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Expert on poverty describes city's challenge

Rochester Business Journal
February 6, 2015

A half-century after the War on Poverty was launched, some 45 million Americans are living in poverty, and wages for most working people in this country have risen, after inflation, an average of one-fifth of 1 percent annually over the last 40 years.

Yet the contention that nothing works is “wrong, wrong, wrong,” Peter Edelman told the 525 people who attended “Rochester’s Crisis of Poverty,” part of the Rochester Business Journal’s Power Breakfast series.

Edelman, who delivered the keynote address at the Jan. 29 event, is faculty director of Georgetown University’s Center on Poverty, Inequality & Public Policy and author of the book, “So Rich, So Poor: Why It’s So Hard to End Poverty in America.” Among his many previous positions are legislative assistant to Sen. Robert Kennedy and director of the New York State Division for Youth, where he worked with Clay Osborne, who later became vice president at Bausch & Lomb Inc.

A number of anti-poverty programs and policies have been highly effective, Edelman said.

“We would have twice as many people in poverty in our country without (them),” he noted.

The problem persists not because of failures in policies or personal responsibility, he added, but due to “nine big changes in our country that we did not foresee.”

Most fundamental, Edelman said, is “we have become a low-wage nation.” The collapse of the labor market stems from a range of forces, including globalization, advances in technology and the decline of labor unions.

The result: “Half of the jobs in the United States pay less than $35,000. … The fact is the wages of half the jobs in the country have been basically stuck for 40 years. This is a structural problem in our economy. We need to call it what it is, and act.”

In the second half of the program, Edelman was joined by a group of leaders from local human service providers. The panelists were Marlene Bessette, president and CEO, Catholic Family Center; Larry Fine, executive director, Jewish Federation of Greater Rochester; James Norman, president and CEO, Action for a Better Community; Wade Norwood, chief program officer, Finger Lakes Health Systems Agency; and Hilda Rosario Escher, president and CEO, Ibero American Action League.

The event, held at the Hyatt Regency Rochester, was supported by six underwriting sponsors: the Farash Foundation, the Greater Rochester Health Foundation, the Rochester Area Community Foundation, the Rochester Business Alliance, the United Way of Greater Rochester and Wegmans Food Markets Inc.

The following is an edited transcript of Edelman’s speech:

I don’t have to tell you that Rochester faces particularly difficult challenges of high levels of poverty and near-poverty and a degree of inequality that’s also exceptionally troubling. And you as a community are working hard—this gathering this morning is one indication—you are working hard to ameliorate those problems. It was so very good for me but for all of you especially to hear that Gov. Cuomo acted the other day to form a Rochester anti-poverty task force specifically for creating and enhancing the partnership between the state and Rochester with the challenges you face here. That’s a promising step, a very promising step. I hope that the stars are aligned for you to move forward on these serious problems.

You’ve asked me to place your issues in the national context, and I hope it will be of some value to do that.

It’s going on 51 years since President Johnson’s War on Poverty was enacted and yet 45 million people are still poor in our country. So why? We’ve heard for quite some time from elected officials and others that we’ve fought a war on poverty and poverty won. Some of those who say that say they really are all for ending poverty but that everything we’ve done has failed. The first thing I want to say to you this morning is that is wrong! It’s crucial for all of us to know the facts and say them out loud in a very public way whenever we have a chance; and that’s all of us, because we are heading into another period of time when we’re going to hear that allegation that nothing works, that nothing we’ve done works. For the sake of our country and doing what we need to do, we need to stand up to that allegation.

We cut poverty in half in the 1960s—from 22 percent in 1959, when we started to measure poverty, down to 11 percent in 1973. African-American poverty went down from 55 percent to 32 percent over that period. There were multiple causes for that, but the main thing is that it happened. From the New Deal until now, and not just in the 1960s and not just the War on Poverty specifically, we have enacted policies that work. Not just public policies, but community efforts here and around the country that make a difference.

