Chapter Two:
Five Reasons To Establish Economic Security

Establishing economic security will transform society. It will not only directly benefit the poor, the near-poor, and friends and relatives who share the burdens of both groups. It will also lay the foundation for a positive reconstruction of the entire social landscape. One way or the other, economic security will benefit everyone.

A. Improve the Quality of Life for All

Most Americans are deeply dissatisfied with the current state of affairs. A 1994 study found that 71 percent of Americans were "dissatisfied with the way things are going in the United States these days." In early 1995, a Times Mirror Center for the People and the Press poll found that six in felt the country was losing ground on its most serious problems. In late 1995, 73 percent reported being "dissatisfied with the way things are going in this country today."

When asked to identify the biggest problem facing the country, poll respondents most frequently mention economic issues. In August, 1995, for example, 37 percent named one of the following as the country's most serious problem: "economy," "unemployment or jobs," "health care or insurance," "homelessness," and "welfare." Only 12 percent cited "crime or violence."

The National Opinion Research Center at the University of Chicago found that 67 percent of the American people in 1995 believed that the "lot of the average man is getting worse." An astounding 38 percent believed that it was "not fair to bring a child into the world." The percentage who "totally" agreed that "young people can no longer take for granted that they will be able to live better than their parents" increased from 78 percent in 1991 to 86 percent in 1994.

A 1993 survey reported that:

84 percent of all Americans believed that it was too difficult for most people to provide for their families;

71 percent considered the average American's chances of finding a satisfying job poor;

61 percent were concerned about inadequate public safety;

almost half expressed dissatisfaction with education and health care.

According to the same survey, most Americans believed that the quality of life had gotten worse over the previous five years and most were pessimistic about the future. A majority expected conditions to improve in none of the five areas studied and a majority believed safety and living standards will worsen.

As demonstrated by the Fordham Institute's Index of Social Well-Being, these subjective evaluations reflect reality. This index, based on data on 16 social problems affecting various age groups, measures the quality of life and monitors it over time. On a scale of zero to one hundred, this index held steady at an average of about 73 from 1970 to 1976, when it started a dramatic and steady decline, falling to 41 in 1982. During the rest of the 1980s, the index leveled off in the low 40s. Its composite ranking then sank to 38 in 1991, increased to 43 in 1992, dropped to 41 in 1993 and 37.5 in 1994 (a record low), and increased to 40 in 1995, the last year for which complete data are available.

Economic conditions and personal attitudes are inter-related. With most people, personal hardship leads to a more negative view of the world. At the same time, widespread poverty and unemployment produce a variety of social problems, such as increased violent crime - problems that lead most people to pessimism about the state of the world. For these reasons, it is not surprising to see an increase in negativity as living standards for most Americans have declined and poverty has increased over the last 20 years. Guaranteeing economic security will dramatically improve both living conditions and feelings about the quality of life.

B. Reduce Economic Anxieties

Among those who are not poor, economic security will diminish the fear of falling into poverty. One poll taker commented following a 1992 survey of public attitudes, "There seems to be a deep-seated, underlying thing in the pits of people's stomachs. People feel they can no longer take the future for granted." Although economic anxieties had diminished somewhat by 1997 after several recession-free years, Americans continued to be worried about their economic situation.

A survey conducted by the Pew Research Center for the People and the Press found that in March 1996, 47 percent of workers were "very concerned" about losing their job or taking a cut in pay, almost twice the number two years earlier. In May, 1997 that number had declined to 30 percent, but another 15 percent were "concerned." This 45 percent who were concerned or very concerned about their future was considerably greater than the 34 percent who were similarly concerned in 1988 following five years without a recession. Thus, at a similar point in the traditional economic cycle, Americans were much more anxious in 1997 than they were in 1988.

The more things change, however, the more they stay the same. The mainstream media often highlights relatively minor changes, exaggerates the importance of these minor changes, and neglects ongoing chronic problems. In terms of economic insecurity, anxiety has long been horribly widespread. In many ways, it is not significantly worse now than during similar periods in the past. Left Business Observer reports, for example, that 39 percent of workers feel that it would be "not easy" to find another job at a similar rate of pay -- virtually the same number that expressed the same worry during the two most recent post-recession peaks. Moreover, the percentage of people who fear the loss of their job within the next year is about the same now as during those previous periods of recession-free growth. At the same time, however, though workers today resemble earlier workers on these two measures (fear of job loss and ability to find similar work), it seems that many are more anxious about other aspects of their economic situation.

The 1997 Pew survey also found that 70 percent were concerned about being unable to afford necessary health-care when a family member gets sick, 68 percent were concerned about not having enough money for retirement, and 65 percent were concerned about their children not having good job opportunities.

