Desperate poverty amid great affluence remains a defining feature of American life. It also remains one of the most striking blind spots in American political science. In 2011, more than 46 million Americans lived below the poverty line. Almost 1.5 million households weathered the grinding effects of “extreme poverty,” living on an income of two dollars or less per person, per day. To find a discernibly higher poverty rate, one must look all the way back to the mid-1960s at the dawn of the War on Poverty. Yet while poverty is a central fact of life for millions of Americans today, it is a peripheral concern at best in the professional study of U.S. politics. In recent years, economic inequality has moved to the field's center stage. As growing numbers of political scientists have asked how the super-rich came to hold so much material wealth and political influence, however, they have largely ignored the opposite end of the income distribution.
Lane Kenworthy's important new book, Progress for the Poor, arrives as a welcome invitation to change this state of affairs. In a slim and tightly framed monograph, Kenworthy pursues a series of empirical analyses designed to shed light on a single question: What kinds of public policies are most effective at raising living standards for the poor? Readers should not look to this book for an analysis concerning how the poor are positioned in class relations, how poverty relates to inequality, or what life conditions are like for the poor themselves. The value of the work lies in its careful dissection of cross-national evidence to 1) demonstrate that material advances for the poor depend on the choices we make among policy alternatives and 2) specify the policy choices that are most effective for achieving this goal.
Drawing on data from 20 affluent democracies, Kenworthy presents empirically grounded arguments that challenge conventional wisdom on both the left and right. He begins by considering the claim that policy interventions to help the poor should follow a simple principle: aim to achieve economic growth. The author does not dismiss this view entirely. On balance, economic growth is better for the poor than stagnation. But economic growth alone is not sufficient because its benefits do not inevitably “trickle down” to the poor. To the contrary, for economic growth to benefit the poor, it must be paired with strong government transfer programs of the sort that pro-growth advocates often decry. “When growth has trickled down to the poor,” Kenworthy concludes (p. 17), “government transfers have been the principle conduit.”
To illustrate his point, the author examines the United States as a case of trickle-down failure. Over the past several decades, economic growth has largely failed to produce wage growth in the lower reaches of the US labor market. And while work hours have tended to rise during periods of economic growth, benefits for the poor have been offset by sharp declines during periods of weaker economic performance. The American experience, Kenworthy argues, underscores the limits of a flexible labor market approach that focuses on job growth. Government social spending, in one form or another, must be treated as an essential component of any serious effort to raise living standards for the poor.
If these conclusions seem unlikely to ruffle feathers on the political left, the same cannot be said for the subsequent discussion of low-wage employment. Drawing again on cross-national evidence, Kenworthy urges readers to make peace with the present era of low-wage employment. By embracing publicly funded wage supplements—employment-conditional earnings subsidies such as the Earned Income Tax Credit (EITC) in the United States—we can accept the reality of low wages without resigning ourselves to low household incomes. Empirically, he argues that low-wage jobs do not preclude progress for the poor if they are combined with adequate public transfers. Morally, he argues that there is little reason to prefer wage income to publicly funded supplements. Economically, he argues that wage subsidies are desirable because they incentivize and reward work. And politically, he contends that liberals who favor government provision of social benefits (such as health care) are both inconsistent and shortsighted when they treat public-subsidy income as less desirable than market-wage income.
Kenworthy's position raises core questions of political economy and, partly for this reason, merits serious discussion. In essence, it calls for abandoning a question of distributive justice that has long been at the heart of the labor struggle: How shall revenues generated through production be divided between the wages of labor and the profits of capital? Adopting a bottom-line stance, the author argues that the same income results we would get from higher wages can be achieved by a system that combines low wages and high profits with broad taxes and efficiently targeted wage subsidies.
Here and elsewhere, Kenworthy stops short of addressing political questions that might complicate his policy prescriptions. What kinds of political dynamics should we expect a low-wage, high-subsidy strategy to set in motion? Can calls for bigger government supplements mobilize workers today as demands for a fair division of profits and wages have in the past? Is it possible to marshal political support that is durable and strong enough to sustain the kinds of taxes needed for such a system to work? If low-wage workers are increasingly and visibly dependent on government transfers, will their employment status protect them from being stigmatized and targeted as freeloaders living off handouts? How politically tenable is the policy strategy if, as Kenworthy claims, wage subsidies can only succeed if they are bolstered by generous minimum wage and public assistance policies? By focusing tightly on the policy's instrumental effects on income, he obscures an array of complications and stumbling blocks that emerge when we consider the expressive effects of policies and the ongoing interplay of policy and politics.
The second half of the book largely mirrors the approach adopted in the first. Kenworthy addresses important policy questions with empirical evidence, emphasizing instrumental effects on income while devoting limited space to political complications. In this manner, he develops a number of arguments with far-reaching implications: A valid case can be made for preferring targeted social welfare programs over universal ones; investments in general public services should be seen as effective tools for improving life conditions among the poor; the structure of a country's tax system (including its progressivity) matters less for the poor than one might think; and, to a surprising degree, we can have our cake and eat it too—improving life conditions for the poor without sacrificing other important values and goals.
Empirical supports for these and other conclusions are drawn mostly from simple scatterplots of bivariate relationships. It is fair to say that our understandings of the issues would be improved, in many instances, by a more searching multivariate analysis of moderating and mediating factors. The questioning of evidence, like the interrogation of politics, too often stops short in this brief book. Yet I recommend it all the same. By combining basic displays of evidence with clear and engaging prose, Kenworthy delivers an accessible and provocative meditation on poverty in affluent democracies. He puts important questions on the table and gives readers good empirical reasons (however preliminary) to think seriously about his arguments. The concise discussions are direct enough to hold the attention of students and policymakers but ambitious enough to motivate more substantial scholarly responses.
Progress for the Poor renews an invitation that has been allowed to gather too much dust—an invitation to confront poverty forthrightly as a product of decisions about the exercise of public authority and the allocation of public resources. The RSVP from American political scientists is long overdue. We would do well to respond in the affirmative.
