The following is a rough transcript which has not been revised by The Jim Rutt Show or by Joanne Goldblum & Colleen Shaddox. Please check with us before using any quotations from this transcript. Thank you.
Jim: Today’s guests are Joanne Goldblum, CEO and Founder of the National Diaper Bank Network, and Colleen Shaddox, a journalist, author and activist. Welcome folks.
Colleen: Thanks, Jim.
Joanne: Thank you.
Jim: Yeah, it’s great to have you on. Today we’re going to talk about their new book, relatively new book, Broke America: Seeing, Understanding, and Ending U. S. Poverty. I must say, I read a lot of books and I read a lot of books for my podcasts, but this one was particularly a vivid and well-told story of the realities of poverty in America. And includes a bunch of practical policy prescriptions and things that each one of us can do to help reduce, or better even end poverty in America. I’ll say it’s unusual for a public policy book and it had kind of a, can’t put it down quality. It really just was a fun read. I read right through it very, very quickly, almost like I was reading one of my favorite thrillers or something. Congratulations on a job well done and making it readable.
Colleen: Thank you very much.
Joanne: Thank you
Jim: Further, not only was it readable, but it didn’t go too far in the other direction. It had an adequate number of footnotes that pointed to some recent research, some of which I’ve been tracking down and more of which I’ll track down in the future. With that, let’s get started. This is a quote from the book, a common saying excepted as wisdom, available on posters and T-shirts meant to be inspirational, reveals a tragic misunderstanding about poverty and its causes. Give a man a fish and you feed him for a day, teach a man to fish and you feed him for a lifetime. Anti-poverty efforts should stop making assumptions about people’s fishing abilities. It’s past time to stop judging and give that hungry person a fish. In some sense, that is the theme of the book. Could you maybe expand on that thematic idea a little bit before we start jumping into some of the details?
Joanne: Sure. You’re right, that’s I think the thesis of the book. The thesis is that people are not the problem and the problem of poverty is actually a lack of money. In the United States, we treat it as a moral failing. The goal that we have is to change the view from that of trying to fix a person to that of trying to fix our economic system. When you look at the way that people who are poor are portrayed in the media and in public policy conversations, it always goes back to, well, they should be married, they should get a better job, they should do this or that. The fact is that it’s not always that simple. There is a gap between what US Americans make and what they need in order to function.
Jim: Coleen, do you have anything to add to that?
Colleen: Yeah. All these things that we say people should do, you should go finish your degree so you can get a better job, you should … They’re a lot easier to do if you’re well fed and you have transportation and you have time and childcare. The idea that you can perform this major life change that for any of us would be quite a feat while you don’t have your very basic needs met is bizarre and cruel, and we really need to get past it
Jim: Well said. I will say that I will push back a little bit because I’m going to represent a little bit the alternative perspective that there are issues of social capital and human capital and incentives that need to be considered too. I will at times represent that point of view while I also accept much of what you have to say, which I think will make for an interesting conversation. Particularly, I think a good summary of Colleen’s particular perspective, this is from the book, when people don’t have the necessities of life, poverty can become a quicksand.
Colleen: Yeah, it’s really true. I think of one woman I spoke with in Pawtucket, Rhode Island. She had grown up in the foster care system, so she had no parents to help her out to get her started in life. But she had worked really hard and she had gotten herself into culinary school. She decided that she wanted to do a particular track with the school that was only available in Florida. She saved up and she got herself a car, and then the car died on the way down to Florida. When she was stuck on the side of the road, the police interceded and found that the car was unregistered because she didn’t have the money to register it. So she went to jail. She finally gets out of jail, gets back in her still unregistered car, drives down to Florida. She’s two weeks late and the semester has started, so she cannot enroll at that point. Her student housing is not available to her, so she became homeless. It was all these small things that a credit card could solve, but she didn’t have a credit card.
Jim: Yep. We’ll talk about a lot of those examples as we go through the book. Joanne, you looked like you were going to say something.
Joanne: Right. I mean, I think that there are so many things that people have meaned to do. When Colleen says, if you just had a credit card, it’s buying your way out of a problem, and we do it all the time. Every time you pay an online fee to do something to make it more convenient, that is buying your way out of a problem. Every time you forget a charger and buy a new one, every time your kid is late for school and you forgot to pack lunch and you drive through a Subway, that is buying your way out of a problem that somebody who is very poor would not be able to do. I think that, that’s a lot of the reason that Colleen and I feel so strongly about the fact that so much of this really is a money problem and not a personal failing.
Colleen: It’s interesting, when I was interviewing that woman, my son had a car accident and he totaled the car. Thank God he was fine, but he totaled the car. He had just gotten out of college and he was looking for a job and he couldn’t go to interviews without a car. So my husband and I bought him a junk car.
Jim: You were able to do that, right?
Colleen: He has a good job, he’s gotten promoted at his job, everything’s great because mom and dad could come up with a few thousand dollars on the quick.
Jim: Although, to push back and represent the social capital perspective. The fact that you were a mom and dad meant that you probably have more economic resources that you accumulated over time. It’s much easier to accumulate economic resources when you’re a longterm married couple. As the trend away from two parent households, particularly in the lower income half approximately of our society has become essentially a cultural norm, the existence of those pockets of stability near to a person have become less and less common. I think back in my own family’s history, I come from poor people on both sides. My mother grew up in a house without electricity, without indoor plumbing and without central heat in the wilds of Northern Minnesota on a beat ass tenant farm. Basically no better than sharecroppers. She left home when she was 14. My dad grew up in inner city, Patterson, New Jersey, dropped out of high school and he was in ninth grade. So I’ve got people on both sides of the family who have struggled and struggled mightily, but the strugglers and the somewhat succeeded were well interspersed.
Jim: We had cousins of mine living in our basement when I was growing up. My dad was a cop, certainly we weren’t a fluent, but we got by. We always had a couch or two in the basement for a cousin or a neighbor or a friend who was down on their luck. I remember one of my uncles who was a heavy drinker. I’m sure we’d say he was an alcoholic today, but he always kept his job. But his wife would throw him out periodically and he’d crash in the attic of my grandmother’s house. These islands of stability amongst in the culture of people who even enter and leave poverty are really important. I do think it’s important for us to acknowledge that the decline in social capital in particularly the bottom 50% of our population makes these problems worse.
Colleen: I get what you’re saying and you’re right, I’m much better off because I’m married. My husband and I have been saving together for 30 plus years, but it’s pretty complicated. In my situation growing up, my parents stayed together and it would have been much safer for everybody in the house if they didn’t. You can’t hold up marriage as a universal good. The other thing that I do see is, when you’re talking to families in poverty, they do help each other out a lot. They are, to some extent, each other’s social safety net. I remember one guy who taught at community college, talked about this kid who had had some sort of difficulty and he was laying in makeup in exam. He was really extending some grace to this kid, and the kid didn’t show. He said to him, “What were you doing? I offered you this chance.” He said, “My sister needed a ride and I had to give my sister a ride.” You will see that, like putting family obligations before obligations that middle-class people would say, “We got to do that. This is just non-negotiable.”
Colleen: I think what happens, is very often in families in poverty, anybody who’s kind of getting up a little bit, whatever they gain can be dissipated because there is this obligation to help so many other people in your family. So it’s a plus and minus. I don’t think it’s an easy question. I don’t know. Joanne?