In February, 1994, the New York Times Poll found that 40 percent of those employed expressed "worry that during the next two years they might be laid off, have to work reduced hours, or take a cut in pay." Almost one in four workers reported having suffered layoffs, reduced hours or pay cuts in the previous two years. The New York Times summarized this survey as follows: "Americans'... sense of insecurity about their own jobs is substantial and pervasive, with anxiety spread across all geographic regions and through all occupational levels."

Dennis Farney, staff reporter for The Wall Street Journal summed up the situation in December, 1994 as follows:

With real incomes falling, with their jobs in jeopardy, ordinary people actually feel what scholars only talk about: The ground is shifting beneath their feet; the old promises, the old assumptions, aren't working any more.
In late 1995:
· affording health care - from 50 to 66 percent;

· children's job opportunities - from 51 to 57 percent;

· money for retirement - from 42 to 48 percent;

· money for college - from 37 to 44 percent;

· can't afford to buy or keep home - from 31to 38 percent;

· losing job/cut in pay; from 28 to 34 percent;

· lack of adequate child care - from 21 to 30 percent.

In early 1996, according to The New York Times columnist Bob Herbert, the Marist Institute of Public Opinion found that "one-third of all American workers are worried that some in their household will lose a job in the next year." In addition, "more than 100 million Americans are worried that their total family income is not enough to meet expenses."

On Labor Day, 1996, the Field Institute released the results of a comprehensive survey of Californians' attitudes toward work. They found that even though the official unemployment rate had fallen to 7.1 percent, one-third of Californian workers still felt economically insecure. Almost half complained about a serious job-related problem, including no medical insurance, no opportunity for advancement, and having a household income below 125 percent of the official poverty level.

In the 1994 New York Times Poll just cited, almost one in four workers reported having suffered layoffs, reduced hours or pay cuts in the previous two years. In 1996, the Bureau of Labor Statistics (BLS) reported that over the three-year-period from 1993 to 1995, more than 7 percent of all workers lost their job involuntarily. Despite a relatively strong economy, as many workers lost their jobs during those three years as did so from 1991 to 1993, which included the 1991 recession. By way of contrast, during a similar period of post-recession recovery in the early 1980s, only 6 percent of workers were laid off permanently.

Most job losers, if re-hired, earn less in their new job than they did in their old job. As of January, 1996, in the BLS study just referred to, only 33 percent of the workers who lost their jobs in 1993 or 1994 had found a new job that paid as much or more than their old job. The more than twelve million white-collar workers who lost their jobs between 1988 and 1991, and found new jobs, earned 30 percent less than they did at their old job. Those with more than twenty-one years at the same workplace did even worse: they earned 44 percent less.

In 1994, for the first time in the country's history, there were more unemployed white-collar workers than blue-collar workers. The development of high-speed, computerized communications systems has enabled many corporations to move high-skill jobs overseas, where they pay lower wages.

During the twelve months that ended March, 1995, inflation-adjusted wages fell 2.3 percent, the worst drop in the eight years the Bureau of Labor Statistics has compiled those statistics. Bradford DeLong, economic historian and former Treasury department analyst, commented that this decline might be the largest since the 1840s, when power looms were introduced into the garment industry.

The average hourly wage of nonsupervisory workers continues to stagnate. In 1982 dollars, the 1996 average wage was $7.43 compared to $7.39 in 1995. By August 1997, it had creeped up to $7.49 -- much below its recent peak of $7.81 in 1986 and far below its 1973 record high of $8.55.

About one in four workers now hold temporary or part-time jobs. According to The New York Times, in 1996, (the number of workers) farmed out by temporary help agencies totaled 2.2 million, up fivehold from 417,000 in 1982. Time in a cover story titled, "The Temping of America," commented:

America has entered the age of the contingent or temporary worker, of the consultant and subcontractor, of the just-in-time work force - fluid, flexible, disposable. This is the future. Its message is this: You are on your own. For good (sometimes) and ill (often), the workers of the future will constantly have to sell their skills, invent new relationships with employers who must, themselves, change and adapt constantly in order to survive in a ruthless global market. This is the new metaphysics of work. Companies are portable, workers are throwaway.
The middle-class is anxious for good reason. Most are only a paycheck or two away from the threat of destitution. Many periodically fall into poverty. Wages in general fluctuate more from month-to-month than they did ten or twenty years ago. In 1984, 49.5 percent of all workers had their incomes change by 5 percent or more in a four-month period; by 1994, that percentage had increased to 53.9 percent. Most Americans own only their home and car and have no net financial assets, leaving them no buffer in case of job loss.