Beginning with Social Security in 1935 and then SNAP—food stamps—and the earned income tax credit and the child tax credit and the SSI, Pell grants, income vouchers and much, much more. Up through the Affordable Care Act and the expansion of Medicaid, with the leadership of President Obama, we have enacted a long list of policies and programs that work. We would have twice as many people in poverty in our country without those programs—more than 90 million people instead of the 45 million people we do have.

So, please, don’t sit silently when you hear nothing works: That is just wrong, wrong, wrong. Still, we have 45 million people in poverty. That’s terrible. So why? How could those two facts be true?

Let’s look back to 1968. We were in a good place on poverty despite the terrible tragedies of that year. There was great optimism (about) ending poverty, and with good reason. I cited those figures to you. Poverty in the country was on its way to being cut in half. Rochester was proud of its long economic prosperity and civic commitment. I remember it well, when Clay and I were working in the Division for Youth, although there were certainly plenty of problems of race and poverty here, as there were everywhere. We can remember, some of us who have gray in our hair or no hair, we can remember the racial unrest of 1964 and the arrival of the famous organizer Saul Alinsky to work with the local organization FIGHT. Still, compared to where things stood then, your issues here in Rochester in many ways are more serious now, even with the programs I mentioned.

Nine big changes
So, what happened? There were nine big changes in our country that we did not foresee, and all of them relate to the issues you have here in Rochester now. These are the real reasons why we haven’t done better; not failure in the policies we have, not wholesale failures in personal responsibility, as some say. And even so, with all the problems I’m going to discuss, we held our own nationally from that low point of 11 percent in 1973 until 2000, when President Clinton left office; poverty was down to 11.3 percent—about the same in 2000 as it had been in 1973. So in fact the high level of poverty that we have right now nationally mushroomed only since 2000—13 million more people poor than just 15 years ago. Up 40 percent since then.

What are the nine changes that we did not foresee? One, and the most fundamental—and indeed, most fundamental in terms of the challenge you face here in Rochester—(is) that we have become a low-wage nation. Not only a low-wage economy, but in regions like those bordering the Great Lakes, a collapse of their labor markets that’s left thousands—especially men and older men—permanently without prospects. We know the major reasons: globalization, technology, also the reduction in the power of unions. And when manufacturing has come back, new technology has meant the plants are back, but with neither the previous number of jobs nor the same level of wages.

That is the heart of the challenge. The flood of low wages is the biggest thing here and across the country. Listen to this number: 106 million people—a third of our country—have income below twice the poverty line, (or) below $39,000 a year for a family of three. Half of the jobs in the United States pay less than $35,000. Half of the workers—and that’s if they have the job full time and all year. A quarter of the jobs pay less than the poverty line for a family of four. Those are the facts. And this wage for half of the jobs in our country has been virtually stuck for 40 years. Up 7 percent in 40 years, after inflation; a fifth of a percent a year. There are not enough jobs and there are not enough good jobs. No wonder people are so angry and we see it in our politics.

Nationally, in my view, we are not facing up to the depth and longevity of the problem. Because we do hear that wages have not returned to pre-recession levels; that is true. But the fact is the wages of half the jobs in the country have been basically stuck for 40 years. This is a structural problem in our economy. We need to call it what it is and act.

Gov. Cuomo is asking for an increase in the state minimum wage; that will help here in Rochester and across the state. The Affordable Care Act and Medicaid expansion are extremely important in this regard (and) are one piece of good news in this discussion of low-wage work. Actually in three ways. One, the new health care coverage will effectively raise people’s income. When you get that health coverage it is equivalent to income. Two, better health care will help many be more effective workers. And three, ACA and the new Medicaid will create large numbers of new jobs for Rochester residents if you provide the necessary education and training. So there is an opportunity here that’s waiting in communities across the country.

Beyond the health care sphere we need to do much more to put America back to work. The recession is not over for millions of our people, and I for one see a long siege of low-wage work if we do not act.

