The Second War on Poverty
Fossedal, Gregory A.
THE AMERICAN SPECTATOR VOL. 19, NO 2 / FEBRUARY...
...Up from "cutting the knot" and back to loosening it...
...Or to turn them into corporate welfare bribes, la many housing and health plans...
...Yet they have no desire to tear it down...
...THE AMERICAN SPECTATOR FEBRUARY 1986 15 Novak's proposal to have some or all of the money handed out by local governments, private charities, and churches...
...And that is that capitalism, far from being a naturally static system that must be infused with vitality, is naturally dynamic...
...We want to give it a few siblings...
...Adding to this gridlock has been the confusion of the Democratic party...
...auto workers in the 1970s...
...Those programs, interestingly, are already the product of some experimentation...
...Either activity threatens your eligibility for benefits, benefits that may be higher than a job paying $7 an hour...
...Thus, from 1972 to 1982, entrepreneurship was a leading instrument of minority advancement...
...In other words, even if there is some degree of corporate welfare on the part of the original business—a good example being Spiegel Inc.'s $20 million renovation project in a Chicago enter-prise zone—so what...
...We have immigrants from Mexico, most with little education...
...Either drug addicts must seek help or they need not...
...Dun-can's findings,' analyzed by Mark Lilla in the Public Interest, throw great doubt on the utility of old-fashioned income distribution figures...
...After being provided with some similar detail—how much money again for the jobs program...
...As a result, morale was high, and a great deal of work was done by volunteers...
...And Kemp-Symms, a "new homestead act" to sell public housing to responsible tenants, using low-interest, nothing-down loans...
...But the price has been high...
...Training and entrepreneurship are solutions to the problem discussed above: the dynamism of capitalism...
...Yet it is not immediately clear on exactly what grounds one can dismiss a professional association of psychologists when, for example, it declares that supporters of nuclear defenses suffer from a pathological condition...
...It's probably the kind ofpolitical mix you need to get something through...
...The safety net for them truly is a net, breaking their fall and then allowing them to get up, rather than a kind of sinister spider web that ensnares all victims...
...In fact, for the uneasy tag team that became Reaganomics, the lead punch was an uppercut to the federal budget...
...that will cover all cases, and even harder to make an exception...
...The results suggest what was probably obvious from the start: Enterprise zones are not going to achieve dramatic reductions in U.S...
...The primary beneficiaries of the voucher program, in other words, have been the poor...
...We don't want to get out the first program, we want to get out the best one," the aide says...
...But this is horribly expensive...
...Here the contest is to make the welfare system, including programs like AFDC and food stamps, amenable to the family...
...Figures on job creation and the like admittedly merit skepticism...
...Aides on Rostenkowski's Ways and Means staff say it will be up to Rangel to take the lead...
...These workers eat lunch at a struggling restaurant, Lisa's Diner, across the street—in fact, Lisa hires two more waitresses and adds a pinball game room for workers on their coffee break...
...Time will tell...
...Despite the growth, though, there is poverty...
...There is Kemp-Garcia: the now well-known enterprise zone concept to shower tax cuts, regulation relief, and capital start-up grants on urban and rural slums...
...Congressional Democrats, forced to spend much of 1981 and 1982 simply defending what poverty programs were there, have charged energetically into the fray...
...This makes it easier to talk about helping the poor, as Walter Mondale recognized during his presidential campaign: "People just aren't going to be as generous when the pie is shrinking...
...There are the fixed-income elderly, who, Moynihan observes, have largely escaped poverty...
...Government is needed not to inject change into this system or "get the country moving," but to keep the fights from getting out of hand, to cushion against the rapid and hap-hazard changes inherent in capitalism and growth...
...The answer is that such a diagnosis in fact violates psychoanalytic principles...
...Where are 'dere solutions...
...Yet this creates a problem for his own model: "Why, if federal social transfers are treacherous," as Murray himself puts it, "should locally mandated transfers be less so...
...Not opposition, just a general silence spliced by an occasional pooh-pooh...
...If we are worried about tax dodging, the thing to do is reduce corporate breaks across the board and create the zones...
...I like it," Kemp said...
...We need to do something about poverty first...