Higher interest rates, real estate appreciation,and falling wages have made home ownership increasingly burdensome; the percentage of a young family's income needed for the principal, interest and taxes on a new home grew from 15 percent in the 1960s to more than 30 percent in 1995. In addition, the cost of providing one's children with the level of education they need is increasing as ever-more education is required to be secure financially.

In early 1994, despite a prolonged period of overall economic growth, working-age middle-class families were spending 23 percent of their income on payment of debts, compared to 18 percent in the 1960s and 1970s. In the two years from the end of 1993 to the end of 1995, consumer credit-card debt increased by 47 percent to more than $3,000 per household, as credit-card delinquencies and personal bankruptcies surged dramatically.

These families don't even have enough cash in the bank to cover current bills. Only 20 percent of all families have a real-estate investment other than their principal residence; only 10 percent have a business investment; and only 20 percent own any other assets, such as stocks and bonds. A New York Times/CBS Poll in early 1995 found that almost half of all households said "they will have trouble if they had to pay a $1,000 bill right away."

Having so little to fall back on in case of hardship leaves many Americans uneasy about the future. This discomfort is aggravated by the fact that the number of workers covered by health insurance and private retirement plans is declining. From 1979 to 1989, the percentage of private-sector employees with company pensions fell from 50 percent to 43 percent, while company-provided health-insurance coverage dropped from 69 to 61 percent of the workforce. The steady decline in private pension plans will leave increasing numbers of seniors living in poverty as the large baby-boom generation ages.

In early 1995, The New York Times reported:

Three out of four working Americans expect people their age to face a financial crisis when they retire.... Over half say they have not begun to save for retirement. And many see themselves reaching old age without the company-paid pensions and Social Security that allowed their parents to live so comfortably.
These uncertainties erode the quality of life in countless ways. Establishing economic security for all will alleviate these problems. Americans will know that they can always find a living-wage job and will have greater confidence that they will be able to receive an adequate retirement income. Less anxious, more people will be better able to focus on more satisfying activities.

C. Improve Public Safety

Most Americans are understandably worried about public safety. Each year, some 30 percent of all households are victimized by at least one crime. In addition, a sense of security is often compromised when pedestrians on city streets are routinely confronted with panhandlers. Although most beggars are not aggressive, enough of them are to lead passersby to worry about whether the next one will be.

Throughout the country, business interests and members of the general public are pressuring the police to hassle panhandlers and homeless persons to persuade them to go elsewhere. Although these efforts are expensive and divert the police from other activities, they are popular with the general population.

In San Francisco, the liberal columnist Herb Caen, after initial opposition, eventually praised an anti-homeless program known as "Matrix" by commenting:

Let me also say again that Frank Jordan's Matrix program seems to be working. Cleaning up the streets, unsightly people and all, is bringing back a lot of auslanders [tourists and other visitors] who had been shunning us like the plague. Typical of the approving letters is this from Marjorie Evans of Los Altos: 'A journey to the city has become a pleasure again, rather than a trip into sadness and regret.'
At the same time, the nationwide movement to lock up more criminals for longer periods of time continues unabated. In 1985, one of every 320 people were locked up in a jail or prison. By 1995, that number was one of every 167 Americans -- a 113 percent increase. Russia is the only other industrialized country that comes close to incarcerating so many of its citizens.

Hiring more police and building more prisons is not the most effective way to prevent street crime, however. Partly because prisons serve as schools where inmates learn how to commit crimes, relying primarily on confinement actually produces more crime. As Labor Secretary Reich has argued, "The best policy to prevent crime is a job." The historical record supports this claim.

Comparing crime statistics is tricky. Over time, police departments change their methods of collecting statistics and the general public changes its crime-reporting patterns. But homicide and suicide rates are relatively reliable. These numbers clearly illustrate the link between poverty and crime.

After the turn of the century, the first major boost in unemployment in 1904-5 was followed by a major increase in homicide and suicide rates in 1905-6. These rates stabilized following an improvement in the economy in 1906-7. But they increased steadily as the economy worsened from 1908-15. In 1914 and 1915, unemployment, homicide, and suicide were each at record-high levels for the new century.

World War I produced a significantly improved economy, with relatively low unemployment rates from 1916 to 1920. Suicide rates correspondingly fell dramatically. But apparently the improved economy only slowed down the increase in homicide rates associated with increasing urbanization. Homicide rates increased every year from 1904 to 1922, but during the years immediately following an improvement in the economy, the increase was noticeably less.