Joanne: Yeah. No, I agree. I also think, I think there are a couple of things. I will say that I don’t have the numbers in front of me, but there are a lot of single parents in the upper 50% of the economic ladder right now. That’s becoming more and more common across the board. But I think that when you’re making minimum wage, when you’re living in poverty, two poverty wages, what we know is that there’s no place in the country where it is accepted that you can live and meet all of your basic needs for less than 200% of poverty. That means, even if you have two people working, if they’re working low wage jobs, you’re still not going to be in a position to really be saving money. That’s why the issue, I believe, I think it’s safe to say, we believe, is, pay rather than marriage in and of itself.
Jim: I expect that, and this is one of my themes, which we talk about in the podcast a lot, that when we talk about social issues, the nurture versus nature, I always come around saying, “It’s almost always both.” I know why you did it, but you guys took the extreme other view and that’s why I say, I’m going to push back a little bit and advocate for the social capital, human capital argument as well. But you are absolutely right. I mean, our ridiculous minimum wage, I don’t believe there’s any place in the country, maybe in a very rural place where two people at the minimum wage, which would be about 28,000 a year, could live decently and save money. Particularly if they had children. That’s obscene that we have that situation in our country and 100% with you there. But at the next few levels up, there’s where people are making $18 an hour, it’s still damn hard if you’re a single parent and it’d be a lot easier if there were two.
Jim: Two make an $18 an hour, which I target as kind of the classic canonical lower middle-class these days, that’s 72,000 a year. $72,000 a year, you can live decently in most places other than the five big cities or whatever it is. I do think that family structure does matter and the disintegration of the two parent family as a norm has made the problem worse. On the other hand, the obscene growth in inequality, the absurd suppression of the minimum wage, the cutting of safety net programs are all obscene and just make the problem worse. But anyway, let’s move on. We can debate this one issue, and as we know, it’s been debated endlessly in the scholarly literature.
Joanne: Absolutely, yes.
Jim: The other thing I wanted to mention, and just as context for this discussion, is that most people that are in poverty aren’t in poverty for that long. In fact, there’s a wonderful short article by Ann Huff Stevens from UC Davis called Transitions into & out of Poverty in the United States. Where she went through some detailed Census Bureau data. Of course, as we’ll talk about later, the US government definition of poverty isn’t really satisfactory, but she is using that. But she does say that from this data, the average spell of poverty lasts 2.8 years. Now, of course it varies considerably and the longer you’re in poverty, the harder it is to get out. I do think that when we’re talking about this, we need to keep aware that there are people who dip in and out of poverty or in poverty just once in their life. Then there are people who are in poverty over a long period of time. As an example of this tendency, for people to be in poverty to stay in poverty, the first year you’re in poverty, you have a 56% rate of getting out.
Jim: However, if you’ve been in poverty for seven or more years, that chance falls to 13%. As you say, poverty is quicksand. Presumably the longer you’re in the quicksand instead of being up to your knees, maybe you can get out, sooner or later you’re up to your neck and it gets harder and harder. In fact, I guess I was technically in poverty at one point. I was one of those disillusioned youth who hitchhiked around the country for a year, lived out of a backpack, slept under bridges and then behind dumpsters and what have you. Worked as a dishwasher in restaurants a couple of days a month to make enough money to keep me on the road. But I didn’t really consider myself poor because I could have always gone back home, gotten a job. I had a good, very solid two parent family and had a trailer in the backyard. I could have stayed in that if I wanted to. I had my little dip into poverty and it didn’t do me any harm. In fact, I’d say it did me some good.
Jim: I actually got to see what the world was like. I got to crash on people’s couches and work in hayfields and do all kinds of crazy things. It is important to keep in mind that there’s a difference between one time spells of poverty, but also the gravitational attraction, the quick sand. I love that analogy actually of poverty is a real thing and that we have to think about particularly those people who are stuck in poverty. That’s, I think more what your book is talking about rather than people who had one line of bad luck or made some crazy ass decision like I did to go hitchhike all around the country. Those are really kind of two different things.
Joanne: Well, I think there are a couple things. I think that while what you’re describing was certainly living in poverty, having that safety net at home really makes things very, very different. A lot of what we talk about in the book is the impact of poverty on children. It’s true, the less amount of time you live in poverty, the better chance you have of getting out of it. But the largest group of people in the United States who are poor are children, and many of them live in poverty for many, many years. It does create this intergenerational level of poverty. There’s some really interesting research, which I can’t site right in front of me, but that talks about how a wealthy student who has a C average has the same chance of graduating a four year college as a poor student who has a straight A average. That impact people’s life trajectories. A poor student who’s wealthy has a better chance of graduating college than a strong student who’s poor.
Joanne: That, yes, there are lots of reasons for that and certainly poor students who don’t have money, who are very strong can go to college, but Colleen, you could give the example of those two young men that you interviewed in Texas.
Colleen: Yeah. This was the hardest day for me in writing the book. I talked to these two young fellows in Lytle, Texas, a very poor rural town. They were both outstanding students and they had both gotten free rides to really good universities. Neither of them could go. One of them felt an obligation to take care of his mom and younger brother. So he was going to stay in the trailer where they were living and go to community college rather than go away. The other was denied his financial aid because his dad was being audited. His dad was a waiter with eight children. IRS wasn’t going to get anything out of that well. But it was actually Trump administration policy to increase audits in border areas in largely Latino border areas, and they got trapped in that. So the kid couldn’t go. That was heartbreaking because both of these boys had worked so hard. They were doing after-school jobs. One of them was lettering in football. They were just doing everything, but the deck was stacked against them.
Colleen: Another thing that really occurs to me with temporary poverty is, one of the reasons you’ll see a lot of emphasis on child poverty is because it’s such a critical time and it’s so damaging. The age group at which we’re most likely right, exactly to be in poverty is infancy. That’s when your brain development is happening. Not only do you want lots of good nutritious food, you want to be in an atmosphere where people aren’t consumed by stress. Which we know really, really happens in poverty a lot. We’ve gotten down to where only one in six US children is growing up in poverty, which is actually a gain. But 35% of kids are going to be poor at some point during their childhood. That can do harm to them that is never going to go away.
Jim: Yep, indeed. One final framing before we dip into the specifics in the book, as you all point out the contrary to some, I suppose, popular wisdom, the majority of poor people in this country are White. I happen to know that because I’ve followed this literature for years. But if you ask your average person, I suspect they wouldn’t realize that’s true. What we’re talking about here affects everybody. This is a general problem. This is not a problem of just this one community over here in the corner or anything like that. This is something, quite frankly, it shouldn’t matter, at least to me as a liberal, universalist, humanist. All people are people, but I think it is useful for people to understand that we’re talking about all kinds of people here.
Joanne: Right. That’s the reason that we chose to write this book, because we do feel that so often poverty is looked at as one place or one group of people. We really wanted to show that this was a problem across the country. It was a problem in rural areas, suburban and urban White and Black, Latino, Native American, everybody. So often, that really is missed. I’m not really sure why. Colleen, what do you think?
Colleen: Well, we imposed this racist stereotype, frankly, on poverty. The welfare queen, he got a lot of mileage out of that. I think if we really had a much broader view of poverty and realized it could happen to you, it could happen to your family, we might have very different social policy going on.
