A few weeks ago, in "Financial Insecurity Ruins Our Lives: Let's Change the Game," I discussed poverty's association with failed relationships, poor health, and mental illness. Poverty exacerbates those. Fiscally "liberal" policies that reduce poverty are good, as are charitable institutions. But they don't strike too deeply at the roots of the problem, they are inevitably fleeting, and they don't challenge or change our assumptions about capitalism or homo economicus. This makes both fiscal liberalism and philanthropy somewhat Sisyphean, condemned to an never-ending uphill struggle with fiscal conservatism against a backdrop of assumptions that this is the way it's supposed to be: a pendulum swinging back and forth between austerity and generosity.
We are surrounded by demoralizing ugliness concerning poverty and inequality. States like Kansas, Missouri, and Wisconsin are passing laws forbidding welfare recipients from eating certain foods and limiting their electronic cash withdrawals (resulting in higher withdrawal fees). The ugliness now includes a reality TV show on CBS, "The Briefcase," which features financially insecure families being forced to choose between keeping a gift of money for themselves or sharing it with others. The "contestants" include an Iraq war veteran with an amputated leg, a man whose small business is failing, and a pregnant woman with a night job. Somewhere, there might be a television show more disgusting than this, but I don't know where it would be.
These demonize-the-poor policies are unsound--they don't even pass a cursory soundness test. We can learn a lot more about what motivates and drives them from placing them alongside "The Briefcase" than we can sifting through their rationale. Like the motivation behind the TV show, they reflect a pathological lack of empathy. But there's more: visceral rage. Our poverty makes everyone feel insecure. If you identify with the privileged class, poverty makes you feel insecure about your worldview as well as your material conditions. When other people make us feel insecure, we want to contain, demoralize, and discipline them. Attributing poverty to moral failure is an easy way to do that, because there are so many cultural reinforcements for that explanation.
But as the enthusiasm behind Bernie Sanders' campaign suggests, Americans are growing increasingly tired of that narrative. Greta Christina's Raw Story piece, "Here are 7 things people who say they’re ‘fiscally conservative but socially liberal’ don’t understand," has been one of the most validated and widely shared articles I've seen in months, generating over 403,000 social media affirmations (aka "likes") and sparking dozens of conversations in my own social media circles alone--probably thousands more elsewhere.
The author argues that those who position themselves as progressive on identity politics but economically conservative do not understand the impact that fiscal conservatism has on the lives of the marginalized. Poverty is a social identity issue, the article correctly argues, because poverty exacerbates every other social challenge, makes life more expensive, and discourages (if not outright killing) our ability to participate in public engagement: "if you do manage to navigate it, it can deplete your ability to do much of anything else to improve your life — and if you can’t navigate it, that’s very likely going to tank your life."
Especially important is the article's attention to poverty in contexts of domestic abuse and workplace harassment. Poverty makes it harder to leave those destructive relationships. While it's fashionable to say domestic violence cuts across all socioeconomic lines, research has repeatedly confirmed that it does not do so equally. In fact, more economic security not only allows victims to more comfortably exit abusive relationships (the less controversial claim), but in fact, the more economic security a woman has (DV victims are mostly women), the less likely she is to experience domestic violence in the first place. After reviewing five comprehensive studies from 1998 to 2003, and fully mindful of the can of worms their conclusion might open, Claire Renzetti of the University of Dayton and Vivian Larkin of the Wisconsin Coalition Against Domestic Violence conclude:
Although it is certainly the case that middle class and affluent families do experience domestic violence, studies consistently indicate that as the financial status of a family increases, the likelihood of domestic violence decreases . . . as the ratio of household income to need goes up, the likelihood of DV goes down. Their findings confirm earlier analyses of data from the redesigned National Crime Victimization Survey, also derived from a large nationally representative sample, that showed DV rates five times greater in households with the lowest annual incomes compared with households with the highest annual incomes.
Moreover, they continue: "As the economy has worsened, then, many DV survivors have likely found that they cannot count on family and friends to help them in tangible ways because these individuals are experiencing greater financial distress themselves."
Greta Christina is also right about the disasterous effects of deregulation, overcriminalization, policing-as-proxy-taxation, and political disenfranchisement. I suspect that one reason for the article's widespread positive reaction is that it draws these connections--between economic insecurity and a host of bad policies--at a time when we desperately need to make such connections.
