Red Counties: More on How the Poor Live

Dining with my old pal Ignoto the other night (salmon carpaccio, gnocchi, scallops, a nice pinot), I listened to Ignoto remark that most of our friends don't have a clue how many poor there are, and how they live.

Leaden (preemptive) irony intended.  One may well ask how Ignoto knows, if he knows.  But if you talked with him for half an hour you'd recognize that he harbors a highly original and independent turn of mind, coupled with almost limitless curiosity.  So you'd be inclined to bet that he probably is onto something. And who knows, he may have seen the map that Ezra Klein finds "terrifying."  And he may have heard followup comments like these below.  First, the Wichita Bureau updates on life in the trackless void that is Western Kansas:

KS counties in red are mostly what you’d expect – the odd part is NW Ks – where the main industry is I 70 (hotels, fleecing hunters and the only Starbucks in that corner of KS; we stayed in a motel out there on the way back from a trip to Denver – and each room has a sign warning against cleaning pheasants in the bathroom sink – they point out that there is a special area behind the motel for THAT). There are three little towns out there that are holding their own – but apparently not in healthcare. The two red counties in SE KS are quite familiar: Greenwood where we had a second home for years and Elk, the poorest county in the state, supposedly. Both are dominated by big land owners – ranchers and oil guys. the Koch family owns at least 5000 acres of prime grass land. I suspect they own the commission. Greenwood has a small county hospital (that mainly packages people up for the helicopter ride to Wichita) with a decent number of doctors – mostly DO’s and foreigners. There is absolutely no industry – and damn few restaurants. About the only significant employers are the county, school system and a cluster of nursing homes supported by Medaire/Kancare.  . ...

Kansas continues to lose population in a majority of counties. In some cases, if the current exodus continues, they will be down to negative population by 2020 (link).

From the stats (link), the influx of Hispanics is done. But a couple of counties (in blue) are now majority minority – More Hispanics and Somalis than Swedes.

He might have added that Western Kansas has a long history of standing at or near the top of the league tables for farm subsidies, though last time I looked, an awful lot of the checks went to post boxes in San Francisco.  Meanwhile, here's an update on Wisconsin from UB's newly appointed stringer in Eau Claire:

That strip of red counties up through the center of Wisconsin is entierly predictable: these counties all lie between, what  I call, the highways. There are three major, north/south highways in WI - 41 on the east runs up through the Fox River Valley, Appleton, Green Bay, etc.; highway 51 (I-39) runs up through the middle of the state, Stevens Point, Wausau, Minocqua, etc.; and highway 53 on the west, LaCrosse to Eau Claire to Rice Lake to Superior. The most conservative and no-growing part of the state (the actual most conservative part of the state is the Fox Valley to Lake Michigan on the east side--Joe McCarthy country--lies between Eau Claire and Wausau (Highways 51 and 53)). Lots of Bubbas and gun nuts, and yes, Amish - not the greatest farm land either. There is just lots of swamp, scrub timber, brush and such. ...These people just won't change, so their kids grow up and leave; they go to LaCrosse, Madison, Eau Claire, and the Fox Valley. By the way, Green Bay is a mess - lots of poverty (lots of Hispanics, Hmongs, etc.), but it is growing-- the "two-class" society.

Followup: I guess what intrigues me most in the red map is that strip of blue counties across Central California and the Rio Grande Vallley.  Just guessing but it seems to me that it must be evidence that Chicanas, i.e., women, punch above their grade when it comes to health care--that they are healthier, better taken care of (take better care of themselves?) than you might guess from income data alone.

Stiglitz on Inequality

There is so much good stuff in Joseph Stiglitz new The Price of Inequality  that it is not easy to specify just why I keep wanting to throw it away with great force.

Start with something positive: he's on the side of the angels.  He's got the right friends and the right enemies and a generous heart.  But he writes a book that can make you just want to scream.

Part of the problem is merely structural.  From the title, you might guess this is a book that makes the functional case against disparities in wealth or income: disparities entrench elites, they undermine democratic values, they destroy trust in the system, and mutual trust.  This is an important perspective and Stiglitz makes many of the particular points well.  Which isn't to say they haven't been made as well or  better elsewhere but no matter: the case can bear repeating.

The trouble is, you have to work awfully hard to find it.  The narrow point--the point of the title--comprises maybe 15-25 pages of the entire book, scattered and sometimes camouflaged.  The rest of the book is a free-floating leftie talking points, loosely scattered as if he had dumped out his box of three by five cards--a bit like locked in a semi-dark room with a loop tape of the Rachel Maddow show.

Ironically, a giveaway as to the content is that Stiglitz spends far more time talking about fairness versus unfairness in distribution than he does about his "costs" argument.  This is telling: fairness functionality are both important principles: one might well want an economy to be both functional and fair.  But it's not clear that Stiglitz even recognizes the difference.   Quite the contrary: much as he cites as principle of fairness, Stiglitz nowhere spells out just what his principle of fairness is.  Rather, he falls back time and again by telling us what the public perceives as fair/unfair.  He never seems to notice that these references tell us nothing about fairness per se; a public might very well perceive a fair world as unfair or vice versa.