Joanne: I think actually, if I could just say, that that’s a lot of what we’re seeing with COVID. There has been a little bit of a shift, I think, in terms of more people who never expected to be in poverty have found themselves in poverty. I think it really has changed the conversation a little bit just in the last year. Because I think that those of us who follow this literature knew that so many US Americans were that close to poverty and when that many people lost their jobs, of course, this is what happened. But I think that it really did open the eyes of a lot of people who don’t think about this all the time to see just how close so many us Americans live to the edge.
Jim: Yeah. I’d like to thank you guys for writing about rural poverty. So often, the focus is only on urban. In reality, the poverty rates in rural America are higher than they are in urban America. I live in Appalachia in a relatively low income county. I will say though, one of the good things about rural America versus urban, is we don’t have the residential segregation that you talk about. There are people who are poor, a widow lives at the end of our lane, we help take care of her. Whenever she needs a ride, we give it to her. We bug her to make sure … “God dammit, get over to the medical center and get your vaccination. We’ll take you. We’ll go pick up your drugs for you.” We’ll drop off an extra turkey when we have one. We’ll let her son cut firewood on our place. In rural America, there’s more poverty, but it’s not hidden. Poor people, I will say, I think have more social capital than they do in some concentrated poverty districts. Where they’re still members of the same church, they’re still members of the same community organizations, et cetera.
Jim: This is the social capital part of poverty is, at least where it’s not highly super concentrated, maybe less of an impact than in communities where most of the people are poor. Particularly where they’re shoved aside and don’t interact with the wider community. You guys make a point about that. That I would qualify that and say in suburban and urban America, through government policies, through banking policies, et cetera, we have developed quite rigid apartheid, essentially, between the long-term poor and everybody else. Maybe you guys could talk about that a little bit.
Colleen: Yes. Certainly Lytle, Texas, the town where I met those two boys was a rural area with a lot of poverty where everybody knew everybody. Church ladies would come around in vans to pick kids up to get them a hot meal, and so on and so forth. That was terrific, but there was a limit on how much that could do. Those two boys still weren’t going to college. In urban and suburban areas, there really is, as you said, an apartheid. We found so many places where redlining was still being practiced. We live in Connecticut, in very blue, idealistic Connecticut. In 2019, one of the major banks here had to settle a redlining suit. It was very clearly making it harder for people of color to get loans and directing those people of color they would give loans to, into the inner city rather than the suburbs where there were various advantages. The schools generally are more successful out here, the crime rate is lower. It’s amazing that this still goes on. The Fair Housing Act passed in the late ’60s, but we’ve never really enforced it.
Colleen: There’s a great deal of data that would need to be gathered to really track these crimes, and we just don’t gather it. Nobody does.
Jim: I mean, that’s disgusting to me that we know this goes on. I mean, we do things like pair testing, but we don’t do enough. Where you send a Black and a White or a lower income, a higher income people in and they’re treated differently. We know this exists, the data is clear that it exists and that would be something that would be relatively inexpensive and would be a quite powerful leverage point. One of the things I do like about your book, is you do talk about let’s look for high leverage points. Attacking these kinds of institutional and structural obstruction to social progress would be a relatively inexpensive and highly leveraged way to do it. Now let’s jump into some of the actual content of the book a little bit. One of the first things that you guys dig into is, what does it mean to be poor? How poor is poor? I think you describe and you compare and contrast the official poverty line to other measures. Let’s hear you guys talk about that a little bit.
Joanne: Sure. The first thing that I think we really felt was important about looking at what is poverty, is to talk about the reality of poverty means that you can’t meet your basic needs. Some people have very, very low income and aren’t able to meet their basic needs. But in say New York City, you can be poor not able to meet your basic needs while still making a good deal of money. That’s one thing. But when it comes to the governmental definition, what we really feel is that the government is trying to define its way out of poverty as opposed to ending poverty. The federal poverty line is so low that it is, of course people are getting out of poverty. But if you look at the American Recovery Act, which is an amazing thing that’s just been passed, a few thousand dollars is going to bring people out of poverty and that’s the poverty line. That really tells us that if a couple thousand dollars is going to make that kind of difference in someone’s life, that means they were really very, very close to the edge.
Joanne: But we know that the poverty level, it requires 200% of poverty, twice the federal poverty level in almost everywhere in the country to meet your basic needs. Colleen, do you want to talk more specifically about the actual how we got to the federal poverty level?
Colleen: Yeah. The federal poverty level, like me, was born in 1963 and neither of us have really kept up with the times. The federal poverty level is very much linked to the cost of food. If you look at inflation over my lifetime, the rise in food costs has been relatively modest compared to housing and healthcare. That means that the federal poverty level very much underestimates what it really costs to live. What’s shocking about this is, everybody admits it. No one claims that it’s realistic, but it’s something that we use. According to US census, X percent of Americans were living below the federal poverty level, and that’s meaningless. It’s really meaningless. What we know is that before the pandemic, 40% of us didn’t have enough money to meet our basic needs. That’s poverty. If the fridge is empty and you can’t fill it, you are poor.
Jim: Yep. Just to put a little bit sharper number on that, you guys quote that in 2020, the federal poverty level for a family of three was $21,000, which is less than $2,000 a month. As you guys point out, that many of these urban areas, you could easily pay 1200, $1,300 a month or more for a two bedroom apartment, and there goes most of your income. I was very intrigued. I didn’t really know the history of quite how that calculation came about, but it makes sense that food was the anchor. One of the great things about our society since 1960 has been the cost of food has come down radically as a portion of people’s wallets. But as you point out, other parts have gone up and things that we used to not even have at all like internet and a computer, which 10 years ago, it wasn’t a necessity, but now it is.
Jim: You basically can’t apply for a job, you can’t apply for some government benefits and COVID has turned out, you won’t be able to get your kids educated if you don’t have adequate internet and at least some form of computing device in your home. So all those things have added to the cost of being a real American, if we want to say such a thing. While food, through the power of the green revolution and evermore industrialized agriculture, which is both a good and a bad … I often talk about the bad of hyper industrialized agriculture. But one of the good parts about it is that the wallet share of food has come down, but it sounds like it was a bad policy determination to anchor the definition of poverty on food. That would be one thing that presumably we, as a society ought to change.
Joanne: And could, yes. There’s lots of movement in that direction. There is this thing called the Self-Sufficiency Standard, which is much, much more focused on exactly where people are. It’s not the same across the country because of course the cost of living is not the same across the country. It also takes into account real costs of housing, food. It includes things like clothing, hygiene products. Because the federal poverty level somehow assumes that you’re not spending money on any of those things, that food and housing are the only costs that you might have.
Jim: Yep. There’s a policy prescription that would make a lot of sense. One of the things I like about your book, is at the end of each chapter, you have a list of things people could do. Talking to our elected representatives to adopt a new, more realistic standard for poverty by itself would make a big difference. Because frankly, I think it would inform discussions about things like the minimum wage. When you say that the poverty level’s 21,000, you can say, all right, that’s one and a half minimum wage jobs. That’s not insane. But if you say that the real cost of living as a fully settled American is 40,000 a year, that’s a heck of an argument for something closer to a $15 an hour minimum wage. Resetting our perception of what poverty is, could have lots of follow-on effects in terms of other policies.
Joanne: Yeah, and it really would.
Colleen: That’s why the first word of the subtitle is seeing. We refuse to even see it right now.