...About 26 percent of business expansion was carried out by marginal businesses that were about to leave, and 46 percent represented new business start-ups...
...N o," the Congressman advised, "the tax bill should come second...
...Finally, the underlying assumptions about human behavior applied by activist professional associa18 THE AMERICAN SPECTATOR FEBRUARY 1986...
...And (4) a modest infrastructure bill of, say, $10 billion, to provide jobs at $5 to $10 per hour for those who want work...
...Kemp wasn't exactly being selfless in suggesting his own modified tax plan be moved down to second place...
...Are enterprise zones not just another form of corporate welfare or tax bribery, a growth strategy pursued with stunningly little success by states and by much of Europe for the last twenty years...
...And private and local administration of programs might be not just kinder, but more flexible...
...Poverty will be just another in a series of the problems they already deal with, like alcoholism or teenage pregnancy, something that carries no particular class or moral stench...
...Yet any number of programs operate with such discretion...
...And as the Reagan tax reform seemed ready to flounder in November, some Democrats began talking about an effort to salvage at least one key provision in 1986: dropping families in poverty off the tax rolls completely...
...As an educational process it had the advantage of not being compulsory...
...People are more likely to understand the needs of those from their own neighborhood, even the same church, than is the federal or state welfare bureaucrat charged with applying mechanistic rules-of-thumb to complete strangers...
...Since 1981 Kemp has lobbied with the White House to encourage a flurry of similar proposals...
...Peter Shaw is the author of The Character of John Adams and American Patriots and the Rituals of Revolution...
...A gas station that went broke and has been sitting vacant suddenly finds a buyer—who remodels, and puts in self-service pumps to gas up the workers who before had to go twenty-five blocks to get late-night service...
...Charles Murray, on the other hand, praises the system of private and local charity that would spring up in the 'From Moynihan's Godkin lectures...
...Murray's book did not cause this pile-up over the merits of the Great Society program, but it has added bodies to the confusion...
...That's interesting...
...In a growing economy, programs to lift the unemployed can be concentrated on the unemployed—and need not be spread all over the map to gain support...
...And, according to an oft-cited MIT analysis, small businesses are more likely to create innovations and jobs...
...These phenomena are synergistic...
...What I hear is that Rostenkowski won't help them [Kemp and Hart] but he won't block them either," says a Ways and Means Committee staffer...
...Late next year or early '87...
...Whoever one thinks is winning or losing this debate, the point is, this has been the debate—a rhubarb 14 THE AMERICAN SPECTATOR FEBRUARY 1986 over past results and who to blame rather than a reasoned discussion of present and future solutions...
...And the worst of the worst is political and intellectual gridlock over the past, a debate that has become, as Meg Green-field put it, "Charles Murrayed...
...The first Reaganite,to hit the magazine covers was David Stockman, whose assault on spending in 1981 achieved a $40 billion reduction, mostly in social programs...
...The numbers, moreover, have changed little since the 1950s, suggesting that the poor are no better off...
...Perhaps the argument to be made for the Novak program is not that it would work but that it might...
...The word is that Kennedy plans his own big initiative when the time is right—fair enough...
...In fact, Kemp aides say, he repeated the comment several times to the President and his top staff during the transition...
...Doubters should compare the atmosphere at, say, an urban YMCA, or one of Mother Teresa's soup lines in Harlem, with that in a state welfare agency, even in a middle-class suburb...
...One can applaud or decry this development...
...The American Enterprise Institute, for example, studied the effects of an experiment with tenant management at the Kenilworth-Parkside Resident Management Corporation in Washington, D.C...
...Yet the same figures also show that the Great Society isn't as bad as some claim—otherwise why don't all these people become corrupted once they're on welfare...
...Planned Parenthood, for example...
...The idea of helping families through welfare is precisely what welfare reformers have argued is a contradiction: "the illusion," as Gilder calls it, of a welfare system that simultaneously helps the needy, sets up the correct incentives, and operates at low cost...
...This doctrine, though controversial, is reflected pervasively, in things like automobile insurance rates and personal finance loans...
...It is a rugby or hockey game, with blazing action and lots of blood...
...Picture, for example, a factory that is about to shut down on the South Side of Chicago...
