The Truth About Poverty
Bad choices, not a bad economy, are to blame.
The release of the U.S. Census Bureau’s mid-decade look at the population late last year sparked the usual outpouring of misinformed reporting on poverty. The familiar story line charged that our economic system isn’t working well. The evidence? The poor are getting poorer, as one headline had it, and poverty rates remained unchanged, as another declared. In an editorial headlined downward mobility, the New York Times explained that the Bush agenda, emphasizing tax cuts and economic growth, wasn’t adequate for helping the poor, who need a wide range of government interventions, from a higher minimum wage and a more progressive income tax to undefined “labor protections.”
But the very same census study that provoked these headlines—the “American Community Survey” (ACS)—also reveals the true nature of much poverty in America, telling a story that the press either ignores or can’t bring itself to write. Poverty in America, that true story goes, results from the choices that people make, not our economic system’s supposed shortcomings.
The census’s profile of poverty is especially revealing in a city like New York. With its wealthy families living side by side with a larger-than-average number of the poor, Gotham often appears in press accounts as a damning example of our society’s inequities. The census’s latest numbers tell us that the city’s poverty rate is 19 percent, a number that hasn’t changed much in 25 years and compares unfavorably with a national rate of about 13 percent. Places in New York—Manhattan, above all—seem the embodiment of former vice presidential candidate John Edwards’s “Two Americas,” with both a poverty rate and an average household income higher than the national average.
Yet behind the differences in economic performance of the “Two New Yorks” lie startling disparities in social behavior, usually unacknowledged by critics of our economic system. For instance, the latest ACS tells us that single parents head more than two-thirds of all of New York’s poor families, including more than 183,000 run by single women. The median family income of female-headed households with children is just $21,233 annually, a stark contrast with the nearly $65,000 brought home by married couples with kids in New York. (Married couples are nearly two-thirds of all families not in poverty in the city.) In fact, economists from the University of California at Davis found in a recent study on poverty in America that “changes in family structure—notably a doubling of the percent of families headed by a single woman—can account for a 3.7 percentage point increase in poverty rates, more than the entire rise in the poverty rate from 10.7 percent to 12.8 percent since 1980.”
It’s not that the adults who head families in poverty don’t earn enough; they don’t work enough. Left-wing critics often charge that nowadays “work doesn’t work” in our “broken” economic system, by which they mean that wages are so wretched that the poor can’t lift themselves up, even when employed. But the ACS informs us that an adult working full-time heads up fewer than 16 percent of all impoverished New York households (and just slightly more than 16 percent nationwide). Among single-woman-headed households, just 14 percent work full-time; 55 percent don’t work at all.
True, it may be hard to work full-time as a single mother unless you can afford child care. Yet in New York, ever more women—especially poor women—are choosing to have kids without a husband. The census shows that about 36,000 women annually in New York are now having children out of wedlock. That’s one-third of all births in the city, though the data vary widely by race, with Asian-Americans having the lowest out-of-wedlock rate (8 percent) and blacks the highest (62 percent). Most shocking, perhaps, is that more than half of women having children out of wedlock are already in poverty or wind up there within a year of giving birth. Those births to poor women partly explain the city’s higher-than-average poverty rate; since the city’s illegitimacy rate is above the nation’s, a greater percentage of children are born directly into poverty here than nationwide.
The second great demographic characteristic of poverty today is education, or the lack of it. The ranks of the impoverished overflow with high school dropouts, who are at a great disadvantage anywhere in America but above all in New York City, whose knowledge-based economy increasingly demands a sheepskin. In New York, almost seven in ten high school dropouts live in poverty, the ACS reports, compared with 40 percent of dropouts nationally. Many of those Gotham dropouts are also single parents, a double whammy that practically ensures poverty for themselves and their children.
The importance of at least a high school diploma for success in America also helps explain why Gotham’s higher-than-average immigration rate worsens the city’s poverty. New York has a far greater stream of foreign-born residents arriving each year, relative to its population, than does the United States as a whole. And 27 percent come without even a high school education. No surprise then, as the ACS shows, that 30 percent of all recent immigrants are poor (though less so than back home)—an average of about 23,000 new recruits to the ranks of the city’s poor every year.
New York City also seems to be a magnet for the poor from elsewhere in the U.S., perhaps because of the lavish housing and welfare benefits that it offers. About 14 percent of those who’ve crossed state lines to move to Gotham—domestic immigrants, the census calls them—are poor, too, an unusually high poverty rate for such immigrants. The result is that almost exactly half of New York City’s poor are born somewhere else—either overseas or in another state. The city, in other words, imports much of its poverty. Given these trends, it’s remarkable that the city’s poverty rate is stable, not soaring.
Sociologists will point out (at least in their candid moments) that most people can stay out of poverty in America by doing just a few simple things—most importantly, graduating from high school and not having kids without a spouse on hand. The latest census survey reinforces this basic wisdom. Sooner or later, the press will get it.