California, Poorest/Richest State in the Nation

California currently has more than 600,000 millionaires and 85 billionaires in the Forbes 400 list, far more than any other state in the nation. At the same time, California is now the poorest state in the nation, with the highest percentage of residents living at or below the poverty level. According to the Census Bureau, 23.5% (8.7 million Californians) are living in poverty. Florida is number 2 at 19.5%.

These numbers reflect a revision in how the Census Bureau measures poverty. In the past, it looked solely at income versus food costs. Under this system, the poverty rate would be only 16%. Under the new system, it now considers income plus assistance programs (e.g., food stamps, welfare) versus tax rate, childcare, housing and medical costs, in addition to food expenses, providing a much more realistic (though still incomplete) picture of families’ financial challenges.

Nearly 50% of California’s children live in or “perilously close” to poverty according to the newer metric, probably the single biggest reason for the state’s low test scores. True poverty rates are further obscured by the arbitrary and absurdly low federal threshold of $23,021 for a family of four. Considering that average monthly rents are $1552 in Los Angeles, $1431 in San Diego, $1938 in San Jose and $2106 in San Francisco, families must spend between $17,172 and $25,272 per year just to place a roof over their heads.

It is not just that better methods are providing a more accurate measure of poverty. The recession has also contributed to a dramatic increase in poverty. Between 2008 and 2011, for example, poverty rose 12% in Los Angeles County to 24.3%, and rose even more in some of the state’s rural counties. Conditions have grown so bad that California has seen negative migration patterns for the past eight years, according to the WSWS. A combination of low unemployment rates in Mexico (roughly half of California’s in recent years) and increased militarization of the border and deportations (a record 400,000 in 2012) has significantly reduced migration from Mexico. This has led to labor shortages in the state’s agriculture sector, with some farmers opting to let unpicked produce rot rather than increasing wages to attract domestic employees, since the former increases sales prices and profits, while the latter only cuts into profits.

While the state’s economy “recovers,” job growth has been primarily in low-wage service jobs. Thus many formerly unemployed are now earning far less than they did prior to the recession, contributing to the ranks of the working poor. Cuts to social programs has placed further downward pressure on living standards and contributed to the growing number of poor Californians under the new measurement system.

Americans Working Longer, Harder and Paid Less

Huck/Konopacki Labor Cartoons

The working and living standards for the majority of Americans have been on a downward spiral since the 1970s. While workers’ productivity is up, allowing their bosses to bring in greater profits, most workers have been working longer hours and doing more work per hour, while their wages have remained stagnant, according to the recent report State of Working America, 12th Edition (Mishel et al. 2012)

Below are some of the report’s findings (summarized by the Economic Policy Institute, where Mishel is president):

In 2007, the average American worker toiled 1,868 hours, 181 hours longer (10.7% more) than in 1979—the equivalent of an extra 4.5 weeks per year. This growth was most pronounced among women, who are now working 20.3% longer than they did in 1979. However, this is primarily because there were far fewer women being paid for their labor in 1979. Overall, men saw a 4.4% increase in their working hours, and this was primarily over and above what they were already working. There was also a large increase in working hours among the lowest 20% of wage earners, whose working hours increased 22% (compared with a 7.6% increase for the top 5% of earners), again due mostly to hours over and beyond what they were already working.

One reason for the increased working hours was, of course, increased demands by employers. However, workers’ wages were stagnant during the period, in many cases not keeping up with inflation, forcing people to work longer hours to make ends meet. Thus, in terms of spending power and the value of their paychecks, workers living standards were either stagnant or declined during this period.

For example, annual income increased during this time period, but for the majority of workers this was the result of their longer working hours—not from any significant increase in hourly wages. For the lowest-wage workers, hourly wages rose only 7.7% over the past three decades. However, for the past decade, their wages have actually declined 3.2%. In contrast, the hourly wages of the top 5% of wage earners increased by 30.2%, and this does not even include the bulk of their income, which comes from non-wage compensation and investments (e.g., stock options, capital gains).

What little growth American workers have seen in hourly wages was concentrated in the late 1990s, when unemployment was low and the minimum wage was increased. Even for middle wage earners, whose overall hourly wages increased 15.8% between 1979 and 2007, total hourly wage growth was only 5.3% when 1995-2000 is excluded.

Half of All Americans Living In Poverty or Close to It

According to the latest census data, nearly 50% of all Americans (150 million people) are living in poverty or can be considered low-income (see Democracy Now). 38% of all African-American children and 35% of Latino children are currently living in poverty. This is a marked increase from the 1970s, when poverty rates were below 15%.

Huck/Konopacki Labor Cartoons

Despite this appalling statistic, the presidential candidates rarely, if ever, mention the words poverty or poor, with the notable exception of Mitt Romney’s declaration that he is “not concerned about the very poor.”

Romney’s remarks should have come as no surprise to anyone. The rich do not become rich through compassion. More significantly, they benefit from the persistence of poverty as it helps keep wages low and workers desperate, making it easier for them to squeeze more profits out of their workers.