From 1920 to 1961, homicide and suicide rates:

· worsened when the economy took a nose dive during the first two years of the 1920s;

· stabilized over the next seven years during a relatively strong economy;

· jumped to record-high levels following the stock market crash of October, 1929 and the Great Depression;

· subsided dramatically with a substantial improvement in the economy during the 1930s;

· fell even further to record lows in 1944 when unemployment dropped below 2 percent for three consecutive years;

· stabilized during the post-War economic boom that produced the most sustained economic growth in the country's history.

In 1961, however, the "baby-boom generation" began to mature. This phenomenon has confused crime statistics ever since. From 1961 to 1974, even though the unemployment rate held rather steady and even fell below 4 percent in the late 1960s, the homicide rate doubled and the suicide rate rose slightly. The fact that baby boomers came of age during this period is a major reason for these increases. People under the age of 30 commit about three-fourths of all crimes. Beginning in 1961, the percentage of the population between the ages of 15 and 29 began a steady increase to its record high in 1976.

A 25 percent increase in the proportion of young adults cannot fully account for a 100 percent increase in the homicide rate, however. It is probably necessary to analyze the political turmoil of this period to pin down the other reasons for this increase in homicide. During the late 1960s and early 1970s, this country was experiencing a series of traumatic conflicts, including:

· The brink of nuclear war with the Cuban Missile Crisis.

· The explosion of the civil rights movement.

· The assassinations of President John F. Kennedy, Robert Kennedy, Martin Luther King and Malcom X.

· Numerous riots in urban ghettos, widespread anger concerning frequent police brutality, the rise of the Black Panther Party, and a series of armed confrontations with police.

· Massive, sustained internal opposition to the War in Vietnam.

· Chaos at the 1968 Democratic National Convention, repeated prison rebellions, and a "counter culture" that called for "revolution."

· A President of the United States forced out of office by the threat of impeachment for having committed high crimes and misdemeanors.

As a result of this turbulence, this country saw a greater increase in homicide and suicide than would have been the case simply due to the aging of the baby boom.

From 1974 to 1994, as the children of the baby boom became adults, unemployment stabilized at around 7 percent and homicide and suicide rates remained fairly steady at about 9 percent. The economy deteriorated somewhat during this period, while the proportion of young adults in the total population declined slightly as well. These two factors apparently counter-balanced each other, resulting in steady homicide and suicide rates. As economic conditions faced by young people worsened considerably in the mid-1990s, however, youth homicide rates increased.

Altogether, this historical review strongly suggests that major increases and decreases in unemployment create strong pressures toward corresponding increases and decreases in homicide and suicide. Homicide rates from 1925 to 1961 provide the clearest evidence. After holding steady from 1925 to 1929, the homicide rate increased by almost 20 percent during the Depression, and then dropped by 50 percent as the economy improved over the next three decades.

The only exception to this pattern since 1900 is the period from 1961 to 1974, which can be explained in large part by the emergence of the baby boomers and in part by the unusual turmoil of the period. This history suggests that another major improvement in the economy could cut the homicide rate in half, as did post-1933 economic growth. Surely efforts to drive the poor "out of sight, out of mind" will never reduce violent crime as much as full employment did during World War II.

A similar pattern is reflected in the FBI's report on "serious crime" rates from 1968 to 1993. During each of the four economic recessions during this period, the crime rate peaked. But as the economy emerged from each of these recessions and the unemployment rate fell, so did the crime rate.

Establishing economic security thus will reduce violent crime, but it probably will not reduce overall crime. Poor people are not more likely to engage in crime than are middle-class and upper-class people. The well-to-do steal far more from the American people with tax evasion, fraud, embezzlement and other forms of white-collar crime than do the poor with their strong-arm robberies, purse snatchings and burglaries. One survey by a George Washington University professor concluded that two-thirds of the Fortune 500 companies had committed one or more "significant illegalities" over a 10-year period. Accusing the poor of being more prone to crime than are others not only unfairly denigrates the poor. It also lets the non-poor off the hook - especially the wealthy who commit the most costly crimes.

Poverty does not cause crime, but that it does cause violent crime. Violence is born of despair and rage fostered by limited economic opportunities. These "inner riots" lead to escalating arguments between angry, frustrated individuals struggling to cope with unbearable living conditions. Some poor people fight quickly over anything because they figure they can't afford to lose what little they have. Others fight because they feel they have nothing to lose. Either way, poverty and anger go together like hand and glove. Because these crimes (and outbursts of hostility) often occur in public, they affect the quality of life of everyone who uses public spaces. They undermine a sense of order. Establishing economic security will lead to a decline in these problems and free up public revenues to deal with other issues.