...To my surprise, conservatives tended to be more enthusiastic about the deal—and in general, less suspicious, demanding fewer details, commenting almost immediately...
...And I think it's the kind of policy mix that would have a real impact on the inner cities...
...Or Project Head Start, which Moynihan praises in the Godkin lectures as a pro-gram "that conservatives might very well have hoped for...
...With growth, as Robert Kuttner argues, "the economic illusion"—that helping the poor can only be achieved by dragging down the rich—evaporates...
...Instead, they want to improve the system on the margin, leaving intact the basic Rooseveltian premise that government has a responsibility toward the poor...
...Moynihan notes: Head Start was . . . disorganized and decentralized...
...Growth, then, may be a necessary condition for full employment, but clearly it is not a sufficient one...
...Its power is limited, paradoxically, by the fact that it can only issue orders...
...Capitalism, unless bogged down in neofascist, corporate-union-state planning, is not a gentle game of croquet...
...Or, as Novak puts it, "Perhaps one cannot solve the whole problem of poverty...
...What follows is an attempt, prompted largely by a recent essay by Daniel Patrick Moynihan, to makesome distinctions about the uses of psychology in political debate...
...Michael Novak suggests "programs which empower [the poor] but do not' generate dependency...
...I wonder why he hasn't put that in...
...And, whatever one year of Murrayism has not made clear has certainly been demonstrated by five years of Reaganism: Social welfare, in some form, is here to stay...
...More important, however, is Perhaps the argument to be made for the Novak program is not that it would work but that it might...
...The spillover benefits of enterprise zones, as suggested by the Cowden-Bonetto study, appear to be large, a kind of geographical version of the old Keynesian multiplier effect...
...To judge by the recent proliferation of think tanks," Robert Kuttner writes in the New Republic, "the Democratic Party is ablaze with thought...
...He wrote the definitive conservative critique of welfare, claiming the poor would be better off if all the programs were scrapped...
...The first image that comes to mind is of, say, Boss Hogg, cruelly turning away deserving blacks while lining his pockets with money...
...textile makers to-day...
...Ideally, assistance would be channeled through programs and institutions that already serve the middle and even upper class...
...Be careful though about the price tag...
...And so on...
...social welfare one of the advantages of the European system, which Kuttner praises as more integrative, giving the poor "the dignity of being associated with the middle class...
...Richard Gephardt proposes handing out unemployment benefits, European-style, in a lump sum—allowing workers to retrain fast, or start up a business, rather than drift for months without sufficient cash, strung along until unemployment runs out and the final choice is the dole...
...This would give U.S...
...The debate now should be, and increasingly will be, about how to improve the government's efforts to help the poor, not how to scuttle those efforts...
...Think about past immigrant groups making their way up the ladder: the Jewish store or Greek restaurant, the German or Norwegian craftsman, and today's Asian and Hispanic immigrants, who man a honeycomb of small businesses from Silicon Valley to New York and Washington, D.C...
...Those small firms, minority-owned and otherwise, tend to hire more women, more young and older workers, more workers with little experience, and more workers without extensive education than do other firms, according to a 1979 Census Bureau survey...
...And he was convinced that if the Republicans led with poverty, they would sweep away the last remaining doubts about the Reagan economic program as an effort to stroke the rich...
...White self-employment grew by only 35percent...
...One could argue the same applies to straight welfare programs...
...Entrepreneurship, Hart notes, is a main road out of poverty...
...He had ideas about a "poverty program," too—centered on another Kemp bill, this one calling for special "enterprise zones...
...19, NO 2 / FEBRUARY 1986...
...There would be reason for hope on both fronts...
...Group psychology tends to find in groups, which necessarily express themselves on a lower intellectual level than the individual, more intensity of emotionally wrought behavior than is necessarily the case...
...Or you limit the vouchers to specific programs, as Secretary of Education William Bennett proposed in a recent initiative...
...And while fending off Murray's ideas and Reagan's cuts, Democrats gained a new issue: the deficit...
...And yet, it may also be the best of times...
...An exhaustive list of the poverty initiatives would have to include dozens of other programs...
...In fact, it is hard to imagine who could make it today...
...dent on welfare was less than 3 per-cent...