Jim: Yeah. It is interesting how our rhetoric changes what we see. If we think 21,000 is what poverty is, then we think very differently about what interventions may or may not make sense than if we think that $40,000 is poverty. That’s just a very different way of seeing. People listening to the show, know we’re always talking about lenses. The lenses for understanding and sense-making in our world. If we realize that something closer to 40,000 represents people who are not living the full American life, then I think that tells us a whole lot of things about what we need to do. Now, let’s dig into some of the specifics. Something that I learned a lot on was your chapter on water and how that’s a horrible trap for a lot of people. Tell us what you guys learned about water in America and how many Americans struggle with paying their water bills or don’t have access to water at the utility level at all.
Joanne: It’s interesting, it was the chapter that I would say we learned the most about as well. We went into this knowing it was a problem, but did not understand the breadth of the problem or really how many people were affected in really, really horrible ways. We tend to, as US Americans, think of water issues as a developing world problem, not a US problem. Then people will say, “Well, there’s Flint.” But that’s an anomaly. What we found is that it’s not, it’s just not. We spoke to so many people whose lives were really impacted in such a very negative way by water in their community. There’s a story in the book of a man in Baltimore who is going to lose his home because of water, because there was an issue with his water bill. It was clearly a mistake. The bill was huge and there’s no way he could have used that much water. But for whatever the reason, and the reason is bureaucracy, he was not able to get that addressed. A lien was placed on his home for non-payment of his water bill.
Joanne: He is now first off spending $20 a week on bottled water to flush his toilet, and he’s on the verge of losing his home. We saw this in so many different places. It was really eye-opening to hear that one in 10 US Americans have trouble paying their water bill. Is that the right … That’s the right number, right, Colleen?
Jim: Yep, that was in the book. That was in the book. I have it in my notes actually.
Colleen: The other thing is it’s a real crystallizing illustration of our failure to invest in infrastructure. Most of the water systems in this country were constructed right after World War II. It was fine to use lead pipes then, we believed. A lot of cities don’t really know what their pipes are made of and they don’t want to know. We found that test for lead are very insensitive, the test that health departments are using. There are better tests, but they don’t want to know because it’s hugely expensive and we just don’t maintain our infrastructure. This is a wealthy country where bridges collapse.
Jim: Yeah. We could easily spend a trillion on our water systems as you guys pointed out, and as other people have in the past. Not only is it things like lead, but also in many of the big cities like Detroit and New York come to mind, 30 to 40% of the water is lost to leaks.
Jim: We can cut the water bill significantly if we just fixed the leaks.
Colleen: Yeah. We really can’t afford to waste water anymore with rising temps. It doesn’t make sense. We looked at Lansing, Michigan. Now they went through, and they started systematically replacing their pipes before they had a problem. What happened was they got very good at it. They got very efficient at it. So they could do it more cheaply and more quickly than when they started. Lansing is a town that was dependent on the auto industry. They’re not swimming in money, but they did this sort of reasonable for thinking maintenance project. They ended up saving themselves, gosh, knows how much money. And no children in Lansing are walking around with lead poisoning.
Jim: Yeah. Pittsburgh’s doing the same thing, if I’m … Good friends of mine live in Pittsburgh, a young couple with kids. They’re basically just going around replacing everybody’s feed lines because the lead is in the final few hundred feet, It’s not in the main lines. They’re doing it for free and doing it at a pretty aggressive rate. Pittsburgh’s another … I mean, it’s a city that’s come back, but it fell a long way when the iron and steel industries collapsed. It’s still by no means back. It’s lost 50% of its population, so it struggles in some ways, but it has prioritize that. So it can be done. On the other hand, it’s interesting, pricing and we know this from real-world experiments, pricing does make people more conservation oriented. If you don’t have pricing, people will just turn the hose on and let it run all the time when they’re washing their car rather than washing their car out of a bucket, the way they should. We lived in Santa Fe, New Mexico for about 10 years. They had a very interesting plan there.
Jim: Where the basic first couple thousand gallons a month was very inexpensive, like $10. But then the prices went up and up and up and up. The previous people that had owned our house were grossly irresponsible. We looked at the history of their water bills, and it was $3,000 a month because they were watering Connecticut style, green grass. they had a big koi pond and all this stuff. Before we bought the house, we did some math and said, “Wait a minute, they’re going through at least 20 times as much water as we need to.” We filled in the koi pond, we put some water catchment basins to big barrels to catch water off the roof for the gardens, got rid of the green lawn, put gravel in, et cetera. Pricing signals are important with respect to water, but I think what Santa Fe did that was so smart was they had a lifeline level. That if you were just using your normal shower every other day, cooking and laundry, it was $10 a month or something like that.
Jim: That might be a general pattern for these baseline utilities, like we have with phone. We have lifelines service. I’ve helped elderly people get lifeline service before where for quite minimal, I guess $3 and 95 cents a month or something, you can get a very basic telephone service. If we think about that for all our utilities, that could get people out of these crazy traps, at least some of them though. Like the story you talked about the guy in Baltimore that’s a different kind of story. But …
Colleen: The Santa Fe system, I’ve talked with a lot of water advocates who want to see that adopted elsewhere. So far, no one has picked up that good idea. Actually, what happens is exactly the opposite. Super users like agribusiness and water bottling companies get lower rates than residential users.
Jim: Well, I will say, from an economics perspective, the example you gave, I would have come down on the other side. It was in Connecticut, they were seeing reduced demand from conservation. Connecticut is a water rich area in general, and so you have the microeconomic argument, Well, I got a lot of fixed cost in my system and getting marginal revenue worked for everybody. It allows me to lower everybody’s rates a little bit. I didn’t really buy that particular argument in that particular setting, but there are certainly cases in New Mexico where ag consumes 80% of the water and it’s almost free. There’s a stronger microeconomic argument there. Should they really be growing alfalfa in New Mexico on water that’s extraordinarily tight when they could be importing it from Colorado on a train? Probably not, but the vested interest in the legislature make sure that they get a special cheap rate. But yeah, it is interesting. I have not seen the Santa Fe style very aggressively tiered water pricing anywhere else.
Jim: From an economics perspective, it makes perfect sense. From a human perspective, provide that lifeline level at a rate that anybody can afford. But if you’re going to wash your three Corvettes and let the hose run all the time, then you’re going to pay several hundred dollars a month. If you’re going to water a Connecticut style lawn in the middle of the high desert, then you’re going to pay 3000 a month. That’s just the way it is. Probably most people won’t. I think there’s a lot of good thinking that can be done here in water. I love that chapter because as you said, it was a learning experience for us all, how pervasive that problem is. Now let’s get onto the next one. I mean, well, interestingly water is the most critical. We’ll die without water in three days. Food, we’ll die in three weeks. A chubby boy like me, it might be more like a month and a half. But sooner or later, the next one is food. You talk about how in the United States we think of ourselves as the Saudi Arabia of food. At some level, we are.
Jim: We feed half the world. Nonetheless, a quote from you guys, in hospitals throughout the United States, doctors are treating young children for failure to thrive. Often abbreviated FTT, these are children who are not gaining weight and growing normally. Dr. Deborah Frank, who specialized in treating FTT notes for the longest time, it was a mother blaming diagnosis. The common assumption that mothers were not adequately feeding and caring for their children. What we call failure to thrive, the rest of the world calls malnutrition. Again, this hits two of our themes that there’s an awful lot of people who don’t have the economic basis to actually live a full life and that those things had hit children disproportionately and stifled their whole lifetime opportunities. Maybe you can tell us a little bit about what you found about food.