The risk of devastating urban riots exploding suddenly at the slightest provocation will also be greatly diminished. When riots erupt, as they did in Los Angeles following the Rodney King verdict, public officials and other public-opinion shapers speak eloquently and at great length concerning the tragedy of poverty. They express sympathy for the hardship imposed by lack of economic opportunity and understanding for how deep resentments naturally result from economic injustice. Without fail, a broad consensus that something must be done is articulated. Strong promises are made to correct the conditions that leave so many neighborhoods simmering with rage and alienation. Following the Los Angeles riot, even Republican President George Bush suddenly began advocating federal aid to our nation's central cities. But most often, the promises are not kept. In South Central Los Angeles, for example, where the Rodney King riot was most severe, conditions in 1995 remained basically unchanged.

Establishing economic security will address these forsaken promises and greatly reduce the chances of additional rioting in central cities - rioting that in the future may spread to outlying suburbs as the Rodney King rebellion threatened to do, prompting large numbers of whites to go on a gun-buying spree. In July 1995, for example, following the shooting death of a black teenager by a white police office, poor blacks in the culturally diverse Miami neighborhood of Coconut Grove injured more affluent white motorists on their way home in the same neighborhood. As The New York Times reported, "Neighbors say there is frustration ... because of the economic disparity with the thriving Coconut Grove of expensive homes, outdoor cafes and tourist shops just blocks away."

Although the threat of urban riots is not a part of daily life for most Americans, awareness of the anger that is experienced by the underprivileged is common. The New York Times has referred to this widespread alienation as a "general social disaffection." Resentments rooted in economic oppression permeate the social atmosphere. "When a person can't count on a permanent job, a critical element binding him or her to society is lost," argues Lillian B. Rubin, describing a key source of much of the behavior that is labeled "anti-social." This simmering hostility leaves many Americans apprehensive about if and when they will be exposed to another outburst of anger, perhaps directed at themselves.

This defensiveness in turn aggravates already-existing tendencies toward mean-spiritedness among ordinary people. As Todd Gitlin has written:

In a thousand ways, the cultural infrastructure seems to be, little by little, coming apart along with the bridges, roads and sewers.... The prevailing mood leads to a general degradation of the streets, corruption and paralysis of the suites, and a riot of cynicism in a population rushing toward separate exits.... The general surliness even shows on the faces of models - men, women and children.
This hostility runs through the social fabric, interferes with a sense of peace, and contributes to an underlying lack of security. This uneasi-ness contributes to a general concern about "law and order" and enables certain politicians to promote their careers by advancing simplistic pseudo-solutions to a crime problem that these same politicians exaggerate to their own advantage.

Contrary to the image perpetrated by the mass media, violent crime in the United States is not getting worse. The most reliable measure of crime is the Justice Department's National Crime Victimization Survey, which has used the same methods to collect its data for decades. According to this survey, the number of violent crimes per 1,000 individuals has remained steady for 20 years. With regards to homicide, despite the publicity given to dramatic drug-related homicides and other dramatic incidents, the homicide rate as well has remained about steady since the early 1970s.

Nor is it true that ordinary citizens are particularly at risk of being the victim of a violent crime, though The New York Times in a front-page story recently referred to "out-of-control streets" as if this were an accurate description of urban America. The risk of being victimized by a workplace injury or car accident is far greater than the risk of being injured by a criminal. Moreover, since households with incomes under $7,500 are three times more likely to be victimized violently than are other households, the typical (better off) American is even less vulnerable than the averages indicate. Less than one in a hundred people are injured violently each year. Most assaults are perpetrated by a friend or family member, not a stranger on the street. Violent crime is certainly a serious problem that needs to be addressed. But it is easy to exaggerate the problem, especially the danger posed by strangers. And it is misleading to speak of an "increase in crime," as William Bennet claimed on the McNeil/Lehrer Newshour in March, 1994.

Distorting the crime problem does not contribute to positive solutions, but rather the opposite. The more Americans are afraid of being victimized by violent crime, the more inclined they will be to support short-term measures to protect themselves by locking up more criminals for longer periods of time. This process of persuading the American public that they are in greater danger than they actually are has been underway for more than 20 years now, ever since Richard Nixon rode the issue all the way to the White House. Aided and abetted by a competitive mass media that attracts advertisers' money by dramatizing the latest eye-catching crime, politicians are becoming adept at manipulating these fears for their own gain.

Consequently, the number of people imprisoned in this country is now about three times greater, adjusted for population, than in 1976, resulting in an incarceration rate in this country that is far and away the highest in the world. If attempting to prevent violent crime by locking up more people was effective, this massive boom in prison construction over the last 20 years should have led to a much lower violent crime rate, especially since the proportion of young adults in the total population has declined. But there has been no such reduction in violent crime.

