Young, Poor, and Desperate
The poverty crisis is devastating young Americans. Here's what the
president can do about it.
By Eliot Spitzer
AMERICA EXCELS IN dramatic crises: When a bank goes bust, when a
tornado strikes, there's no country in the world that rises to the
occasion better. But we don't do so well with the accretive and
perhaps more widely destructive social shifts that creep up on us,
which is why the realization that we have a full-fledged poverty
crisis is so troubling.
Publication of the Census Bureau's 2010 annual report on income—as dry
a data set as there could be—reveal a shocking rise in poverty.
Median family income fell 2.3 percent between 2009 and 2010—to
$49,445—but more significantly, is down 7.1 percent from its peak in
1999. The percentage of the population in poverty—15.1 percent—is the
highest since 1993, and the total number—46.2 million—is an all-time
high. We have given back a generation of economic progress.
But it gets much worse. Below this topline data is evidence of a more
insidious picture of poverty and joblessness among the young and among
African-Americans. Income for households headed by someone under 24
fell an astounding 15.3 percent between 2007 and 2010. The poverty
rate among those under 18 is 22 percent. For those 18 to 24 it is 21.9
percent, and for blacks under the age of 18 it is a staggering 39.1
But this should be no surprise, since declines in income follow
increases in joblessness, and the burden of the jobs crisis has fallen
hardest on the young and African-Americans. The stated unemployment
rate for whites aged 16 to 19 is 23 percent, and for blacks of that
age it is a staggering 46.5 percent. (And recall, the formal
unemployment rate is a significant undercount.) In the past year—which
was supposedly a period of recovery, however painful and spasmodic—the
number of those ages 16 to 19 who were working dropped by more than
500,000; the number of those counted as not even being in the work
force increased by 600,000.
These numbers portray an unraveling of the social safety net. The
convergence of multiple polices—reduced taxation of the wealthy at all
levels of government and greater dependence on taxes that fall on the
poor (sales and payroll taxes, in particular)—has weakened government
programs that help the poor and the young.
We have also had a full-fledged intergenerational transfer of wealth
going on in our nation. The programs that consume the greatest
percentage of our federal budget benefit seniors—Medicare and Social
Security in particular—and have been rather well protected by
politicians. The investments that benefit the younger
generation—education, housing, and job training for instance—fall by
and large into the non-defense discretionary spending part of the
budget that has been subject to the most cuts.
We are facing a moral dilemma. We have actually done a reasonably
effective job preserving the income of seniors. Medicare and Social
Security have worked, future financing issues notwithstanding. But we
are failing abysmally in investing in the next generation. How can we
do both in a financially viable manner?
If we resolve the current fiscal crisis by cutting more deeply the
investments we need to make in the young, we will be making a grave
error. This makes it more urgent that the administration do something
dramatic on the jobs front. What has been proposed—primarily a payroll
tax cut–isn't enough. It is time for the president to channel Franklin
Roosevelt, to create modern versions of the CCC and WPA for those
under 25—not an entitlement program, a work program. The economy, our
social fabric, and the president's political viability depend upon it.