We need a national debate on what it takes to have enough good jobs. One part of getting people back to work … would be to invest in jobs for things that we need done in this country. Rebuilding our infrastructure, child care, building affordable housing—all of these things are things we need to do. However, of course, they will cost money, so it certainly will not happen overnight and we have to have that national discussion. The deluge of low-wage jobs is not going away and we need to face up to it in America, in New York and here in Rochester.

The second unforeseen thing: Family structures have changed. There are many more single parents, primarily women. Poverty is more and more a question of women and children, of all races. There’s much to be discussed about why this occurred and what to do about it, but one thing is sure: Only one breadwinner at low-wage work constitutes a disastrous combination.

Children are the poorest age group. Certainly you know that here in Rochester—50 percent child poverty. Single mothers and their children are the highest poverty group nationally, well over 40 percent, regardless of race or ethnicity. That is a very troubling number. And to make matters worse, lacking the wherewithal for quality child care, many women are forced to leave their children in circumstances that are downright dangerous. Certainly a very high priority here and everywhere is an intense commitment using all possible financing to create a true system of child care.

And it’s not just about helping mom at her job. It’s about the future of the children themselves. We know more than ever about the consequences of the first five years for the rest of life. We need to invest in our children. And especially for moms in the work force, but for all workers, we need paid family leave, and the governor has endorsed that. (Also), reform of work schedules and here in Rochester in particular you have issues of transportation. Those at the low-wage jobs very often cannot afford to have a car. So, all of this is involved when we look at the combination particularly of women and low-wage work.

The third change we did not foresee is the crisis in public education, especially for low-income children in city after city and, I understand, here in Rochester. Our public schools went into decline just as the good jobs began to require more and more rigorous education and training. All of our children—girls as well as boys, young people of all races and ethnicities—need access to 21st century jobs and this means 21st century curriculum. STEM jobs, middle-skill jobs have to be a priority in every school system … with a smooth pathway into a community college and beyond, for girls and boys. Do you know that only 8 percent of engineers in our country are women? Just a high school diploma isn’t good enough anymore.

I know you are working on all of this. Wegmans has been absolutely a leader in the country in helping young people get into the workforce and being an employer that’s responsible about having decent-paying jobs and getting the results. So, you have a model, as all of you know, in this community.

And there is as I said earlier a particular opportunity in health care. There will be a large number of jobs there, and it’s worth saying again. I urge you to take advantage of the opportunity in that sector and invest in the education that the young people in Rochester need to be educated for those jobs.

Four: more incarceration. We started locking up people at a prodigious rate; remember, I’m talking about things we did not foresee as of 1968. Many of you have read, and some of us remember, how low the number of people incarcerated was then. And now over 2 million people across the country. So we are locking up at a prodigious rate and especially African-American and Latino men, and it is a vicious circle. Poverty, especially coupled with race, leads to disproportionate incarceration and incarceration leads to what often is a lifetime of poverty. We need to be working on that in New York; every state needs to be looking at its sentencing structures. Crime has gone down in our country; we all know that. (Yet) incarceration has barely budged. And that is because of how long we’re are sending these men, in particular, away to be in prison.

We do seem to be waking up to the idea of more humane re-entry policies, but that’s not nearly enough. We really need to look at the sentencing policies, which remain awful. The long sentences, the mandatory minimum sentences, the three strikes and you’re out, incarcerating youth in adult prisons. And we shouldn’t kid ourselves. This is a racial issue and an ethics issue in our country. Gov. Cuomo’s Commission on Youth, Public Safety & Justice recently recommended to raise the age of juvenile jurisdiction from 16 to 18. Clay and I worked in the system when the state was one of three that treated all young people as adults at the age of 16. Sent them to state prison. Still do. Now you’re one of two. So there’s an opportunity here in this recommendation to stop being out of step with almost all the rest of the country. So I hope you’ll tell the governor that you would support this change.