This is frustrating.Although I should stress I don't have a lot of trouble with content.  As to particulars, I think I'd sign on to somewhere between 60 and 90 percent of what Stiglitz has to offer (lot of nuances, but let that be).

But none of this is what is really maddening. I guess what really gets me is what I wrote about in passing when I was sizing up Chris Hayes a few days ago.  In the end, it is a massive exercise in preaching to the choir, telling his audience what they already know, beefing them up with soundbytes to annoy their relatives at the Thanksgiving dinner table.  In the process, it sidesteps or minimizes virtually almost any difficult or perplexing argument that complicate the case.

I could offer a number of particular examples but let me concentrate on a thematic difficulty:  Stiglitz' near-complete schizophrenia on the issue of "competition" and its evil twin, "economic rents."  You can probably guess he framework: competition good.  Rents bad.  Goal of policy, dismantle rents, restore competition.  

In individual cases, this is bound to be a beguiling argument. But it sidesteps the core paradox of the economic world-view: everybody wants free competition for others.  Nobody  wants it for themselves.  And who can blame them?  A competitive world is a grey, bleak and heartless kind of a place--a world in which as Albert O. Hirschman says, "every individual firm considered in isolation is barely getting by, so that a single false step will be its undoing."  Or as the fella says, absolutely the last thing you want in the world is a job where you get paid what you're worth.

I think this problem is pervasive in Stiglitz' book but it takes on particular poignancy for two reasons.  One: Stiglitz is in his own way a conservative or better, if there is such a word, a nostalgiast (id that a word?).  He's a sucker for the old ways, meaning particularly the old ways of the Roosevelt New Deal and the broad social compact that organized the United States from the end of World War II until the first Arab oil shock.  Strong bank regulation, good manly jobs and in particular, strong unions.t

Unless I missed it, he never once faces up to the stark fact that this entire model subsisted in a warm bath of economic rents and restricted competition.   American industry had a huge home market, protected from foreign competition by law and by the disaster of World War II.  There was a lot to go round, even for the low-skilled.  But the best jobs were in the most protected places: big auto, big steel, big telecom: these were the places where management and labor could agree to split up the proceeds, secure in the knowledge that they wouldn't be undercut.

Stiglitz' nostalgia for the Good Old Days carries over into what may be the weakest part of his book.Oh yes, he says, good thing, globalization. bit you've got to do it right and the financiers have done it all wrong.  Let's concede that big finance has committed great mischief in the pursuit of globalization.  Still, I see almost no recognition in Stiglitz that a newly globalized word has less starvation, less abject poverty and yes, more equality (between nations if not in nations) post-globalization than it did before.  As Paul Collier says, we used to talk about "the bottom five sixths;" we now talk about "the bottom one sixth."  And scandalized as we may be over the abuses of labor in the developing countries, I don't know of anyone who has ever made the explicit argument that our nation should be rich while all others are poor.

The problem of rents-versus-competition imbues his discussion of our own current internal agonies as well.   Specifically, I don't see any acknowledgment in Stiglitz that governments as well as private persons can be rent-seekers as well; that, indeed, our current politics may perhaps be best understood as a competition between two different alliances for control of the rent-seeking machine: young people and public employees on one side, old people and finance on the other.

I know.  Almost anyone who has stuck with me this far is sputtering that but, but I don't understand, there are various kinds of rents, and not all rents are alike, and we can have good competition and bad competition.  Well, very likely we can; I certainly hope so.  But any attempt to understand that point will have to start with an account of the present that is far more clear-sighted and yes, ambivalent, than what is on offer here.

That's my point.  Actually, I've got (at least) one more point I'd like to make about Stiglitz and his ilk but I guess I'll save it for a separate post (which I may or may not get round to writing).

Footnote:  I seem to have hammered on this particular guitar before.  See:  Link, link, link all of whom impel me to believe, in various ways, that I'm not crazy..

More on the Cost of Being Poor: Bank Fees

Joel points to Candace Choi's fine AP story itemizing how much it costs to be poor in the banking system.  Answer--$93 a month in nickels and dimes and baby-needs-a-new-pair-of-shoes charges for the privilege of keeping hold of your own money.  I'd buy about 80 percent of this, but with one important 20-percent limitation: being poor is a kind of job and there are no unskilled jobs.  Had she stayed poor a while longer, Choi would have figured out some fiddles and chisels and sidesteps to reduce the $93 to--something less than $93, albeit still not to zero.

What it Means to be Poor

Times like this, you really wish you knew who writes The Economist:

SHOPPING with coupons and jars of loose change. Watering down milk to make it go further. Using washing up liquid instead of shampoo. Inventing excuses for skipping lunch. Having to walk everywhere. Sharing beds and baths. Mending clothes that are themselves second-hand. Reviving old newspapers as makeshift lampshades. Always being tired.

(Link)...so you could give them a hearty handshake or a cigar a masterpiece of concise thick description.