...2) Kemp's enter-prise zone and homesteading initiatives...
...Ted Kennedy's leading initiative is no longer national health insurance but a proposal he is polishing to improve nutrition programs for the young...
...The next day, Kennedy said through a spokesman that he and his staff had "kicked it around and preferred not to comment—it's a complicated proposal and there isn't much detail...
...What is surprising is that these schools get by despite having more students per teacher, serving more minority families, and having a lower per pupil income than the public system...
...An assistant, who would only speak anonymously, said, "We've drawn up a set of options for him—including just learning more, visiting some areas, getting some publicity for the problems with hearings...
...There is less need to include the upper and even the middle class in poverty pro-grams, such as Social Security...
...You don't mind jobs bills...
...Let us imagine a "second declaration of war," as Merrick Carey calls it, to include something like the following: (1) Gary Hart's training account, probably with an added William Bennett-style voucher that the poor could use to ac-quire new job skills...
...The opportunity to start one is especially important to those who have short resumes but lots of drive, or who face racial discrimination but are willing to battle it with initiative and risk...
...Sometime in 1986, after tax reform and Gramm-Rudman have had their day," says Carey...
...Gary Hart, who often seems to be the last progressive Democrat in America, offers individual accounts to make job retraining easier and grants to spur entrepreneurship...
...In the event, Kemp's idea did not catch on...
...And yet, the Democratic response to Democratic bills like Hart's, or the Gephardt proposal for lump-sum unemployment benefits, has been decidedly muted...
...I don't think they're the best way to create jobs, but I recognize it may take something like that to get the proposals moving...
...Psychobiography tends to produce a diminished view of the individual life, as recent books and essays about Richard Nix-on and Ronald Reagan illustrate...
...Yet it could be essential—particularly in light of our current, more sophisticated under-standing of poverty...
...The tenant group far exceeded the performance of the other groups," the study reports...
...The head of a local government charity can keep her eye on job openings that might suit an out-of-work electrician...
...Today, however, there is a new factor...
...Similar surprises, Doyle notes, come from voucher or quasi-voucher systems in Denmark, Holland, Vermont, and New Hampshire...
...Moynihan originally made that statement in 1965, but he reaffirmed it in his 1985 Godkin lectures...
...The tax cut, deregulation, monetary reform, and other items on the conservative agenda would be rammed through a stunned 100-day Congress initially disarmed of The Fairness Issue...
...Hart would also, under the Self-Employment Opportunity Act, conduct a five-to-ten state experiment that would allow unemployment recipients to engage in some self-employment activities without sacrificing their eligibility for support...
...It has been pointed out that psychological professionals have no greater claim to political sagacity than sports figures, academics, medical doctors, or anyone else...
...Even Hart and Kemp, however, would be dependent upon some support from the top...
...Hart, like Kemp, can point to successful experiments in other countries...
...And so conservatives learn, perhaps more readily, to value whatever it is that reinforces the elemental ties of family and neighborhood.' On the flip side, one might argue that merely handing out money through different institutions would have little effect...
...How do we know a job was really "created" as a result of the zone...
...As an institution, a network of more or less autonomous institutions...
...The Ethics and Public Policy Center has set up a two-year study program to try and haul the debate forward, entitling its first seminar "Gaining Ground...
...After extensive surveying and cross-checking, they found that only 1 percent of activity in The right has moved quickly to consolidate the turf it gained from Losing Ground...
...For years, their attempts at reform were dismissed as disingenuous...
...The rub, of course, is how...
...To enhance incentives, you have to extend benefits to the non-poor or near-poor—or they may find that they are better off not working...
...These people may share many of Charles Murray's complaints with the present welfare state...
...We know much more in the 1980s than we knew in the 1960s about what does not work," Murray writes...
...absence of the welfare state...
...Growth makes helping the poor more feasible not only politically, but also economically...
...Either mothers are going to be required to work or they aren't...
...We have a lot to learn about what does work...
...What good is the opportunity to start a business to someone with little or no capital and perhaps not even a high school degree...
...poverty nationwide or even in the zones themselves, but they can bring some jobs and help many areas rebuild on the margin...
...What are the politics...
...Some open-minded experimentation might be in order...