Five: inner city concentrated poverty. Too many poor people all in one place. This has gotten worse in city after city with a disproportionate impact on African-American and Hispanic families. From the perspective of 1968, we didn’t think that concentrated poverty would get worse; maybe many of us thought it couldn’t get worse. You in Rochester certainly know the consequences: persistent and intergenerational poverty that is the hardest to attack. And also it’s really politicized by racial attitudes.

Now, of course, concentrated poverty is not just urban; think Appalachia, the Mississippi Delta, Indian reservations and so on. At the same time it’s important to emphasize that we have learned that concentrated poverty is not simply a matter of race. You in the Rust Belt certainly know this. Robert Putnam of Harvard will publish a book later this year—I’m going to send him a bill for the plug. You know his book, “Bowling Alone.” This is a remarkable scholar, Robert Putnam. He grew up in Port Clinton, Ohio. When he was growing up the town was prosperous; the children of factory workers routinely went on to college, the factories and the good jobs then, as we know, generally went away and the town fell apart. Drugs and alcohol, teen pregnancy, dropping out of school and so on. And almost everybody was white. You may have read Nicholas Kristof’s deeply moving column last Sunday (in the New York Times), which made the same point. We have to make every effort to do better about concentrated poverty.

The answers (where) we have too many people living all in the same space is to do everything. Economic opportunity, which means jobs available to all without discrimination, effective schools, community safety, family support and so on. We have to break the cycle.

There are models around the country now that are popping up. A new form of cross-disciplinary, of multiple focus, as we’ve had most recently with President Obama’s Promise Neighborhoods, as we’ve had over the past with things like Bedford-Stuyvesant that I worked on with Robert Kennedy. But now around the idea of doing at scale a combination of things that families need (and) to be able to get those either in one place or in a network. And that’s one of the things you’ve said to the governor in your proposal for the task force. Well, if you look at the Youth Policy Institute in Los Angeles, if you look at the Community Action Program in Tulsa, at Community Solutions in the Brownsville section of Brooklyn and in Hartford, Conn., you will find models at scale, not just a little storefront here and a storefront there, that are making a difference in those communities. So, that’s a relatively new idea especially in places where there’s a high concentration of poverty.

Six: deep poverty. The statistics (are) deeply, deeply troublesome, about 6.7 percent nationally, 16 percent (here). What is deep poverty? That’s incomes below half the poverty line. Half of the poverty line for a family of three is $9,500 a year. Sixteen percent of the people in the city of Rochester with incomes that low. The census tells us that 20 million people now have incomes below half the poverty line and the percent has doubled nationally over 40 years, from 3.3 percent to 6.7 percent.

Why? We did it. We did it with the welfare law of 1996; we did it to women and children. Women and children are taking the brunt of the low-wage jobs and they take the brunt of poverty as well. And the 1996 law did it. … The problems of the old welfare system (needed) to be fixed; I want to say that very clearly—the old (Aid to Families with Dependent Children) program was unsatisfactory. But at least there was a right to help. Before 1996, 68 percent of children living in poor families, those families were getting cash assistance. It’s 25 percent now around the country. In more than half the states fewer than 20 percent of children in poor families receive cash assistance. In Wyoming, which wins the prize, 800 people in the entire state are receiving cash assistance, 5 percent of the children living in poor families.

We’re down to 3.7 million people (nationally) who receive cash assistance from over 14 million before the 1996 law. That’s barely 1 percent of our population and we still hear about how the thing that’s wrong is all that welfare. We still hear that—welfare doesn’t exist anymore in half our country! Six million people in our country have food stamps and no other income. Six million people. That’s a third of the poverty line; that’s what you get if that’s all you have. You get about $6,000 a year for a family of three. It’s an enormous hole; we should be absolutely ashamed.