Colleen: We found that while it’s cheaper here than many places, it’s still beyond the means of many people in poverty. The lowest quality food tends to be the most accessible. Lean meats and fruits and veggies are what we all know we should be eating, but not everybody can.
Joanne: Yeah. I think that one of the issues is formula, for example, is very expensive. If you go into most pharmacies, now, formula is locked. That is an indication that US Americans who are feeding their children formula can’t afford it. I think that as much as WIC is an amazing program and really does help a lot of people, women who are pregnant and nursing and children up to the age of five with nutritional food, not everybody is able to access that. While it is a great help to many people, it doesn’t make it through the whole month for people. I think that that’s another … Just it’s really, I think that part of seeing poverty is thinking about what’s locked in stores. If what you’re seeing is the food that keeps babies alive locked on shelves, maybe there’s a problem with getting it to people.
Jim: Indeed. One of the things you advocate for and you make a very good case for is that the so-called Thrifty Food Plan, which is the basis for things like WIC and SNAP are really unrealistic. Just in terms of how much time it takes to cook and the ridiculously small quantities of things that it specifies that you’re never going to be able to buy cost effectively. Instead you advocate for what it’s called the low cost food plan. Could you talk a little bit about those two plans and maybe to what degree they differ and what are kind of the aggregate levels that it might mean in terms of where we put SNAP and WIC if we were using the low cost food plan?
Colleen: The low cost food plan is realistic. It is what a person on a budget who isn’t buying seafood and beef and so forth, could reasonably buy to nutritionally feed their family. The Thrifty Food Plan is just wackadoodle. You can have 0.6 ounces of frozen dinners a month, which is like three quarters of a fish stick. I don’t know where you combine three quarters of fish stick. Who came up with this? They need to be more realistic and they also need to be realistic about time. I like to cook more than most people. I spend time cooking every night. But I work one job and my children are grown. The Thrifty Food Plan assumes that you’re going to cook, I believe 13 hours more a week than the average American. I mean, for people working two and three jobs, it’s not realistic. It’s funny, time poverty is really something that we saw a lot. It takes a lot of time and effort to be poor and cost a lot of money to be poor. Joanne can talk about this.
Jim: Yeah. I thought that was a very interesting analysis about time poverty and particularly how it impacted food and the assumptions around what kind of food people could realistically be able to cook. What was the current budget for food stamps? It was something like $170 a month. Something like that for a family of three. That was certainly unrealistic. I kind of did some calculations with my fingers and thought back to what would it really cost. I came up with a family of three, about $360 a month, something like that. That would be being very parsimonious and very thoughtful, buying in bulk, all those kinds of things. I don’t know how anybody could feed a family of three for $175 a month. That just seems completely crazy. As you point out, maybe if you bought nothing but beans and brown rice and things like that, maybe you could do it. But in this day and age, whose kids are going to eat it?
Joanne: Well, I think you just brought up a really good point when you said, and we bought in bulk. It is more expensive to be poor. Being able to buy in bulk, being able to go to big box stores or club stores, there’s a cost associated with those things. I talk a lot about diapers. When I talk about the cost of diapers, someone invariably writes to me and says, “The numbers you’re quoting are much too high. If you use coupons and buy from Amazon, you use subscribe and save, you can do it for much less.” That’s true, but buying from Amazon assumes so much. It assumes first off that you have a credit card. You have a credit card that has room on it to charge something else, and you have an address where something can safely be delivered. That’s just not realistic for so many of us. I think that that’s just something that, again, lots of us don’t see sort of the privilege of being able to buy things that cost less.
Jim: Yeah, I would call that a systems problem.
Joanne: Absolutely. Yes.
Jim: People who listen regularly know we often use the systems and the complexity lens to look at problems. As you say, in principle, yeah, but there are a lot of neighborhoods where it’s not safe to have Amazon deliver stuff. Even in people who have homes. But if you’re at work all day and you come home, the porch pirates will get you, I guarantee it. As you guys point out, if you’re living in a place where you don’t have transportation and access to even let’s say a big chain grocery store, and instead you’re buying your diapers at a bodega or a little convenience food store in the small quantities that they offer, the price is five times higher and it can actually break you. I thought that was a wonderful example from a systems perspective. How one seemingly small thing from those of us well past our child rearing years … Though I will say I did strategically lay in a huge supply of diapers for our coming granddaughter right at the beginning of the pandemic when no one knew what was going to happen. I basically got enough diapers for her for-
Colleen: He’s the guy, Joanne.
Joanne: That’s right.
Jim: I’m the one. I got enough for her until she was one just because I’ve been damned of … Anyway, that’s privilege. I’m privileged. I’ll admit it. But when it comes to protecting my granddaughter, I’m the grizzly bear, God dammit. So she was not going to miss out on any diapers and I’m sure it did cause stress down the chain. Sorry about that, I apologize. But it’s a classic systems problem. That, I was so impressed by Joanne’s coming to that insight that diapers have all kinds of implications. Let’s have a little note about your network later, but why don’t you do a dive into diapers? I think it was actually a beautiful analysis and realization of a really good leverage point.
Joanne: Right. It’s funny because I became obsessed with this issue probably over almost 20 years ago now. I’m a social worker and I was doing direct service working community-based social work. I went people’s homes or met them where they were in the community. What I saw was a level of poverty that even for somebody who thought that they understood what poverty looked like in America, I was shocked. I began … This whole process really started with toilet paper. I was working with a woman who was developmentally disabled and had three children under three. They never had toilet paper in their house, in their home. Like I said, I was a clinician. I was working at Yale Child Study Center. We thought a lot about what would be driving things clinically and what kind of intervention I could make to try to help with this issue. What became very, very clear to me, and I had to sort of say out loud is, there is no clinical intervention for not having toilet paper. There’s just not. There’s nothing you can do except give somebody toilet paper.
Joanne: As a social worker and for other professions like that, nurses, teachers, doctors, they send caring professionals into work with families who are very, very poor. We are told, maintain your boundaries. Don’t give people things because that will cause dependency. Okay. What should really be the response to going into a home where I saw this woman empty the solids out of diapers and put it back on her baby. The idea was, as a clinician, I was supposed to teach about parenting. I couldn’t teach her to diaper her baby more effectively if she didn’t have a clean diaper. We just weren’t talking about it. We were talking about all of these abstract ideas, and this was in fact quite concrete. She knew her baby needed to be changed. She was embarrassed by what she was doing, but she didn’t have a choice. I began talking to elected officials, talking to policy makers. What I found is nobody was talking about it. This was a part of poverty.
Joanne: What Colleen and I have really come to believe is that so much of this comes from the change in welfare as we know it or knew it. Sort of the way that Temporary Assistance for Needy Families has been implemented. Prior to TANIF, Temporary Assistance for Needy Families, there was not a time limit on benefits for families. The idea of TANIF was that people would be moved from welfare to work. Again, in theory, that’s great. But what we found is that really what was happening is people were just being moved off of TANIF. They weren’t necessarily being moved. Even if they were working because of the gap because of minimum wage and the gap between how much it cost to live and how much people make, they really weren’t able to meet their needs. We could say they were off the welfare roles, but they weren’t in fact self-sufficient. It was this disconnect that I really couldn’t figure out a way to address. It became clear to me that a way to address it was by talking about the basics and to talk about something as simple as a diaper.
