Poverty In America

7 02 2012

 By Timothy D. Naegele[1]

Presidential candidate Mitt Romney made one of the dumbest and most insensitive comments that I have ever heard from an American politician since I became involved with politics:
You can choose where to focus.  You can focus on the rich; that’s not my focus.  You can focus on the very poor; that’s not my focus.  My focus is on middle-income Americans.

He went on to explain that “[w]e have a safety net for the poor.”  And “[i]f there are people that are falling through the cracks, I want to fix that.”[2]

However, the fact that America’s poorest citizens theoretically have access to food stamps, Medicaid and housing vouchers[3]—which Romney cited—does not constitute much of a “safety net” at all.  Some Americans, such as senior citizens, are too proud to accept any governmental assistance (other than Social Security and Medicare benefits) or handouts.  They have worked all of their lives; and to find themselves in poverty is embarrassing and deeply depressing.  They and others are often turned away or sanctioned by the government bureaucracy that can be brutal and cruel, especially to people who are truly in need.[4]

Those Americans who had moved into our “Middle Class” will lose their homes and everything else, which is happening already.  The idea that colleges and professional schools were guaranteed pathways to success will also evaporate.[5]  Our society and that of other countries will be upended.  And yes, there will be “class warfare,” which Barack Obama and his surrogates are fanning already.  Leave aside the fact that he will add more debt than all 43 prior presidents combined, demagoguery is in season and full swing.

When I worked in the U.S. Senate as a young lawyer with its Senate Banking Committee and later headed the Senate staff of Edward W. Brooke (R-Mass)—the first African-American in the Senate since Reconstruction following our Civil War, with Obama being the third—the senator and I met with Mitt’s father who was Secretary of Housing and Urban Development (1969-1973)[6], and I was very impressed with him.  At that time, I was working on the passage and implementation of the Housing and Urban Development Acts of 1969 and 1970, which included the “Brooke Amendment” relating to public housing; and the national “Housing Allowance” program, which morphed into the Section 8 housing program that has helped millions of Americans.  The senator, George Romney and I talked about these programs at length.

On behalf of Senator Brooke, I also established a summer program for disadvantaged kids in Massachusetts, in conjunction with the Pentagon, which involved underutilized military facilities within the state (e.g., the Boston Navy Yard, Otis Air Force Base) and served approximately 100,000 kids during its first year alone.  Indeed, the senator and I traveled to Massachusetts with then-Secretary of Defense Melvin R. Laird in his private plane to review the program and its progress.

In making my observations, I am not singling out Mitt Romney for condemnation.  I have believed in Mitt for a long time now, and will vote for him—in no small part because I share most of his positions with respect to the economy and national security issues.  However, lots of politicians and other successful Americans are “tone deaf” when it comes to the needs of the poor.  They do not relate to them at all, and they cannot understand them.  To be poor is a sign of failure in our success-oriented and driven society.  Our advertising touts beautiful bodies and fancy cars and materialistic dreams.  In no way are the poor glorified, much less given dignity.  Shame is heaped on them, which is wrong.

When I was graduating from grade school in Los Angeles, my mother came to the ceremony in a wheelchair, and I was mortified.  No other mothers were present like that.  She had suffered the convergence of two debilitating illnesses, which robbed her of her beauty and almost killed her.  By the time that I was entering high school, her right leg had been amputated, which stopped the onslaught of what she had gone through; and during the Vietnam War, she walked with an artificial leg and was named the “Woman of the Year” by the local chapter of the Red Cross—for her outstanding volunteer work.

What all of this taught me was that her faith in God had sustained her, and given her courage, hope, joy and great love.[7]  And that stigmas and discrimination attach, especially in Southern California, to those people who are physically or mentally “challenged” or handicapped, the poor, and to those who are not “beautiful.”  Hollywood has gone nationwide and worldwide since then, with a vengeance; and life-threatening illnesses and poverty are not part of the “American dream,” which has been embraced by people globally.  As the U.S. economy declines more between now and the end of this decade—which will happen to an even greater extent in countries around the world—poverty, human suffering, misery and anger will increase dramatically.[8]

The core issues will be how Americans adjust to their poverty and hopelessness, which will be just as rampant in this decade as during the Great Depression of the last century that did not end until the onset of World War II, at the earliest.  There are no easy solutions to losing one’s job, home, car and everything else.  As State governments scramble to avoid bankruptcy, programs that might have helped the poor will no longer exist.  For example, in California, State parks are being closed; and the nightly price for staying at those that remain open equals the cost of a cheap motel already.  Where will the poor stay, especially if they have no family members who can—or are willing to—take them in?  How will they afford food to eat, and find transportation to get from one place to another (e.g., looking for work)?  When inclement weather sets in, how will they survive?

The published numbers of “poor” do not begin to tell their tragic stories; and the human suffering will increase and become unfathomable during the balance of this decade, whether Romney is president or not.  Pure economics will dictate this; and there is nothing that can be done governmentally, by any politician.[9]  And yes, many of those poor will be “middle-income Americans” or those who had been members of our Middle Class.  They will be devastated; suicides and divorces will increase[10]; and families will be torn asunder.  Mitt Romney and the wealthy of the United States—which includes Obama and most members of Congress—need to wake up now, and begin to demonstrate real compassion.  The problem is that they have no earthly idea of what it is like to be poor.

In Greece today, parents are giving away their children because they cannot afford them.  Kids are being dumped in streets or abandoned at shelters with notes attached to them, saying that one or both parents are at wits’ end.[11]  Poverty breeds inhumanity on a scale that is unknown to most Americans; and it also breeds crime (including massive Internet fraud[12]), which will increase in the United States as money for law enforcement declines and as our prisons are overcrowded and prisoners are released.  Reality is crashing down with a thud like never before in our lifetimes.

As I wrote almost three years ago:

America and other nations are in uncharted waters; and their politicians may face backlashes from disillusioned and angry constituents that are unprecedented in modern times. Also, the limits of godless secularism and paying homage to the false gods of materialism may become self-evident.[13]

The chickens are coming home to roost, in spades; and the “good times” are ending for vast numbers of Americans and their counterparts around the world.

Others will remain rich, or attain great riches[14]; and I do not begrudge it to them at all.  I do not envy or covet what another has.  I have never done so.  My parents taught me that, by their own words and actions.  In my lifetime thus far, I have had lots of money, and none.  I have friends with many millions, and one with several billions; and others who have nothing.  I have treated them all the same—with love, respect, dignity and compassion.

I lived in a tent for months at a time—with water everywhere inside it, during the rainy season—because that was all I could afford.  I have had two cars repossessed, as well as a boat.  I have been evicted; and lost my dream house, as well as most of the possessions that were important to me, including priceless family items that had been handed down over generations.  When I was in law school, I had a pair of shoes resoled so many times that I was told it could not be done anymore; and I have struggled to make ends meet for food.

I do not wish any of this on others.  However, I realize that many Americans have experienced losses, pain and suffering that are far worse than I ever have; and this is true today of people abroad who are dying of wars, diseases and malnutrition, and are being forced into slavery and prostitution.[15]  I have great faith in God, the United States, all Americans[16], and people everywhere.  I believe we will survive like my mother did.  However, we will be tested like never before.

© 2012, Timothy D. Naegele

[1] Timothy D. Naegele was counsel to the United States Senate’s Committee on Banking, Housing, and Urban Affairs, and chief of staff to Presidential Medal of Freedom and Congressional Gold Medal recipient and former U.S. Senator Edward W. Brooke (R-Mass).  He practices law in Washington, D.C. and Los Angeles with his firm, Timothy D. Naegele & Associates, which specializes in Banking and Financial Institutions Law, Internet Law, Litigation and other matters (see www.naegele.com and http://www.naegele.com/naegele_resume.html).  He has an undergraduate degree in economics from UCLA, as well as two law degrees from the School of Law (Boalt Hall), University of California, Berkeley, and from Georgetown University.  He is a member of the District of Columbia and California bars.  He served as a Captain in the U.S. Army, assigned to the Defense Intelligence Agency at the Pentagon, where he received the Joint Service Commendation Medal.  Mr. Naegele is an Independent politically; and he is listed in Who’s Who in America, Who’s Who in American Law, and Who’s Who in Finance and Business. He has written extensively over the years (see, e.g.,www.naegele.com/whats_new.html#articles), and can be contacted directly at tdnaegele.associates@gmail.com; see also Google search:Timothy D. Naegele

[2] See http://edition.cnn.com/2012/02/02/politics/campaign-wrap/?hpt=hp_t1

[3] As discussed later in this article, “housing vouchers” are an outgrowth of the national “Housing Allowance” program that I crafted as a young attorney with the Senate Banking Committee—which was complementary to the “Brooke Amendment,” and morphed into the Section 8 housing program that has helped millions of Americans.

[4] As I have written:

[L]awyers who are prosecutors are often less interested in fairness and justice than they are in winning at all costs, and exercising their raw power and hurting others in the process—such as those who are innocent but are convicted anyway.

See https://naegeleblog.wordpress.com/2011/01/03/the-american-legal-system-is-broken-can-it-be-fixed/

And I added:

A federal official with reason to know told me that between 15-20 percent of the indictees in federal courts are probably innocent.  Some are seniors who have been charged with cheating the Social Security program, and they are scared to death, so they agree to plea bargains rather than fight for their innocence.

See id. at n.8.  This is truly frightening, and cruel.  Also, those who are engaged in prosecutorial misconduct are “sheltered” by the government, which is a travesty unto itself.  Aside from any civil remedies against them, such prosecutors should be prosecuted and disbarred.

See, e.g.http://www.usatoday.com/news/washington/story/2012-02-06/ted-stevens-prosecutors-justice-department/52922922/1 (“Taxpayers pay to defend prosecutors in Ted Stevens case”); see also https://naegeleblog.wordpress.com/2011/01/03/the-american-legal-system-is-broken-can-it-be-fixed/#comment-1700 (“Perhaps the best remedy for such abuses is to have the ‘guilty’ prosecutors incarcerated; and let justice be meted out with respect to them, by those in prisons”)

[5] See, e.g., https://naegeleblog.wordpress.com/2011/01/03/the-american-legal-system-is-broken-can-it-be-fixed/#comment-1977 (“Law School May Amount To The Worst Investment Of Her Life!”) and https://naegeleblog.wordpress.com/2011/07/29/are-colleges-dinosaurs/ (“Are Colleges Dinosaurs?”) (see also the footnotes and all other comments beneath the article)

[6]  See, e.g., http://en.wikipedia.org/wiki/George_W._Romney#Secretary_of_Housing_and_Urban_Development

[7] See, e.g.https://naegeleblog.wordpress.com/2010/05/12/what-and-where-is-god/ (“What And Where Is God?”) (see also the footnotes and comments beneath the article)

[8] See, e.g., https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-1960 (“Global Economy Could Endure Disaster For a Week”) (see also the article itself, as well as the footnotes and all of the other comments beneath it)

[9] See, e.g., http://www.americanbanker.com/issues/173_212/-365185-1.html (“Greenspan’s Fingerprints All Over Enduring Mess”) and http://www.realclearpolitics.com/news/tms/politics/2009/Apr/08/euphoria_or_the_obama_depression_.html (“Euphoria or the Obama Depression?”); see also http://www.philstockworld.com/2009/10/11/greenspan’s-legacy-more-suffering-to-come/ (“Greenspan’s legacy: more suffering to come”)

[10] See https://naegeleblog.wordpress.com/2011/07/14/divorces/ (see also the footnotes and comments beneath the article)

[11] See, e.g., http://www.dailymail.co.uk/news/article-2085163/Children-dumped-streets-Greek-parents-afford-them.html (“Children ‘dumped in streets by Greek parents who can’t afford to look after them any more'”)

[12] See https://naegeleblog.wordpress.com/2010/01/31/lawyers-and-internet-scams/ (“Lawyers And Internet Scams”) (see also the footnotes and all of the comments beneath the article)

[13] See http://www.realclearpolitics.com/news/tms/politics/2009/Apr/08/euphoria_or_the_obama_depression_.html

[14] See, e.g., http://www.thedailybeast.com/galleries/2012/02/02/the-youngest-and-richest-people-in-america-from-mark-zuckerberg-to-sean-parker-photos.html (“The 10 Youngest Richest, From Sergey Brin to Mark Zuckerberg”)

[15] See https://naegeleblog.wordpress.com/2009/12/28/human-trafficking/ (“Human Trafficking”) (see also the footnotes and all of the comments beneath the article)

[16] See https://naegeleblog.wordpress.com/2010/02/26/america-a-rich-tapestry-of-life/ (“America: A Rich Tapestry Of Life”) (see also the footnotes and all of the comments beneath the article)



36 responses

7 02 2012

Mr. Naegele,

The most accurate prophetical-diagnosis-portrait of America, I have ever read. This is Presidential speech material…..awaiting a President to believe it and then deliver it.

If things don’t change in America soon,….the real change won’t be in effect until after Christ returns.

Gary A. Flynn


7 02 2012
Timothy D. Naegele

Thank you so much, Gary, for your very kind words. I appreciate them greatly.

The president who comes to mind was Lincoln; and I have written two articles that discuss Jefferson, Grant, Lincoln and other presidents, as well as another one that compares Ronald Reagan with John F. Kennedy.

See https://naegeleblog.wordpress.com/2010/03/22/jefferson-lincoln-and-america/ (“Jefferson, Lincoln And America”) and https://naegeleblog.wordpress.com/2010/03/21/ulysses-s-grant-an-american-hero/ (“Ulysses S. Grant: An American Hero”) and https://naegeleblog.wordpress.com/2010/03/20/ronald-reagan-and-john-f-kennedy-a-question-of-character/ (“Ronald Reagan and John F. Kennedy: A Question of Character”)

The problem is that our political process is so “challenging” that only skilled politicians make it to the top. Many Americans had great hopes for Barack Obama, but I believe they were unfounded. He too is an elitist.

See https://naegeleblog.wordpress.com/2009/12/05/is-barack-obama-a-racist/ (“Is Barack Obama A Racist?”) and https://naegeleblog.wordpress.com/2010/12/03/barack-obama-is-a-lame-duck-president-who-will-not-be-reelected/ (“Barack Obama Is A Lame-Duck President Who Will Not Be Reelected”) (see also the footnotes and all of the comments beneath these two articles)

Having watched our national politicians up close for 19 years nonstop, and many more years after that—to this day—my concern is that the campaign rigors are so difficult that many very able and talented Americans are turned away. They do not want to run the often-destructive political gauntlet, and who can blame them?

I believe this year’s race between Obama and Romney—in all likelihood, the GOP nominee—will be an interesting one, because it will pit two very different philosophies and visions for the future of America against each other. There will be a stark contrast.

However, it has been my experience that genuine empathy is lost in the political process, as higher and higher offices are sought. One example comes to mind that is illustrative.

The year before I arrived at the U.S. Senate to work, there had been a major housing bill, in which a prominent senator sponsored a seemingly-worthwhile program, which bore his imprint. Afterward, it came under fire and there were problems with it; and to my great amazement, the person turned against the program instead of trying to fix it.

I will always remember this as demagoguery at its best, in many ways. I was a young attorney, and I was tempted to tell the senator: “This is your program. You should be spending your time trying to fix it, not destroying it.”

Politics at the highest levels of our country, and essentially every other country on earth, is brutal to say the least. It is not for the “fainthearted.” Also, politicians have “feet of clay,” and one learns that in spades the closer one gets to them. If they had values, principles, compassion and true empathy for others, such characteristics are generally compromised or lost somewhere along the road to the top.

Next, in my article about Lincoln and Jefferson, I wrote about Lincoln:

He was certainly not the folksy backwoods caricature that often is presented, although he used that to his advantage (e.g., to disarm opponents and garner support).

. . . [O]ne gets the sense that what truly made Lincoln “tick” was unknowable, from a deeply personal standpoint. Having worked on Capitol Hill, my sense is that most senators are that way, possibly because they have been compromised again and again to reach high offices, and to be all things to all people.