Nevertheless, the blunder did support his detractors’ claims that he is out of touch with Main Street, so he made a lame attempt to defend himself by adding that there was a safety net for the poor, which is a gross exaggeration, and certainly not a justification for not caring. The safety net has been severely eroded over the past several decades with welfare “reform” and budget cuts. Yet even if there was a robust safety net, the poor would still be poor relative to the affluent. Even if homelessness ceased to exist and everyone had sufficient food, the majority of us would still be poor relative to the rich. They would continue to amass wealth by paying us less than the value of our labor. They would continue to maintain political and social hegemony. They would continue to control our working and living conditions.  They would hold onto their yachts and mansions and summer homes, while we would still have to struggle to pay our rents and mortgages.

He also tried to imply that it wasn’t callousness on his part, but a campaign strategy to focus on the middle class, which is the same reason that Obama and most other political candidates in recent memory refrain from using the terms poverty and poor. On the one hand, the poor do not vote in large numbers and thus candidates can safely ignore them without any political cost. On the other hand, the ranks of the poor have been growing rapidly because so many formally middle class people have lost their jobs, pensions, investments and homes. Many are anxious about their own financial vulnerability. Thus, by ignoring or discounting poverty, candidates hope to make everyone who isn’t rich believe they are middle class, thus keeping the chronically poor, as well as the formally middle class nouveaux poor, optimistic about the future under their presidential candidate.

Wealth Makes You a Jerk (and this is News?)

Stealing Candy from Babies (Images from Flick, by Qfamily and jantik)

As people’s wealth increases, so does their tendency to engage in unethical behaviors, according to researchers from UC Berkeley and the University of Toronto, whose work was published in last week’s PNAS.  (A summary of the report can be read at Wired).

The researchers conducted seven different experiments. In the first, they found that wealthier individuals were more likely to cut off other drivers and pedestrians at busy intersections in the San Francisco Bay Area, even when controlled for time of day, gender, age, and traffic conditions.

In one experiment, participants were asked what they would do if given change for $20 if they had paid with a $10 bill. Higher SES individuals were significantly more likely to keep the change.

In another experiment, participants played the role of job contract negotiators. They were told that applicants wanted job stability and would accept lower pay in exchange for longer contracts. They were also offered bonuses for hiring people at lower salaries. Under these circumstances, wealthier participants were much less likely to be honest with applicants about job stability.

In another study, researchers let participants play a computer game of chance and then report their results. They were told that there were cash prizes for high scores. Higher SES individuals were significantly more likely to cheat or misrepresent their scores.

One of the authors was interviewed by FSRN on Monday, 3/5/12. When asked how he knew that the rich weren’t already jerks or that being a jerk is what made them rich in the first place, he said that they also created simulations in which they made people of modest incomes feel rich and even they were more likely to take candy from a bowl designated for children than were people who were not wealthy nor made to feel wealthy.

Yes, wealth apparently makes people steal candy from babies.

Religion Makes You Live Longer By Making You Behave?

(Image adapted from Energizr on Flickr)

Back in 2000, psychologist Michael E. McCullough and colleagues published a meta-analysis of several dozen studies indicating a strong correlation between religiosity and lower mortality. For the pious, this seemed to be proof that God had their backs and that their belief was paying off. To the rational minority, this data was a curiosity that begged deeper analysis. What other aspects of these individuals’ lives were also correlating with longevity? Could it be something other than their belief in God that was responsible?

MCullough did not rest on his laurels,. Rather, he did another meta-analysis in 2009 with his colleague Brian Willoughby, this time looking at hundreds of research papers, revealing that religious people are more likely to engage in healthy behaviors, like regularly visiting the doctor or dentist, and they are less likely to smoke, drink, take recreational drugs and engage in risky sex, Michael Shermer reported in this month’s Scientific American. This healthier behavior is clearly the more likely explanation for the longer life span.

Shermer, who writes the monthly Skeptic column for SciAm, went on to suggest that religion reinforces positive behaviors and rewards self-control by providing a tight social network and by promising Heaven and other delayed rewards. However, he suggests that we are all capable of this without belief in God or participation in organized religion. Meditation, for example, can help people exercise greater self-control and change bad habits. Parents and teachers try to reinforce impulse control and delayed gratification for children so that they will focus longer on the task at hand and refrain from disruptive behaviors.

Of course this notion of living a healthier lifestyle seems implausible in light of the high profile examples of religious leaders engaging in promiscuous sex and drunkenness and the Catholic Church’s ban on condoms. It also seems unlikely in light of the fact that the Bible Belt is the most obese region of the country and has among the highest smoking rates.

Nevertheless, let’s assume the data is valid, that most pious people do engage in healthier behaviors like visiting the doctor more regularly.  Does this mean that their religious affiliations are the cause of this health consciousness? Isn’t it possible that religious people are more likely to have health and dental insurance? It would be interesting to examine the data to see if pious people do in fact have better health plans or, for that matter, higher paying jobs. While the latter seems unlikely—we all hear about how religious the poor are—it is possible that the average wealth of religious people is actually higher than it is for the nonreligious, even including the religious poor.