Prisons do not prevent crime; they teach crime. Confine together people with a common tendency, and it is only natural that they will reinforce that tendency in one another and share ideas on how best to pursue it. The current fascination with "three strikes and you're out" will apparently perpetuate this wasteful, destructive trend toward higher rates of prolonged incarceration.

This distorted fear of crime has probably been worsened by other factors, including growing numbers of panhandlers and homeless people on public streets. Increasingly visible signs of disorder prompt an underlying sense of discomfort, including a general feeling that "things are getting out of control." Growing economic insecurity caused by declining wages, widespread corporate downsizing, and frequent plant closings aggravate this fundamental uneasiness.

Using the contemporary political mantra, "no justice, no peace," Congresswoman Maxine Waters may have been referring only to the threat of rioting when she declared, "Listen up, America. If there is no justice, there will be no peace." But being "at peace" involves more than absence of overt violence. People understandably desire a minimal degree of comfort in their lives that goes beyond not being violently victimized. Increasingly, this basic confidence in the future is slipping away, losing ground to an underlying "free floating anxiety" which is fertile ground for demands to maximize control by locking up the most visible criminals and throwing away the key.

Even if it were true that more jails would reduce street crime, it would still be both more humane and more effective to correct the social causes of street crime. Taken all the way to a totalitarian police state, the use of force can reduce crime. But it is doubtful that this option is really the solution preferred by the American people. Abolishing poverty will more effectively address the human need for order and will eliminate those conditions that lead to violent crime. The best way to address the issue of crime is to establish economic security for all.

D. Diminish Racism

By strengthening a sense of security in general, the abolition of poverty will also diminish racism, for racism is aggravated by economic hardship and personal anxiety. This connection between racism and the economy is illustrated by one finding reported in a poll conducted by The Washington Post, the Kaiser Family Foundation, and Harvard University. This poll reported that among those people experiencing the most eco-nomic distress, 57 percent said racial tensions were increasing, compared to only 39 percent among those who were worried least about their economic condition.

The same survey found other signs of persistent racism among many whites. Most whites, for example, believe that the average black is doing as well economically as the average white, though in fact whites earn 60 percent more than whites. And only 38 percent of whites said that they believe that racism is "a big problem in our society today." This denial that racism is a problem is itself a form of racism.

Even more revealing is that compared to whites who were more accurate about the relative status of blacks, those who were persistently wrong (38 percent of the total) were:

· twice as likely to support cuts in food stamps spending;

· twice as likely to believe that "self-help" is the solution for black progress;

· and four times as likely to believe that "reverse discrimination" against whites is more serious than discrimination against minorities.

The evidence of serious discrimination throughout the society is compelling. A 55-year-old insurance salesman in Milwaukee, for example, secretly tape-recorded instructions from his boss to "stop selling blacks insurance." In California, Insurance Commissioner John Garamendi uncovered internal company documents proving that the California Insurance Group instructed its agents not to insure African American, Latino, and gay neighborhoods. These restrictions on acquiring insurance have a ripple effect throughout society. As a special commission appointed by President Lyndon Johnson concluded:

Without insurance, businesses are left to deteriorate; services, goods, and jobs diminish. Efforts to rebuild our nation's inner cities cannot move forward. Communities without insurance are communities without hope.
Research studies have clearly demonstrated that African Americans receive inferior health care due to racism. Sara Rosenbaum, director of the Center for Health Policy Research at George Washington University reported:
When you take black and white Americans and exactly the same situation like being hospitalized for a heart attack and having the same insurance, the chance that the black patient will get the advanced care is much less that it is for the white patient. The medical system appears to treat them differently.
African American men continue to be paid much less than white men, even when they have comparable education and are employed in similar jobs, according to a Census Bureau report released in 1993. Among college­educated men employed in executive, administrative and managerial jobs, median earnings for African American during 1991 were 77 percent of the figure for whites. The difference for workers with only a high-school diploma was even greater.

Racism is also reflected in the "white flight" that usually happens when a substantial number of African Americansmove into a predominantly white neighborhood. "Whites just do not want blacks as neighbors," reports Andrew Hacker in his review of the book American Apartheid. "Nor is this a reflection of class. Whites are just as apt to pull out when middle-class blacks begin to enter a neighborhood."

As a result, the nation's housing is no less segregated now than a decade ago. Many cities, especially in the North, are more segregated. In fact, schools in the South are now more likely to be integrated than are schools outside the South. Undercover investigations have documented that African Americans are illegally turned down about half of the time when they seek to buy or rent housing.