Therein lies the rub.

Lastly, your concluding paragraph may prove prophetic.


12 12 2012

Speaking of the BIBLICAL figure CHRIST, would that those hunting for answers to the HOW/WHY of our decline simply study the Old Testament, then there would be much understanding and efficacious problem-solving; e.g., avoid MORAL HAZARDS and resulting SLIPPRY SLOPES, such as providing welfare payments to unwed mothers!!!—and the list of the nation-wrecking love-crimes of liberals’ liberalism is too long to continue here.


7 02 2012
Jitendra Desai

Why only US leaders. Leaders everywhere have gone thick skinned with the poor and poverty. They think and propagate the idea that no matter what we do, certain people will remain poor. Why worry? What is needed though is not a very elaborate government programme with attendant redtape and cost over runs. What is needed is sensitivity of our leaders to the issues of poverty and hunger.


7 02 2012
Timothy D. Naegele

Thank you, Jitendra, for your comments.

Yes, I agree with you. However, how does one instill “sensitivity,” empathy and compassion, when the arduous and brutal road to the top of the political process seems to strip these qualities from them? It is a fascinating dilemma.


19 02 2012

issue of poverty is a major issue is overlooked. in my country Indonesia many government programs are carried on a variety of government agencies with no coordination and clear results. I think there should be institutions that deal with this record all forms of csr and government programs provided to the community in addressing this. management and good cooperation can improve the rate of poverty that exist if not then the program MDG’s that it shall be implemented in 2015 to just a dream but it seems only a dream is realized because sometimes the program is actually a land profiteers who want to get more money for their pockets which is already full.


14 05 2012
Timothy D. Naegele

The Power Of Hope

An article in the UK’s Economist about this subject is worth reading.

See http://www.economist.com/node/21554506

Hope and faith in God are needed today, and will be required during the balance of this decade, more than at any other period in our lifetimes. People will be tested like never before.

Compare https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-2160 with https://naegeleblog.wordpress.com/2010/05/12/what-and-where-is-god/ (see also the footnotes and comments beneath both articles)


25 10 2012
Timothy D. Naegele

Foreclosed Family Watches Helplessly As Craigslist Crowds Strip House Bare

It has been reported:

A family in Woodstock, [Georgia] who just lost their home of 20 years to foreclosure and are preparing to move out, lost even more on Wednesday.

. . .

Their online [craigslist] post was just a well-meaning ad for a giveaway in their driveway outside the small house, a giveaway scheduled to begin at 10 a.m. Wednesday.

But big crowds showed up and ended up taking practically everything inside the house, too.

Wednesday night, Michael Vercher walked . . . through his family’s almost empty soon-to-be former home.

“Well, when we got to the house, I mean, pretty much — this,” he said as he stepped from the foyer into the living room.

Their home — ransacked, ravaged, raked over.

Almost everything inside — gone.

“They came in and just tore the place up,” he said.

People responding to the family’s craigslist ad showed up at the house earlier than 10 a.m., before Vercher arrived there from work to supervise the giveaway.

And when he drove up to the house, he said, they had already broken into it, helping themselves to almost everything inside.

And he could not stop them.

“Everyone was inside the house; they were taking out items,” he said. “There were cars around the block. It was like ants in and out of the house.”

He spoke of how they took family keepsakes, all their clothes and shoes — everything but a few books left scattered across the carpet.

Vercher’s fiancee, Dana Lamanac, said they took her guitars, which were gifts from her father.

See http://www.11alive.com/news/article/261774/40/Foreclosed-family-watches-helplessly-as-Craigs-List-crowds-strip-house-bare

This is merely one example of the human tragedies and suffering that are occurring throughout the United States and in other countries, which will only accelerate during the balance of this decade, as the economic tsunami continues its relentless and unforgiving advance globally.

See https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/ (see also the footnotes and comments beneath the article)


26 10 2012
Timothy D. Naegele

Crime Will Increase Dramatically In America

During the balance of this decade, crime will increase in the United States as economic conditions worsen and poverty increases, and as criminals are released because of overcrowding in the prisons, and as law enforcement declines because of budgetary cutbacks that cannot be avoided. One shining example is the State of California.

The UK’s Daily Mail has reported in an article entitled, “Bursting at the seams: Uncompromising pictures from inside America’s overcrowded prison system show the cramped and impersonal lives lived by more than two million inmates”:

Correctional institutions across the U.S are bursting at the seams with more than two million Americans behind bars with the worst hit state, California, housing 140,000 inmates when its 33 adult prisons are only designed to hold a maximum of 80,000.

Overall, the Bureau of Prisons Network is around 39 per cent over ‘rated capacity’ – their highest level since 2004 – with that figure expected to soar to 45 per cent above its limit by 2018.

So bad is the situation in California that the Supreme Court has slapped an order on the state ruling that 30,000 prisoners must be released by the middle of next year, labelling overcrowded conditions in its jails as ‘unconstitutional’.

The prison system has seen a stream of new offenders in the past five years and is still massively overstretched despite extra space being added.

Wardens and experts now fear that increased overcrowding and an increasing lack of privacy for inmates will see them more prone to lashing out and causing trouble.

Many prisons have had to create makeshift living quarters for detainees in public spaces such as gymnasiums, with some inmates having to sleep in bunks of three, while some cells which are only designed to house one person are home to up to three.

Inmates are being allowed less time in communal areas such as the cafeteria, TV rooms and recreation yards.

The country is streets ahead of the rest of the world in terms of the number of prisoners per 100,000 population, with Russia the second highest and South Africa in third. The European average took fourth place.

See http://www.dailymail.co.uk/news/article-2223626/Prisons-America-breaking-point-million-citizens-bars.html; see also http://sanfrancisco.cbslocal.com/2012/10/30/chickenpox-outbreak-puts-san-quentin-state-prison-on-lockdown/ (“Chickenpox Outbreak Locks Down San Quentin”) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/ (“The Economic Tsunami Continues Its Relentless And Unforgiving Advance Globally”)

California is the most populous U.S. state, and its gross domestic product (GDP) is larger than all but eight countries in the world. In a very real sense, it is a microcosm of America—and of things to come.


8 03 2013
Timothy D. Naegele


It has been reported:

The number of Americans not in the labor force increased by 296,000 in February, according to the Bureau of Labor Statistics’ latest jobs report. According to the report, there were a total of 89.3 million people not in the labor force, up from 89 million in January.

BLS labels people who are unemployed and no longer looking for work as “not in the labor force,” including people who have retired on schedule, taken early retirement, or simply given up looking for work.

The increase marks the second month in a row, after rising in January from 88.8 million in December.

See http://cnsnews.com/news/article/296000-americans-drop-out-labor-force-february

. . .

As Peggy Noonan noted in the Wall Street Journal:

[T]he general fear [is] that we’re on a long slide and can’t turn it around.

See http://online.wsj.com/article/SB10001424127887323628804578346680172271600.html?mod=WSJ_hps_sections_opinion

This is totally consistent with my article on the economy and the comments beneath it. The worst is yet to come, and things will get very ugly!

See https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/ (“The Economic Tsunami Continues Its Relentless And Unforgiving Advance Globally”); see also https://naegeleblog.wordpress.com/2010/12/22/the-next-major-war-korea-again/#comment-2501 (“North Korea Says It Will Launch Nuclear Attack On America“) and https://naegeleblog.wordpress.com/2011/01/13/china-is-americas-enemy-make-no-mistake-about-that/ (“China Is America’s Enemy: Make No Mistake About That”) and https://naegeleblog.wordpress.com/2012/02/07/poverty-in-america/#comment-2301 (“Crime Will Increase Dramatically In America”) and https://naegeleblog.wordpress.com/2013/03/01/is-obama-the-new-nixon/#comment-2494 (“Obama’s Enemies List And His Thugocracy”)

Noonan added:

[I]t’s a jobs crisis that’s the central thing. And you see it everywhere you look.

I’m in Pittsburgh, making my way to the airport hotel. The people movers are broken and we pull our bags along the dingy carpet. There’s an increasing sense in America now that the facades are intact but the machinery inside is broken.

This is so so true. I grew up a block away from the fabled Sunset Boulevard in Westwood, a mile west of the lovely UCLA college campus, in an affluent area of Los Angeles—with the super-rich Beverly Hills to the east, Bel Air to the northeast, and Brentwood, Pacific Palisades and Malibu to the west. Leaving the UCLA campus recently, I hit a pothole in the street near the campus, which was similar to those I had hit in Washington, D.C. a number of years before. The streets that I had traveled on my bike as a kid, to watch movies at the Village and Bruin theaters in Westwood, have not been paved in all those years. Hefty tax monies paid by residents have been diverted elsewhere, and wasted.

Noonan continued:

The man who checked me in put his phones on hold when I asked for someone to accompany me upstairs. As we walked to the room I felt I should explain. I told him a trial attorney had told me a while back that there are more lawsuits involving hotels than is generally known, and more crime, so always try to have someone with you when you first go to your room. I thought the hotel clerk would pooh-pooh this. Instead he said, “That’s why we just put up mirrors at each end of the hall, so you can see if someone’s coming.” He made it sound like an amenity.

“What should we do then, scream?” I asked. He laughed and shrugged: “Yeah.”

Things are getting pretty bare-bones in America. Doormen, security, bellmen, people working the floor—that’s maybe a dozen jobs that should have been filled, at one little hotel on one day in one town. Everyone’s keeping costs down, not hiring.

What that hotel looked like is America without its muscle, its efficiency, its old confidence.

. . .

ObamaCare is being cited as a reason employers are laying people off and not hiring, according to a report from the Federal Reserve.

What a mess.

. . .

But what is the sequester about? At the end of the day it’s about fewer jobs or fewer hours. In the midst of what is already a jobs crisis.

. . .

[Obama’s] whole approach is still stoke and scare—stoke resentment and scare the vulnerable into pressuring Republicans.

. . .

Mr. Obama is making the same mistake he made four years ago. We are in a jobs crisis and he does not see it. He thinks he’s in a wrestling match about taxing and spending, he thinks he’s in a game with those dread Republicans. But the real question is whether the American people will be able to have jobs.

. . .

There’s little sense he sees this. Dr. Doom talks about coming disaster when businessmen need the confidence to hire someone. He’s missing the boat on the central crisis of his second term.

See https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-2483 (“The Fiscal Cliff Explained, And Sequestration”); compare http://www.nationalreview.com/corner/342366/white-house-saving-18000-week-cancelling-tours-patrick-brennan (“White House Is Saving $18,000 a Week By Cancelling Tours”) with http://www.dailymail.co.uk/tvshowbiz/article-2290937/MoS-Diary-Adele-lands-biggest-gig-Michelle-Obamas-50th-birthday-party.html (“ADELE, BEYONCE TO PERFORM AT MICHELLE’S 50TH [BIRTHDAY PARTY]”); see also https://naegeleblog.wordpress.com/2010/12/03/barack-obama-is-a-lame-duck-president-who-will-not-be-reelected/#comment-1172 (“Michelle Obama: ‘Let Them Eat Cake!'”) and http://www.latimes.com/business/money/la-fi-mo-savings-financial-emergency-20130130,0,4750796.story (“Nearly half of Americans are one emergency from financial ruin“)


3 04 2013
Timothy D. Naegele

The Great Depression II Is Here To Stay, And It Will Last At Least Through The End Of This Decade

While many Americans and the “elite” of other countries have never had it so good financially—including Barack Obama and his family—as their yachts cruise the waters of the Mediterranean, the Caribbean, and elsewhere in this world, others are living in poverty and utter desperation. This will continue unabated for many years to come, with no relief in sight. As I have written, things will only get far worse; and the human suffering will be unfathomable.

See, e.g., https://naegeleblog.wordpress.com/2012/02/07/poverty-in-america/ (“Poverty In America“) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-2135 (“Suicides, Growing Despair And Hopelessness May Be The Future“) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-2177 (“The Risk Of Runs Is Real“) and https://naegeleblog.wordpress.com/2010/12/03/barack-obama-is-a-lame-duck-president-who-will-not-be-reelected/#comment-1172 (“Michelle Obama: ‘Let Them Eat Cake!'”) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-1516 (“Debtors’ Prisons“)

Evidence of this is reflected in the latest statistics released by the U.S. Census Bureau:

[N]early 50 million Americans—one in six—were living below the income line that defines poverty, according to the bureau. . . . The bureau said 20 percent of the country’s children are poor.

See http://news.yahoo.com/help-shrinks-poverty-spikes-us-122230503.html (“Help shrinks as poverty spikes in the US“); see also http://www.dailymail.co.uk/news/article-2302997/U-S-sees-highest-poverty-spike-1960s-leaving-50-million-Americans-poor-government-cuts-billions-spending.html (“U.S. sees highest poverty spike since the 1960s, leaving 50 million Americans poor as government cuts billions in spending“) and http://www.zerohedge.com/news/2013-04-05/people-not-labor-force-soar-663000-90-million-labor-force-participation-rate-1979-le (“[T]he number of people not in the labor force . . . in March soared by a massive 663,000 to a record 90 million Americans who are no longer even looking for work“)

It is a myth and downright lie woven by our politicians and their counterparts in other countries that America and Europe are slowly climbing out of the deepest economic downturn since the Great Depression of the 1930s. It must never be forgotten that the depression of the last century did not end with the onset of World War II, but rather it abated only after the war’s end. During the 1930s, there were “green shoots” as there are now—or signs that things were improving economically—which did not materialize until the end of that devastating war.

As I wrote almost four years ago:

International terrorism and other very real national security concerns still loom, which might produce flashpoints at any time. We have enemies who seek to destroy us—a fact that is sometimes forgotten as 9/11 recedes in our memories. While it might be attractive . . . to take a “meat ax” to the Defense Department, it would be foolhardy to gut our military precisely when it has been performing magnificently and its continued strength is needed most. America’s economic and military strength go hand in hand. Both are indispensable ingredients of our great nation’s future strength.

See http://www.realclearpolitics.com/news/tms/politics/2009/Apr/08/euphoria_or_the_obama_depression_.html; see also https://naegeleblog.wordpress.com/2010/12/22/the-next-major-war-korea-again/#comment-2501 (“North Korea Says It Will Launch Nuclear Attack On America”) and https://naegeleblog.wordpress.com/2010/01/19/emp-attack-only-30-million-americans-survive/ (“EMP Attack: Only 30 Million Americans Survive”) and https://naegeleblog.wordpress.com/2012/03/08/the-madness-of-benjamin-netanyahu (“The Madness Of Benjamin Netanyahu”)

And I added almost four years ago:

While U.S. politicians and their counterparts in other countries have been trying to convince their electorates that they have the answers, they are simply holding out false hopes that real solutions are at hand. . . .

America and other nations are in uncharted waters; and their politicians may face backlashes from disillusioned and angry constituents that are unprecedented in modern times. Also, the limits of godless secularism and paying homage to the false gods of materialism may become self-evident.

See http://www.realclearpolitics.com/news/tms/politics/2009/Apr/08/euphoria_or_the_obama_depression_.html; see also http://www.telegraph.co.uk/finance/newsbysector/banksandfinance/9985280/Big-banks-more-dangerous-than-ever-IMFs-Christine-Lagarde-says.html (“Big banks ‘more dangerous than ever’, IMF’s Christine Lagarde says“)

The chickens are coming home to roost as fewer and fewer Americans and other nationalities trust their governments, and as economic and other forms of chaos reign.



1 06 2013
Timothy D. Naegele

I Love LA . . . NOT!

Movie actress Gwyneth Paltrow has written an article about Los Angeles, which is interesting. However, real people live in L.A., and she is not one of them.

