The End of Poverty Issue - YES! Fall 2014 by YES! Magazine

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7 Compassionate

P owerful I deas , P ractical A ctions

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Communities Create Equality One Policy That Could Solve Poverty

2014

$15 and Change: How Seattle Started a Wage Revolution

The End of Poverty WE’VE GOT THE MONEY, DO WE HAVE THE WILL?

The Jobs That Lift Us Up NYC Invests In Co-ops Zaida Ramos raised her family while working at the nation’s largest worker co-op.

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The End of Poverty The gap between the wealthy and the poor widens daily in America. And the prevailing story says poverty is inevitable—a natural part of the human condition. In this issue we show how the richest country in history chose policies that create an impoverished underclass—and how different choices will end poverty.

The Widening Gyre. History

shows a deliberate march toward inequality.

Poverty is Not Inevitable. Practical actions to fix the policies that keep people poor.

20 One Policy That Could Solve Poverty. We can attack the problem by creating full employment.

42 40

$15 and Change. Seattle workers

The Jobs We Need. New York City

Farming and Freedom. Incubator

fought for a living wage, and now real people are looking forward to better pay.

finally invests in worker-owned cooperatives, which improve working conditions and offer better pay.

farms provide migrant workers an opportunity to put down roots and work for themselves.

More Education Works. States like

Compassionate Communities.

War on Poverty Redux. Decades ago,

Oregon and Tennessee want to put more kids into college with free tuition.

It’s not hard to bring a little more equality into each others’ lives.

government tried to reduce poverty, and it was working. We can do it again.

SHUTTERSTOCK IMAGES BY CAMERON WHITMAN, FJSTUDIO, TEERAPAT PUNSOM

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HOW MONEY=COLLEGE AND COLLEGE=MONEY 1

While half of all people from highincome families have a bachelor’s degree by age 25, only 1 in 10 from low-income families do.

Rate of children attending college

100% 80 60 40

If you have only a high school diploma, you’re 50% more likely to be unemployed than a person with a community college degree; almost twice as likely as a person with a bachelor’s degree.

Doctoral degree

2.3%

Professional degree

7.0% 7.5%

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100

$1,714

Master’s degree

$1,329

Bachelor’s degree

$1,108

Associate’s degree

$777

Some college, no degree

$727

Less than high school diploma 2013 average 6.1%

$1,623

$651

High school diploma

11.0%

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Full-time wage and salary workers

2.2%

5.4%

Median weekly earnings

People 25 and older

4.0%

And the more college you have, the more likely you will be to have a high income.

Unemployment rate

3.4%

Income rank of parents

$472 2013 average $827

Sources: National Bureau of Economic Research, “Where is the Land of Opportunity? The Geography of Intergenerational Mobility in the United States,” June 2014 and U.S. Bureau of Labor Statistics

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INEQUALITY The Choices We’ve Made

n his deeply researched book Who Stole the American Dream?, Pulitzer Prize-winning journalist Hedrick Smith reports on the structural choices that have brought the United States to a crisis of inequality. He describes “the heyday of the middle class,” from the mid-1940s to the mid-1970s, when higher wages gave tens of millions of families steady income to spend, generating consumer demand, expansion of production, and higher living standards. Social movements of the 1960s, building on labor agreements from earlier decades, pushed forward new legal protections for consumers and the environment. Smith’s detailed timeline from the book, excerpted and adapted here, charts how strategic lobbying and legislation over the next four decades gave corporations dominion over the economy and eroded the security of the American middle class.

$1.4 million

Annual income of the top 1%

1970s

The Deliberate March Toward Inequality

1971-1972 Corporate lawyer (soon to be Supreme Court justice) Lewis Powell writes in a secret memo that U.S. business must organize to fight labor, consumer activists, and government regulation. In response, CEOs establish the Business Roundtable, which becomes a powerful lobby for corporate America.

$235,700

1945-1973 U.S. worker productivity up 96 percent; hourly wages and benefits up 94 percent. 1973-2011 U.S. worker productivity up 80 percent; hourly wages and benefits up 10 percent.