The conclusion is clear: Policies that provide economic stability to the greatest number of people decrease violence, hardship, and stress. Widespread prosperity does mean better relationships and happier lives. Economic security is emotional and physical security, and from such security emerges more progressive and inclusive attitudes toward gender, race, sexual orientation, and other identity categories. In fact, it's difficult to understand why anyone would conclude otherwise. The article's conclusions about fiscal policy and fiscal conservatism bring this home:
So what does this have to do with fiscal policy? Well, duh. Poverty is perpetuated or alleviated, worsened or improved, by fiscal policy. That’s not the only thing affecting poverty, but it’s one of the biggest things. To list just a few of the most obvious examples of very direct influence: Tax policy. Minimum wage. Funding of public schools and universities. Unionization rights. Banking and lending laws. Labor laws. Funding of public transportation. Public health care. Unemployment benefits. Disability benefits. Welfare policy. Public assistance that doesn’t penalize people for having savings. Child care. Having a functioning infrastructure, having economic policies that support labor, having a tax system that doesn’t steal from the poor to give to the rich, having a social safety net — a real safety net, not one that just barely keeps people from starving to death but one that actually lets people get on their feet and function — makes a difference. When these systems are working, and are working well, it’s easier for people to get out of poverty. When they’re not, it’s difficult to impossible.
Fiscal policy affects poverty. And in the United States, “fiscally conservative” means supporting fiscal policies that perpetuate poverty. “Fiscally conservative” means slashing support systems that help the poor, lowering taxes for the rich, cutting corners for big business, and screwing labor — policies that both worsen poverty and make it even more of an inescapable trap.
Of course, the fiscal conservatives the article attacks either believe (against empirical data, but they're not seeing all the data) that trickle-down economics does ameliorate suffering and does bring shared prosperity, or they simply believe that liberal, redistributive economic policies are a greater evil than the suffering caused by poverty and inequality. In either case, articles like Greta Christina's, as passionate and accurate as they are, are unlikely to change fiscal conservatives' minds. Direct experience, or even indirect experience with poverty has a far better chance of facilitating consciousness shift than polemical articles. Publicized narratives about the hardships of poverty, such as Voices of Poverty, will also help.
In the present political reality, fiscal "liberalism," redistributive policies, regulatory policies, are only going to be as successful as the political will to implement and enforce them, and that political will is always unstable. It depends (again, in the present reality) on two major parties whose regard for such policies ranges from contemptuous (GOP) to pragmatically, aloofly tentative (Democrats). That isn't a reason to abandon them, but it is a reason to actively build new economic structures that don't depend on the generosity of the haves or the inconsistent political courage and marginal majority of Democratic elected officials.
Fiscal liberalism is not economic democracy, although economic democracy will likely have several elements of fiscal liberalism. But economic democracy will achieve that egalitarianism in more sustainable and enduring ways: Public banks will give communities greater control of their wealth. Worker cooperatives will erase the divide between ownership and labor. Economic policies based on protection and self-management of the commons, food sovereignty and food localism, community land contributions, and basic income guarantees are also paradigm-shifters that give structural expression to our interdependence and promise widespread prosperity within natural limits, rather than the artificial limits of capitalism's imposed scarcity. Most of these endeavors can happen in communities that choose to implement them, while others will require mass movements and more large-scale policy changes. All are worth campaigning for because they will free us from the ever-shifting whims of big capital--the true cause of structural poverty.
That shift transcends the liberal-conservative dichotomy. Financial democracy--sustainable, transparent public finance, chiefly through public banking, is "conservative" in all the right ways. The Bank of North Dakota has endured decades of political conservatism in that state precisely because the BND helps North Dakota remain fiscally responsible. The lesson to draw is that local institutions and policies that keep all constituents secure will endure, provided they are insulated from potential sabotage by outside interests.
Sustainable economic institutions are vital--and fiscal liberalism alone is insufficient--in fighting poverty precisely because of the passion that drives Greta Christina's piece, and our disgust with demonize-the-poor laws and meanspirited reality TV shows. Incentivizing empathy and equality into civil society turns stakeholders into equal economic participants. Taking the creation of value out of the hands of private banks and turning it over to public and community institutions infuses finance with an ideal of public trust. It creates a "money commons" -- communities of sharing financial stakeholders. It's harder to demonize or ridicule the dependent in a world of shared interdependence.
Matt Stannard is a Policy Director at Commonomics USA and a Board Member of the Public Banking Institute
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