January 10, 2014

Alright, I confess. The pithy title above was not mine. I give credit to Michael Savage as on his Wednesday radio program he led off with a clip from Lyndon Johnson's State of the Union Address from January 8, 1964 in which Johnson declared his War on Poverty and the beginning of the Great Society.

Actually, Johnson's 'Great Society' began the following year, in 1965, with his Aid to Families with Dependant Children Program, aka Welfare. But, it was the culmination of a year's worth of planning, raising taxes, and backroom deals along with promises made to Martin Luther King, Jr. and the NAACP, which guaranteed Johnson's election in November, 1964 and secured the African-American vote for the Democrats for generations to come.

Yes, the so-called War on Poverty was aimed at all poor, whether working or having fallen on hard times, but the chief beneficiaries were poor black families and within three years became isolated mostly to women with children and no father in the home. Thus began the climb in the number of out-of-wedlock births among the black community and the demise of a culture once solid and less prone to a life of crime and illegitimacy.

50 years later, the progress of Johnson’s “war on poverty” is beyond terrible. Trillions of dollars have been spent, and the number of Americans living in poverty is higher today than it was in 1964, while the poverty rate has held steady at just under one in five. That contrasts unpleasantly with the trend before President Johnson declared his war: The poverty rate had been dropping since the end of World War II. That progress came to a halt as President Johnson’s expensive and expansive vision began to be implemented in earnest, which coincided with the tapering of the postwar boom. By the 1970s, the poverty rate was headed upward. It declined a bit during the Reagan years, crested and receded again in the 1990s, and resumed its melancholy ascent around the turn of the century.

To understand the failure of the war on poverty requires understanding its structure, which itself is bound up in the idiosyncrasies of Lyndon Johnson’s politics. President Johnson played many parts in his political career: Southern ballast to John Kennedy’s buoyant Yankee idealism; an enemy of civil-rights reform and anti-lynching laws who reversed himself in 1964; a sometimes reluctant but in the end unshakeable Cold Warrior. But at heart President Johnson was a New Deal man, and his Great Society, of which the war on poverty was a critical component, was his attempt to resuscitate the spirit and the political success of Franklin Roosevelt’s program.

It was the New Deal that made Johnson’s Texas a fiercely Democratic state, as the older residents of New Deal, Texas, no doubt remember. Johnson’s House district was energetically anti-Communist, not especially segregationist, but above all wild about the New Deal. Johnson ran for the House as a New Dealer, and it was his association with FDR’s domestic agenda (and, according to biographer Robert Caro, a few thousand fraudulent ballots) that made him a senator and a force.

For all its shortcomings, and they were many, the New Deal was enacted in response to a genuine economic crisis—the Great Depression. The Great Society was launched under very different circumstances: Between the end of World War II and President Johnson’s declaration of war on poverty, the real economic output of the United States had doubled. The postwar boom was not destined to last forever, because the war-ravaged nations of Europe and Asia inevitably would reemerge as global economic competitors, but in the early 1960s the United States enjoyed a position of unprecedented economic advantage. The real challenge of the Johnson years, tragically overlooked, was figuring out how to build upon that position and consolidate those gains.

Unfortunately, what got consolidated was political power, as Johnson and his progressive allies did what progressives always do: transfer wealth, power, and responsibility from the private sector to the public sector, where they can be put under the political discipline of men such as Johnson and his allies.

The war on poverty has been conducted partly in earnest and partly self-servingly.

No doubt programs such as Head Start were launched with a great deal of idealism, but as their ineffectiveness became apparent, it was not idealism that sustained them but political self-interest. Providing at best temporary relief to the poor, the permanent welfare bureaucracies benefit Democrats by creating thousands of well-paid positions for their political allies and subsequent campaign contributions for their candidates.

Head Start today is a money-laundering program through which federal expenditures are transmitted to Democratic candidates through the Service Employees International Union, which represents many Head Start teachers. The National Treasury Employees Union, which represents, among others, the welfare bureaucrats at the Administration for Children and Families, is a large political donor that gives about 94 percent of its largesse to Democrats. This is not coincidental. The main beneficiaries of the war on poverty have not been and will not be the poor; the beneficiaries are the alleged poverty warriors themselves. The war on poverty is war on the Roman model in which soldiers are paid through plunder.

The result: a large and expensive welfare state that provides relatively little welfare, and a destructive and ruinous war on poverty that has not reduced poverty.

It is not enough for conservatives to understand and advertise the failure of the war on poverty. The issue is real and it is urgent, but it will not be ameliorated through the usual progressive program of consolidation and command.

Poverty in the United States is an economic issue, to be sure, especially as it relates to economic growth, the most important driver of employment and wages. But it is also a cultural issue. Well-off U.S. households are made up overwhelmingly of married couples in which one or both spouses are engaged in full-time employment. Poor households are the opposite. Poor households have on average 0.42 full-time workers in them, and 68 percent of their members are entirely unemployed; only 17 percent of them consist of married couples.