$94,100 $64,500 $43,600 $23,000

1980

1985

1990

1995

2000

2005

2010 Source: CBO 2011-2013

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YES! MAGAZINE INFOGRAPHIC 2014

Top 20%

Bottom 20%

1971-1981 Number of companies with Washington lobbying offices goes from 175 to 2,445. 1977-1978 Business lobbyists convince Congress to block prolabor and consumer protection legislation; produce deregulation of airlines, railroads, trucking; cut corporate and capital gains tax rate from 49 percent to 28 percent.

1980s 1980 Congress overturns usury laws and limits on interest for first mortgages, paving way for future subprime mortgage boom. 1981 Reagan tax cuts drop top personal rate from 70 to 28 percent, capital gains from 28 to 20 percent, corporate rate from 46 to 35. These tax cuts add $1 trillion to the incomes of the superrich per decade. 1982 Congress authorizes unprecedented exotic loans—adjustable rate mortgages, 100 percent financing, negative amortization—which will lead to real estate boom and bust of 2000s. Late 1980s-1990s Employers push workers out of traditional pensions and into 401(k)s. Employee share of retirement cost in 1980 is 11 percent; in 2006, 51 percent.

1990s 1990 Congress passes H-1B visa program. By the early 2000s, nearly a million college-educated Americans lose their jobs to imported foreign workers, mainly in high-tech fields.

Mid-2000s 18 percent of employees of companies with more than 100 workers get fully paid health insurance—down from 70 percent in 1980. 35 percent get company pensions, compared to 84 percent in 1980. 2007 Corporate profits at highest share of national income since 1943. Share going to employee salaries lowest since 1929.

1994 Thanks to stock options and rapidly increasing pay, corporate executives overtake wealthy heirs as biggest portion of richest 1 percent.

2008-2009 During recession, hundreds of major U.S. companies cut back employer match for 401(k) programs.

1999 Jack Welch, who cut 25 percent of GE’s workforce, named “the ultimate manager” of the 20th century by Fortune.

2009 Following taxpayer bailout, big Wall Street banks continue to offshore jobs in finance, IT, human resources, and back-office functions.

1995-2000 Clinton tax increases lower inflation and interest rates, generate strongest economic growth since 1960s, boosting wages of middle-class workers.

December 2009 Germany ends decade with $2 trillion trade surplus, 21 percent of workforce in manufacturing; United States had $6 trillion trade deficit, 9 percent employed in manufacturing. 1985-2009 Average German hourly wage rose 30 percent versus 5 percent in the United States.

2000s 2001-2003 Bush administration gets tax cuts through Congress each year. Federal Reserve cuts interest rate from 6.5 to 1 percent, fueling housing boom. Americans borrow $700 billion a year from home equity.

2000-2009 U.S. multinational companies hired 2.4 million people overseas while firing 2.9 million workers at home.

2010s

2004-2005 Fed Chair Alan Greenspan praises rapid growth of subprime mortgages, encourages borrowers to refinance with adjustable rate mortgages. Fed then raises interest rates.

2010 In congressional elections, business outspends labor 16-to-1, $1.3 billion to $79 million. 49 percent of members of Congress are millionaires compared with 1 percent in the general population.

2005-2006 Of people who were sold subprime mortages, more than half actually qualified for prime loans.

Adapted from Who Stole the American Dream? by Hedrick Smith. Random House Publishing Group, 2012, 592 pages.

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One Policy That Will Work

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A POLICY THAT AIMS FOR FULL EMPLOYMENT CAN REVERSE INEQUALITY. A SUSTAINED ONE PERCENTAGE POINT DECLINE IN THE UNEMPLOYMENT RATE MEANS A 9.4 PERCENT RISE IN THE WAGES OF POOREST WORKERS.

