it harder for them to become employed because now they’re convicted felons. It makes them ineligible for many education programs and scholarships. It may often make them ineligible for housing in many areas—landlords can ask if you have a conviction. And of course, it makes them ineligible for occupational licensing. We were just talking about: you cannot get a barber’s license in most states if you have a felony conviction. So basically, we’re taking them out of the labor force, we’re taking them out of the marriage pool as I mentioned earlier, we’re keeping them uneducated, and then we’re probably going to see them end up back in prison where they’re going to cost society money again to house them and feed them while they’re in prison.
Bob Zadek: What you mentioned about convicted felons not being able to carry on a licensed activity—Cato and other libertarian organizations have pointed out that in many cases, in order to apply for, for example, a barber’s license in many states, you have to pass a board who has to say you are of “good character.” And if you are a convicted felon, you are not of good character, you can’t be a barber. A barber! If you went to jail. And that is just one example of how governmental policies make sure you don’t work your way out of poverty.
Caller Michael: Historical Wealth and Mythology [36:39]
Bob Zadek: Now Michael, we have some callers. We’re going to take a caller from your namesake, Michael. Michael, are you on the line this morning?
Caller (Michael): Hi Bob, thanks for an informative show. Michael, you had mentioned earlier that the ancestors of slaves would, if they weren’t slaves, they would have a lot more wealth now. And I see that as certainly a possibility, but there are other counter-possibilities. One is that if they weren’t brought here as slaves in the first place and were still in Africa, they may not be creating wealth and they may not be wealthy now. And the other one is that even if they had the wealth originally that they were creating for the land that they were working on, even if they had that wealth, we don’t know that they would have maintained it. There are many people who start out with wealth and then squander it through their lives. People who win the lottery squander it. So it’s possible what you say, but it’s also possible that there are other options. Does that make sense?
Michael Tanner: Well, yeah, I mean, the second part of that question suggests that, okay, let’s steal from people because they might not use their money wisely. Look, the fact is we stole that wealth from African Americans by depriving them of wages. We mistreated them for years. We built up an entire mythology around African Americans in order to justify slavery—that black women are immoral and promiscuous, that black men are criminal and brutes. That sort of stereotype is still pernicious today. I mean, basically, there are consequences to our action as a society. We have mistreated African Americans and we’re reaping the results of that sin today.
Bob Zadek: Michael Tanner, this conversation brings us into a very complicated subject, one that has all of a sudden surfaced in the Democrats’ struggling to get attention in the upcoming primary for president. And Liz Warren and others have argued for reparations, a word which scares the heck out of me—how in the world would you administer that? Is the logical extension of your point that there are tangible adverse consequences from being in the generational line of slavery? Is the conclusion therefore that we should jump to reparations?
Michael Tanner: Not just slavery, as I say, Jim Crow and the entire history of penalizing African Americans over history. Now, that said, and of course we’ve done the same with Latinos and Asian Americans and Native Americans—we have a long history of mistreating people of color in this country. That said, I don’t see any practical way in which you can make reparations work. I mean, we are a multicultural, multi-mixed society with immigrants over the years, people who have suffered different levels of wrongs historically. And the question is: who would pay? How much would they pay? Who would receive? I mean, the woman who filed the first reparations lawsuit in Louisiana, I believe this was the first ever, was descended on one side of her family from slaves, on the other side of her family from slave owners. Would she actually end up paying herself? I mean, there’s just very little way in the way of practicality to make this work. I think what we need to do is use our knowledge of the mistreatment of people of color in order to inform our decisions today going forward so that we don’t continue this legacy that we’ve established.
The Culture of Poverty and Constraints [41:19]
Bob Zadek: So I guess the point of your point is not that we then jump to reparations, but rather you remind people on the Right who tend in a simplistic way to blame the victim, blame the poor person, to respond by saying, “No, not so fast. The issue of why you are there, why you are poor—behavior may be somewhat of a factor, but it is very complicated.” And therefore your message to the Right is: go slow or stop entirely on this blame the victim because frankly, that’s not helpful.
And the concept is called in sociology, it’s called the “culture of poverty.” Is there a belief system that keeps people into poverty? And you mention the culture of poverty, that concept in your book. Expand upon that just a bit to help people on the Right organize their thinking about how much personal responsibility plays into this. So tell us about the culture of poverty and how much that affects who is in poverty and who is not.
Michael Tanner: Sure. As I mentioned at the beginning of the show, we do know that if you behave in certain ways that you are unlikely to be poor. That if you graduate high school, for example, you’re very unlikely to be poor. If you graduate college, you’re almost certainly not going to be poor for any length of time. If you drop out of high school, however, about 50 percent of folks in that category end up living in poverty. So clearly, finishing school is an important choice.
We know that work is absolutely essential to getting out of poverty. If you have a job, you’re not likely to be poor for at least not for any length of time, even an entry-level job or a minimum wage job will lead in the long term to your getting out of poverty. And as I mentioned earlier, not having children when you’re not married makes a big difference in terms of poverty.
