Nick Kristof Parachutes Back Into Appalachia and the Results Aren’t Pretty
|Tuesday, 25 February 2014 10:32|
In his Sunday column Nicholas Kristof returns to West Virginia and calls for an “integrated set of early interventions”, including family planning, home visitation programs, support for breastfeeding, lead-poisoning prevention, and screenings for hearing and visual impairments, and pre-K. So far so good, these are all worthy social programs that we should be investing much more in as a nation.
But Kristof goes astray when he argues that “American antipoverty efforts over the last half-century haven’t been more effective [because] they mostly treat symptoms, not causes” and, in an accompanying blog post, to say he’s frustrated the current inequality debate is “mostly about the minimum wage and unemployment benefits” which “to [his] thinking are useful but not the most cost-effective measures.”
The idea that labor standards and social insurance “treat symptoms, not causes” is a very strange one. In fact, increasing our very low minimum wage would help address one of the fundamental causes of high poverty in the United States: employers’ failure to fairly compensate workers despite rising productivity. As economist Hillary Hoynes and her colleagues have found, “the lack of improvement in poverty rates despite rising living conditions is due to the stagnant growth in median wages and increasing inequality.”
This is one of the reasons why increasing our very low minimum wage rightly looms so large in current debates (as should related issues like full employment and increasing workers’ bargaining power). Moreover, while I don’t think there is much sense in comparing the cost-effectiveness of labor market standards like the minimum wage with those of social programs like home visiting, the immediate cost-effectiveness of an increase in the minimum wage is quite evident and direct since it would reduce public expenditures that currently go to subsidize employers who provide inadequate compensation.
As in previous articles where he parachuted into deepest Appalachia to cover domestic poverty issues, Kristof continues to pit social insurance and improved labor standards against early childhood programs. This is a false dichotomy. The United States doesn’t have an unusually high child poverty rate because it raised the minimum wage too much and invested too much in social insurance, while underfunding early childhood programs over the last 50 years. It has an unusually high child poverty rate because, among other things, it didn’t raise the minimum wage enough, underinvested in social insurance, and underfunded early childhood programs, while providing massive tax benefits to the wealthy and structuring the market in ways that send money upward.
West Virginia, the state Kristof chose to highlight in his column, provides a perfect example here. According to the West Virginia Center on Budget and Policy, corporate tax cuts enacted in recent years will cost the state $205 million in fiscal year 2015 along. This is big money in a small state like West Virginia, where it amounts to about 4.5 percent of state revenues. As WVCBP has shown, it’s nearly enough, for example, to make in-state tuition free at all 4-year and 2-year colleges in West Virginia. Similarly, it would have taken only $25 million to provide a universal home visiting program in West Virginia.
But instead of expanding programs like this, West Virginia’s Governor is now proposing to cut them to close a budget deficit caused by previous tax cuts. Many of the programs Kristof says he favors are on the cutting block. Home visiting, for example, would be cut by 25 percent, under the Governor’s budget.
Of course, you wouldn’t learn any of this from reading Kristof since it doesn’t fit his frame pitting social insurance against “child investments.” It would be great to see Kristof follow up with a column urging West Virginia policymakers to put kids before corporations, but I’m pretty sure he doesn’t have the spine to do it.
One could easily get the impression reading Kristof that the early interventions he mentions—family planning, home visitation programs, free at-home help for new moms who want to breast-feed, lead poisoning prevention, screenings for problems like hearing and visual impairment, and quality pre-K—are new ideas that have little to do with the “War on Poverty.” Nothing could be further from the truth. Here’s a basic review.
All of these programs are inadequately funded and merit greater public investments. But it’s just wrong to imply that these are new ideas that are fundamentally different from the ideas that animated the War on Poverty, or that an excessive focus on expanding the “safety net” over the last several decades has impeded their growth.