Although African Americans are more likely to be subjected to more severe forms of racism, as is reflected in part by the fact that housing segregation is worse among African Americans, other people of color also suffer serious discrimination. A 1992 report issued by the Federal Civil Rights Commission, as summarized by The New York Times, for example, found that Asian Americans "face widespread discrimination in the workplace and are often victims of racially-motivated harassment and violence." In support of its conclusions, the commission referred to its review of court records and extensive scientific studies. Asian Americans themselves particularly complained of a "glass ceiling" which prevents them from being promoted to higher levels of management.

Public-opinion surveys also report a persistence of racist attitudes. The National Science Foundation in 1993 found that about 50 percent of all whites admit believing that African Americans are "aggressive or violent," about 40 percent believe they are "boastful," and about 25 percent believe they are "lazy." Combining their various questions into a single index, these researchers found that overall about 30 percent of all whites have a "'high' level of belief in negative stereotypes of blacks."

The most compelling evidence of racism in the United States, however, may be provided in the daily experience of successful middle-class African Americans, as reported by Newsweek editor Ellis Cose in his much-publicized book, The Rage of a Privileged Class. Based upon extensive interviews with established professionals, Cose describes the race-based insults and limits on advancement that are common even with African Americans who have clearly paid their dues and should be able to cash in on the American Dream as well as anyone. But as Arnold Rampersand puts it in his review of Cose's book:

Unfortunately, Mr. Cose declares, white America will not leave them alone. Every day, the members of this class are humiliated and treated with disrespect, made to know that whatever their accomplishments, they remain, in the eyes of far too many whites, hardly more than ... 'the dogs of society.'
Another side of racism in America is recurring anti-immigrant sentiment. Anger towards immigrants was so strong in recession-weary California in 1994 that the San Francisco Chronicle, in a special report, described it as "unprecedented in California history." The impact of material insecurity on this issue is acknowledged openly by critics of immigration, who argue that immigrants cause the loss of jobs to American citizens. These hostilities often boil over into overt racism. As the Chronicle reported: "The descendants of Mexicans, Chinese and Japanese who came to California generations ago say they hear slurs and insults on the street. Some have been threatened. A few have been beaten." No doubt responding to a careful reading of public-opinion polls, California Governor Pete Wilson, whose chances for re-election had been considered poor, miraculously rehabilitated his political career in 1994 by hammering away at the immigration issue.

Defenders of immigrants counter that immigrants typically take jobs at wages that others don't want. They point to studies that conclude that immigration leads to an increase in jobs for citizens because immigrants spend their earnings on goods and services, which stimulates job creation. Regardless of exactly where the truth falls on this issue, providing every adult citizen with a living-wage job opportunity will certainly soothe the fear that motivates so much of the passion on this issue. As Texas-based columnist Molly Ivins has pointed out, although Senate candidate Jim Mattox tried to exploit the issue by calling for U.S. troops on the border, "in Texas (unlike California) no one gives a rat's heinie.... The difference is that California's economy is in the toilet and ours is on the upswing." The same pattern has held true historically. As reported by the Chronicle: "In American history, anti-immigrant sentiment typically arises in times of grave economic insecurity."

The interaction of poverty and racism is also seen in the fact that one in three African American men in their 20s are in jail or prison or on parole or probation. This reality is partly due to the fact that police are more likely to file charges and juries are more likely to convict African Americans than whites.

Racism toward people of color understandably provokes hostility among those who are subjected to racist behavior. This anger is often expressed in degrading stereotypes applied automatically to all whites. A majority of African Americans, Asian Americans, and Latinos, for example, believe that whites are "bigoted, bossy, and unwilling to share power." At the same time, members of minority groups tend to hold negative opinions of one another. For example, a survey reported in 1994 found that 46 percent of Latinos and 42 percent of African Americans believe that Asian Americans are "unscrupulous, crafty and devious in business."

Hostility and conflict between different racial and ethnic groups is thus one of the country's most severe problems. Racial tensions, whatever their source, are inflamed by economic distress. When the struggle to survive is intense, people become frustrated, angry, and prone to attack any convenient target. Economic insecurity leaves people on edge, inclined to "take it out" on anyone they can. People of another color are often easy targets.

Ending poverty will not directly solve the problem of racism and other forms of discrimination, such as bias against women, gays and les-bians. But establishing economic security for all will surely lessen these conflicts and contribute to a more peaceful social environment. We could then more easily learn to minimize and control deeply-ingrained prejudices. These factors offer urgent reasons why the federal government needs to guarantee economic security.