...Much of the effort is aimed not at defending old programs but at improving them and devising new ones...
...Crime goes down, encouraging an unemployed black woman to start up a 24-hour convenience mart, the only place where men on the late shift can buy a sandwich...
...By contrast, a priest can suggest that an alcoholic getting support from the church also get counseling...
...Japan and several European nations make job training much easier through tax incentives and direct subsidies...
...16 THE AMERICAN SPECTATOR FEBRUARY 1986 the zones involved outright relocation...
...Kemp seems to think he would have better luck at the next meeting...
...This is probably the weaker objection...
...During this period, the number of families persistently depen'See Greg J. Duncan et al., Years of Poverty, Years of Plenty (University of Michigan, 1984...
...Excellent...
...At this point, some progress in the general direction would be welcome...
...Our problem is we can't do it because as Vice President what he says would become Administration position...
...It has some components I wouldn't like, but as a package, pretty attractive," said Congressman James Courter of New Jersey, a rising conservative...
...Anyone who brings psychological considerations into the realm of politics needs to exercise special care...
...Kemp has competition...
...Today, by contrast, most poverty initiatives are cosponsored deals, and win broad support from both parties...
...By the way, does Ted Kennedy support Gary Hart's bill...
...James Baker shot an intrigued glance...
...Meanwhile, think tanks are scrambling for the new-ideas high ground...
...Like when...
...Cowden and Bonetto studied these composition issues as well, with interesting findings...
...No enterprise is perfectly efficient, of course, but 25 percent seems like a low rate of efficiency, and in fact is low compared to the result Europe gets for its income assistance dollar...
...Now this is arguably a bad idea, undermining incentives to work for the near-poor...
...While Democrats were fighting doggedly behind the fixed fortifications of the Great Society, they left Kemp to steal the initiative, at least in appearance...
...Former Census Bureau director and Reagan policy adviser Bruce Chapman calls it "fairness for families...
...This suggestion, believe it or not, was given by Jack Kemp to Ronald Reagan at a meeting in January 1981...
...It would be as silly to deal with these problems through identical methods as it would be to try to design a national bridge usable over all rivers...
...This datum, and similar events of the last few years, have helped forge a new understanding—or maybe it is Joseph Schumpeter's old understand-ing—of the nature of capitalism itself, shared by writers as diverse as Irving Kristol, Michael Kinsley, George Gilder, and Robert Heilbroner...
...We are winning on the deficit issue," Democratic Congressman Tony Coelho exults, and he is probably right...
...Pat Moynihan suggests a policy directed to the "quality and stability of American family life...
...It has certainly caused great agony for Reagan, heightening the conflict between Republican budget balancers and supply-siders...
...The whole economy has a clear interest in worker education, flexible labor markets, and worker mobility...
...Fairness" became a major issue, with enterprise zones and similar ideas serving as a kind of defense against it—allowing Reagan to demand, as Richard Daley used to, "Where are 'dere programs...
...Up from debating whether cost-of-living adjustments should be snipped or AFDC eliminated...
...But there can't be an Administration position, I explained, it's not a bill, just a hypothetical...
...And so on...
...Most people, according to Duncan, move quickly into and then out of support programs...
...The state lacks the criticalpower of suggestion that a local official or neighbor or clergyman can have...
...Perhaps right-wingers really are a less cautious lot than they used to be, or perhaps they are simply less cautious about questions put to them by a writer from the Wall Street Journal...
...some in intact families, some in broken homes...
...How many jobs are simply moved from another area to escape taxation...
...Redistribution becomes a mild, Keynesian bargain to expand the economy by helping those most in need of help—a positive sum game...
...Either they will lose benefits if they have an unmarried man in the house or they won't...
...I like the last part," a Kennedy aide said, referring to the jobs program...
...Many zones, despite involving large tax breaks, become rapidly self-financing...
...Since 1983, small businesses have been starting up at record rates...
...Helping those who nevertheless fall through the Social Security cracks will take one kind of initiative...
...There is poverty at near-record levels, in fact...
...Liberals, in effect, took the Caspar Weinberger position: Anyone who wants to cut a million here or modify a system there must be out to wreck the whole program...
...Just about everyone agrees on the goal...