See http://www.telegraph.co.uk/travel/ultratravel/10083824/Gwyneth-Paltrows-guide-to-Los-Angeles.html

I too grew up in L.A., and its principal problems today are that much of it has become seedy, fiscally unmanageable, and “Hollywood-ized.” Instead of such people being a fringe group, the “inmates” run the asylum and they epitomize the emptiness, falsity and fantasy of L.A., which has been exported worldwide.

We live in a celebrity-driven, fake world, in which the human suffering is ignored—and it will only get far worse between now and the end of this decade—yet one would never know it from the fashionable perches of Beverly Hills, Bel Air, Brentwood and Malibu. In a sense, it is unreal and harps back to the fall of the Roman Empire.

See, e.g.,https://naegeleblog.wordpress.com/2012/02/07/poverty-in-america/ (see also the comments beneath the article)

I used to love L.A., but today it is a morally-impoverished fantasyland, bound together by clogged streets—often with gaping potholes in them—and freeways.


24 06 2013
Timothy D. Naegele

76 Percent Of Americans Are Living Paycheck-To-Paycheck!

CNNMoney has reported:

Roughly three-quarters of Americans are living paycheck-to-paycheck, with little to no emergency savings, according to a survey released by Bankrate.com Monday.

Fewer than one in four Americans have enough money in their savings account to cover at least six months of expenses, enough to help cushion the blow of a job loss, medical emergency or some other unexpected event, according to the survey of 1,000 adults. Meanwhile, 50% of those surveyed have less than a three-month cushion and 27% had no savings at all.

. . .

Last week, online lender CashNetUSA said 22% of the 1,000 people it recently surveyed had less than $100 in savings to cover an emergency, while 46% had less than $800. After paying debts and taking care of housing, car and child care-related expenses, the respondents said there just isn’t enough money left over for saving more.

“There really hasn’t been much relief,” said Megan Staton, director of marketing for CashNetUSA “The economy is stagnant, $100 is not enough to help you out in an emergency.”

See http://money.cnn.com/2013/06/24/pf/emergency-savings/index.html; see also http://www.breitbart.com/Big-Government/2013/07/05/only-47-americans-have-full-time-job (“ONLY 47% OF ADULTS HAVE FULL-TIME JOB”)

As the U.S. and global economies get far worse between now and the end of this decade, more and more Americans and those in other countries will slide into desperate poverty.


28 07 2013
Timothy D. Naegele

4 Out Of 5 in USA Face Near-Poverty, No Work . . .

The AP has reported:

Four out of 5 U.S. adults struggle with joblessness, near poverty or reliance on welfare for at least parts of their lives, a sign of deteriorating economic security and an elusive American dream.

Survey data exclusive to The Associated Press points to an increasingly globalized U.S. economy, the widening gap between rich and poor and loss of good-paying manufacturing jobs as reasons for the trend.

The findings come as President Barack Obama tries to renew his administration’s emphasis on the economy, saying in recent speeches that his highest priority is to “rebuild ladders of opportunity” and reverse income inequality.

Hardship is particularly on the rise among whites, based on several measures. Pessimism among that racial group about their families’ economic futures has climbed to the highest point since at least 1987. In the most recent AP-GfK poll, 63 percent of whites called the economy “poor.”

“I think it’s going to get worse,” said Irene Salyers, 52, of Buchanan County, Va., a declining coal region in Appalachia. Married and divorced three times, Salyers now helps run a fruit and vegetable stand with her boyfriend, but it doesn’t generate much income. They live mostly off government disability checks.

“If you do try to go apply for a job, they’re not hiring people, and they’re not paying that much to even go to work,” she said. Children, she said, have “nothing better to do than to get on drugs.”

While racial and ethnic minorities are more likely to live in poverty, race disparities in the poverty rate have narrowed substantially since the 1970s, census data show. Economic insecurity among whites also is more pervasive than is shown in government data, engulfing more than 76 percent of white adults by the time they turn 60, according to a new economic gauge being published next year by the Oxford University Press.

The gauge defines “economic insecurity” as experiencing unemployment at some point in their working lives, or a year or more of reliance on government aid such as food stamps or income below 150 percent of the poverty line. Measured across all races, the risk of economic insecurity rises to 79 percent.

“It’s time that America comes to understand that many of the nation’s biggest disparities, from education and life expectancy to poverty, are increasingly due to economic class position,” said William Julius Wilson, a Harvard professor who specializes in race and poverty.

He noted that despite continuing economic difficulties, minorities have more optimism about the future after Obama’s election, while struggling whites do not.

“There is the real possibility that white alienation will increase if steps are not taken to highlight and address inequality on a broad front,” Wilson said.


Sometimes termed “the invisible poor” by demographers, lower-income whites are generally dispersed in suburbs as well as small rural towns, where more than 60 percent of the poor are white. Concentrated in Appalachia in the East, they are also numerous in the industrial Midwest and spread across America’s heartland, from Missouri, Arkansas and Oklahoma up through the Great Plains.

More than 19 million whites fall below the poverty line of $23,021 for a family of four, accounting for more than 41 percent of the nation’s destitute, nearly double the number of poor blacks.

Still, while census figures provide an official measure of poverty, they’re only a temporary snapshot. The numbers don’t capture the makeup of those who cycle in and out of poverty at different points in their lives. They may be suburbanites, for example, or the working poor or the laid off.

In 2011 that snapshot showed 12.6 percent of adults in their prime working-age years of 25-60 lived in poverty. But measured in terms of a person’s lifetime risk, a much higher number—4 in 10 adults—falls into poverty for at least a year of their lives.

The risks of poverty also have been increasing in recent decades, particularly among people ages 35-55, coinciding with widening income inequality. For instance, people ages 35-45 had a 17 percent risk of encountering poverty during the 1969-1989 time period; that risk increased to 23 percent during the 1989-2009 period. For those ages 45-55, the risk of poverty jumped from 11.8 percent to 17.7 percent.

By race, nonwhites still have a higher risk of being economically insecure, at 90 percent. But compared with the official poverty rate, some of the biggest jumps under the newer measure are among whites, with more than 76 percent enduring periods of joblessness, life on welfare or near-poverty.

By 2030, based on the current trend of widening income inequality, close to 85 percent of all working-age adults in the U.S. will experience bouts of economic insecurity.

“Poverty is no longer an issue of ‘them’, it’s an issue of ‘us’,” says Mark Rank, a professor at Washington University in St. Louis who calculated the numbers. “Only when poverty is thought of as a mainstream event, rather than a fringe experience that just affects blacks and Hispanics, can we really begin to build broader support for programs that lift people in need.”

Rank’s analysis is supplemented with figures provided by Tom Hirschl, a professor at Cornell University; John Iceland, a sociology professor at Penn State University; the University of New Hampshire’s Carsey Institute; the Census Bureau; and the Population Reference Bureau.

Among the findings:

—For the first time since 1975, the number of white single-mother households who were living in poverty with children surpassed or equaled black ones in the past decade, spurred by job losses and faster rates of out-of-wedlock births among whites. White single-mother families in poverty stood at nearly 1.5 million in 2011, comparable to the number for blacks. Hispanic single-mother families in poverty trailed at 1.2 million.

—The share of children living in high-poverty neighborhoods—those with poverty rates of 30 percent or more—has increased to 1 in 10, putting them at higher risk of teen pregnancy or dropping out of school. Non-Hispanic whites accounted for 17 percent of the child population in such neighborhoods, up from 13 percent in 2000, even though the overall proportion of white children in the U.S. has been declining.

The share of black children in high-poverty neighborhoods dropped sharply, from 43 percent to 37 percent, while the share of Latino children ticked higher, from 38 to 39 percent.


Going back to the 1980s, never have whites been so pessimistic about their futures, according to the General Social Survey, which is conducted by NORC at the University of Chicago. Just 45 percent say their family will have a good chance of improving their economic position based on the way things are in America.

The divide is especially evident among those whites who self-identify as working class: 49 percent say they think their children will do better than them, compared with 67 percent of non-whites who consider themselves working class.

In November, Obama won the votes of just 36 percent of those noncollege whites, the worst performance of any Democratic nominee among that group since 1984.

Some Democratic analysts have urged renewed efforts to bring working-class whites into the political fold, calling them a potential “decisive swing voter group” if minority and youth turnout level off in future elections.

“They don’t trust big government, but it doesn’t mean they want no government,” says Republican pollster Ed Goeas, who agrees that working-class whites will remain an important electoral group. “They feel that politicians are giving attention to other people and not them.”

See http://bigstory.ap.org/article/exclusive-4-5-us-face-near-poverty-no-work-0

Hold on tight. It will get far worse between now and the end of this decade!

. . .

But nothing interrupts the Obamas’ lavish vacations!

See, e.g., http://washingtonexaminer.com/obama-vineyard-vacation-at-7.6m-private-resort-over-75-rooms-booked-for-staff/article/2533598 (“Obama Vineyard vacation at $7.6m private resort, over 75 rooms booked for staff”) and http://www.whitehousedossier.com/2013/07/29/wh-tours-parade-special-visitors-continues/ (“Still No [White House] Tours, but Parade of Special Visitors Continues”)


7 11 2013
Timothy D. Naegele

49.7 Million Americans Living In Poverty [UPDATED]

Dorothea Lange photo of Depression-era mother

[Florence Owens Thompson was the subject of Dorothea Lange’s photo Migrant Mother (1936). The Library of Congress caption reads: “Destitute pea pickers in California. Mother of seven children. Age thirty-two. Nipomo, California.” See also http://www.dailymail.co.uk/news/article-2290879/I-lost-hope-Startling-interview-unearthed-woman-iconic-Great-Depression-image-talking-just-years-death-1983.html (“‘I never lost hope’: Startling interview unearthed with woman behind iconic Great Depression image talking just five years before her death in 1983”) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-2135 (“Suicides, Growing Despair And Hopelessness May Be The Future”)]

AP News has reported:

The number of poor people in America is 3 million higher than the official count, encompassing 1 in 6 residents due to out-of-pocket medical costs and work-related expenses, according to a revised census measure released Wednesday.

The new measure is aimed at providing a fuller picture of poverty but does not replace the official government numbers. Put in place two years ago by the Obama administration, it generally is considered more reliable by social scientists because it factors in living expenses as well as the effects of government aid, such as food stamps and tax credits.

Administration officials have declined to say whether the new measure eventually could replace the official poverty formula, which is used to allocate federal dollars to states and localities and to determine eligibility for safety-net programs such as Medicaid.

Congress would have to agree to adopt the new measure, which generally would result in a higher poverty rate from year to year and thus higher government payouts for aid programs.

Based on the revised formula, the number of poor people in 2012 was 49.7 million, or 16 percent. That exceeds the record 46.5 million, or 15 percent, that was officially reported in September.

The latest numbers come as more working-age adults picked up low-wage jobs in the slowly improving economy but still struggled to pay living expenses. Americans 65 and older had the largest increases in poverty under the revised formula, from 9.1 percent to 14.8 percent, because of medical expenses such as Medicare premiums, deductibles and other costs not accounted for in the official rate.

There also were increases for Hispanics and Asian-Americans, partly due to lower participation among immigrants and non-English speakers in government aid programs such as housing aid and food stamps.

African-Americans and children, helped by government benefits, had declines in poverty compared with the official rate.

“This is a real incongruity, when 1 in 6 people face economic insecurity here in the richest country in the world,” said Joseph Stiglitz, a Columbia University economist and former chairman of the White House Council of Economic Advisers who has argued for more government action to alleviate income inequality.

“When so many citizens are worse off year after year, with food insecurity and health care insecurity, there’s no way you can say that’s a successful economy.”

Last week, more than 47 million Americans who receive food stamps saw their benefits go down, while Congress began negotiations on further cuts of up to $4 billion annually to the program.

Among states, California had the highest share of poor people, hurt in part by high housing costs and large numbers of immigrants, followed by the District of Columbia, Nevada and Florida. Under the official poverty rate, more rural states were more likely to be at the top of list, led by Mississippi, Louisiana and New Mexico.

Some other findings:

-Food stamps helped lift about 5 million people above the poverty line. Without such aid, the overall poverty rate would increase from 16 percent to 17.6 percent.

– Adults of working ages 18-64 saw an increase in poverty from 13.7 percent based on the official calculation to 15.5 percent, due mostly to commuting and child care costs.

-Child poverty declined from 22.3 percent to 18 percent under the new measure. Under both measures, children still remained the age group most likely to be living in poverty.

-By race, Hispanics and Asians saw higher rates of poverty, 27.8 percent and 16.7 percent respectively, compared with rates of 25.8 percent and 11.8 percent under the official formula. In contrast, African-Americans saw a modest decrease, from 27.3 percent to 25.8 percent based on the revised numbers. Among non-Hispanic whites, poverty rose from 9.8 percent to 10.7 percent.

“The primary reason that poverty remains so high is that the benefits of a growing economy are no longer being shared by all workers as they were in the quarter-century following the end of World War II,” said Sheldon Danziger, a University of Michigan economist.

“Given current economic conditions, poverty will not be substantially reduced unless government does more to help the working poor.”

Economists long have criticized the official poverty rate as inadequate. Based on a half-century-old government formula, the official rate continues to assume the average family spends one-third of its income on food. Those costs have declined to a much smaller share, more like one-seventh.

In reaction to some of the criticism, the Obama administration in 2010 asked the Census Bureau to develop a new poverty measure, based partly on recommendations made by the National Academy of Sciences. The goal is to help lawmakers better gauge the effectiveness of anti-poverty programs.

For instance, the new measure finds that if it weren’t for Social Security payments, the poverty rate would rise to 54.7 percent for people 65 and older and 24.5 percent for all age groups.

Refundable tax credits such as the earned income tax credit helped lift 9 million people above the poverty line. Without the credits, child poverty would rise from 18 percent to 24.7 percent.

In recent years, New York City as well California, Virginia and Wisconsin have sought to put in place a more accurate poverty measure. They were prompted in part by local officials such as New York Mayor Michael Bloomberg who have argued that the official measure does not take into account urban costs of living and that larger cities may get less federal money as a result.

See http://hosted.ap.org/dynamic/stories/U/US_CENSUS_POVERTY?SITE=AP&SECTION=HOME&TEMPLATE=DEFAULT&CTIME=2013-11-06-13-38-44; see also http://newyork.cbslocal.com/2013/11/10/nyc-food-bank-head-40-of-veterans-need-food-assistance/ (“40% Of Veterans Need Food Assistance“) and http://dailycaller.com/2013/11/11/record-high-91-5-million-people-not-included-in-labor-force/ (Record 91.5 million Americans not in labor force) and http://www.nytimes.com/projects/2013/invisible-child/?smid=tw-nytimes#/?chapt=1 (NYC has highest number of homeless children since Great Depression) and http://washingtonexaminer.com/wall-street-advisor-actual-unemployment-is-37.2-misery-index-worst-in-40-years/article/2542604 (“Actual unemployment is 37.2%, ‘misery index’ worst in 40 years“) and http://cnsnews.com/news/article/ali-meyer/record-20-households-food-stamps-2013 (“Record 20% of Households on Food Stamps in 2013“) and http://hosted.ap.org/dynamic/stories/U/US_DEBT_STUDY?SITE=AP&SECTION=HOME&TEMPLATE=DEFAULT&CTIME=2014-07-29-00-12-33 (“35 PERCENT IN US FACING DEBT COLLECTORS“) and http://www.businessinsider.com/half-of-america-doesnt-save-any-money-2015-3 (Half of American households live from paycheck to paycheck—”People who don’t save won’t have any buffer should the economy turn and they lose their jobs. Longer term, people who don’t save won’t have the capacity to retire”)

Obamacare will increase these numbers dramatically!

See https://naegeleblog.wordpress.com/2013/03/01/is-obama-the-new-nixon/#comment-3119 (“Obamacare Laid Bare: Barack Obama’s Big Lie”); see also https://naegeleblog.wordpress.com/2013/03/01/is-obama-the-new-nixon/#comment-3138 (“Five Years In, Obama And Bush Poll Numbers Nearly Identical”)


21 01 2014
Timothy D. Naegele

85 Richest People On Earth Own As Much As Bottom Half Of World’s Population

The Los Angeles Times has reported:

The 85 richest people on Earth have the same amount of wealth as the bottom half of the population, according to a new report that highlights growing income inequality as political and business leaders gather for the annual World Economic Forum in Davos, Switzerland.