And now we have an attack on food stamps because that’s the new welfare to attack for those who have that view. It makes me particularly angry. I went to Mississippi with Robert Kennedy in 1967 and we saw children with swollen bellies, with running sores on their arms and legs that would not heal, and we came back and Robert Kennedy started the fight that was picked up not by President Johnson but President Nixon. Bipartisan. It’s always been bipartisan until the last two or three years. Bob Dole, George W. Bush—all were huge supporters of food stamps because it is the fundamental safety net now that we do not have cash assistance in half our country. So we need to stand up and say the program we have is totally vital and important.

Seven: We did not foresee what has happened to affordable housing and homelessness. You’ve seen it here, it’s across the country; a huge loss of affordable housing, rents have skyrocketed—low-wage work on the one side, skyrocketing rents on the other side. A terrible combination. People can’t pay the rent even if they’re working. There are people in every city in our country who are homeless and have jobs. … This is terrible for children. I was really glad to see the governor asking for an almost $500 million increase in affordable housing and $200 million more in fighting homelessness. That is exactly what we need to do. Please help in getting those proposals enacted in Albany. And this should be a pressing priority for Rochester.

Eight: race and ethnicity and gender. We thought we would be doing better by now. We all know what’s happened in the course of the last few months in our country on the question of race. From Ferguson to Staten Island to Cleveland and elsewhere. 27-25-10—that’s not a quarterback calling signals. Twenty-seven percent poverty still among African-Americans. Remember it had gotten down from 32 percent in 1973 (to) 23 percent under President Clinton, but (then) back up. Twenty-five percent among Hispanics, 10 percent among whites. The disparities continue. Politics are ugly in too many places. Look at the politics of immigration, look at Ferguson. It seems that we cannot pick up the paper without reading about another unarmed black man being killed by a police officer. And that is not to say a thing about all of those police officers in this country who do their job and who we need for our community safety. But this is a fact, and this is not who we should be.

Nine: inequality. Our economy doubled in size over the past 40 years and it all stuck at the top. And I mean all of it. The gap is still widening. From 2009 to 2012, the income of the top 1 percent went up 21 percent while the bottom 99 percent lost 0.3 percent. And you’d better believe that’s not the same at 99 as it is at 1. So we have to focus on the top, and when we talk about the other 99 percent and even as we focus as we should on the squeeze on the middle because that is very real, let’s make sure our focus goes all the way to the bottom. That’s why we’re here this morning; that’s what you’re doing in Rochester. That is who we should be.

All are responsible
I worry for our democracy, for the political power of the people at the top, for the very functioning of our economy—$889 million, it was announced, the Koch brothers and others are putting into our elections in the next year. That is terrible. I worry for the very future of our country. We’ve become a society of gated communities and ghettos, yachts and people with no boats at all, private jets and children whose wings are clipped long before they could even consider flying. Our work here in Rochester and across the country is to create a vibrant economy for everyone; good jobs, strong families, healthy communities, affordable housing, great public schools, excellent health and mental health care, and human services of all kinds, a criminal justice system that is truly just, respect for all, (and) justice, not charity. I don’t think that’s too much to ask.

We need public policy at all levels, private and civic action as well as public policy, and personal responsibility in all ways. So much of what we can and must do is civic and local. Here in Rochester, everywhere local around the country, civic and local. … Think, as I said before, zero to five. The civic responsibility. Think getting young people into jobs of the 21st century. A local responsibility. Outside resources, but to do it well, local responsibility. You can pull the money in; if there is not local responsibility, nothing happens. The money is just wasted. So those two examples show we need civil leadership if we’re going to make a difference and that is what you’re doing here in Rochester.

I always close with a short quote from Rabbi Abraham Joshua Heschel, Dr. (Martin Luther) King’s dear friend, a deeply spiritual man, an author of many books of great length. But here, a tweet, before there was Twitter, if you will. He said, “We are not all guilty, but we are all responsible.” I’m so glad to be here with you. Thank you for having me. Thank you for letting me share these thoughts with you this morning.

2/6/15 (c) 2015 Rochester Business Journal. To obtain permission to reprint this article, call 585-546-8303 or email service@rbj.net.


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