Conservatives, ever mindful of the role of economic incentives, have long argued that our approach to poverty must focus on making work and independence more attractive than welfare and dependency. There are two sides to that equation. We have made work more attractive by, among other things, radically reducing federal income-tax rates on low-income people, to the extent that that particular burden is either zero or negative (accounting for the Earned Income Tax Credit) for the working poor.

But there are other heavy burdens, notably the payroll tax. Heaviest of all are the indirect burdens — the regulations, taxes, and expenses inflicted on employers that inevitably are passed on, in some measure, to employees, and particularly to those employees without the in-demand skills that put them in a stronger negotiating position.

While on paper our taxes and regulations are targeted precisely, the economic fact is that those burdens are borne collectively, with costs shifted throughout the economy. It should surprise no one that they fall with disproportionate weight upon low-wage workers. The Democrats have for generations ignored that fact, and pronounce themselves shocked that our highly redistributive system of taxes and benefits has done so little to alleviate poverty.

Now comes the Income-Redistributor-in-Chief, Barack Obama. It's no secret that Obama and the far-left see this as a life-or-death issue. Liberals are all popping off about it. It's everywhere, from Obama's speeches to liberal think tanks to liberal reporters. It's almost as if they were conspiring to distract us from Obamacare.

I find it hard to believe that all liberals really believe their own propaganda that redistribution stimulates economic growth and helps the disadvantaged. Nevertheless the President is constantly drilling it into our heads, via his compliant media that those who have more must pay more. Why? Because the rich (i.e. the White Privileged) are evil.

Enter class warfare and the "Hate Society." No longer do we have a "War on Poverty" but a "War on Workers"

For Obama, it was more important to punish the "rich" than to help the poor. But by rich, he doesn't mean the truly rich, for they are his major contributors. They consist of Wall Street Executives, Hollywood producers and fat-cat bankers. Then the major corporations are not being punished for they stuff the campaign coffers as well. GE, Microsoft, Facebook, and Google are among those who raked in huge profits and are not paying one dime in taxes.

Don't get me wrong. Obama and his fellow leftists are fixated on redistributing wealth, but a major component of that, as witnessed by his attitude on increasing the capital gains rate, is that the 'wealthy' need to be punished — even if it means hurting lower-income groups. To Obama, the wealthy make between $50,000 and $250,000 a year. We know them to be the middle-class, the working people.

While vocalizing his support and praise for the middle-class, he punishes them through higher payroll taxes, estate taxes and capital gains taxes. These taxes are then redistributed to the poor, a large amount of whom refuse to work. It's merely an expansion of Johnson's War on Poverty.

The irony of all this is that these liberal policies often result in exacerbating income inequality. Obama can pretend, once again, that he's an innocent bystander, but income inequality is getting worse under his presidency.

It's a Socialist's dream come true. In the drive to achieve income equality, Obama and the far-left must stir up envy, malice and hate, because LBJ's "War" didn't work. So Obama has a war on taxpayers. And the only person paying taxes these days are the middle-class, the workers.

Still, the poor are not well off even though many on federal subsidies often get more from the government than the average worker gets from his or her employer. Consider this: Robert Rector in Wednesday Wall Street Journal presented a startling series of facts by noting that in 2012 alone, the Federal Government spent $916 billion on 80 welfare programs. That represent 23 percent of the entire Federal Budget. Rector also noted that about 100 million people received aid from at least one of these programs. These facts do not include Medicare and Social Security.

According to the Census Bureau, about 97% of welfare beneficiaries support the Democratic Party. This is why Obama and the Democrats are ramping up the upcoming midterm elections with more talk of more benefits via a war on income inequality which is newspeak for demonizing taxpayers for not paying enough. This, in turn, stirs up more discontent among the lower class and a once 'Great Society' morphs into a 'Hate Society.'

Let's face it. Poverty is a difficult issue with few obvious remedies. And even such obvious remedies as we have are politically difficult. The most attractive of the low-hanging fruit before us is reform of our dysfunctional public-education system, particularly as it affects students in our dangerous and ineffective inner-city schools. But when it comes to education reform, Barack Obama stands in the schoolhouse door as pitilessly as George Wallace.

Republicans, for their part, have shown a remarkable inability to view issues such as immigration reform, and especially an amnesty for illegals, through the eyes of low-income workers rather than those of the Chamber of Commerce. Whatever the cure for poverty is, it is not the importation of poor people.

The Left has made a mess of the issue, and while we should not let them forget that it is their mess, conservatives will, by necessity, be the ones who clean it up. Economic thinkers such as Thomas Sowell have been making the case for a conservative approach to poverty for years, and recently conservative leaders such as Ralph Reed have been making a praiseworthy effort to ensure that the problems of the poor are front and center in the minds of a sometimes too well-fed GOP.

The campaign against poverty is not a war, and it is not the moral equivalent of war, but it is worth fighting. But the answer will never be to throw money at it and that is always the Democrats way of doing things. And they get that money with their 'War on the Worker.'

We believe that the Constitution of the United States speaks for itself. There is no need to rewrite, change or reinterpret it to suit the fancies of special interest groups or protected classes.