Dean Baker

homas Piketty’s book, Capital in the Twenty-First Century, put inequality front and center in public debate. Piketty warns of a tendency in capitalism to produce an ever greater concentration of income and wealth. There are many questions about Piketty’s analysis, most importantly whether the rise in inequality is an inevitable result of our economic system or whether it is the result of intentional policy decisions that lawmakers can alter. There is very good reason to believe the latter. Our focus should be on reversing the policies that have produced three decades of the rich getting richer as the rest are pushed down the economic ladder. The best place to start is a full employment policy designed to return us to the low levels of unemployment we saw at the end of the 1990s. This was the only time we saw sustained wage growth for workers at the middle and bottom of the wage distribution since the early 1970s. It is difficult to overestimate the importance of unemployment in the distribution of income. In our new book, Getting Back to Full Employment (free download available), Jared Bernstein and I present evidence that a sustained one-percentage-point decline in the unemployment rate is associated with a 9.4 percent rise in the wages of workers in the bottom quintile of the wage distribution. The logic behind this result is straightforward. When demand falls, employers don’t lay off their managers and top executives; they lay off retail clerks, assembly line workers, and custodians. In periods of high unemployment, these workers have limited bargaining power. However when unemployment gets to low levels—particularly like those we saw in the late 1990s boom— employers find it difficult to get workers. They then bid up wages to attract new people into the workforce or to pull away workers from competitors. There were numerous accounts in the business press in the late 1990s of employers going to extraordinary lengths to get additional workers. Some businesses chartered buses to take people from the inner cities to jobs in restaurants or hotels in the suburbs. Others arranged on-site child care or made arrangements to accommodate workers who needed to care for family members. Now, with the rate of unemployment still over 6 percent and an enormous amount of underemployPHOTO BY KYLE RUTH

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$15

and Change HOW SEATTLE POLITICIANS, UNIONS, AND VOTERS LED THE NATION’S NEW WAGE REVOLUTION Goldy

“I

t’s easy to not think about the person serving you your food,” 21-year-old Caroline Durocher told me as she prepared for the 8 p.m. to 2 a.m. shift at a Taco Bell in Seattle’s Ballard neighborhood. Durocher had been working low-wage jobs since she was 16,

but after five years of so-called “entry-level” employment, she felt stuck. Unable to get a better job without a college degree, but unable to earn enough money to go back to college, Durocher barely scraped by serving up 99-cent tacos to a steady stream of impatient drive-thru customers before heading home to the studio apartment she shared with her father. “We definitely get disrespected a lot and looked down upon for being in fast food,” sighed Durocher. But she was about to earn some respect. Shortly after 11 p.m. that night, May 29, 2013, Durocher walked off her $9.19 an hour job to become the first fast-food worker in Seattle to strike for a $15 an hour minimum wage. The next day, hundreds of Seattle fast-food workers and their supporters followed her lead, temporarily shutting down as many as 14 restaurants to chants of “Supersize our salaries now!” It was an outrageously ambitious goal—a 64 percent pay hike to more than twice the federal $7.25 an hour minimum wage. Yet only one year and four days later, the Seattle City Council met their demands, unanimously approving the first $15 minimum wage in the nation. Seattle’s path to a $15 minimum wage is a winding tale of effective organizing, smart messaging, bold experimentation, opposition missteps, and blind dumb luck. It is also a roadmap for bypassing our nation’s partisan gridlock by rolling out a broader progressive agenda one city at a time.

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Brittany makes $9.52 per hour. Martina makes $9.47 per hour. Both work full-time at McDonald’s in Seattle’s Capitol Hill neighborhood.

Portraits by photojournalist Betty Udesen

Brittany’s daughter, Emonie Phelps, 5, marched with her mother and aunt, chanting “What do we want? 15! When do we want it? Now!” She says her favorite thing to do is “play outside.” Her mom doesn’t let her out to play in the South Seattle neighborhood where they live, saying it’s too dangerous. With the increased minimum wage, Brittany hopes to move out of her mother’s 2-bedroom, 1-bath apartment that is currently home to five people. Both women have college degrees. Martina hopes to get her own place to live and to return to school for a degree in cosmetic chemistry so she can make beauty products for skin and hair. yesmagazine . org

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YES! PHOTO BY BETTY UDESEN

» P a r t ly t h r o u g h i t s e a r ly s u p -

Occupy Wall Street, New York Communities for Change (NYCC, formerly the New York City chapter of ACORN) came to focus on the minimum wage as a tool for improving the lives of the working poor, taking a lead role in organizing the first of what would eventually become a series of national, rolling, one-day, fast-food strikes. It was a bold plan with potentially big media port of