...Most small businesses are started with little capital, less than $500 on average...
...And Kemp-Kasten, among whose features was the biggest tax break for the poor among the Big Three tax reform proposals (the other two being Bradley-Gephardt and Reagan-Rostenkowski...
...You lead with that and everything else falls into place...
...it was in constant jeopardy...
...Both, furthermore, have undertaken to use two specialties—psychobiography and group psychology—that carry built-in intellectual risks...
...In the second place, the concept of a group pathology, which can sometimes be applied to sects and fringe groups in society, is simply inapplicable within the normal range of political opinion...
...A 1984 study of state enterprise zones by Dick Cowden and Gerald Bonetto, sponsored by the Sabre Foundation, found that some 180 state-established zones had saved or created more than 20,000 jobs in desolate urban areas and were "instrumental" in stimulating $450 million in new construction...
...It is American, paralleling the successful homesteading policies of the 1800s...
...Murray himself probably deserves much of the credit for burying Murrayism...
...The answer, Murray says, is that a localized system "allows fine-grained judgments based on personal knowledge . . . about specific people and changing situations...
...But this creates disincentives to work and form families...
...In that decade, the number of self-employed non-white workers grew from 332,000 to 474,000, an increase of 42 percent...
...Many existing poverty programs have rather large corporate welfare components as well, yet do not markedly reduce poverty or dependency...
...Rangel recently cosponsored (with Moynihan) an initiative to reform AFDC, and in a 1984 House-Senate conference reportedly voted to support enterprise zones...
...Thus we have programs designed to deal with "poverty," instead of different kinds of poor people and their myriad needs, handicaps—and advantages...
...Kuttner, for example, attributes much of the effectiveness of European social pro-grams to the attitudes and institutions which surround them...
...We have immigrants from Asia, with lots of education...
...Gregory A. Fossedal THE SECOND WAR ON POVERTY Up from Murrayism...
...Or maybe my pro-posed package was skewed in their favor...
...And yet, on the best-of-times side, there is a growing economy...
...He hasn't taken a position...
...The psychologist will find that rather than being accorded the authority of one who has a special insight into human motivation, he has opened himself to criticism from the wide range of people who make politics their business...
...So, you can make the system more efficient, erecting means tests and other waste-and-fraud checks to have aid reach only the "truly needy...
...George Bush was similarly mum, with press aide Marlin Fitzwater citing the lack of any "Administration position" on the bill...
...It is hardly Armageddon...
...The zones, they report, "may even have more favorable fiscal consequences than originally projected...
...then at least such corporate welfare as exists will be directed toward the reduction of poverty...
...The programs suggested by the young turk innovators, Democrat and Republican, would do their work mostly on the margin of the existing safety net, trying to make the transition to new work a bit easier (Gephardt) or retraining more affordable (Hart) or neighbor-hoods somewhat more livable (Kemp...
...Yet there are answers to this objection...
...I'm not sure you could get many Democrats to vote $10 billion for poverty right now," he cracks...
...And so on...
...Adviser Merrick Carey calls it a "second war on poverty," but without Reagan's interest, it has been a war without a cannon...
...3) Consolidation of Aid to Families with Dependent Children, food stamps, and health-care programs such as Medicaid into a more coherent income transfer program, but with aid channeled through local governments, private charities, and the church—a Novakian solution...
...Peter Shaw PARANOIA AND AMERICAN POLITICS Is Senator Moynihan out to get the right...
...There was no stigma of welfare about Head Start centers, and even though the state had created them they were something more than a creation of the state...
...Let's start with the worst...
...They fight unemployment not by holding down growth, but by givingpeople the flexibility to adapt...
...By surveying a fixed group of families over a ten-year period however, Duncan found that this superficial stasis masks deep, volcanic changes in the distribution of wealth...
...The new homesteading idea has obvious conceptual appeal, particularly for conservatives...
...From 1971 to 1978, for ex-ample, one out of four families moved up or down by two or more quintiles—say, from bottom fifth to middle fifth, or from second fifth to fourth fifth...
...Enterprise zones, for example, are at work in Great Britain and in nearly two-dozen states...
...You give bigger vouchers to disadvantaged students...
