4 OPINION Page 4 Saturday, January 8, 1983 The Michigan Daily ., , Looking for ways to eliminate poverty 4 By Da n Aronoff Indignation and alarm over poverty and suf- fering is one thing; constructive criticism of current policies and intelligent proposals for change are quite another. Unfortunately, in these troubled times we hear much of the fMr- mer, but almost nothing of the latter. Everybody is upset and concerned about poverty, lbut many people seem intent on fin- ding someone to blame, rather than looking for solutions. The general existence of sin among human beings virtually ensures that instances of bad behavior can be found in abundance, but the real question is: to what extent is that behavior responsible for the desperate economic plight of millions in our country today? Blaming scapegoats may soothe the consciences of middle and upper-class people who are on "guilt trips," but it won't accomplish anything toward- putting food in hungry mouths, or providing jobs and livable housing for those in need. The Facts There is more than enough money currently being spent on anti-poverty programs to lift every man, woman, and child in America far above the poverty level income. For example, in 1976 the government spent $33 billion on anti- poverty programs, when it only cost $11.4 billion to lift every person out of poverty. Yet there were 5 million people below the poverty line that year. When we add all forms of government spen- ding on social welfare programs of the federal, state and local levels, the total amount equaled approximately $250 billion last year. If all of that money had been distributed directly to the poor, then every person could have become a relatively wealthy person. For instance, a family of four whose pre-transfer income was below the officially defined poverty level would have received between $55,000 and $57,000 in cash. So the problem is not that not enough money is being spent to fight poverty-the problem is that too little of the money actually reaches the poor. The government could cut spending on anti-poverty programs by two-thirds and there would still be enough left to eliminate poverty Total social spending could be slashed by some enormous proportion and we could eliminate poverty. Conversely, under existing conditions, if we increased social welfare spending by some enormous amount, it is quite likely that very little would seep thorugh the bureaucracy and reach the poor. The Problem The reason that we have not completely eliminated poverty in this country is because our government spends a very low percentage of its revenues in actual transfers to the poor. Why does this occur? The answer, no doubt, is very complex and certainly beyond the scope of a single article. But a few things should be pointed out that are part of the problem. For one thing, many people benefit from the perpetuation of poverty: their incentives are such that they are better off when many people are impoverished and lots of money is being spent to fight poverty. Such people are bureaucrats, social reformers, research in- stitutes which receive government grants to study poverty, business and individuals who are recipients of government boondogle con- tracts, etc. These people, who collectively may be referred to as "The Poverty Industry," represent a substantial middle-class and politically left-leaning constituency. No wonder liberals love social programs; if the gover- nment just gave money directly to the poor, many empires would crumble. Conservatives, however, have not offered a very attractive alternative. The Reagan ad- ministration has made many of its cuts in the most cruel places of all-where money is ac- tually reaching the poor. Although the ad- ministration correctly has pointed out that, theoretically, there is enough money actually reaching poor people in aggregate to protect them from want of food, shelter or medical care, many individuals and families fall through the "safety net" for various reasons. Most of the reasons have to do with the irrational crazy-quilt pattern of government programs, which are uncoordinated and have different criteria for qualification to par- ticipate. The Solution The solution to these problems is analytically obvious, although it may be politically unrealistic. If we replaced the existing welfare system with a direct negative income tax, we could structurally eliminate poverty in this country virtually overnight. Moreover, such a system would offer many other attractive features. By abolishing all social programs and replacing them with direct cash subsidies- which recipients could make their own choice on how to use-the liberty of the recipients would be enhanced. If we eliminated transfers to the middle-class (which are paid mostly out of taxes from other middle-class people), we could reduce government spending, balance the budget, and cut taxes easily. Indeed, the ultimately incompatible goals of freedom and egalitarianism would both be enhanced by the abolition of the welfare state as we know it and the adoption of a negative in- come tax. Real transfers to the poor would in- crease, while government intrusion into our lives would be reduced. Most importantly, we could then adopt policies to ensure the economic recovery that must occur if we are to reduce unemployment' and return to prosperity. Lower government spending, less intervention in the marketplace, and lower taxation are the only policies that will restore health and scope to the free-market economy. And it is only in a healthy market economy that growth and progress has ever# taken place-here or anywhere else in the world. Perhaps this is idle speculation; certainly it is not currently a practical political possibility., But if the intellectual foundations of the welfare state and its surrounding ideology can be undermined, then we may be able to make significant advances in this direction. Aronoff, an LSA junior, studying at the London Economics. currently is School of>: Edited and managed by students at The University of Michigan Wasserman WHAT PRE j COrlSMiTUEN Vol. XCI#I, No. 80 420 Maynard St. Ann Arbor, MI 48109 SI YZ 111111 wKI Mt? RbW C Editorials represent a majority opinion of the Daily's Editorial Board - I Reagan'sn HIS IS the time of the year for that most hair-raising of events-the semi-annual arrival of the report card. But as we cringe over disappointing performances this week, we can take some comf6rt. Of