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appeal. But what exactly were the workers’ demands? A $10 minimum wage seemed way too low, especially in pricey New York City, but $20 an hour seemed unrealistic. It was at a meeting in Brooklyn that organizers settled on splitting the difference. And thus the $15 minimum-wage movement was born. On Nov. 29, 2012, about 200 fastfood workers walked off their jobs in

New York City to strike for $15 an hour and the right to unionize, the largest such job action ever to hit the industry. The powerful Service Employees International Union (SEIU) had helped back NYCC’s efforts and quickly started funding organizing efforts nationwide. It was representatives from SEIUfunded Good Jobs Seattle who first approached Durocher at her Seattle Taco Bell. “Local organizers came into my store

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Aden makes $10.95 per hour as a home care aide. She lives in Tukwila with her brother and her three children, ages 7, 9, and 13. “There are a lot of people in my shoes,” Aden says. “They’re not earning enough money to pay their bills.” She recently moved to Washington state from Atlanta to be near her parents. “They are getting older, and they’re the whole reason I’m getting into health care.” She explains that as she went through her training and met other caregivers, she was “shocked” to learn how low their pay would be. “My eyes were opened to the whole [minimum wage] thing.” So she got involved in the movement to raise it to $15. “I believe in saying what is right,” she says. At age 17, she was the first of her Somali family to leave a refugee camp in Kenya. After earning her citizenship, Aden sponsored 12 family members to come to the United States. “I’m glad it passed in Seattle,” she says. “Everybody deserves to have better pay. I hope it will pass across the state and across the nation.” Aden also works as a medical interpreter, making “more than $20 an hour.” She is about to begin a position with Neighborcare Health. She is also taking night classes, with plans of a future working in public health. YES! PHOTO BY BETTY UDESEN

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Picture Their Hunger Erasing stereotypes about who struggles to put food on the table

W h a t d o e s h u n g e r l o o k l i k e i n A m e r i c a ? According to Feeding America, a nationwide network of food banks, 49 million Americans, including 16 million children, suffer food insecurity each year. So, more and more, hunger looks like you and me. In Colorado, a diverse group of women who receive food assistance benefits chronicled their experience through photography. Their photographs and stories shed light on the reality of hunger with the hope of creating change in how we view and understand the issue. â&#x20AC;&#x153;Hunger Through My Lens,â&#x20AC;? an exhibit of their work, will be on display this year at locations around Denver.

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Ancestral Meals I’ve learned so much about life from working my farm space side by side with a Cambodian refugee family. I have a greater appreciation for the diversity other cultures bring to the community table. I learned to respect and admire the way this family shares meals and ceremony. C a r o l i n e P o o l e r , 52, artist, has a collective, “OUI Contemporary Arts,” in The Rhino District in Denver. After losing her job in 2011, she took an interest in urban farming to help fill the nutritional void.

AIDS? Food Is Medicine Too The photograph on the left depicts me prior to my diagnosis. You can see I was sick, and I didn’t have enough food to eat. The picture of me on the right shows me seven years later, much healthier. Food is an important part of my health. Not only does it give me proper nutrition, it allows me to take my medications and absorb them. I look better, feel better, and am better. S a l l i e C a m p b e l l , 51, Denver native and working mother of four, is dedicated to helping others and establishing food as a basic human right.

The Stress of $50 a Week—$2.40 Per Day— for One Mom, Two Kids Before I was on SNAP, I budgeted $50 a week for all groceries for my two children and myself. This was for food, shampoo, toilet paper, everything. It was very stressful to plan my list, and even more stressful going to the grocery store every time. I would add things up on my calculator as I put them in the cart. As soon as I hit $50, I had to decide what I was going to get and what I wasn’t. One day, I noticed that my nephew, who was visiting me, left a note on my grocery list. That small act of telling me, “I love you,” helped me through that trip to the grocery store. It is acts of kindness that have helped me through life’s challenges and given me the motivation to be the best mom that I can to my children. A n d r e a F u l l e r , a mom in her 40s, has a B.A. and M.A. in international relations and a certificate in conflict resolution. She works on issues of justice, human rights, and advocacy for women.