...Studies by the Ways and Means Committee and even the Congressional Black Caucus laid the groundwork, praising the Reagan and Kemp bills...
...Not only do the poor gain property, a chance to join the ownership class, but they gain greater freedom to control their own lives...
...The most persistent objection to vouchers has been that they tend to subsidize the private schools of the rich at the cost of public schooling for the poor...
...Where individual sale is not feasible, a second provision of the Kemp-Symms bill would allow tenants to apply for per-mission to run their own apartment complex as an association...
...That would put the ball in the Oval Office court, bouncing around in search of a presidential commitment—right about where it was in 1981...
...Then we come to Gary Hart's retraining proposal, and the related idea of vouchers—which might be given to those with too little income to benefit from a tax shelter...
...It is not hard to envision the objections Novak is likely to face...
...It is a positive sum game: Selling housing to the poorrelieves the government of its landlord burden and usually increases the property's value, since owners tend to take better care of a home than do renters...
...We don't want to spend all our energies just defending Aid to Families with Dependent Children," a Kennedy staffer told me...
...I think after all that he'll be putting together something comprehensive...
...This might be a workable compromise with the demand that means testing be preserved in some form, to prevent money from being showered on the non-poor, yet at the same time applied with less pettiness—means testing, in other words, that is not so mean...
...The typical "maldistribution" chart simply shows what the poorest one-fifth of all Americans made in a given year as against the richest one-fifth...
...See also "The Charmed Kids of Head Start," by Peter Skerry, The Public Interest, Fall 1983...
...Almost half moved by at least one quintile, while only 40 percent stayed the same...
...At least one other that deserves mention, however, is the education voucher...
...Instead of shutting down, it remains and actually hires new workers...
...Underlining this view as it applies to poverty are the findings of such path-breaking researchers as Greg Duncan of the University of Michigan...
...Well, suppose a voucher is added for the poor, I asked...
...But the old Daley line was a Gregory A. Fossedal is an editorial writer for the Wall Street Journal...
...With fewer unemployed, there are fewer people to help, more money to help them with, and fewer other struggling actors to bribe into the bargain...
...Similarly, the psychologizing political writer lays himself open to professional criticism for his use of clinical terms...
...And even generalized vouchers, not targeted to the poor, have tended to help lower-income groups in countries where they have been tried...
...Whatdoes George Bush think...
...In the first place, though, a moment's reflection tells us that the diagnosis logically applies to those members of the professional association who happen to disagree with their activist, anti-nuclear colleagues...
...From his base at the American Enterprise Institute, Michael Novak is hawking an idea to reconcile welfare with The Family...
...France and Britain allow self-employment without cutting off unemployment benefits...
...But a few preliminary words are in order about the use of politics by psycho-logical professionals...
...Today experts view poverty, correctly, not as a problem but as a series of "different problems," as Leslie Lenkowsky, now of the Institute for Educational Affairs, writes...
...Stuart Butler at the Heritage Foundation continues to sell privatization solutions...
...As Denis Doyle of the American Enterprise Institute has shown, for example, in Australia, vouchers have been of chief benefit to private Catholic schools, which is not surprising...
...It is, in some ways, the worst of times for such ideas...
...some black mothers, some white fathers...
...which programs are going to be combined into a cash transfer...
...For one thing, giving local and even private organizations discretion might be thought a dangerous thing...
...Most of the new poverty programs under discussion involve a similar microeconomic approach...
...We have the hard-core, urban poor—some working at low wages, some not working...
...This flexibility might seem of marginal importance...
...All of which leaves us nowhere to go but up—up from Murrayism...
...But this dynamism rapidly generates not only winners but losers: farmers in the Great Depression...
...In 1982, the richest 20 percent of Americans received more income than the bottom 70 percent combined," the Catholic bishops argued in their pastoral first-draft...
...Well then, how can one object to the same amount of aid, and maybe even more aid, but handed out differently...
...You give the vouchers only to the poor and middle class and make them redeemable at public and private schools alike...
...Under self-management, the property's safety ratings improved, rental income doubled, crime was reduced by 70 per-cent, and even welfare dependency decreased...
