Thursday, November 23, 2006

Poor Americans are not poor: Thanksgiving Day has got me thinking about abundance and poverty. Students moan in my class about how poor so many Americans are. I looked at the American Community Survey to see what percent of poor Americans own a house. According to the 2000 sample of 52,830 of Americans making less than $20,000 annually total household income, 30.4% own a house free and clear, 17.8% own with a mortgage or loan, and 51.8% rent. The modal home owned has 3 bedrooms. A Third Worlder would giggle if you told him that 1/2 of poor Americans owned a house with 3 bedrooms. That ain't poor, baby.

5 comments:

jabowery said...

You're not paying attention to how the real cost of reproduction has changed from the GI generation to the Boomer generation. It's gone up by a factor of 4 and this during a time when there was a bidding war between corporations and husbands for fertile years of young women. You can ignore the demographic collapse of the US if you like but the rest of the world and the powers that be insisting on open borders aren't. Just for a start let's look at the distribution of net assets by age vs time:


A. Mean Net Worth (Ratio to Overall Mean)
Overall 1.00 1.00 1.00 1.00 1.00 1.00
1983 1989 1992 1995 1998 2001
Under 35 0.21 0.29 0.20 0.16 0.22 0.19
35-44 0.71 0.72 0.71 0.65 0.68 0.64
45-54 1.53 1.50 1.42 1.39 1.27 1.25
55-64 1.67 1.58 1.82 1.81 1.91 1.86
65-74 1.93 1.61 1.59 1.71 1.68 1.72
75 & over 1.05 1.26 1.20 1.32 1.12 1.20

http://www.levy.org/default.asp?view=publications_view&pubID=fca3a440ee

Table 9

The rest of the world may laugh at the idea of our poverty but poverty must be measured in more than mere material artifacts -- I know you must agree with this.

Ron Guhname said...

jabowery: Yes, my post is about there being little absolute poverty in America. But I do agree that severe or growing inequality is a real problem. One can detect from my blog that I am concerned about a breakdown in social solidarity that can come from ethnic heterogeneity. We could easily call inequality "wealth heterogeneity", and it seems logical that if one type of diversity erodes solidarity, so does the other. Ethnicity is probably stronger than class, but I agree that class matters. You mention fertility: American mothers are not having fewer babies because they are one paycheck away from malnutrition, but they are forgoing large families in order to keep up with the Joneses.

HAIRYBEARS said...

HI

GREAT BLOG

HUGZ

jabowery said...

I don't merely mention fertility -- I posit it as a better definition of general poverty than aggregate net "assets" and indeed a better definition of general poverty than availability of net assets to young couples.

Your original article seems to indicate a large number of households own 3 bedroom homes free and clear -- hence young women are choosing to not have babies not because of a lack of secure housing but because they are merely trying to have more stuff beyond the necessities.

I think you're wrong about this.

The low income people who own their houses free and clear are the GI generation -- people who had their children in conditions far more favorable to childbearing not just culturally but monetarily -- by a factor of 4 monetarily.

See my analysis here.

That this occurred during the time their parents' (and elder siblings -- guys like Clinton, Gore and Bush Jr. did get in early enough to ride the wave) real estate equity surged along with the land barons. The closest I've seen to data on this is the table I gave previously which indicates that the early boomers like Clinton, Gore and Bush Jr., -- all born before 1950 -- got in on the speculation that wiped out the reproduction of the mid to later boomers.

The claim, commonly made, that the real estate price rise was due an increase in quality of the houses, is belied by the fact that it was primarily the lot value -- the land value -- that went up in the cost of reproduction. The "McMansion" syndrome, possibly related to "keep up with the Jones" did not dominate the demographic collapse.

Moreover, let me give the devil his due here: I did mention that there was a bidding war between corporations and husbands for the fertile years of the young boomer femals and that this did contribute to the demographic collapse being exploited by the world via our derracinated elites. And I'll agree that when such a bidding war is going on, basically the fertility of young women is being monetized for an expanded consumer (and taxation) base. But more importantly I think is that this monetization of young women's fertility places them at the mercy of what can be thought of as modern urban harem masters during a period of de facto polygyny (aka "serial monogamy" as said harem masters prefer to call it).

Part of the problem is that multiple circumstances conspired to destroy the demography of the US -- rendering factor analysis very difficult. Such a profoundly destructive miasma of mutually confounding factors -- seeming to all emanate from the urban centers of the US within such a short period of time -- conceals within it a common factor waiting to be ferreted out by compassionate inductivists.

Ron Guhname said...

jabowery: I am always skeptical of mainstream social science findings, but for what it's worth the demographers tell us that the most important global cause of fertility decline is rising levels of female education. Now, you focus on economic factors, and education is certainly tied in with this, but I think part of it is cultural as well. The GSS shows that white women who of childbearing age in the 1950s thought that 3 children was the ideal. And if they sometimes had more than they wanted, birth control and abortion have now remedied that. By the 1970s and until the present day, white women have given 2.5 children as the ideal, but have had significantly fewer than that. Evidently, they are having fewer than they want because they perceive that they cannot afford more. This points to an economic explanation (but I would argue that some of it stems from a culturally-defined acceptable standard-of-living.) But why has the ideal dropped one- half a child? I would argue that some of that change is due to a cultural shift toward self-realization. Children, or many children, are more likely to be seen as an obstacle to self-fulfillment. People are more likely to have a child to experience parenthood, and you only need to do that once. Plus, the emphasis on a quality childhood has grown, and large families are thought to impede this. Women (and men) soak this up from school, from the mass media, from the culture. We would both agree that the demographic collapse is a major problem, but I think the explanation is cultural (and technological) as well as economic.