Those wealthy individuals are a small part of the richest 1% of the population, which combined owns about 46% of global wealth, according to the report from British humanitarian group Oxfam International.

The study found the richest 1% had $110 trillion in wealth—65 times the total wealth of the bottom half of the population.

That bottom half of the population owned about $1.7 trillion, or about 0.7% of the world’s wealth. That’s the same amount as owned by the 85 richest people, the report said.

The findings undermine democracy and make it more difficult to fight poverty, the report said.

“It is staggering that in the 21st century, half of the world’s population own no more than a tiny elite whose numbers could all sit comfortably in a single train carriage,” said Winnie Byanyima, the group’s executive director.

“Widening inequality is creating a vicious circle where wealth and power are increasingly concentrated in the hands of a few, leaving the rest of us to fight over crumbs from the top table,” she said.

In a report last week, the World Economic Forum said widening income inequality was the risk most likely to cause serious damage in the next decade.

President Obama recently called the expanding gap between rich and poor a bigger threat to the U.S. economy than the budget deficit.

The United States has led a worldwide growth in wealth concentration, according to the Oxfam report, titled “Working for the Few.”

The percentage of income held by the richest 1% in the U.S. has grown by nearly 150% since 1980. That small elite has received 95% of wealth created since 2009, after the financial crisis, while the bottom 90% of Americans have become poorer, Oxfam said.

The share of wealth owned by the richest 1% also expanded in all but two of the 26 nations tracked by researchers in the World Top Incomes Database.

That’s caused a “massive concentration of economic resources in the hands of fewer people,” Oxfam said.

Falling taxes for the rich and increased use of tax havens have helped widen income inequality, Oxfam said.

The group called on World Economic Forum participants, which include some of the wealthiest and most influential corporate executives, to take steps to reverse the trend.

Among other things, Oxfam wants them to support progressive taxation, pledge not to dodge taxes, pay a living wage to workers at their companies and push governments “to provide universal healthcare, education and social protection” for their citizens.

See http://www.latimes.com/business/money/la-fi-mo-oxfam-world-economic-forum-income-inequality-20140120,0,7080817.story#axzz2qxEXoTZW; see also http://www.forbes.com/billionaires/ (Forbes: “The World’s Billionaires”); but see http://online.wsj.com/news/articles/SB10001424052702304149404579324530112590864 (Bill and Melinda Gates: “By almost any measure, the world is better off now than it has ever been before. Extreme poverty has been cut in half over the past 25 years, child mortality is plunging, and many countries that had long relied on foreign aid are now self-sufficient”)


24 05 2014
Timothy D. Naegele

The VA And Homelessness [UPDATED]


America’s veterans have served our great nation unselfishly since it was founded. They have earned our respect, gratitude, love and loyalty—never pity.

However, too many of them—of all ages and races—have joined the ranks of the homeless, or are teetering on the brink. Poverty is a national epidemic.

Like waiting in line to get medical care, and dying before it is available, essentially nothing is offered to vets who are homeless. Yes, there is a national hotline that operates 24/7, but the VA offers no help at all to those who are desperate.

There are vets who do not have physical or mental disabilities, just a shortage of money. Yet, they are left out in the cold, to fend for themselves. It is scandalous, and a national disgrace.

Many are too proud to ask—which is a tragedy unto itself—and scared of being homeless . . . and preyed upon or assaulted by others.

See also http://online.wsj.com/news/articles/SB10001424052702303980004579576423045207210 (“Treat Veterans With Respect, Not Pity”) and http://online.wsj.com/news/articles/SB10001424052702303480304579578470109140820 (“The Scandal That Shadows Memorial Day”) and http://www.cnsnews.com/news/article/ali-meyer/372-percentage-not-labor-force-remains-36-year-high (92,009,000 Americans Not Working) and http://hosted.ap.org/dynamic/stories/U/US_DEBT_STUDY?SITE=AP&SECTION=HOME&TEMPLATE=DEFAULT&CTIME=2014-07-29-00-12-33 (“35 PERCENT IN US FACING DEBT COLLECTORS”)


6 12 2014
Timothy D. Naegele

Hotline To Help Homeless Veterans Is Useless [UPDATED]

Homeless Vet

The Wall Street Journal has reported, in an article by Ben Kesling:

A Department of Veterans Affairs hotline established to help homeless veterans missed thousands of opportunities to help at-risk vets last year, the agency’s inspector general said.

The VA’s National Call Center for Homeless Veterans, launched in mid-2012, didn’t consistently ensure that veterans who called the hotline received access to support services, according to findings released Wednesday.

“This is a huge national problem[;] our veterans deserve to have the phone answered when they call for help,” Rep. Jackie Walorski (R., Ind.), a member of the House Committee on Veterans’ Affairs, said in an interview Thursday.

Ms. Walorski said this isn’t a one-off issue at the VA, but shows the depth of problems that face VA Secretary Robert McDonald, who has been at the helm since the end of July. “I think it’s symptomatic and we have a long way to go,” Ms. Walorski said.

Of the nearly 80,000 calls made to the hotline in fiscal-year 2013, more than 21,000 went to an answering machine because counselors weren’t available, and 13,000 calls weren’t returned because messages were inaudible or callers didn’t leave contact information, the inspector general said. And none of the more than 50,000 referrals made by the call center were monitored or followed up for quality control.

“Everyone is pretty disappointed in the execution of the call center,” said Baylee Crone, executive director of the National Coalition for Homeless Veterans. “The use of the voice-mail system should never have happened. ”

The inspector general found counselors “often did not log in or did not spend the entire day logged into the call center telephone system,” and records were inadequate so inspectors couldn’t account for time not spent taking calls. Staffing at peak periods was inadequate, and many calls went to an answering machine rather than being handled by a counselor.

“In our opinion, the majority of these calls could have been answered by counselors, instead of the answering machine,” the report said. An inspector-general spokeswoman said the center had 60 workers at the time of the audit.

The VA concurred with the report’s findings and agreed to eliminate the use of answering machines, develop new training for counselors, and establish a system to measure employee performance—all things targeted for completion in early 2015. The VA is also in the middle of an overhaul known as the MyVA program, which includes streamlining the agency and improving customer service.

“As VA undergoes a major transformation to better serve Veterans thorough the MyVA initiative, we will be looking at how call centers like the National Call Center for Homeless Veterans and others can be organized to make it easier for Veterans to take advantage of the services and benefits that Veterans have earned and deserve,” the VA said.

“Their plan is pretty ambitious,” said a spokeswoman for the inspector general’s office, who said the most pressing concern—that veterans are pushed into voice-mail queues—hasn’t necessarily been addressed. “We’re not sure that if we called today that we wouldn’t get sent to an answering machine,” she said. The inspectors will check back with the VA in three months to check on progress of fixes.

In 2009, then-VA Secretary Eric Shinseki announced a goal of ending veteran homelessness by 2015. The number of homeless vets fell by 33% since 2010 to just under 50,000 in January 2014, according to the Department of Housing and Urban Development.

Mr. Shinseki resigned in April, amid a scandal after whistleblowers exposed systemic problems at the department, including employees who routinely misreported patient wait times to make it seem as if benchmarks were being met. Long patient wait times didn’t directly cause patient deaths, but did contribute to them, according to inspectors.

Congress passed a more-than $16 billion emergency funding bill to help VA fill staffing gaps and speed treatment to vets who had been waiting for appointments.

In July, Mr. McDonald, former CEO of Procter & Gamble Co. was named new secretary and immediately embarked on a nationwide tour of VA facilities and kicked off an effort to revamp the VA.

See http://online.wsj.com/articles/hotline-to-help-homeless-veterans-falls-short-inspector-general-says-1417726553 (emphasis added); see also http://www.wsj.com/articles/thousands-of-living-vets-declared-dead-and-lose-benefits-in-past-five-years-1464174000 (“Thousands of Living Vets Declared Dead and Lose Benefits in Past Five Years”—”For veterans, the mistake can be devastating, as benefits checks can suddenly stop showing up”)

If this is how America’s veterans are treated, just imagine what the nation’s non-veteran homeless experience, who include families that have fallen on hard times.

Even if the calls get through, local homeless services are either nonexistent or overwhelmed, and offer little or no help . . . or hope.

As the global economic conditions worse between now and the end of this decade, these problems may become unfathomable.

See https://naegeleblog.wordpress.com/2016/01/16/the-obama-great-depression/ (“The Obama Great Depression“) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-7614 (“Doomsday Clock For Global Market Crash Strikes One Minute To Midnight As Central Banks Lose Control“) and Naegele: “The World’s Next Credit Crunch Could Make 2008 Look Like A Hiccup” (“The World’s Next Credit Crunch Could Make 2008 Look Like A Hiccup“) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-5264 (“Global Economic Conditions Worsen: Green Shoots Will Disappear“)


1 09 2015
Timothy D. Naegele

The Surging Ranks Of America’s Ultrapoor

American poverty

One thing is certain: the worst is yet to come.

See https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-7614 (“Doomsday Clock For Global Market Crash Strikes One Minute To Midnight As Central Banks Lose Control“)

CBS News has reported:

By one dismal measure, America is joining the likes of Third World countries.

The number of U.S. residents who are struggling to survive on just $2 a day has more than doubled since 1996, placing 1.5 million households and 3 million children in this desperate economic situation. That’s according to “$2.00 a Day: Living on Almost Nothing in America,” a book from publisher Houghton Mifflin Harcourt that will be released on Sept. 1.

The measure of poverty isn’t arbitrary — it’s the threshold the World Bank uses to measure global poverty in the developed world. While it may be the norm to see families in developing countries such as Bangladesh and Ethiopia struggle to survive on such meager income, the growing ranks of America’s ultrapoor may be shocking, given that the U.S. is considered one of the most developed capitalist countries in the world.

“Most of us would say we would have trouble understanding how families in the county as rich as ours could live on so little,” said author Kathryn Edin, who spoke on a conference call to discuss the book, which she wrote with Luke Shaefer. Edin is the Bloomberg Distinguished Professor of Sociology at Johns Hopkins University. “These families, contrary to what many would expect, are workers, and their slide into poverty is a failure of the labor market and our safety net, as well as their own personal circumstances.”

To be sure, the labor market has been rocky for many Americans, not just the poorest. But changes in how employers deal with their low-wage workers have hit many of these poor Americans especially hard, such as the rise of on-call scheduling, which leaves some parents scrambling for hours and dealing with unpredictable pay.

Retailers such as Walmart and fast-food companies increasingly are using sophisticated scheduling software that allows them to tinker with work schedules at the last minute, depending on their stores’ needs. That reduces costs for the employer, but it can make life difficult for employees, especially those with children and dependents.

“Time and time again, we would constantly see people’s hours cut from week to week,” said Shaefer, associate professor of social work at University of Michigan. “Someone might have 30 hours one week, down to 15 the next and down to 5 after that. We saw people who would remain employed but were down to zero hours. This was incredibly common in this population.”

Other workforce problems include abuses such as wage theft and unhealthy workplaces, which lead to health problems and missed work, he noted.

These families have also been hurt by the welfare reform of the 1990s, when America’s social safety net was overhauled to create Temporary Assistance for Needy Families (TANF), which is geared toward providing temporary monetary aid to poor families with children.

But TANF isn’t working, Shaefer and Edin said. Since the program was created in 1996 to replace a 60-year-old welfare system, the number of families living on less than $2 a day has more than doubled. In 2012, only one-quarter of poor families received TANF benefits, down from more than two-thirds in 1996, according to the Center on Budget and Policy Priorities. According to “$2.00 a Day,” the welfare program reached more than 14.2 million Americans in 1994, but by 2014 only 3.8 million Americans were aided by TANF.

The authors’ research — which included data analysis and interviews with ultrapoor families in four regions — found that many families weren’t even aware of TANF. “One person said, ‘They aren’t just giving it out anymore,'” Shaefer said. “In fact, in Appalachia it has, in some ways, disappeared. We asked, ‘Have you thought about applying for TANF?’ and they said, ‘What’s that?'”

Aside from a lack of knowledge about the program, poor Americans often put off applying for aid because of social stigma and other hurdles, such as requirements to attend orientation meetings, make employment plans and register for employment services.

Once a family qualifies for TANF, they can receive benefits ranging from about $300 a month for a family of three in Texas to as much as $780 per month in New York. That’s hardly living in the lap of luxury, but it would lift those families out of dire need.

Many of the families Edin and Shaefer interviewed saw themselves as workers, the researchers noted. Rather than the negative stereotype of the “welfare queen” created by President Ronald Reagan, the families that are suffering with less than $2 a day want to work and are using self-reliance to get by. That hasn’t stopped the stereotype from proliferating, even though Edin and Shaefer note that extreme poverty in America is an equal-opportunity affliction: It hurts single parents, married couples, white, blacks and Hispanics, as well as rural and urban families.

“One thing that surprised me was a clear attachment to the labor force,” Shaefer said. “They saw work as a way to lift themselves up out of those circumstances.”

So, how do families living on so little get by? They tend to rely on a few strategies, including selling their own plasma for $30 a pop and selling scrap metal. Some families also sell their food stamp benefits for cash, which is illegal and which Edin said is “very unusual.”

Some women barter for goods and services using sex. Private charities provided very little assistance. Dealing in drugs wasn’t common, Edin said, perhaps because the researchers were interviewing families, which might be less likely to engage in drug use given the presence of children.

“In no cases did [these strategies] raise people out of poverty,” Edin said. “$60 would be the maximum per week” for earnings through these methods. “There was no case where someone was living high off the hog from this informal economy.”

Edin and Shaefer have some solutions in mind for easing the plight of America’s ultrapoor. Reforming TANF is one potential pathway, while increasing the quality of jobs available to people at the bottom of the income ladder is another. They also noted that government-sponsored work programs, such as the Works Progress Administration during the Great Depression, could also help put these families back on track.

See http://www.cbsnews.com/news/the-surging-ranks-of-americas-ultrapoor/ (emphasis added)

Hold on tight. Things will get even uglier!


30 01 2016
Timothy D. Naegele

Life At The Bottom [UPDATED]

American poverty

As mentioned in my article above, when I was in elementary school in Los Angeles (K-6), my mother was in a wheelchair through no fault of her own. I remember my parents coming to my 6th grade graduation; and I would be less than candid if I did not admit that I was embarrassed and ashamed.

In LA, everyone’s parents were “movie star” perfect; and they lived in perfect houses on perfect streets in perfect neighborhoods, etc. At least in Hollywood’s fantasy world, there were no people in wheelchairs or who were otherwise disabled. Indeed, terrible stigmas attached to those who were.

Fast forward to today, and lots of progress has been made with respect to those with disabilities. But not with respect to America’s poor.

See, e.g., https://naegeleblog.wordpress.com/2012/02/07/poverty-in-america/#comment-7646 (“The Surging Ranks Of America’s Ultrapoor“)

Again, Americans turn their eyes from those who are. They are viewed as “lepers.”

There is little or no sympathy for them, much less genuine empathy. Yet, the ranks of America’s poor are surging, which will only get dramatically worse. We are on the brink of an economic catastrophe—of unfathomable depths, which have only been witnessed in this country during the last century, in the course of our Great Depression.

Families who own homes and cars and have good jobs today will fall—like never before in their lifetimes, or ours. Indeed, right now, there are Americans who are struggling to survive on $2 a day.

Their ranks will be growing dramatically—again, through no fault of their own.