...Even if dealing with the deficit does not necessarily re-quire further cuts in social welfare—and most Democrats and nearly all Republicans believe, wrongly in my estimation, that it does—the maniacal focus on them has made it difficult to discuss almost any other proposal, even helping the poor...
...Yet even this courageous author now concedes that's implausible, and talks simply of trimming some excesses and making welfare consistent with the family...
...Workers could experiment with new jobs, or start up a small business, without endless harassment from bureaucrats or even a loss of payments...
...And finally, as a factor improving the hope for new poverty initiatives, there is the fact of Kemp and a like-minded brigade of politicians and think tankers: neoconservative intellectuals such as Novak and Leslie Lenkowsky, and politicians such as Robert Dole, a long-time supporter of food stamps and other nutrition pro-grams...
...It is awfully hard to draw up a regulation from Washington, D.C...
...This January he became the Media Fellow at the Hoover Institution...
...There are displaced homemakers and . wives, many of them mature, middle-class women—suddenly deprived of sup-port, with job skills rusted, not used to meeting financial and emotional needs on their own...
...While the income going to the "top" and "bottom" 20 percent changes little, he found, there is significant turnover in the people who make up those categories...
...So might a selloff of public housing to its responsible tenants, the object of Kemp's "homesteading...
...The ' potential for substantial employment gains from Hart's and Kemp's entrepreneurship initiatives, then, are not to be sneezed at...
...THE AMERICAN SPECTATOR FEBRUARY 1986 17 Such are the policies of the post-Murray era...
...To the extent that welfare provides at least some subsidy to non-work, however, its beneficial effects are undermined...
...Recall the fury over Reagan's proposal to tinker with AFDC by modestly raising the eligibility standards, so that families making well above a poverty-level income would lose benefits...
...At the same time, the right has moved quickly to consolidate the turf it gained from Charles Murray's Losing Ground, and is devising poverty solutions faster than Kemp can draw up bills...
...Hence some reformers suggest consolidating the present patchwork of separate programs for health, housing, food, and education into a coherent in-come support system, so that the same amount of money will go farther...
...You know the Gary Hart plan wouldn't really help the poor—it's not going to help people with little income to deduct from," the Kennedy aide told me...
...This competition, long overdue, comes at a strange point in the poverty debate...
...Many reform proposals start with adjustments to present social pro-grams...
...The accounts would allow workers to sock away money tax-free and use it later to train for new jobs...
...Hart and colleague Bill Bradley also support broad economic growth initiatives, such as a new Bretton Woods conference to stabilize international exchange values and reduce interest rates...
...Duncan's findings are seized on by some to show the poverty problem has been overstated...
...Fitzwater's voice pierced my fog to note that Bush "strongly supports enterprise zones and education vouchers...
...Although the stumbling blocks are many and obvious, there's an encouraging level of interest in such a package...
...The answer is that such opportunity is crucial to the hard-core poor, who tend to be uncredentialed and unfinanced...
...Such lukewarm reaction from the party leadership has staffers from Kemp and Hart mumbling about putting together a big-name initiative to force poverty back onto the agenda...
...First rate...
...The debate now should be, and increasingly will be, about how to improve the government's efforts to help the poor, not how to scuttle those efforts...
...These efforts were important in keeping tax reform alive into December...
...After all, as Novak notes, we already spend four times the amount needed to lift every poor family out of poverty...
...One way to soften the inefficiency of current programs without worsening incentives is to centralize the programs but decentralize their administration...
...A belief in the benefits of broad property ownership is a long-standing structure on the conservative landscape, going back to the Reflections, where Burke wrote that the property holder is likely to be "in a considerable degree more laborious, more virtuous, [and] more sober...
...There is a tendency to belittle the relevance of entrepreneurship to people living in Harlem...
...what about COLAs?—the aide went off to put the question to Teddy and his press secretary...
...handy defense, nothing more...
...Some people understood this twenty years ago, but, as Moynihan notes in the Godkin lectures, few stressed it...
...The key players, according to Beltway wisdom, will be Ronald Reagan for the Republicans and, for the Democrats, Charles Rangel and Dan Rostenkowski, who chair, respectively, the sub-committee and committee that would have to steer a new poverty initiative through the House...
Vol. 19 • February 1986 • No. 2