The question is how you end up in those places where you’re going to make those bad choices. If you live in a community that has no jobs because we’ve regulated and taxed them out of existence, if you live in a community where the government school systems are terrible and where nobody’s getting an education, if you live in an area where every time you set foot out of your house you’re being hassled by the police because of the way our system works and the racism within our criminal justice system, then you’re going to end up making a very different set of choices and decisions than if you’re, say, a white guy from the suburbs. And we need to understand the causes of those decisions, not just say, “Well, you made a bad choice in your life, starve.”
Conflicting Programs and Human Flourishing [45:19]
Bob Zadek: So the fact is there is such a thing as the culture of poverty, but of course how the culture got there is itself complicated and government had a role in fostering or in creating that culture of poverty, which includes, of course, dependence on the government. And dependence, like the dependence on pain-killing drugs—an analogy I made earlier in the show—any dependency diminishes free will. Once you are dependent, your exercise of your free will is greatly diminished. And Michael argues effectively and strongly in his book to undo programs that build dependency and put the individual more able to take care of their own lives.
And Michael, what’s interesting in many of the programs you highlight in your book is very few of the programs done to cure or alleviate poverty have a scientific basis. In other words, the cure is simplistically picked, or the cure they identify is: give them more money. And the science, as you point out, indicates that’s not the right cure. So these programs are not data-driven, not scientifically designed, but they are simplistic and really designed to garner votes. If you give somebody more money, you’ve gotten their vote, or that class of citizens’ vote. So there’s very little scientific basis for most of these “anti-poverty” programs, whether they are housing subsidies or any of the other programs. Is that a fair statement or am I being too unfair with these programs in general?
Michael Tanner: Well, I mean, I think it’s how you measure the result. I look at this as sort of on Maslow’s hierarchy of needs, which is a famous psychological profile. At the very bottom of that pyramid—Maslow draws it as a pyramid—at the very bottom are the necessities of life: having a roof over your head, having enough food to eat. We have basically eliminated that type of poverty in America. Very few people don’t have running water or electricity, or we don’t see mass starvation in this country anymore. We have largely eliminated that type of poverty. So you could argue—and there’s reason to question on both sides of this—how much of it has to do with the government programs.
But at the top of that pyramid, as Maslow points out, is self-actualization. That is becoming the master of your own fate, of being able to go wherever your individual talents take you. And that is not being addressed at all with our anti-poverty programs. And we should not settle for less than enabling people to become full, thriving, flourishing members of the American economy.
Bob Zadek: So that should be the goal, and don’t focus as much anymore on the subsistence level issues. Michael, in the few seconds we have left, one parting observation. When I understood the various theses of your book, what I flashed back to is there was a time in America that we were providing massive tobacco growing subsidies at the same time spending bajillion dollars on discouraging people from smoking. So we had two massive programs working at direct cross purposes. And to some degree, that’s true of our poverty programs today. Part of it throws money at the poor, building dependency, and part of the programs—but not nearly enough—wants to build independence and inclusiveness in the economy. So it strikes me that the programs that increase dependency have to yield to those that increase self-reliance. I think, is that a fair analogy going back to the tobacco?
Michael Tanner: Yeah, I think it is. I think we use the spending money on the poor as a way to paper over our guilt at not fixing the real problem. That we can say that we don’t have to worry about police abuse, we don’t have to worry about the privilege that we use to keep poor people out of our neighborhoods through zoning laws, we don’t have to worry about protecting the teachers’ unions at the expense of educating poor children, because we’re going to give them welfare programs. And that is simply a way to hide our own guilt at not fixing the problem.
Bob Zadek: Perfectly put. We have to stop—some of the programs are sort of self-centered to make us as a society feel better, and so we’re buying good feelings, but we’re not really fixing the problem that you have identified in your book. Now Michael, we have about two minutes left. In about a minute, do you see movement? Is the country awakened to the issue? Are you discouraged? Are you optimistic? Because this is an issue that crosses party lines, that cries out for bipartisanship because both sides of the aisle, if you will, support improving the condition of poverty in America.
Michael Tanner: These are, at least the solutions that I talk about in this book, are things that have drawn broad bipartisan support. I think that they are things that you see the Obama administration and the Trump administration both having been willing to address. My fear is that the division and the polarization that is going on in today’s politics and in society in general will keep people from coming together and talking about the common ground that they have on these issues. That we get into the same old sterile debate in Washington about should we spend a billion dollars more on this program or cut a billion dollars here? “Oh, you want to have socialism,” “No, you’re a racist.” I think what we really need to do is look at the areas we come together and agree on. That’s what I’m ultimately talking about in this book, and I’m hoping that people will listen.
Bob Zadek: Michael, how can our friends out there follow your work?
Michael Tanner: Cato.org. I’m a regular there, and of course they can find my book in bookstores near them or on Amazon or at Cato.
Bob Zadek: Thanks for your time, Michael. Thanks for sharing your wisdom with us. Bob Zadek saying thank you to Michael Tanner, thank you to my listeners. I’ll be back again next Sunday. Have a good week.