See https://naegeleblog.wordpress.com/2016/01/16/the-obama-great-depression/#comment-8083 (“The Coming Global Meltdown“) and http://www.wsj.com/articles/thriving-u-s-cities-grapple-with-homelessness-surge-1454063401 (“Thriving U.S. Cities Grapple With Homelessness Surge”) and http://www.worldaffairsjournal.org/blog/michael-j-totten/life-bottom (“Life on the Bottom“)

Look at the face of the young child above. Heart-breaking sights like this will occur again and again, throughout America—to those who never expected it to happen to them.


20 06 2017
Timothy D. Naegele

24 Percent Of Americans Do Not Have Single Dollar Saved For Emergency

American poverty

Catey Hill has written for Dow Jones’ Money-ish:

You can take this to the bank: Americans are messed up about money.

A slew of new surveys and data have come out revealing that we don’t save enough, we spend money we don’t have, we have our financial priorities backwards — and more. Here are five new stats that prove Americans are backwards about money.

1. About 1 in 4 literally have no emergency savings. A survey released Tuesday by Bankrate.com found that 24% don’t have even a single dollar saved for an emergency. And that’s just one of many surveys showing how little we have saved: A survey released in January by Bankrate found that nearly 60% of Americans wouldn’t have enough savings to pay for a $500 expense if it came up unexpectedly. What’s more, more than one in five say they’d slap down their credit card to pay that expense and more than one in would mooch off family to get the cash. Experts recommend that Americans have a least three to six months of income in the bank to pay for unexpected emergencies.

2. We are more worried about paying for our next vacation than about saving enough for retirement. That’s the finding of a study released this week by COUNTRY Financial, in which Americans report being more concerned about affording . . . vacations (36%) than having adequate retirement savings (32%). That may explain, in part, why more than half of Americans will be broke when we retire, according to a survey from GoBankingRates.com.

3. Millions of us hide money from our spouses and partners. An estimated 12 million Americans confess they have kept a source of money secret from their romantic partners, according to CreditCards.com. That’s typically not smart, experts say: “Any time you get into these kinds of things where you are operating behind the scenes, it usually comes out at some point,” Corey Allan, a marriage and family therapist told Credit Cards.com. “We can’t keep things hidden, especially in today’s technological world. Any spouse who has any kind of suspicion can become a detective and find it.” (Also see: If you have sex with a rich millennial, expect this power dynamic.)

4. We prioritize paying the wrong bills first. When we can’t pay all our bills, we make bad choices about which to pay. “Consumers in financial distress tend to prioritize unsecured personal loans ahead of other credit products such as auto loans, mortgages and credit cards,” according to a study of roughly two million consumers who had all four types of debt out this week from credit monitoring service TransUnion. But experts say that’s a backwards way to handle these bills.

5. We’ve racked up $1 trillion in credit card debt — and that’s just a fraction of what we owe. That’s according to data released this year from the Federal Reserve, which found that U.S. consumers owe $1.0004 trillion on their cards, up 6.2% from a year ago; this is the highest amount owed since January 2009. What’s more, this isn’t the only consumer debt to top $1 trillion. We now also owe more than $1 trillion for our cars, and for our student loans, the data showed.

See https://moneyish.com/ish/5-facts-that-prove-americans-dont-know-anything-about-managing-money/ (“5 facts that prove Americans are terrible at managing money“) (emphasis added); see also the article and comments above, including but not limited to https://naegeleblog.wordpress.com/2012/02/07/poverty-in-america/#comment-8084 (“Life At The Bottom“)


8 10 2017
Timothy D. Naegele

America’s Left And The Ravages Of Poverty

Hepatitis A in San Diego

Chriss W. Street has written at Breitbart:

The California hepatitis A outbreak is on the verge of reaching statewide epidemic status, as cases have spread through homeless tent cities from San Diego north to Sacramento.

California health officials have reported that at least 569 people have been infected with the hepatitis A liver disease and 17 have died since a San Diego County outbreak was first identified in November. Cases have migrated north to homeless populations in Los Angeles, Santa Cruz, San Francisco and Sacramento over the last 11 months.

Although local and state authorities have tried to underplay the risks and severity of the outbreak, the most recent annual totals for cases of hepatitis A in the United States was 1,390 in 2015, according to the Center for Disease Control (CDC). California only reported 179 cases during the same year.

The highly-contagious hepatitis A outbreak may have taken root because of the City of San Diego’s efforts in the run-up to Major League Baseball’s All-Star Game held at Petco Park in July 2016 to push the homeless, and the rampant drug and prostitution trade among them, out of the downtown tourist venues. Those effort included locking public bathrooms and essentially relocating the homeless to the congested tent city encampments that stretch for blocks east of downtown near freeway onramps.

Another explanation may be the city’s decision to ban plastic bags, which deprived homeless people of an alternative means of disposing of human waste when bathrooms were not available.

The last major hepatitis A outbreak was 900 cases and 8 deaths in Pennsylvania in 2003. The infected suffer flulike symptoms and jaundice, but the disease can progress to death. Since 1998, national hepatitis A incidence rates had been “progressively lower each year” due to the development of a “safe and effective hepatitis A vaccines in 1995–1996.”

California homeless advocates have been successful across the state in forcing cities to accept the homeless living in large tent communities on public property. The advocates refer to anti-homeless ordinances as the modern-day equivalent to post-slavery Jim Crow and Depression era anti-Okie laws that allowed police to disperse people deemed “undesirable” after dark.

The City of San Diego was forced to sign the Spencer Settlement in 2006, which forbids its Police Department from enforcing the city’s “Illegal Lodging Enforcement Guidelines” between the hours of 9 pm to 5:30 am.

California, with 115,738 homeless, now accounts for about 21 percent of America’s total homeless population. Due to legal settlements against vagrancy laws, about 72.3 percent of California’s homeless are unsheltered, usually living in tent cities.

California public health officials are desperately scrambling to offer vaccine injections to the homeless, but many in the population are under legal warrants and do everything possible to avoid being identified.

An epidemiologist with the Division of Viral Hepatitis at the U.S. Centers for Disease Control and Prevention, Dr. Monique Foster, told the Los Angeles Times that California’s hepatitis A outbreak will persist, despite prevention: “It’s not unusual for them to last quite some time — usually over a year, one to two years.”

See http://www.breitbart.com/california/2017/10/08/california-hepatitis-a-outbreak-on-verge-of-statewide-epidemic/ (“California Hepatitis A Outbreak on Verge of Statewide Epidemic“) (emphasis added)

America’s Left is bankrupt morally. Eight years of the disgraced, failed and black racist Barack Obama achieved essentially nothing to erase poverty in Democrat-controlled cities like his Chicago. Black-white racism has increased dramatically because of him.

Now the lawless State of California has adopted “sanctuary state” legislation. In San Diego, it has moved the “unsightly” homeless; and its plastic bag restrictions have increased the spread of Hepatitis A. In Berkeley, it has allowed the so-called “Black Lives Matter” and Antifa thugs to perpetrate their violence unimpeded.

“Bringing the third world to a neighborhood near you” has described what America’s Left has been instituting!

Their efforts are the fulfillment of George Orwell’s Animal Farm, where all of the animals were equal until the Pigs reigned supreme.

See https://en.wikipedia.org/wiki/Animal_Farm (“Animal Farm”); see also https://naegeleblog.wordpress.com/2010/09/24/washington-is-sick-and-the-american-people-know-it/#comment-10846 (“Washington And Hollywood Scum“) and https://naegeleblog.wordpress.com/2009/12/05/is-barack-obama-a-racist/ (“Is Barack Obama A Racist?“) and https://naegeleblog.wordpress.com/2012/02/07/poverty-in-america/#comment-7646 (“The Surging Ranks Of America’s Ultrapoor“) and https://www.yahoo.com/news/california-becomes-first-sanctuary-state-undocumented-migrants-230001006.html (“California becomes first ‘sanctuary state’ for undocumented migrants“) and https://pjmedia.com/trending/2017/10/06/antifa-group-plans-nationwide-deface-columbus-day-actions-for-monday/ (“Antifa Group Plans Nationwide ‘Deface Columbus Day’ Actions for Monday“) and https://naegeleblog.wordpress.com/2015/11/30/a-34-trillion-swindle-the-shame-of-global-warming/ (“A $34 Trillion Swindle: The Shame Of Global Warming“)


23 11 2017
Timothy D. Naegele

Numbers Of Homeless Rise To Levels Not Seen Since The Great Depression [UPDATED]

American poverty

The Los Angeles Times has reported:

Thanksgiving meals will be served to thousands of homeless and near-homeless individuals today on Skid Row and in Pasadena and Canoga Park amid calls for donations and volunteers for the rest of the year.

The Midnight Mission will serve Thanksgiving brunch to nearly 2,500 homeless and near-homeless men, women and children, according to Georgia Berkovich, its director of public affairs.

Scheduled volunteer servers include gubernatorial candidate and former Los Angeles Mayor Antonio Villaraigosa, entertainer Dick Van Dyke and actress Nicolette Sheridan.

The Midnight Mission is seeking donations of $5 to $10 to help it cover the costs of the meals. Donations can be made by texting “Meals” to 71777, Berkovich said. The mission serves meals seven days a week, distributes hygiene kits after its meal service and conducts drives for food and clothing to distribute to its guests.

Berkovich said the group has been serving nearly 1 million meals a year each year since 2013.

“We haven’t seen numbers like this since the Great Depression,” she said.

The nearby Fred Jordan Mission expects to serve more than a ton of turkey drumsticks, along with 500 pounds of mashed potatoes, 80 gallons of gravy, hundreds of pounds of traditional cornbread stuffing, 560 pounds of candied yams, 585 pounds of green beans, glazed carrots, spiced peaches, cranberry sauce and 400 pumpkin pies, according to the mission’s Suzanna Choi.

The mission is seeking donations of unwrapped toys worth $15 to $20 each to be given to thousands of poor children for Christmas. The toys can be dropped off at the mission on Thanksgiving or any other day through Dec. 15, Choi said.

Union Station Homeless Services will be serving thousands of meals at its annual Thanksgiving Dinner in the Park at Central Park in Pasadena, continuing a tradition that began in 1972. Donations of store-bought pies will be accepted Thanksgiving morning, CEO John C. Brauer said.

More than 2,000 people will be served a sit-down meal of turkey with trimmings at the 30th annual Community Thanksgiving Day Dinner for San Fernando Valley homeless and low-income families at the Guadalupe Community Center in Canoga Park.

See http://www.latimes.com/local/lanow/la-me-homeless-thanksgiving-20171123-story.html (“Thanksgiving help for the homeless: ‘We haven’t seen numbers like this since the Great Depression’“) (emphasis added); see also https://naegeleblog.wordpress.com/2012/02/07/poverty-in-america/#comment-7646 (“The Surging Ranks Of America’s Ultrapoor“) and http://www.miamiherald.com/news/nation-world/national/article186044173.html (“Homeless man spent his last $20 to keep her safe. She’s raised $250,000 to repay him“)

While the United States as a whole seems to be flourishing economically, there are vast numbers who are not living the “American Dream.” Those hardest hit may be little kids, such as the one shown in the photo above.


15 01 2018
Timothy D. Naegele


American poverty

Michael Walsh has written at PJ Media:

This just in from what was once the best state in the Union:

Guess which state has the highest poverty rate in the country? Not Mississippi, New Mexico, or West Virginia, but California, where nearly one out of five residents is poor. That’s according to the Census Bureau’s Supplemental Poverty Measure, which factors in the cost of housing, food, utilities and clothing, and which includes noncash government assistance as a form of income.

Given robust job growth and the prosperity generated by several industries, it’s worth asking why California has fallen behind, especially when the state’s per-capita GDP increased approximately twice as much as the U.S. average over the five years ending in 2016 (12.5%, compared with 6.27%).

The Left’s first, last and only instinct is to throw more money at the problem, but California’s already done that[] and guess what?

It’s not as though California policymakers have neglected to wage war on poverty. Sacramento and local governments have spent massive amounts in the cause. Several state and municipal benefit programs overlap with one another; in some cases, individuals with incomes 200% above the poverty line receive benefits. California state and local governments spent nearly $958 billion from 1992 through 2015 on public welfare programs, including cash-assistance payments, vendor payments and “other public welfare,” according to the Census Bureau. California, with 12% of the American population, is home today to about one in three of the nation’s welfare recipients.

The generous spending, then, has not only failed to decrease poverty; it actually seems to have made it worse.

The progressives who control every aspect of the state’s government are not necessarily stupid people, but they are malign. They understand that increasing welfare spending only encourages the arrival of more recipients on whom to spend it, and the high likelihood that those new constituents will vote Democrat as soon as they are able, legally or otherwise. Already, some 55 percent of “immigrants” receive means-tested benefits, while only 30 percent of native Californians do so.

California’s army of bureaucrats contributes as well, as does the state’s highly restrictive land-use ordinances and environmental restrictions, which drive up the cost of housing in what is already the nation’s most expensive real-estate market:

With 883,000 full-time-equivalent state and local employees in 2014, California has an enormous bureaucracy. Many work in social services, and many would lose their jobs if the typical welfare client were to move off the welfare rolls.

Further contributing to the poverty problem is California’s housing crisis. More than four in 10 households spent more than 30% of their income on housing in 2015. A shortage of available units has driven prices ever higher, far above income increases. And that shortage is a direct outgrowth of misguided policies.

They’re not “misguided” — in fact, they’re doing exactly what the progressives designed them to do. Higher housing prices means more money in the pockets of Angelenos and San Franciscans when they go to sell, high energy prices have a disproportionate impact on the poor, generous welfare “benefits” mean an endless supply of new Democrats and permanent employment for the public-employee unions who actually run the state.

It’s a perfect racket, and one that will continue unless and until the California Republicans get their act together and begin vigorously contesting what has become a one-party state designed to enrich those at the top, beggar the middle class, and keep those on the bottom in permanent penury.

See https://pjmedia.com/trending/whats-matter-california/ (“What’s the Matter with California?“) (emphasis added); see also https://pjmedia.com/victordavishanson/dark-ages-california/ (“California of the Dark Ages“) and https://naegeleblog.wordpress.com/2012/02/07/poverty-in-america/ (“Poverty In America“) (see also the other comments beneath the article) and https://www.newsmax.com/us/us-new-california-declaration-independence/2018/01/16/id/837529/ (“‘New California’ Declares ‘Independence’ From State”)

There is nothing “progressive” about America’s Left and far-Left, or its eco-Nazis. They are the Pigs that George Orwell described in his prescient Animal Farm, where all of the animals were equal until the Pigs reigned supreme and subjugated the other animals.

See https://en.wikipedia.org/wiki/Animal_Farm (“Animal Farm”)


30 01 2018
Timothy D. Naegele

Most Americans Cannot Afford A $1,000 Minor Emergency [UPDATED]

American poverty

At a time when U.S. housing prices have been soaring, and some Americans are experiencing unprecedented economic wealth, Valerie Edwards has written in the UK’s Daily Mail:

More than half of the American population are unable to afford a $1,000 emergency room bill or a $500 car repair, according to a new report.

Just 39 per cent of respondents in Bankrate’s latest survey said they would be able to tap into their savings to pay for an unexpected, minor emergency.

However, that leaves 61 per cent of US citizens scrambling for funds to pay off a visit to the ER or repairs to their vehicle.

The most common unexpected incidents are related to transportation, appliances or home-related breakdown or injury or illness.

In Bankrate’s survey, 19 per cent of Americans said they would be able to pay for a minor emergency with a credit card, while 13 per cent said they would have to reduce their spending in other areas.

Meanwhile, 12 per cent said they would have to borrow the money from friends or [family] and 5 per cent of the respondents said they would just take out a loan.

Those making less than $30,000 a year, were twice as likely to use some form of borrowing than savings, while households making more than $50,000 were more apt to use cash.

Bankrate’s findings dovetail a recent report from the Federal Reserve that found ’44 per cent of all respondents could not cover an unexpected $400 emergency expense or would rely on borrowing or selling something to do so’.

That particular survey also showed that many adults have no savings for retirement.

