RICH MAN, POOR MAN
Gray, Horace M.
Rich Man, Poor Man by HORACE M. GRAY THE polar extremes of American A society—the separate worlds of the rich and the poor—are here examined by a distinguished scholar and a thoughtful journalist....
...a reduction of savings by the top group...
...The proliferation and acceleration of these wealth-concentrating devices since 1956 would almost insure this...
...monopoly...
...This strategy has paid off handsomely in recent years...
...These people are all poor, many of them destitute...
...Their average gross estate was $182,000, contrasted with the national average of less than $10,000...
...Truly the equalization reforms of the New Deal have for all practical purposes been liquidated since World War II...
...As a consequence, few can rise to higher levels ol income or become permanent members of the larger society...
...If they keep their portfolios in favored forms of property, they need only sit by the cash register and wait...
...as Lampman shows, it has increased their share of total wealth from 20.8 per cent in 1949 to 26 per cent in 1956...
...191 pp...
...The spirit of aspiration languishes and is displaced by a depressive mood of bitterness and defeatism...
...He makes no claims to perfectionism or infallibility...
...The structure of ownership being what it is, continuation of these wealth-concentrating practices will inevitably increase the percentage of wealth held by the top wealth-holders...
...Thus, the "Other America" becomes a permanent, institutionalized culture incapable, both economically and psychologically, of reintegrating itself with the rest of society by its own efforts...
...This can be done only by the Federal government...
...How can this be done...
...While wealth is highly concentrated at one polar extreme of our society, institutionalized mass poverty exists at the other...
...The author is fully aware of these pitfalls and proceeds with great caution...
...Robert J. Lampman attempts to measure the wealth of the top one per cent of the population...
...about one-tenth were farmers...
...This percentage rose to 36.3 in 1929, The Share of Top Wealth-Holders in National Wealth, 1922-1956, by Robert J. Lampman...
...How can these two worlds—the one per cent, who own 30 per cent of the national wealth, and the 20-25 per cent who own nothing and live below the "poverty line"—be integrated in a wholesome democratic society...
...Relatively little has returned to them in the form of welfare benefits to relieve their distress or to equip them lor productive participation in the economy...
...286 pp...
...In 1953 personally owned wealth in the United States stood at about $1 trillion...
...Macmillan...
...Over the period of 1922-1956 there was a slight decline in the degree of concentration of wealth among the top one per cent...
...defense spending, as now managed, and discriminatory, regressive taxation...
...In this social limbo one finds the victims of racial discrimination—Negroes, Puerto Ricans, Mexicans—the poor whites, small farmers, migrant farm laborers, the rejects of industry, the victims of automation, the unemployable, some 8,000.000 old people, and some 11,000,000 children...
...This is Michael Harrington's "Other America"—that invisible, isolated, largely ignored "culture of poverty" in which some 40 to 50 million people (depending on where the "poverty line" is drawn) arc enmeshed...
...They held about 80 per cent of all corporate stock, virtually all state and local bonds, and between 10 and 33 per cent of other types of property—U.S...
...He regards it as a middle class concept, designed to serve the interests and rising expectations of that group...
...shifts in the composition of assets...
...in a world that demands ever-increasing levels of skill and education they lack both...
...Using raw data from Federal estate tax returns as a "sample," Professor Lampman employs an "estate-multiplier" to "blow up" this "sample" to an aggregate of living top wealth-holders...
...Harrington is* particularly bitter against the "upside down" welfare state, as it exists today...
...A terrible sense of isolation and rejection characterizes this "culture of poverty...
...These top wealth-holders comprised 1.01 per cent of the total population and 1.6 per cent of the adult population...
...Although they have little, much of that has been taken from them by inflation, monopoly pricing, rent racking, loan sharks, and regressive taxation...
...It has yielded substantial benefits for the middle class, who need it least, but has scarcely touched the really poor, who need it most...
...These percentages would have been slightly higher if the family rather than individuals were the unit of measurement...
...This is a difficult and tricky business, and professional statisticians may object to the methodology and question the results...
...his methods and assumptions appear to be conservative and objective, in keeping with the tradition of the National Bureau of Economic Research, under whose auspices the study was made...
...The first is an objective, sophisticated statistical analysis, with only minimal attention to questions of social values and public policy...
...6.50...
...In 1922 they held 31.6 per cent of all personal wealth...
...A basic reorientation of welfare programs and a large commitment of public funds, he thinks, will be required if the very poor are to be successfully reintegrated into our society...
...They were preponderate^ independent professionals, businessmen, or managerial workers...
...Alter 1949, however, it increased and in 1956 stood at 26 per cent...
...their numbers tend to increase because the young are locked into the system by the disadvantages of the environment and there is a steady accretion from the rejects of the agricultural and industrial revolutions...
...changes in transfer practices, induced in part by tax policies...
...The principal impact of declining industries, distressed areas, agricultural displacement, automation, cyclical unemployment, the decay of the cities, and deterioration of the public services has fallen on these unfortunate and defenseless people...
...bonds, real estate, mortgages, life insurance, unincorporated businesses, and cash...
...The group turns inward against itself, rejects the outside world, and develops values and attitudes which cut it off almost completely from the larger society...
...The Other America: Poverty in the United States, by Michael Harrington...
...slumped to 28.3 in 1933, rose to 30.6 in 1939, and then fell to 20.8 by 1949...
...27,000 of them had estates of $1 million or more...
...By these devices billions of dollars each year are forcibly transferred from the people into the coffers of the wealthy and the big corporations which they own...
...For the future he regards changes in prices and in savings as likely to be most determinative...
...Michael Harrington studies the way of life of the poorest twenty-five or so per cent...
...The plight of the 40-50 million poor, which Harrington describes so starkly, is a direct result of this wealth-concentrating process...
...The author advances four reasons for the slight decline below the period 1922-1956: changes in the price of assets...
...A number of adjustments are then made to correct for deficiencies in the orginal data...
...protection, privilege, and subsidy for favored groups...
...They receive about 40 per cent of property income—rent, interest, and dividends...
...Clearly a major redistribution of wealth would appear to be necessary...
...Such policy is bad economics, bad morality, and bad democracy...
...Although the authors, each pursuing his special interest, never bring their two worlds into conjunction, it is fitting that they be considered together for there is an integral relationship between them...
...the second is a passionate, impressionistic, sociological study of the "culture of poverty"— of what poverty does to its victims— and is deeply concerned with remedial public action...
...If the American people really care, and are prepared to prove it by deeds, the "Other America," Harrington thinks, will respond...
...This is truly a separate society, cut off from the affluent upper and middle classes, largely untouched by the ministrations of the welfare slate...
...If comparable figures were available to the end of 1961, their share would probably be close to the 1929 high of 36.3 per cent...
...This will require a sharp reversal of those wealth-concentrating policies and institutions now operative in our system, such as inflation...
...Of this $309.2 billion, or 30.2 per cent, was owned by 1,659,000 top wealth-holders (those with $60,000 or more...
...they sutler from ill health, malnutrition, lack of adequate clothing, housing, and medical care...
...It will be corrected only when the Federal government abandons its fatuous policies of promoting the further concentration of wealth and adopts contrary wealth-distributing, wealth-equalizing policies...
...He demonstrates how the very poor have been excluded from specific welfare benefits, partly by law, partly by lack of sufficient funds, partly by the circumstances of their existence...
...If he errs at all it is probably on the side of understatement...
...Princeton University Press...
...Bad as the material conditions are the psychological effects are worse...
Vol. 26 • May 1962 • No. 5