late, even the president's been getting some pretty bad grades himself. But unlike the typical student, when it comes to higher education, the president's poor marks are something to cheer about. As the Chronicle of Higher Education pointed out this month in its look back at the president's midterm performance, Reagan has received a number of failing grades while attempting to im- plement his broad program of educational cutbacks-good news for those interested in preserving the status of higher education in America. In several areas, Reagan's farflung plans have come to naught. Although the president proposed cutting the Pell Grant budget by more than 40 percent, little in the budget has changed since 1980. He also hoped to abolish even- tually the Department of Education, a plan that has seemingly made no headway. With other educational programs, Reagan's drastic proposals have led to only relatively minor cutbacks. The proposed 50 percent reduction in fun- ding for the National Endowment for the Arts and Humanities, for example, has resulted in roughly a 14 percent budget decrease. --- i-i; L-CONOIG1C TUKI1tON-$ FAM*E WrNNoI~o Mc*E". ~ R" 11611A 4 . . report card At times the president proved to be all too efficient. His plan to do away with Social Security student benefits by 1984 has been only slightly sidetracked. The program will end in 1985. Why has Reagan been only partially successful in his efforts to eliminate the federal role in higher education? Much of the credit-and the blame- for the current state of federal support rests with Congress. After going along comfortably with the first-and most devastating-round of budget cuts, the representatives have largely reversed themselves and become ardent sup- porters of educational programs. The change of heart, to be sure, coincided with a strong show of protest from students and educators, but so far it has stuck. It's anyone's guess whether Reagan plans to renew his attacks on higher education. He will have his hands full in coming months using what political capital he has left to defend his arms build-up and his economic policies. It's only certain that there will be no sud- den conversions. Reagan-so obsessed with the goal of a "strong" America- will continue to work against one of its greatest strengths: a sound system of higher education. No matter what the president hopes to do in his next two years in office, students across the country can only wish him one thing. Keep up the poor work. 'I 4 1 rr Ko~c-o'~qGTo FIND t~dG. NEIGHORHOOoDS DYING? WELL, A~T LBEAST 1NIy VE ABUO'T Zlh OCIA1L W59*$ l .vC to 0 4 v,,,. - P.N I k ' - I I As a liberal and a child of the Enlightenment, one who had hated the Middle Ages since he was 5, and as a professor of religion, Peter Wilson was not only shocked by what happened to his son, he was frightened. It shook the very foundations of his own beliefs. Mark, his eldest, had in his last year at Yale suddenlyturned to faith, becoming one of the growing numbers of studen- ts-some of the best and the brightest, often from educated backgrounds-to join a charismatic fundamentalist Christian church and make it the focal point of his existence. THE CHURCH, which prac- ticed faith-healing and exor- cisms, is a church of no par- ticular denomination, but "the only church there is" to his son. Mark had changed drastically because of it. He had abandoned thoughts of going to medical school, adopted standards of per- sonal morality that had disap- peared generations ago-no drugs, no smoking, no sex before marriage. He spent much time in prayer and study of the Bible-. of a kind that to his father, who had studied the book most of his life, constituted "idolatry of the printed word." In an effort to reach his son, the elder Wilson (not his real name) began to attend the church in a rented former synagogue about 30 miles from the Yale campus. He bought tapes of the pastor's sermons and witnessed healings. And now he was frightened. What he had sen raised for A fat her's struggle with fundamental Christian ity By Rasa Gustaitis were what their parents' generation had banished.x The battle between them, Wilson decided, would have to be fought on theological ground, in a context of love. As he perceived it, his son's church made a 'quilting party of the Bible,"a taking words out of their' historical context to piece. together an apocalyptic meaning,; with the Beast returning toward Bethlehem. So, when Mark asked for a Concordat for Christmas, Wilson gave it to him and wrote inside: -Y1OU HAVE studied the Bible' word for word. I hope you will also study it paragraph by: paragraph." Then he found a task on which he and his son could work jointly while continuing their spiritual struggle. The family's summer cabin was endangered by recent deepening of a nearby river to: permit entry of larger ships. The, passing craft made waves that washed ashore, eroding the land. and threatening to wash away they cherished family retreat. CONTRACTORS turned down, the job of shoring up the land as hopeless because of soil con- ditions. So Wilson, with his son, and a companion of Mark's from' the church, resolved to build a' wall to keep out the river. As they worked on this deman- ding-perhaps impossible-task, they could talk. At this point, the wall still is un- 4 and feeling them slip from his grasp. In his son's church he wit- nessed things he could not dismiss as mere mental manifestations. There was the 30- year-old man who had been homosexual all his life, standing up before the congregation and telling how he had been "cured." He was now a heterosexual. Wilson could see and hear that. He was not just under an illusion. The change was real. And there was the 11-year-old child who had been rejected by her parents and was angry and unmanageable, who was tran- sformed as the'demons of rejec- tionns were astnent-sval of r of his church members for con- scientious investing. .His son had been raised in an interdenominational -church and in a home where the life of the mind was valued. He'd been a good student, and when Mark showed an interest in medicine his mother was pleased; it was what she had hoped. Then he became involved with this unlikely church-started by a retired insurance man-which already. had become central in the lives of some of his fellow students. One friend and classmate-brilliant in economics-had even declined a $7,000 fellowship from a graduate schoo1Qsohe ncold stav nn in New