‘The survey findings remind us that many American households are struggling financially, including fully 40 per cent of those with a high school diploma or less,’ said Federal Reserve Board Governor Lael Brainard.

The Bankrate survey shows that 45 per cent of American adults said they or their immediate family had a major unexpected expense in the past 12 months. That’s up 2 per cent from last year.

Just 41 per cent of adults said they would pay an unexpected cost from savings. That’s a 4 [percent] increase from last year’s survey.

A person’s age and work status often determines if he or she is more apt to use savings or credit cards to pay for the unexpected, according to Bankrate.

Millennials are much likelier to tap savings, with 45 per cent saying so. Those who are 71 years and older have the highest credit use for unexpected expenses, at 28 per cent.

Parents were less likely, at 36 per cent, to use savings for an unexpected expense than the childless, at 43 per cent.

Carina Diamond, a certified financial planner professional in Akron, Ohio, told Bankrate that Americans are increasingly aware of the need to save for emergencies.

‘I wish I could say it’s because people are smarter about it, but it’s really the fear factor,’ she says. ‘One little thing — a new roof, a medical emergency — can set you up for financial disaster if you don’t have an emergency fund.’

See http://www.dailymail.co.uk/news/article-5328051/Most-Americans-afford-1-000-minor-emergency.html (“More than half of Americans are unable to afford a minor emergency: Only 39% would be able to cover an unexpected $1,000 bill from their savings“) (emphasis added); see also http://www.latimes.com/local/lanow/la-me-homeless-how-we-got-here-20180201-story.html (“L.A.’s homelessness surged 75% in six years. Here’s why the crisis has been decades in the making“) and https://www.cnsnews.com/commentary/terence-p-jeffrey/521-percent-kids-live-households-getting-means-tested-government (“52.1% of Kids Live in Households Getting Means-Tested Government Assistance“)

These are sobering facts, which when coupled with my article above and the extensive comments beneath it, paint the picture of alternative universes: one of massive wealth, and the other of abject poverty.


16 03 2018
Timothy D. Naegele

65 Percent Of Americans Save Little Or Nothing—And Half Could End Up Struggling In Retirement [UPDATED]

Senior poverty

Emmie Martin has written at CNBC:

Despite a low unemployment rate and increasing wage growth, Americans still aren’t saving much. That’s according to a new survey from Bankrate.com, which found that 20 percent of Americans don’t save any of their annual income at all and even those who do save aren’t putting away a lot.

Only 16 percent of survey respondents say that they save more than 15 percent of what they make, which is what experts generally recommend. A quarter of respondents report saving between 6 and 10 percent of their income and 21 percent say they sock away 5 percent or less.

At this rate, many people could be setting themselves up to fall short in retirement, Bankrate warns.

“With a steady, significant share of the working population saving nothing or relatively little, it’s virtually guaranteed that they’ll be unable to afford a modest emergency expense or finance retirement,” says Mark Hamrick, senior economic analyst at Bankrate. “That amounts to a financial fail.”

The economy might be prospering now, but that won’t last forever: “The party has to stop sometime, and when it does, employers will lay off workers,” the study says.

In fact, Bankrate estimates that half of the American population won’t be able to maintain their standard of living once they stop working. A report from GoBankingRates found similar results: Over 40 percent of Americans have less than $10,000 saved for when they retire.

What’s keeping Americans from saving? “Expenses” was the No. 1 answer of 39 percent of respondents. Another 16 percent say they don’t have a “good enough job” to be able to save, which presumably means they aren’t earning enough.

“The average American has less than $5,000 in a financial account, a quarter to a fifth of what you should have, and those aged 55 to 64 who have retirement savings only carry $120,000 — which won’t last long in the absence of paychecks,” the survey reports.

But saving money for retirement doesn’t have to be as hard as it seems. For starters, anyone looking to lower their expenses can consider downsizing their home, trimming their grocery bill or making it a priority to eliminate debt.

Those with the capacity to take on additional work can also bring in extra cash each month by renting out spare rooms, reselling items online or taking on freelance work. . .

See https://www.cnbc.com/2018/03/15/bankrate-65-percent-of-americans-save-little-or-nothing.html (emphasis added; charts omitted); see also http://www.latimes.com/local/lanow/la-me-ln-homeless-older-adults-20180719-story.html (“22% surge in number of older homeless people catches L.A. officials off guard“)

My article above, and the comments beneath it, set forth the cold, hard facts of poverty in America today, which may only get far worse.


1 05 2018
Timothy D. Naegele

San Francisco’s Homeless

Homeless man in San Francisco

[As described by the Daily Mail, this photo is of a “homeless man [who] digs in the trash while talking to himself in downtown San Francisco, California”]

Rory Tingle has written in the UK’s Daily Mail:

Though known for its compassion to the needy, San Francisco may have hit peak saturation with tent camps, stinky urine and trash littering the streets, and the new interim mayor has vowed to do something about it.

In the last few weeks, Mayor Mark Farrell has promised $750,000 to hire more people just to pick up discarded needles and $13 million over the next two years for more heavy duty steam cleaners and pit stop toilets.

He also had workers dismantle sprawling homeless tent camps in the city’s Mission District.

The city famed for its picture-perfect views of the San Francisco Bay has long tolerated overflowing trash bins and homeless people camped out on sidewalks.

Commuters routinely walk past people slumped over in transit stations, sometimes shooting up in public.

But Farrell and others say the squalor has gotten out of control, and that everyone should feel safe using city sidewalks. It is not humane to let the mentally ill or houseless fester outdoors, he said.

‘The trash, our homeless, the needles, the drug abuse on our streets, I’ve seen it all in our city and it’s gotten to the point where we need to really change course,’ Farrell said in an interview.

‘We’ve gone away from just being compassionate to enabling street behavior and that, in my opinion, is a shift that’s unacceptable.’

It’s not just the mayor who’s fed up. Cleaning up the city and getting people off the streets have become key issues in the upcoming mayoral race.

Many of the problems are in the city’s downtown shopping and South of Market corridors, but elected officials say complaints have rolled in from across the city of 850,000 residents.

Adam Mesnick, who lives in the South of Market neighborhood and owns two deli shops there, said San Francisco is ‘finally kind of melting down’ and that leaders have routinely ignored dangerous street behavior for years.

‘I cannot have my family down here, I can’t have visitors. I can, but I don’t choose to, have my nieces come here,’ he said. ‘It’s horrifying for my family to walk down the street here.’

He’s not sure Farrell, who was tapped as interim mayor after the sudden death of Mayor Ed Lee in December, will be able to make meaningful change in the short time he has left before the June mayoral race.

The downtown portion of Market Street, a key downtown arterial that runs from the Embarcadero through the Castro, teems with tourists, people shuffling in wheelchairs and children on school trips.

On a recent day, a man was curled up on the sidewalk at a bus stop, moving his head just inches away from a bus as it pulled up. A bystander went to check on him.

The exact number of homeless people in San Francisco is uncertain, but about 7,500 were found during a one-night count in 2017.

The city’s logged more than 24,300 requests last year for human waste cleanup and 9,500 for needle pick-up.

This year, there already have been more than 8,300 requests to pick up waste and 3,700 for needles.

San Francisco has budgeted $65 million out of a $10 billion citywide budget for street cleaning this year.

The $13 million the mayor announced this month will go toward hiring dozens more cleaners and expanding staffed pit stop toilets.

Homeless advocacy groups are critical of Farrell’s plan to dismantle camps, saying the move only pushes people into other neighborhoods. The problem, they say, is a lack of long-term housing.

Lawana Tillman, 55, camps out in a wheelchair with friends on a corner they’ve claimed near Market Street. Most of them have been homeless for years. The women say they welcome help, but haven’t seen any offers.

‘They should first interview us and give us housing,’ she said. ‘It would take most of us off the street.’

San Francisco’s top tourism ambassador, Joe D’Alessandro, is convinced civic leaders can fix the problem.

He made the rare decision to go public about city conditions, which he says have worsened in recent years, even for a cramped city that’s always been less than pristine.

‘It’s going to take some money, it’s going to take some dedication, but it’s very fixable, and we can make San Francisco even more magical,’ he said.

Near the city’s cable car turnaround by Union Square, tour guide Joseph Amster said he has seen more public defecation and more encounters with violent people who need medical help. He leads tours dressed as Emperor Norton, a failed 19th century entrepreneur beloved in a city that celebrates oddballs.

‘I had somebody spit on me once. I’ve had a number of close calls. That didn’t use to happen,’ he said.

Not everyone agrees that the city is roiled in human misery.

New York City resident John Rajnic, who was waiting to ride a cable car, said the city looks dirtier than when he was here nearly a decade ago, but he says the reaction is overblown.

‘I’m not walking around thinking this place is filthy.’

See http://www.dailymail.co.uk/news/article-5675665/Tolerant-San-Francisco-fed-dirty-smelly-streets.html (“San Francisco launches $13m drive to clear the streets of used needles and human waste, stop addicts shooting up and dismantle homeless camps as it admits the problem is out of control“) (emphasis added)

San Francisco has been unsafe for a long time now, which is true of parts of Los Angeles too.

And yes, there are innocent young children who are victims as well. With any economic hard times ahead, tragically their ranks will swell.

See, e.g., https://naegeleblog.wordpress.com/2012/02/07/poverty-in-america/ (“Poverty In America“) (see also the other comments beneath the article)

American poverty


19 07 2018
Timothy D. Naegele

THE NEW 1928? In 5 states, Richest Americans Live In A New Gilded Age [UPDATED]

American poverty

Aimee Picchi has reported for CBS News:

America is heading for a level of income inequality that hasn’t been seen since 1928 — yet the richest residents in fives states and 30 cities have already surpassed that threshold, according to a new study.

Unequal income growth since the 1970s has buoyed the fortunes of the top 1 percent of income earners, widening income inequality in every state, the study from the Economic Policy Institute found. Across the country, the top-earning households took home 22 percent of all income in 2015, the latest year for which the IRS has data. That’s just 1.9 percentage points lower than 1928’s record share of 23.9 percent of income.

But that 1928 peak has been surpassed in New York, Florida, Connecticut, Nevada and Wyoming, EPI said. Metropolitan regions that have leapfrogged over the 1928 record include Jackson, Wyoming — home to the resort town of Jackson Hole — and Naples, Florida, a popular retirement location.

The trend is likely to continue, said Mark Price, a labor economist at the Keystone Research Center who co-authored the study with Estelle Sommeiller, a socioeconomist at the Institute for Research in Economic and Social Sciences in France.

“The top 1 percent is capturing a bigger and bigger share of income,” Price said. “That raises questions where voice is often determined by access to money.” He added: “Our concern is that a healthier economy is one where incomes are growing much faster at the bottom than they are.”

A family in the top 1 percent of income earners receives about 26.3 times the income as a family in the bottom 99 percent, the study found. That’s an increase from 2013, when the top 1 percent received 25.3 times as much as the rest of U.S. households.

The trend represents a reversal of what’s often considered the golden years of the U.S. economy, the decades following World War II. While the country was hardly equal during those decades — gender and racial bias was widespread — income growth for both the poor and rich grew at the same pace, EPI noted.

But the 1 percent started taking the lion’s share of income growth after 1973. Since the end of the Great Recession in 2009, the top 1 percent has captured about 42 percent of income growth. In nine states, they’ve gained more than half of income growth.

The new Gilded Age

In 1928, the country was enjoying a booming stock market, boosting the wealth of families like the Rockefellers and Mellons to unheard-of levels. They vacationed in resorts like Newport, Rhode Island, leaving the cities for havens of wealth far removed from the centers of industry.

Today, the richest Americans are likewise capable of picking up and moving to resorts and vacation spots, which explains the presence of Jackson, Wyoming, as one of the top spots for income inequality. Jackson Hole is home to a famed ski resort, as well as extremely wealthy patrons like Walmart heiress Christy Walton.

“We are returning to something that was more common in the late 1800s and early part of 20th century: the idle rich, basically earning income from that accumulated wealth,” Price said. “If you’re a financial executive, you need to be near Wall Street, but as the 1 percent transition into this different group and are able to live off their wealth, it’s possible to live wherever you want.”

Differences from 1928

Even as gap between the rich and everyone else widens, the quality of life for the bottom 99 percent has vastly changed since 1928. The social safety net didn’t exist during the country’s last inequality peak, leaving the poor and elderly to manage without programs like a national pension system or health care.

The EPI study analyzed pre-transfer and pretax income, or earnings excluding the impact of taxes and government benefits like Social Security or unemployment benefits. Those benefits can reduce inequality by raising the incomes of poor and middle-class Americans, while taxes can lower income at the top of the distribution. But the EPI noted that the biggest force for inequality is the increasingly unequal distribution of income.

Americans need at least $421,926 in annual income to break into the top 1 percent, the EPI found. Yet in some states, residents will require much more to be considered among the top 1 percent, such as Connecticut, where the threshold stands at $700,800.

The 5 states where the top 1 percent have exceeded 1928’s 23.9 percent share of income:

1. New York: 31 percent
2. Florida: 28.5 percent
3. Connecticut: 27.3 percent
4. Nevada: 24.8 percent
5. Wyoming: 24 percent

The 30 metropolitan regions where the top 1 percent now control more wealth than in the 1928 peak:

1. Jackson, Wyoming-Idaho: 57.1 percent
2. Naples-Immokalee-Marco Island, Florida: 47.6 percent
3. Key West, Florida: 45.1 percent
4. Sebastian-Vero Beach, Florida: 40.4 percent
5. Bridgeport-Stamford-Norwalk, Connecticut: 38.6 percent
6. Miami-Fort-Lauderdale-West Palm Beach, Florida: 35.9 percent
7. Port St. Lucie, Florida: 31.5 percent
8. Glenwood Springs, Colorado: 31.2 percent
9. Hailey, Idaho: 31.2 percent
10. Gardnerville Ranchos, Nevada: 30.9 percent
11. Summit Park, Utah: 30.5 percent
12. North Port-Sarasota-Bradenton, Florida: 30.3 percent
13. New York-Newark-Jersey City, New York-New Jersey-Pennsylvania: 28.5 percent
14. Cape Coral-Fort Myers, Florida: 28.2 percent
15. Fayetteville-Springdale-Rogers, Arkansas-Missouri: 27.3 percent
16. Midland, Texas: 26.5 percent
17. Steamboat Springs, Colorado: 26.3 percent
18. Easton, Maryland: 26 percent
19. Las Vegas-Henderson-Paradise, Nevada: 26 percent
20. San Jose-Sunnyvale-Santa Clara, California: 25.9 percent
21. Crestview-Fort Walton Beach-Destin, Florida: 25.8 percent
22. San Francisco-Oakland-Hayward, California: 25.7 percent
23. Santa Maria-Santa Barbara, California: 25.4 percent
24. Los Angeles-Long Beach-Anaheim, California: 25.3 percent
25. Charlottesville, Virginia: 25.3 percent
26. Reno, Nevada: 25.2 percent
27. Casper, Wyoming: 24.8 percent
28. Corsicana, Texas: 24.7 percent
29. Boston-Cambridge, Newton, Massachusetts-New Hampshire: 24.6 percent
30. Napa, California: 24 percent

See https://www.cbsnews.com/news/in-5-states-richest-americans-live-in-a-new-gilded-age/ (“In 5 states, richest Americans live in a ‘new Gilded Age'”) (emphasis added; charts omitted)

This must be juxtaposed against massive poverty in the U.S., involving the “Ultrapoor”—who are struggling to survive on $2 a day—and seniors, which is discussed in the article above and in the comments beneath it.

Senior poverty


31 07 2018
Timothy D. Naegele


Vehicular homelessness

Jonathan Beer has written for CBS’ MONEYWATCH:

The number of people who live in their vehicles because they can’t find affordable housing is on the rise, even though the practice is illegal in many U.S. cities.