E. Improve Social Relations In General

Insuring material security as proposed here will facilitate improved social relationships in many other ways as well, including the quality of family life. These improvements include:

· Low- and middle-income families will become more cohesive by receiving in-home caregivers' grants to care for infants and frail or disabled family members. An estimated 10 to 12 percent of the work force is responsible for an aging relative. This percentage is expected to increase to one in three or higher by 2020, as corporations increasingly pressure their employees to move from region to region, making it more difficult for them to fulfill family responsibilities.

· As financial pressures diminish and the number of three-job families declines, parents will have more time to be with their children (compared to 30 years ago, parents now spend 40 percent less time with their children).

· Latchkey kids will not routinely be left home alone, for affordable after-school programs will be available to all families who need them.

· Child abuse, which has increased in recent years due to an increase in economic stress, will become a less severe problem.

Women, in particular, will benefit from universal economic security. Women who currently tolerate oppressive husbands to provide themselves and their children with basic necessities will be better able to escape. Women are pressured to endure bad marriages in part because on average they earn only 77 percent of what men earn. The situation for women who leave the labor market for years to care for children is even worse. Guaranteeing women the opportunity to living-wage employment will provide them with the option of independent living, so households will more likely form out of choice, rather than due to economic pressures. Women will also benefit because expanding economic opportunities will reduce the pressure to endure sexual harassment at work.

Neighborhood centers, parks, recreation centers, and arts programs will be more fully staffed, which will facilitate more people providing natural human support to one another. Friendships formed at these centers will constitute new forms of community based upon common interests.

Citizens will have more time to become involved in politics, partly because working overtime, holding down two jobs, and spending hours looking for work or figuring out how to survive will no longer consume so much time. Economic anxieties have contributed greatly to a dramatic increase in apathy, alienation, and indifference toward public affairs. The Harris Poll found that the number of people who "feel a sense of powerlessness and of alienation" fluctuated around 60 percent in the 1980s, about twice the 29 percent found in 1966. This Harris Alienation Index was based on responses to the following statements: "the rich are getting richer and the poor are getting poorer;" "most people with power try to take advantage of people like yourself;" "what you think doesn't count very much anymore;" "the people running the country don't really care what happens to you," and; "you are left out of things going on around you." Establishing economic security will enable these attitudes to soften and free up people to participate more in public affairs.

Senior citizens will no longer face mandatory retirement, but will work so long as they are able and willing. Discriminating against job applicants because of their age, which was found to occur 25 percent of the time in one investigation, will no longer be such a barrier to self-advancement. In-home caregiving will be available to all who need it and nursing homes will be fully staffed.

Providing needed support services to disabled individuals will greatly enrich their lives and promote independence. Assistance with personal hygiene, dressing, housekeeping, and transportation will enable many disabled persons to work who are currently unable to do so. Strong enforcement of the law requiring employers to make reasonable changes in the workplace so that disabled persons can work will facilitate gainful employment. Increased personal incomes for disabled people now living in poverty will strengthen their independence.

Increased funding for public-service employment will enable local governments to reduce substance abuse by expanding public education and social-rehabilitation programs. Formerly poor substance abusers will be able to assist addicts, including middle- and upper-class addicts. Self-help and community-support programs for individuals struggling with personal problems-in-living will be improved by expanded staffing. The effectiveness of human-service programs in general will be enhanced because they will no longer be overwhelmed by persons suffering from problems caused by poverty or simply seeking services to get food and shelter.

Establishing economic security will also lead to major improvements in a number of other institutions that today are struggling to fulfill their mission. In particular, affordable, comprehensive health care will become available to everyone and schools will be staffed with more teacher's aides, which will enable them to provide better schooling.

In these and other ways, abolishing poverty will produce a more supportive, creative, and humane social environment. One or more of these improvements will directly touch the lives of virtually the entire population and indirectly improve living conditions for everyone.

Universal economic security will also help prevent wasted public expenditures in a number of institutions. In this regard, all taxpayers will benefit. Programs that can be reduced or eliminated will include:

· welfare programs;

· homeless shelters;

· emergency-room services for preventable illnesses;

· drug and alcohol programs for people driven to despair by current living conditions;

· special care for those who suffer birth defects due to poverty, and;

· remedial programs for those who don't receive proper early childhood education.

Every dollar spent on appropriate prenatal care, for example, saves more than three dollars in the costs of care for low-birth-weight babies. The total sum of public expenditures will not be reduced, for increases in other areas will be necessary. But what money is spent by the government will be used more efficiently, without wasting it on preventable problems.

Sources for this chapter included the following, in order of appearance.
For more specific references, contact Wade Hudson at

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