Joanne: Because as you said at the very beginning, the idea of leaving a baby sitting in its own mess all day, I felt like that was a way to talk about poverty and a way to open people’s eyes. Because you can have all sorts of theoretical conversations about poverty. But when someone says to me that they’re okay with their neighbor being so poor that their child has to sit in their own filth all day, I’m like, “Okay, well, that’s a different conversation.” That tells me where you are. But I think that most people when it’s described like that can hear it and see it a little differently, if that makes sense. So we started giving out diapers. We started The New Haven Diaper Bank 17 years ago and the National Diaper Bank Network 10 years ago. There are now over 300 diaper banks in the country, giving diapers, period products, other basic needs out to families for free. It’s in part to help people actually get what they need.
Joanne: Sort of the feeling from the beginning for me was that eventually policy has to change because the government is the only entity that is large enough to actually address this. But in the interim, we were going to give people the things that they needed. That’s how we got to a place where my username is often diaper lady.
Jim: We’ll have a link to your natural organization for people that want to start up their own affiliates, right?
Joanne: Thank you.
Jim: You guys pointed out some good leverage points. When people have diapers, they work more, et cetera. So this is again a lever point. It’s really, I thought, a very clever analysis, or probably … It’s both humane and efficient. It’s nice when things align on both of those things. Let’s go back and wrap up on food here and then we’ll move on to housing. I really liked, and this is a thing I harp on, you talked about the people that claim that giving credits or letting WIC be used at farmer’s markets for high priced organic food is not a scalable solution. You quoted from a book called The Food Police: A Well-fed Manifesto about the Politics of Your Plate. I pointed out this all the time that local agriculture can’t be the answer to mass food problems until it’s no more than 25% more expensive than Walmart. In reality, we have to take the food system as it is and not be selling people false stories about how they’re going to get out of food insecurity. I thought that was a really good and important point.
Colleen: Yeah. I love a farmer’s market as well as the next person. They’re just terrific. I live in farm country, I like to buy farm fresh produce, but that’s not the goal. The goal is to get people the nutrition they need, and a bag of frozen broccoli can do that for 99 cents. I think very often when people talk about hunger, they sort of fold that into their bucolic vision of the food system that they want. This is an emergency. We need to figure out how to get everybody in America the nutrition they need to be healthy. We’re going to do that and then you can grow your organic snow peas and exchange them with your friends and water them with Unicorn Tears or whatever you want to do.
Jim: Absolutely. A very important point. I do work in local agriculture and I’m a believer in it, but in the current state of the world it’s not the answer to the food insecurity problem for people who are trying to live on $175 a month, which is impossible. But even I can guarantee you $360 a month for a family of three isn’t going to take you very far at Whole Foods or your local farmer’s market. So we have to be realistic. I do want to push back on one little thing and move on, which is you had a fairly substantial section about iron deficiency. As it turns out, that’s a trivial problem to solve, vitamins with iron. I have a medical condition where I need a little extra iron. My daily vitamin is one with iron in it and it costs a few cents a day. For young children, who maybe you don’t want to give vitamins to, iron enriched cooked cereals exist. Where a few times a week, a little bit of the enriched rice cereal provides you all the iron you need. This one that can be fixed on the cheap.
Jim: This is an example of what I’d call cultural capital, but people don’t know it. The word has to get out in our cultures that iron in particular, and as you guys do very vividly point out, has huge developmental implications if you don’t have enough iron in your diet as a young child, in brain development, brain wiring, all those things that really matter. But that one’s an easy fix, but we just got to get the word out. Let’s move on to the next. We’re just kind of going up Maslow’s hierarchy in some sense, from water to food, to housing. Again, this is one that is very real. I mean, and talking about this quicksand effect, if you don’t have housing, everything else just gets exponentially more difficult. So you can’t get your Amazon delivery and truthfully, they don’t have an address. Getting your mail’s much more difficult. I remember, I will say, when I was on the road, I used to use the general delivery facility at the post office that most people don’t even know exists. But I don’t know if it still does.
Jim: But I would be hanging out in some town for a month or two and I’d say, “Okay, send me mail at Jim Rutt general delivery, Ketchum, Idaho.” Sure enough, you’d wait in line and get up, pick your mail up at the general delivery window. That was the thing, but probably not realistic these days. Talk a little bit about housing and how that is such a systemic and pervasive influence on everything else.
Colleen: Housing is, I would say the toughest nut to crack of the basic needs. Housing costs have gone up at a much greater rate than wages, putting them out of means for many of us. I remember talking with doulas in Brooklyn, where there was a high maternal mortality rate. They said, “Well, the first thing we need to do is get expectant moms in a good situation. We need to make sure they have food stamps. We need to make sure they have housing.” I said, “Well, where do you find them housing?” They said, “Yeah, well, that’s where we fall down. We just don’t have a spot of affordable housing in this country.” The government used to build a lot of affordable housing. We kind of got out of that in the ’80s and we’ve never really gotten back into it. The housing that we do build in this country is impractical for our needs. As you mentioned, families are getting smaller, but houses are getting bigger. Two and three family houses would be a good solution for a lot of families right now, but they’re really not being constructed and local zoning very often prohibits them.
Colleen: You have empty McMansions and you have families living in motels because they can’t get into affordable housing.
Jim: Yeah, it really is.
Joanne: It’s interesting there’s actually a lawsuit right now in Connecticut related to that. There’s a town, a wealthy town outside of New Haven that doesn’t allow for any multifamily and they have requirements on land usage and stuff like that. They’re being sued to allow not to change anything except how many people are allowed to live in a home who are unrelated. It’s the only change they’re trying to make. This town is fighting against it because they want to maintain their way of life. I think that that’s one of the really, really difficult things about housing as well, is how much local zoning laws are controlled by a very small group of people. That’s why one of the solutions we offer that individuals can take is to run for their local planning and zoning board. Generally speaking, it’s not a job that everybody wants so it’s pretty easy to get that nomination. It really can change the trajectory of your town and then the trajectory of people being able to live there in an decent manner.
Joanne: I think you see suits like that all over the country, and we’re really hopeful that some of them move forward in a positive way, a positive outcome.
Jim: Yeah. I’m really glad you guys picked out on that issue of how much of this scarcity of housing is artificial. In 1965, the average new American home was 1200 square feet. Now it’s over 2000 square feet. Family sizes are almost half in that time. In terms of per square footage, we’ve got enough housing for everybody, but it’s not evenly distributed like so much else. I love the fact that you hit on zoning regulation. I’ll add building codes. This is something that our GameB movement is very interested in is reforming these three categories and health department rules too, like for how many people you can have in a building. For instance, the tiny house movement is something that could be a huge solution for homelessness. At current interest rates, you can get a decent tiny house for $300 a month, but most jurisdictions consider them to be the equivalent of trailers, which they’re not. Many of the particularly more fluent jurisdictions are trying to suppress trailer parks on kind of general prejudicial grounds. My parents lived in a trailer park for a while. It didn’t do us any harm.