The number of people residing in campers and other vehicles surged 46 percent over the past year, a recent homeless census in Seattle’s King County, Washington found. The problem is “exploding” in cities with expensive housing markets, including Los Angeles, Portland and San Francisco, according to Governing magazine.

The problem of vehicle residency is national in scope, although its impact may be more “acutely felt in urban areas where space is more limited,” said Sara Rankin, an assistant professor law at Seattle University and the director of Homeless Rights Advocacy Project, in an email to CBS MoneyWatch.

Challenges abound for people who live in their vehicles, ranging from racking up parking tickets to finding a safe place to park and shower, advocates say.

A recent survey by the National Law Center on Homelessness and Poverty (NLCHP), which tracks policies in 187 cities, found the number of prohibitions against vehicle residency has more than doubled during the last decade.

“Much like outdoor camping and sleeping bans, city-wide restrictions on living in vehicles may leave no lawful place where homeless people may live in a community,” NLCHP said in a recent report. “Bans that permit vehicle impoundment, or that result in impoundment flowing from unpaid tickets or other enforcement of such bans, can cause homeless people to lose their shelter, transportation, and personal belongings in one fell swoop – with no realistic option to retrieve or replace them.”

It’s a frequent problem for the youth and veterans who turn to the Volunteers of America in Illinois for help, impacting perhaps one-third of the organization’s clients, said Airielle Macool-Cunningham, manager of veteran’s support services.

“People don’t consider themselves to be living in their car if they are only doing it for a couple of nights here and there, and so they are not self-reporting that,” she said. “Since our climate is a lot colder, they don’t typically stay in their cars long term unless it’s the summer months.”

Stephanie Monroe, managing director of Children Youth & Family Services at Volunteers of America, Dakotas, tells a similar story. At least 25 percent of the non-profit’s Sioux Falls clients have lived in their vehicles at some point, even during winter’s sub-freezing temperatures.

“Many of our communities don’t have formal shelter services,” she said in an interview. “It can lead to individuals resorting to living in their cars or other vehicles.”

Homelessness rose last year, marking its first increase since 2010, according to the U.S. Department of Housing and Urban Development. About one-third of the homeless population was described as “unsheltered,” which includes people living on the streets and in their vehicles. HUD’s data doesn’t provide more specific information.

A fair number of the “vehicular homeless” in Silicon Valley are employed but are unable to find affordable housing, as the Associated Press noted last year. Lines of RVs can be found near the headquarters of tech heavyweights such as Apple, Google and Hewlett-Packard. Nationwide, extremely low-income renters are facing a shortage of 7.2 million rental homes, according to the National Low Income Housing Coalition.

“A lot of times, once you lose your home it can spiral downwards from there,” said Megan Hustings, interim director of the National Coalition for the Homeless, in an interview. “We have seen people living in their cars anywhere from a couple of weeks to months to years.”

See https://www.cbsnews.com/news/more-americans-are-living-in-their-vehicles-amid-high-housing-prices/ (“More Americans are forced to ‘reside’ in their vehicles”) (emphasis added)

As the fees at State and local parks have climbed almost to motel prices, in States such as California, the problem has become more acute, with far worse likely to come.


6 08 2018
Timothy D. Naegele

Too Little Too Late: Bankruptcy Booms Among Older Americans

Senior poverty

Tara Siegel Bernard has written for The New York Times:

For a rapidly growing share of older Americans, traditional ideas about life in retirement are being upended by a dismal reality: bankruptcy.

The signs of potential trouble — vanishing pensions, soaring medical expenses, inadequate savings — have been building for years. Now, new research sheds light on the scope of the problem: The rate of people 65 and older filing for bankruptcy is three times what it was in 1991, the study found, and the same group accounts for a far greater share of all filers.

Driving the surge, the study suggests, is a three-decade shift of financial risk from government and employers to individuals, who are bearing an ever-greater responsibility for their own financial well-being as the social safety net shrinks.

The transfer has come in the form of, among other things, longer waits for full Social Security benefits, the replacement of employer-provided pensions with 401(k) savings plans and more out-of-pocket spending on health care. Declining incomes, whether in retirement or leading up to it, compound the challenge.

Cheryl Mcleod of Las Vegas filed for bankruptcy in January after struggling to keep up with her mortgage payments and other expenses. “I am 70, and I am working for less money than I ever did in my life,” she said. “This life stuff happens.”

As the study, from the Consumer Bankruptcy Project, explains, older people whose finances are precarious have few places to turn. “When the costs of aging are off-loaded onto a population that simply does not have access to adequate resources, something has to give,” the study says, “and older Americans turn to what little is left of the social safety net — bankruptcy court.”

“You can manage O.K. until there is a little stumble,” said Deborah Thorne, an associate professor of sociology at the University of Idaho and an author of the study. “It doesn’t even take a big thing.”

The forces at work affect many Americans, but older people are often less able to weather them, according to Professor Thorne and her colleagues in the study. Finding, and keeping, one job is hard enough for an older person. Taking on another to pay unexpected bills is almost unfathomable.

Bankruptcy can offer a fresh start for people who need one, but for older Americans it “is too little too late,” the study says. “By the time they file, their wealth has vanished and they simply do not have enough years to get back on their feet.”

The data gathered by the researchers is stark. From February 2013 to November 2016, there were 3.6 bankruptcy filers per 1,000 people 65 to 74; in 1991, there were 1.2.

Not only are more older people seeking relief through bankruptcy, but they also represent a widening slice of all filers: 12.2 percent of filers are now 65 or older, up from 2.1 percent in 1991.

The jump is so pronounced, the study says, that the aging of the baby boom generation cannot explain it.

Although the actual number of older people filing for bankruptcy was relatively small — about 100,000 a year during the period in question — the researchers said it signaled that there were many more people in financial distress.

“The people who show up in bankruptcy are always the tip of the iceberg,” said Robert M. Lawless, a law professor at the University of Illinois and another author of the study.

The next generation nearing retirement age is also filing for bankruptcy in greater numbers, and the average age of filers is rising, the study found.

Given the rate of increase, Professor Thorne said, “the only explanation that makes any sense are structural shifts.”

Ms. Mcleod said she had managed to get by for a while after separating from her husband several years ago. Eventually, though, she struggled to make ends meet on her income alone, and she fell behind on her mortgage payments.

She collects a small Social Security check and works at an adult day care center for people with intellectual disabilities and mental health problems. For $8.75 an hour, she makes sure clients participate in daily activities, calms them when they are irritated and tries to understand what they need when they have trouble expressing themselves.

“When I moved here from Los Angeles, I was wondering why all of these older people were working in convenience stores and fast-food restaurants,” she said. “It’s because they don’t make enough in retirement to support themselves.”

Ms. Mcleod said she hoped that filing for bankruptcy would help her catch up on her mortgage so she could stay in her home. “I am too old to move out of here,” she said. “I am trying to stay stable.”

The bankruptcy project is a long-running effort now led by Professor Thorne; Professor Lawless; Pamela Foohey, a law professor at Indiana University; and Katherine Porter, a law professor at the University of California, Irvine. The project — which is financed by their universities — collects and analyzes court records on a continuing basis and follows up with written questionnaires.

Their latest study — which was posted online on Sunday and has been submitted to an academic journal for peer review — is based on a sample of personal bankruptcy cases and questionnaires completed by 895 filers ages 19 to 92.

The questionnaire asked filers what led them to seek bankruptcy protection. Much like the broader population, people 65 and older usually cited multiple factors. About three in five said unmanageable medical expenses played a role. A little more than two-thirds cited a drop in income. Nearly three-quarters put some blame on hounding by debt collectors.

The study does not delve into those underlying factors, but separate data provides some insight. The median household led by someone 65 or older had liquid savings of $60,600 in 2016, according to the Employee Benefit Research Institute, whereas the bottom 25 percent of households had saved at most $3,260.

That doesn’t provide much of a financial cushion for a catastrophic health problem. Older Americans typically turn to Medicare to pay their medical bills. But gaps in coverage, high premiums and requirements that patients shoulder some costs force many lower-income beneficiaries to spend more of their own income on those bills, the Kaiser Family Foundation found.

By 2013, the average Medicare beneficiary’s out-of-pocket spending on health care consumed 41 percent of the average Social Security check, according to Kaiser, which also estimated that the figure would rise.

More people are also entering their later years carrying debt. For many of them, at least some of the debt is a mortgage — roughly 41 percent in 2016, compared with 21 percent in 1989, according to an Urban Institute analysis.

And those who are carrying debt into retirement are carrying more than members of earlier generations, an analysis by the Employee Benefit Research Institute found.

Perhaps not surprisingly, the lowest-income households led by individuals 55 or older carry the highest debt loads relative to their income. More than 13 percent of such households face debt payments that equal more than 40 percent of their income, nearly double the percentage of such families in 1991, the employee benefit institute found.

Older Americans’ finances are also being strained by the needs of those around them.

A little more than a third of the older filers who answered the researchers’ questionnaire said that helping others, like children or older parents, had contributed to their seeking bankruptcy protection. Marc Stern, a bankruptcy lawyer in Seattle, said he had seen the phenomenon again and again.

Some parents, Mr. Stern said, had co-signed loans for $10,000 or $20,000 for adult children and suddenly could no longer afford them. “When you are living on $2,000 a month and that includes Social Security — and you have rent and savings are minuscule — it is extremely difficult to recover from something like that,” he said.

Others had co-signed their children’s student loans. “I never saw parents with student loans 20 or 30 years ago,” Mr. Stern said.

“It is not uncommon to see student loans of $100,000,” he added. “Then, you see parents who have guaranteed some of these loans. They are no longer working, and they have these student loans that are difficult if not impossible to pay or discharge in bankruptcy, and these are the kids’ loans.”

Keith Morris, chief executive of Elder Law of Michigan, which runs a legal hotline for older adults, said the prospect of bankruptcy was a regular topic for his callers.

“They worked all of their lives, and did what they were supposed to do,” he said, “and through circumstances like a late-life divorce or a death of a spouse or having to raise grandkids, have put them in a situation where they are not able to make the bills.”

For Lawrence Sedita, a 74-year-old former carpenter now living in Las Vegas, the problems began when he lost his health insurance about two years ago. He said he had been on disability since 1991, when a double pack of 12-foot drywall fell on his head at work.

After his union, the New York City District Council of Carpenters, changed the eligibility requirements for his medical, dental and prescription drug insurance, he lost his coverage.

Mr. Sedita, who has Parkinson’s disease, said his medical expenses had risen exponentially. (A spokesman for the union declined to comment.)

A medication that helps reduce the shaking — a Parkinson’s symptom — rose to $1,100 every three months from $70, Mr. Sedita said. “I haven’t taken my medicine in three months since I can’t afford it,” he added.

He said he and his wife, who has cancer, filed for bankruptcy in June after living off their credit cards for a time. Their financial difficulty, he said, “has drained everything out of me.”

See https://www.nytimes.com/2018/08/05/business/bankruptcy-older-americans.html (emphasis added; diagrams omitted)

Far worse than bankruptcy is homelessness, where the innocent are preyed on by criminals or those who are mentally unstable.


12 10 2018
Timothy D. Naegele

40 Percent Of American Middle Class Face Poverty In Retirement

Middle class foreclosures

Elliot Dinkin, president and CEO of Cowden Associates, has written for CNBC:

Nearly half of middle-class Americans face a slide into poverty as they enter their retirement, a recent study by the Schwartz Center for Economic Policy Analysis at the New School has concluded.

That risk has been driven by depressed earnings, depressed asset values and increased health-care costs — causing 74 percent of Americans planning to work past traditional retirement age. Additionally, both private and public pension plans have been allowed to become seriously underfunded. So what can be done?

Fundamental changes in the structure of the U.S. economy, combined with increased health-care costs and lack of saving, have created a financial trap for millions of American workers heading into retirement.

Roughly 40 percent of Americans who are considered middle class (based on their income levels) will fall into poverty or near poverty by the time they reach age 65, according to the study.

The study also concluded that if workers age 50 to 60 decide to retire at age 62, 8.5 million of them are projected to fall below twice the Federal Poverty Level, with retirement incomes below $23,340 for singles and $31,260 for couples. Further, 2.6 million of those 8.5 million downwardly mobile workers and their spouses will have incomes below the poverty level — $11,670 for an individual and $15,730 for a two-person household.

It can be debated as to how this happened. Who is to blame? Who is ultimately responsible for a retiree’s well-being in retirement?

Most importantly, though, employers and employees need to focus on a fix. Personal savings is obviously a needed conversation. And sponsors of pension plans — whether corporate, governmental or multi-employer — need to ensure they are doing their part.

Not coincidentally, older Americans increasingly continue to work longer than their forebears. More than 20 percent of the workforce in the United States is 55 or older, a historic high, and that percentage is expected to increase — 74 percent of Americans now say they plan to work past traditional retirement age.

So how will this impact employer pension plans? Are there solutions? What do they look like? Who do they affect and how?

Employers need to complete an in-depth analysis of their business models, risk management policies, benefit offerings and financial options through a total compensation approach.

A defined benefit plan should be managed like a separate line of business: It should have budgets, forecasts and a strategic plan. The magnitude of the issue and its prominence require this approach, as the plan is a use and source of cash, creates volatile liability and expense and causes negative consequences often at the worst time in business cycles.

The process involves a variety of areas regarding benefit design, cost, risk management, cash flow, taxes, competitiveness and labor management. . . .

Finally, pension plan sponsors must continually monitor investment strategies; the impact of potential regulatory changes, including funding and accounting rules; appropriateness of assumptions; and development of funding policies to ensure they are appropriately managing their risk and cost issues, but acting in the most prudent manner for their current employees and current retirees.

See https://www.cnbc.com/2018/10/12/40percent-of-american-middle-class-face-poverty-in-retirement-study-says.html (“40% of American middle class face poverty in retirement, study says“) (emphasis added; chart omitted)


2 11 2018
Timothy D. Naegele

America’s Dark Underbelly: As Housing Costs Rise, Many Americans Are Falling Behind On Other Bills

Attention renters

Annie Nova has written for CNBC:

Financial stress visits renters more than homeowners.

That’s the main takeaway from a new report by the Urban Institute, a nonpartisan think tank in Washington.

Rental costs are rising much faster than renters’ salaries. Between 1960 and 2016, the median income for a renter grew by just 5 percent. During the same period, the median rent ballooned by more than 60 percent, according to The Joint Center for Housing Studies of Harvard University. (Both figures account for inflation.)

To be sure, buying a house has also become harder for many Americans — to do so now costs four times the median household income. The homeownership rate fell to 63 percent in 2016 – the lowest rate in half a century.

“Still, renters seem to be worse off,” said Corianne Scally, a senior research associate at the Urban Institute and a co-author of the study.

The Urban Institute’s findings come out of its 2017 well-being and basic needs survey, which received responses from 7,500 people ages 18 to 64.

Half of renters in the survey reported a material hardship in the past year, compared with one-third of homeowners.

More than one-quarter of U.S. renters in the survey were not confident they could cover a $400 emergency. Around 18 percent of homeowners reported low emergency savings.

Nearly 18 percent of the renters experienced a large and unexpected decline in income in the past year, compared with 14 percent of the homeowners.

More than 12 percent of the renters report difficulty covering their housing costs, compared with 9 percent of the homeowners.

Over 15 percent of the renters say they struggled to pay a utility bill during the last 12 months, while 11 percent of the homeowners did.

While renters are worse off, Scally said, it’s clear that many homeowners are also struggling with their bills.

“It seems that some of them are having to make trade-offs in just meeting their basic needs,” she said.