Better than Candy My husband was fixing supper when my spirited toddler grabbed a carrot and ran away with it, laughing. She was still at the steamed food stage but pretended to eat it anyway. Healthy food is so much more than just calories for our bodies. It also is how we raise our children and pass on our values; it’s nutrition to help them grow and learn; it’s time together as a family cooking. R o b i n D i c k i n s o n , 32, is married and mom to a 5-year-old boy and 2-year-old girl. She is a practicing physician and also a stroke survivor. She is grateful for food stamps and Medicaid being there for her family.

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COMPASSIONATE COMMUNITIES It’s not hard to bring a little more equality into each others’ lives

Kerry Morrison interviews homeless veteran John Watkins in the Hollywood Hills. Hollywood was one of the first communities to join the 100,000 Homes Campaign. Watkins has been provided with housing. PHOTO BY RUDY SALINAS AT PATH

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Shannan Stoll

1 100,000 homes so far Teams of volunteers across the country hit the streets early in the morning to put a name and a face to the long-term homeless in their communities. The volunteers started canvassing at 4 a.m., combing the streets to gather names, photographs, and stories of the people sleeping there. They searched for the people at the highest risk of dying from being on the streets. Once they identified the most vulnerable people, they offered them a home. That was the 100,000 Homes campaign’s approach to eliminating homelessness in communities across the country for the past four

PHOTO BY THE ALL-NITE IMAGES

years, and it worked. In June, one month before their deadline, campaign organizer Community Solutions announced that its more than 230 partnering cities, counties, and states had surpassed the goal of placing 100,000 people in homes in just four years. It was a bold goal. In the traditional housing placement system, it often takes more than a year to work through the multiple agencies, treatments, and counseling requirements to secure a home. The process is intended to ensure that government subsidies for housing go to the people best prepared to receive them. The 100,000 Homes campaign flipped this paradigm by offering housing first. Once housed, people received supportive services to deal with substance abuse, mental illness, and joblessness. The housing first method is quicker, and it’s successful. Studies show that two years after receiving supportive housing for free, more than 80 percent of people were still living in a home instead of on the street. Community Solutions isn’t stopping with 100,000 homes. Next January, the organization will launch Zero: 2016. This new national campaign will target the elimination of all chronic and military veteran homelessness, one home at a time. It’s another bold goal, and they just might do it.

2 Suddenly debt free When 80-year-old Shirley Logsdon went into the hospital for a back injury, she came out with nearly $1,000 in debt that she would never be able to pay. For a year and a half, she received persistent phone calls from debt collectors. Then Logsdon received a letter from Rolling Jubilee. “You no longer owe the balance of this debt,” it read. “It is gone, a gift with no strings attached.” Letters like the one Logsdon received were sent to 2,693 people last November, when Rolling Jubilee bought and forgave $13.5 million in personal debt. A newly released study by the Urban Institute says about 77 million people in the United States have debt that is subject to collections—often debt that was incurred to pay for basic needs. That’s one of the reasons the Occupy Wall Street group Strike Debt formed the Rolling Jubilee project. “We believe that no one should have to go into debt for the basic things in our lives, like healthcare, housing, and education,” the group says. Since forming in November 2012, Rolling Jubilee has bought nearly $15 million of debt for just $400,000 on the secondary debt market, where lenders sell unpaid bills to collectors for just pennies on the dollar. Thousands of individual donations averaging just $40 have paid for these debt buys. It’s a bailout for the people, funded by the people.

3 Stuff of good neighbors Freecycle and Craigslist give new life to old stuff by facilitating porch pickups for everything from free lamps and scrap wood to cans of food close to their expiration dates. That kind of stuff is posted on Buy Nothing’s local Facebook pages too, but the group

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RICHNESS IN THE WORLD IS A RESULT OF OTHER PEOPLE’S POVERTY. WE SHOULD BEGIN TO SHORTEN THE ABYSS BETWEEN HAVES AND HAVE-NOTS. Eduardo Galeano

PHOTO BY DAVE GLASS

Tenderloin District, San Francisco