Jim: Regulating say the tiny house developments, you could literally have a house suitable for a person for $300 a month. Which is frankly, a lot less than the welfare department is paying for the adverse effects of living on the streets and having to go to emergency rooms and causes of crime and all that sort of thing. I very much command your recommendation to people to do that. Now, the one thing you guys didn’t mention that is one of the great success stories around homelessness is the Utah solution. They did the numbers and said, you know what? It would be cheaper to put people in housing than it is to pay for all these healthcare, law enforcement, prison, mental health costs that are downstream from lack of housing. So over a period of a fairly short, like six or seven years, they got almost everybody off the streets and just bought housing for them. Completely nonjudgmental. If you want to be a whino and sit in your single room efficiency and get drunk all the time, go right ahead.
Jim: Because we’ve calculated that we’ll have to spend less on medical bills for you if we give you a place to live than if we don’t. Utah is one of the reddest of red states and yet on pragmatic grounds and humanitarian grounds, because they they are quite religious out there, they concluded that getting people off the street by brute force was worth doing and they did it.
Joanne: Well, one thing I … That is a great thing that they did. One thing that Colleen and I always like to point out is, lots of the wealthy people sit in their house and drink all day. Being a drug user, an alcoholic, all of these, being mentally ill, it goes across economic spectrum. But somehow when you have a lot of money, nobody minds quite as much.
Jim: Yeah. As we like to say, if you’re rich, you’re eccentric. If you’re poor, you’re crazy.
Joanne: That is … Yes.
Jim: That was one of my mother’s favorite sayings actually.
Colleen: Boston University Medical Center actually got some funding. They can prescribe housing to people. It’s, managing an acute illness for a person who doesn’t have housing is nearly impossible, particularly asthma. Asthma is so often housing related. They can prescribe housing. They have access to rent subsidies and so forth to do that. I talked with another researcher who said, what we really need to do is get it for less serious illnesses like diabetes, COPD, all these chronic conditions. We know we could serve patients better if they were in housing and we’re probably going to save in traumatic healthcare costs down the road.
Jim: Yeah. I would go further and just say, a country as rich as the United States, it’s a God damn disgrace that anybody should live on the streets who didn’t want to. I mean, if we want to, I mean, hell, I didn’t mind living on the streets. But I was 22 and healthy, and big and mean. Anybody mess with me, I’d punch him in the face. a couple of them tried and a couple of them wish they hadn’t. But that anyone should be non voluntarily homeless in a country as rich as America is just God damn a disgrace. That’s all I got to say about it.
Joanne: Well, you know what, Jim? Can I just add to that? If anything, I think that’s the point of our book. In a country as wealthy as ours, it is a sin for any of these issues to exist.
Jim: Yep. Particularly where if we had regulatory reform, we could do it for 300 or $500 a month. But the vested interest, the real estate lobbies, the homeowners that don’t want to have some theoretical issue about their real estate values being impacted, which I think are mostly false, but they believe it anyway, conspire to keep us from doing what is very doable. As Utah found, frankly, particularly with homelessness, it might actually be free. It may be that the downstream savings, and that’s just the short term downstream savings from things like emergency medical, healthcare and incarceration. If you take the longer term savings from improving human capital so that kids are less traumatized, they get more education, they’re more likely to then become taxpayers when they grow up. I suspect that we could solve the homeless problem and make money as a society. To not do so, it’s just a disgrace. As you say, that’s one of the things that is so much in the spirit of your book. While I like to pushback on little things, that’s kind of what I do here on the show, overall, I absolutely buy your broader thesis.
Jim: That it’s more and well enough time that we do something about this. We had some other topics we could get into, transportation, high poverty schools and that quicksand trap, but we’re kind of getting near our time. So let’s jump to some solutions. In your solution section, you start off with Japan. You mentioned that in their constitution, I did not know this, it states all people should have the right to maintain the minimum standards of wholesome and cultured living. In all spheres of life, the state shall use its endeavors for the promotion and extension of social welfare and security and of public health. Wouldn’t that be great if we had something like that in our country?
Colleen: Yes. It seems reasonable to me.
Jim: Yeah. Again, as rich as we are, the GDP per capita is now about 70,000 a year, which means the average GDP for a family of three it’s $210,000. If 40,000 is what it costs to live marginally decently, we should be able to do that. Particularly in a country that prides itself on its religion … I mean, I will say personally, I’m a bloody-minded atheist, but I’m also a humanist. But for the large number of people that are religious, what would Jesus say, frankly, about people living on the street? He would not be pleased, I suspect, in a country this rich.
Joanne: Luckily Colleen can tell us what Jesus said.
Colleen: Yes, I could tell us.
Jim: What did Jesus say about this?
Colleen: [inaudible 01:13:43]. Well, I always go back to that quote that people throw at you, the poor will be with you always. He said that to Judas, one guy who was about to die. He didn’t say it to you in me. There’s no out. The entire gospel is about feeding people. Give a man a fish, Jesus did. He gave 5,000 of them fishes. No questions asked, no means testing, no citizenship test, nothing. Fishes, lots of fishes.
Jim: I love it. Now in terms of actual systemic policies that could end fully poverty in America, some of the ones that you all discuss are guaranteed income, guaranteed work and universal basic incomes. Maybe outline those and their similarities and their differences and how any one of the three could probably end poverty in America if we funded it satisfactory.
Joanne: Yes. I think that that’s really important, Jim. Is that we do feel that there are lots of answers. It’s not that there has to be one. Certainly raising the minimum wage is one way to do it. Guaranteed job is one that we really love because the truth is, like we say through the book again and again, most people in poverty are working. But if we could guarantee jobs that paid and guaranteed jobs that also helped with our infrastructure, we would have a better country in general. Colleen, do you want to go into the UBI versus …
Colleen: Yeah. UBI is a set payment that goes to everybody, you, me, Jeff Bezos, and the guy on the street all get $1,000 a month or 2,000 or whatever we decided it’s going to be. For people who don’t need it, it’ll probably get taken back in taxes on the other end. Guaranteed minimum income is means tested. Meaning we’re going to say, okay, everybody in America is going to have $20,000 a year. If you’re not already making that, the government will make it up for you. A national jobs guarantee is the federal government creates jobs, doing things that need to be done, pays a living wage and pays health insurance, which then we hope will force private employers to do the same. We have a good illustration of this. We saw it in the new deal. I actually have an uncle who was in the Civilian Conservation Corps and he was an orphan. He had a high school diploma and nothing else, no prospects. He built railroad tracks across the country, got a good meal every day and went to college at night through the program.
Colleen: He ended up being an intelligence officer in the Second World War because he had a real facility for languages and became a great interpreter. He did that all his life. He was a prosperous guy because the government invested a little bit in him and was really just paying him to do work they needed to do anyways. It just seems like such a win-win. I also think that that’s one that has a great chance because it sort of fits in with the American mythology, work hard, get ahead, save up, be frugal. That’s kind of what a national jobs guarantee is, asking people to be of service to their community and giving them a hand up.
Jim: Yeah. It can be a lot of administrative overhead and frankly, when we talk about social capital and some of these really deep poverty stricken areas where there has been this apartheid of poverty, there are generations that don’t even know what it is to work and what’s necessary to work. Well, I guess you could argue that on both sides. It may be that their work isn’t very productive initially, but it would be useful for them to learn the skills necessary to work. So that would be an argument in favor of it. What I kind of like conceptually from a systems perspective and also for the longer term is universal basic income. One of the reasons of this is forward thinking, not necessarily about our problems of today, but automation has actually destroyed far more jobs than China has. Probably six or seven times as many. Probably we’re on an inflection point in the history of technology where that’s going to continue to accelerate into more and more kinds of jobs as we get closer and closer to true general artificial intelligence.