Regardless of one’s religiosity, the biggest influence on one’s health and longevity is wealth and social status (see here, here and here). Being poor and/or black dramatically increases the odds of having a stressful, low-paid highly demanding job, food and housing insecurity, and lack of access to healthcare and leisure time. It also dramatically increases the chances of developing diabetes, cancer, heart disease, hypertension and an early death.

The debate about whether religiosity or faith improves one’s health is a red herring. If we really cared about improving health outcomes for all, we would focus on ways to improve the wealth and social status of all. Universal health care, for example, would significantly reduce the rate of preventable deaths in the U.S.

Starving in the Land of Plenty

Recent data from the Food Research and Action Center (FRAC) shows that 25% of California households with children are experiencing food hardship (from New America Media).

Latinos and rural residents were most affected. In agricultural Fresno County, for example, 68.6% of public school students were receiving free or reduced lunches, which means their families were suffering from material (and likely food) insecurity. The county is also 59% Latino. In Los Angeles County, which is over 63% Latino, 65.6% of students were receiving free or reduced lunches.

California also has four of the nation’s 20 metropolitan areas with the worst food hardship.  Fresno was fifth in the nation, with 32.6% of its residents facing food insecurity. The Riverside-San Bernadino-Ontario area ranked eighth (30.4%), the Bakersfield area ranked 11th (29.5%) and the Los Angeles-Long Beach-Santa Ana area ranked 18th (28.3%).

Starving In Front of Gratuitous Wealth

With over 15 million people, at a rate of 28.3% the LA area alone has over 4,300,000 residents suffering food insecurity. This statistic is particularly stark when juxtaposed with the phenomenal wealth found in Los Angeles. Here is a list of just its billionaires (all 34 of them), from the Forbes list of 400 wealthiest people on the planet:

19. Kirk Kerkorian, $10 billion

25. Sumner Redstone, $8.4 billion

38. Donald Bren, $5.7 billion

39. Eli Broad, $5.5 billion

45. David Geffen, $4.5 billion

52. Barbara Davis, and Family, $4 billion

52. David Murdock, $4 billion

70. Bradley Wayne Hughes, $3.2 billion

78. Haim Saban, $2.8 billion

83. Stephen Spielberg, $2.7 billion

89. Jerold Perenchio, $2.6 billion

112. Ronald Burkle, $2.3 billion

116. Patrick Soon-Shiong, $2.2 billion

125. Alfred Mann, $2.1 billion

125. Steven Udvar-Hazy, $2.1 billion

133. Michael Milken, $2 billion

153. David Hearst, $1.9 billion

153. George Hearst, $1.9 billion

181. Franklin Booth, $1.7 billion

181. Louis Gonda, $1.7 billion

181. Anthony Pritzker, $1.7 billion

181. Tom Gores, $1.7 billion

198. Ming Hsieh, $1.6 billion

235. John Anderson, $1.4 billion

235. Charles Munger, $1.4 billion

258. Gary Michelson, $1.3 billion

283. Alan Casden, $1.2 billion

283. Robert Day, $1.2 billion

283. Roy Disney, $1.2 billion

283. Leslie Gonda, $1.2 billion

283. Alec Gores, $1.2 billion

283. George Joseph, $1.2 billion

320. Edward Roski, $1.1 billion

346. William Hilton, $1 billion

Insult to Injury
As terrible as it is to have so many hungry children, the problem is exacerbated by the draconian eligibility requirements for CalFresh, the California version of the federal food program. Many are no doubt discouraged from participating because of the finger-imaging requirement, particularly those concerned about being deported.

The New America Media article also suggested that the new federal Super Committee that is set to propose solutions to the federal deficit will slash federal food programs. Considering that state governments have been gutting programs for children, seniors and the poor in order to close their deficits, this fear is not at all unrealistic. In fact, it could be argued that the Super Committee’s mandate is precisely to impose austerity on the most vulnerable and politically least powerful members of society so that the wealthiest can continue to enjoy their privilege and luxury.

Health and Education Implications
Under- and malnourished mothers are much more likely to have babies born prematurely, with low birth weights or with significant health problems. Children who are not receiving adequate nutrition can suffer from iron deficiency anemia and are at risk for a host of developmental and cognitive impairments. Any of these can have a large impact on school-readiness and academic achievement.

However, it is not just hunger and lack of calories that places children at risk. Families that cannot afford to eat nutritious foods will often compensate with food that is cheaper but less nutritious, particularly junk foods, increasing the risks for obesity and diabetes. Such diets tend to be rich in sweets, particularly sugary drinks, and increase the risk of cavities and dental problems. This, too, can hinder academic achievement as students without insurance may be missing class and have trouble concentrating due to pain.