Jim: We’ve already eliminated secretaries pretty much. It won’t be long before we eliminate bookkeepers and then accountants and then legal aidS and then lawyers to a substantial degree. Much of what a lawyer does could in theory be done by a smart enough artificial intelligence. A universal basic income provides a transition mechanism towards the future where we can gradually raise that as automation eliminates more and more jobs. For those who don’t know what a UBI is, and I guess Joanne said, it’s where there’s a stipulated amount that goes to every single citizen. Currently people are talking about $1,000 per person per month. I typically like to add in and half of that per child. I think that’s an important thing to add because they usually say adults only. But I think if you had 500 a month per child, that does a lot of good things for eliminating child poverty. Which as we discussed is frankly the most important thing to address. One of the things about UBI versus all these other programs is, the administrative overhead is minimal.
Jim: You don’t need to hire a bunch of bureaucrats to manage it, to recruit, to make sure people aren’t lying, there’s no possibility of fraud. Well, there is a little bit of possibly of fraud, but if you’ve got a national ID program, that goes away or becomes very, very small. Then here’s the other one that again from a systems perspective is things like guaranteed income, I have some strange incentives. An incentive is not to work because you get more money from the government if you don’t work. The beauty of UBI is, every bit of work you do, you get fully rewarded for. If you decide to work 10 hours a week because that’s all you really feel like you need to do because you’re a hippie and you want to just hang out and smoke reefer, so be it. You get rewarded honestly for your 10 hours of work. Well, things like EITC even, which is not a bad program, they ramp back your benefits based on your earnings. You get to keep a part of it, but you often lose 40, 50% of what you earn incrementally.
Jim: UBI does not have that nor does it have a notch. Many of our good programs like Medicaid have a horrible notch. If you make $100 more a month, you lose Medicaid, which is worth $500 a month. UBI has no notches. There is no place where it’s not in your interest to do another hours of work if you are so inclined. On the other hand, if you don’t want to, you don’t have to and then nobody makes any moral judgment about it. It’s expensive of course, because as you point out, it goes to everybody. Jeff Bezos, he’ll get this $1,000 a month. Of course he’ll pay about 50% of it back in taxes, as you also pointed out and that’s important. Frankly, I believe top rates should be a lot higher. Top rates should be more like they were when Ronald Reagan took office, which was they were 71%, and that’s just at federal level. You throw in state, you’re probably talking to 80%. I have no problem at all of people with high incomes, and some years I have higher incomes, paying 80% of that.
Jim: I think that’s morally correct and that would go a long way towards funding those. But even on the other side, I’ve done the numbers, and if you assume the recapture even at current income tax rates, we could do $1,000 a month UBI for about a 15% VAT tax, value added tax. Look at Canada. Canada has a VAT tax. It’s more than 15%. We have no VAT tax at all. We could actually bring everybody out of poverty or at least nominal poverty. As you point out, that’s not truly, fully participating in the American way of life. But for a family of three, two adults and a kid, we’re collecting … What would that be? 24 plus six, $30,000 a year, tax-free. You’re getting pretty close to that $40,000 threshold. Even a small amount of work would get you there. Yes, it’s the biggest of the changes, but from a systems perspective, it’s the one I personally happen to like.
Joanne: Well, and we’ve kind of warmed up to it a little bit. Stimulus payments, what are they?
Jim: Yep. They’re sort of baby … We have them like in Alaska. Alaska has been paying a UBI for many, many years from its oil trust funds and it seems to work there. As you guys point out in the book, there were a number of experiments including done by Don Rumsfeld and Dick Cheney back in the ’70s and mostly the effects are good. The fins have tried it. They unfortunately didn’t do a very good job analyzing the data. He told a great story about … Where was it where someone did the big experiment and then the data sat for 40 years?
Joanne: Manitoba. Yeah.
Jim: Manitoba, that was it. Yeah. Now someone’s going back to research the data to see what they learn. I suspect they’re going to find mostly good. Nothing’s perfect.
Joanne: So far, they have. Yeah.
Jim: Yeah. I’d love to see that result when it happens. All right. For our last turn here, you finish off your book with a chapter on advocacy and I would put in parens activism. Tell us … This is something we hear a lot from people. “All right, this is all great theory, blah, blah. Yeah. Okay. You all are smart people, blah, blah. But what can I do tomorrow to help the world be better?” Why don’t each of you give us a couple of minutes on what you think real people could realistically do to help reduce the negative implications of poverty in America. Joanne, why don’t you start?
Joanne: Sure. I think there are a lot of things. As I think we say in the book, an advocate is just someone who won’t stop talking and who won’t go away. So any of us can be an advocate. It doesn’t require any special education or any special training. First and foremost, that is I think really important. Anybody can do this work. There are a lot of different things, but an example I like to give is that you can do something on a very, very local level. Using a diaper drive, as an example, you can do a diaper drive in your community. Collect diapers and give them to an organization that needs them. a diaper bank or someplace else that could use them. But more than that, take a picture of yourself doing it, and then send that picture to your elected officials, your state, local and federal. Say to them, how I vote is impacted by what you do. Diapers are important to me. Food is important to me. Taking care of my neighbor is important to me. That it’s threefold.
Joanne: You’re going to do the drive anyway, and how easy is it just to snap a selfie and send it along. Letting your elected officials know what’s important to you is a huge way to change the trajectory of our country. But so many of us feel like our voice doesn’t matter. For me, the most important thing that I hope people take from this book is that your voice matters and can change things. Go ahead and tell people how, what they’re doing impact how you’re going to vote. Then vote.
Jim: Absolutely. Well-spoken. Colleen, what would be your advice on advocacy and activism that realistic people can realistically do?
Colleen: I think it’s important that you bring the lens of poverty to whatever you’re already doing. Here’s an example. If you are a parent who’s active in the PTA, you follow the school board, the school board is going to report out on SAT scores and it’s going to tell you how many of your high school seniors are going on to highly competitive universities and so forth. Ask them to publicly report on absenteeism. Poor kids miss a lot of school because they’re working, because they have unmanaged chronic illnesses, all sorts of reasons. You need to start tracking that and looking at it. Anybody can do that. Anybody can do that. When Connecticut started taxing plastic bags, I got all my friends together to make cloth bags for the people who come into my church food pantry. Because while environmentally getting rid of plastic bags is just terrific and I support it 100%, not everybody has their little PBS Tote bags ready to go. You have to think about everything under the lens of what would this be like if I just didn’t have enough money to get by.
Colleen: Once you start examining the world like that, you will move through it very differently. It touches all of our lives. We all have places where we can make a difference.
Jim: I love it. Thank you very much. Well, I think we’re going to wrap it here. I’d like to thank Joanne Goldblum and Colleen Shaddox, who are the authors of Broken America for a wonderful conversation. I hope an energizing one for our readers out there. Go read the book. It has my full recommendation and let’s all see if we can somehow in our lifetimes end poverty in America.
Colleen: Thank you, Jim.
Joanne: Thank you, Jim. This was wonderful.
Production services and audio editing by Jared Janes Consulting, Music by Tom Muller at modernspacemusic.com.