See https://www.cnbc.com/2018/11/02/as-housing-costs-rise-many-people-are-falling-behind-on-other-bills.html (“One-quarter of renters couldn’t cover a $400 emergency, survey finds“) (emphasis added; charts omitted); see also http://www.latimes.com/business/la-fi-financial-pulse-20181101-story.html (“Most Americans aren’t financially healthy despite booming economy, survey finds“)


5 09 2019
Timothy D. Naegele

Homelessness: Seattle Is Dying

See also https://naegeleblog.wordpress.com/2019/05/07/the-brooke-amendment-and-section-8-housing-revisited/#comment-18161 (“The Face Of Homelessness“) and https://naegeleblog.wordpress.com/2015/07/01/global-chaos-and-helter-skelter/#comment-18288 (“The Real Legacies Of The Great Recession: Renters and Homelessness, With Much More To Come?“) and http://www.dickmorris.com/homelessness-is-due-to-liberal-policies-not-poverty-lunch-alert/ (“Homelessness Is Due To Liberal Policies, Not Poverty“)

Homelessness is a multi-faceted and multi-dimensional problem in the United States, which is growing worse with each day that passes.

And no, police “roundups” are not the answer; and yes, the shelters are full in many if not most of our communities where homelessness is an epidemic.

The police are not “social workers.” In a city like San Francisco, they have enough to do dealing with serious crimes, without the added burden of trying to solve societal problems.

Indeed, it has been reported—and as indicated in the video above—that qualified officers are leaving the nation’s law enforcement ranks in growing numbers because of increased stress, frustrations and risks.

There have to be teams, including social workers and elements of law enforcement. Filling up our jails and prisons with the homeless is no solution. And yes too, many families with small children have fallen on hard times, and they are victimized by the hardened criminal elements in the homeless ranks.

Far-Left policies such as “sanctuary cities” are absurd, and lawless, and must be overturned and rejected.

American poverty


13 11 2019
Timothy D. Naegele

Did The Emptying Of Mental Hospitals Contribute To Homelessness? [UPDATED]

Jessica Placzek has written for KQED News:

Earlier this year, we asked for your questions on homelessness. More than 1,300 of you responded and we answered many of your questions in our first round of reporting.

There was one topic that kept coming up again and again as we sorted your questions. This week on the podcast, we answer listener Debbie Ow’s question:

“Is the situation as bad as it is because of the closure of mental health facilities in our state?”

Deinstitutionalization: A History

1833 Worcester State Hospital opens in Massachusetts as the first mental hospital fully supported by state funds.

1860 Twenty-eight of the 33 existing U.S. states have state psychiatric hospitals.

1939-1945 During World War II conscientious objectors enter state psychiatric hospitals to replace doctors who were sent away for the war effort.

1946 Life Magazine publishes photos depicting the horrors inside the hospitals.

1954 Chlorpromazine, marketed as Thorazine, is approved by the Food and Drug Administration. It’s the first anti-psychotic drug widely used to treat the symptoms of mental illness. For many, it brought hope that some patients could live among the community.

1955 The number of patients inside public mental hospitals nationwide peaks at 560,000.

1959 The number of patients in California state mental hospitals peaks at 37,000.

1963 President John F. Kennedy signs the Community Mental Health Act. This pushes the responsibility of mentally ill patients from the state toward the federal government. JFK wanted to create a network of community mental health centers where mentally ill people could live in the community while receiving care. JFK could have been inspired to act because his younger sister, Rosemary, was mentally disabled, received a lobotomy and spent her life hidden away.

Less than a month after signing the new legislation, JFK is assassinated. He doesn’t see the plan through. The community mental health centers never receive stable funding, and even 15 years later less than half the promised centers are built.

1965 The U.S. Congress establishes Medicaid and Medicare. Mentally disabled people living in the community are eligible for benefits but those in psychiatric hospitals are excluded. By encouraging patients to be discharged, state legislators could shift the cost of care for mentally ill patients to the federal government.

1967 Ronald Reagan is elected governor of California. At this point, the number of patients in state hospitals had fallen to 22,000, and the Reagan administration uses the decline as a reason to make cuts to the Department of Mental Hygiene. They cut 2,600 jobs and 10 percent of the budget despite reports showing that hospitals were already below recommended staffing levels.

1967 Reagan signs the Lanterman-Petris-Short Act and ends the practice of institutionalizing patients against their will, or for indefinite amounts of time. This law is regarded by some as a “patient’s bill of rights”. Sadly, the care outside state hospitals was inadequate. The year after the law goes into effect, a study shows the number of mentally ill people entering San Mateo’s criminal justice system doubles.

1969 Reagan reverses earlier budget cuts. He increases spending on the Department of Mental Hygiene by a record $28 million.

1973 The number of patients in California State mental hospitals falls to 7,000.

1980 President Jimmy Carter signs the Mental Health Systems Act to improve on Kennedy’s dream.

1981 President Reagan repeals Carter’s legislation with the Omnibus Budget Reconciliation Act. This pushes the responsibility of mentally ill patients back to the states. The legislation creates block grants for the states, but federal spending on mental illness declines.

2004 The U.S. Department of Justice estimates that 10 percent of state prisoners have symptoms that meet criteria for a psychotic disorder.

2015 In the San Francisco Homeless Count, 55 percent of people experiencing chronic homelessness report they have emotional or psychiatric conditions.

See https://www.kqed.org/news/11209729/did-the-emptying-of-mental-hospitals-contribute-to-homelessness-here (emphasis in original); see also https://www.dailymail.co.uk/news/article-7683381/Woman-recalls-attack-homeless-man-psychotic-disorders-poured-bucket-hot-feces-her.html (“Woman describes how homeless LA man with ‘psychotic disorders’ poured a bucket of hot feces over her as figures reveal huge increase in arrests fro assault by vagrants“)

Whatever the genesis, homelessness in America—and especially in our big cities—has become an epidemic, with no end in sight. It touches all ages, skin colors, and ethnicities.


30 11 2019
Timothy D. Naegele

6,000 Plus Mass Grave Of Irish Famine Immigrants Likely Found In Montreal [UPDATED]

This is the title of an article at IrishCentral:

The discovery of the remains and coffins of between 12 and 15 people at Victoria Bridge, near the Black Rock in Montreal, is proof there is a massive Irish Famine mass grave at this site which should be memorialized, say Irish community leaders.

Local media reported last week that archaeologists have discovered the remains of between 12 and 15 people in Montreal, close to the Irish Famine memorial known as the Black Rock, where 6,000 Great Hunger victims are thought to be buried.

Light rail dig

The discovery was made by archaeologists for the Réseau Express Métropolitain (REM), who were excavating in preparation for the construction of the future light rail system at Bridge Street. The Irish Memorial Park Foundation who has been petitioning for an Irish Famine memorial on this site for the last ten years believes this discovery is proof of a larger Irish burial ground.

Fergus Keyes, a Director of the Montreal Irish Memorial Park Foundation told the Montreal Gazette “I think we’ve been proven right”.

REM was digging in a small area of about 2.3 meters in diameter, where a pillar for the elevated light rail will be erected.

Keyes told the Gazette “In this one small space that the REM is digging in, the fact that they’ve already pulled up somewhere around 15 or more bodies is a pretty good indication how many burials are really under that area.”

Montreal Irish Famine memorial

The Black Rock, a makeshift memorial to the Famine dead was erected in 1859 by workers constructing the Victoria Bridge. Today the Black Rock stands on the grassy median in the middle of Bridge St, in a disaffected industrial area near a Costco warehouse.

Every year Montreal’s Irish community join the Ancient Order of Hibernians (AOH) in the annual “Walk to the Stone” to commemorate the more than 6,000 victims of the Great Hunger who died there in the years surrounding 1847.

The Irish community, backed by public figures such as the former Quebec premier Bernard Landry, believes the planned light rail station should be named for the Great Hunger victims buried at the site, according to Keyes. This will include a memorial park.

Keyes said the memorial park would pay tribute both to the Irish victims and the many Montrealers who risked their lives to care for them including Catholic priests and nuns, British soldiers, families who adopted orphaned children, First Nations who contributed food and money and Montreal’s then-mayor, John Easton Mills, who died of typhus while nursing the sick.

The Irish Famine victims were “the worst immigrants you can imagine”, Keyes said, highlighting the Montrealer’s selflessness in coming to their aid and its importance given the polarizing modern-day debate surrounding immigration.

“They were poor, they were hungry, they didn’t speak the language, for the most part, they were illiterate and on top they brought disease,” he said.

“And a bunch of Montrealers of every language and culture went to help them, provide food, provide care, provide comfort.”

Answering Great Hunger questions

The archaeological dig at the site will continue for about another week, said Keyes.

Within the 2.3-meter wide hole bone fragments along with wood were discovered. These are believed to be from the stacked coffins.

A REM spokesperson Elizabeth Boivin said the skeletal remains are in good condition. She added that more bodies could be discovered since archeologists don’t yet know how deep the graves lie.

“It was in the context of an epidemic, so there was a public health problem, and the bodies were stacked up, put into coffins, but it wasn’t an organized cemetery as we know it,” she told GlobalNews.ca.

The recovered bones will be sent to a laboratory for analysis and study. This process will likely take a few months.

Keyes told the Gazette that the REM have promised to set up a meeting with the Montreal Irish Memorial Park Foundation once their analysis is complete.

He said “We have a lot of questions…

“Can they define the gender, their approximate age? Can they extract DNA?

“Can they say if they were indeed killed by typhus or malnutrition, or a combination of both?”

In 1847, 70,000 Irish Famine migrants landed in Montreal overwhelming the city, which at the time had a population of 50,000. Many Irish lost their lives here during the typhus epidemic of 1847, a year that is named Black ‘47 in Irish history in memory of the worst period of the Irish Famine and the vast numbers of Irish leaving the country for foreign shores.

Keyes told the GlobalNews.ca “By September and October of 1847, we know they were running out of coffins and started trenching people.

“At the end of the day, they were digging a trench and throwing in 30 bodies here, there and elsewhere.”

Keyes commented on the 2018 dig, on the east side of the river, for Hydro-Québec, which uncovered mid-19th-century artifacts like bottles and crockery but no human remains. It’s believed that these artifacts were deposited during the construction of the Victoria Bridge when sheds were constructed in the area.

These discoveries are consistent with research on where the unmarked mass grave is located, Keyes attests.

He praised the REM for their sensitivity to the Irish community’s concerns about the sanctity of the site. For example, the pillars are being spaced farther apart than usual to avoid disturbing the burial ground more than necessary, he said. The REM also held a blessing on the site in June ahead of the dig.

It is the Foundation’s hope that the Great Hunger victims be reinterred at the site and commemorated. Victor Boyle, Co-president of the Irish group said: “It seems to me unseemly that you would take bones that have been there for more than 100 years and move them somewhere else.”

See https://www.irishcentral.com/news/great-hunger-montreal-mass-grave (emphasis in original); see also https://www.irishcentral.com/opinion/others/irish-famine-ghosts-grosse-isle (“The Irish Famine ghosts linger still on Grosse Isle“) and https://www.irishcentral.com/news/irish-famine-studies-us-holocaust (“Irish Famine studies in the US should be mandatory, like the Holocaust“)

This article is important, not only for its historical references and the human tragedies that it describes—like the Nazi Holocaust, the Chinese Holocaust, and the Soviet Holocaust—but also because it is occurring each and every night and day in America today.

Imagine all of the homeless who are living outside under freezing conditions right now in temperate climates such as California’s coast; and imagine more living in areas of the country where temperatures fall far lower. It’s clear there is no housing for Veterans under the Section 8 program, which is overwhelmed; and it is likely that the meager homeless shelters are overwhelmed too. Extrapolate this around the country, and lots of human beings are barely surviving.

And yes, my first Irish ancestor arrived in America in 1850, right in the midst of the Irish Famine. But the urgency today applies to all Americans, regardless of their ages, races, religions and ethnic heritages.

See, e.g., https://naegeleblog.wordpress.com/2010/02/06/the-silent-voices-of-stalin%E2%80%99s-soviet-holocaust-and-mao%E2%80%99s-chinese-holocaust/ (“The Silent Voices Of Stalin’s Soviet Holocaust And Mao’s Chinese Holocaust“) and https://naegeleblog.wordpress.com/2019/05/07/the-brooke-amendment-and-section-8-housing-revisited/ (“The Brooke Amendment And Section 8 Housing: Revisited“) and https://www.dailymail.co.uk/news/article-7753511/Fed-Oakland-residents-place-LOGS-outside-stores-bid-stop-homeless-encampments.html (“Fed-up Oakland residents place LOGS outside stores in a bid to stop homeless encampments“)

So many Americans turn their eyes from the plight of the homeless, and go about their days as if such conditions did not exist. The same thing was true with respect to Americans with disabilities, such as my mother who was in a wheelchair when I was growing up. Finally, the nation came to grips with such issues and addressed them. Hopefully the same thing happens with our great nation’s homeless.

Never forget you, or someone who is dear to you, could become homeless at any time. And no, the homeless are not today’s lepers, who will be spurned forever. The residents of Oakland, California should know this as well as anyone. They have had homeless in their ranks for decades, among other things when Jerry Brown was the city’s mayor.


7 12 2019
Timothy D. Naegele

Los Angeles Is Spending Over $1 Billion To House The Homeless, And It’s Failing

Zach Weissmueller has written at Reason.com:

More than 2,500 homeless individuals sleep on the streets of the 53-square-block Skid Row area in downtown Los Angeles.

“Skid row is the worst manmade disaster in the United States. There’s human waste on the sidewalks. There’s all kinds of disease,” says Rev. Andy Bales, CEO of Skid Row’s Union Rescue Mission, the nation’s largest private homeless shelter. He lost his leg to staph infection he contracted while serving the homeless on Skid Row.

But California’s homelessness crisis extends far beyond Skid Row and Los Angeles. The state’s homeless population has jumped more than 12 percent in the last five years, and it’s part of a national crisis.

The city’s particular predicament is notable for its sheer scale. Bales says that Los Angeles, which has the largest unsheltered homeless population in America, has failed to deal with what’s become a public health and humanitarian crisis. More than 1,000 homeless people died on the streets of Los Angeles County last year, according to government figures.

In 2016, Los Angeles voters approved a referendum to spend more than $1.2 billion dollars building new housing for the homeless. It’s part of a plan championed by Los Angeles Mayor Eric Garcetti, who declined our interview request.

The city set a target in 2016 of building 10,000 new housing units within a decade, but just one percent of those apartments will be ready for occupancy by the end of 2019.

“It’s going to be too late when they get through spending the money,” says Jimmy Anderson, who’s lived on Skid Row for 40 years and currently sleeps at Union Rescue Mission. “There’s going to be triple the homeless who’re out here now.”

Building in California isn’t easy.

The state legislative analyst’s office found that “increasing competition for limited housing is the primary driver of housing cost growth in coastal California,” which has some of the nation’s highest housing prices and rents thanks partly to local interest groups, which often use tools like zoning and the state’s environmental review law to delay or kill new housing projects. Those obstacles prevent new housing units from being built, which drives up prices. As a result, people living on the margins are priced out and turn to the streets.

Even after voters approved more than $1.2 billion dollars specifically to build housing for the increasing homeless population, a recent report by the L.A.’s Controller’s Office attributed the delays and cost overruns largely to regulatory barriers, permitting challenges, and bureaucratic confusion.

Meanwhile, the existing shelters are running out of space.

“Women and kids are going to take over the [Union Rescue Mission] and all the men are going to have to move back out here onto the street,” Anderson says.

The city’s approach to homelessness, known as “Housing First,” was adopted by municipalities nationwide after Utah reportedly reduced chronic homelessness by 91 percent by giving away permanent apartments with no strings attached.

But state auditors later attributed those findings to a data collection error. Utahns don’t actually know how their homeless population has changed over the years, or what effect various homelessness programs have had on Utah’s homeless population, which is estimated to be two-thirds the size of just Skid Row’s homeless population. What’s more, building housing for the homeless is considerably more costly and complex in Los Angeles than in Salt Lake City.

The city initially ballparked the permanent units at a median cost of $350,000 a piece. Three years later, the estimated cost rose to more than half a million per unit. Some units are approaching $700,000 each.

Andy Bales says he saw it coming.

“I was a critic 10 years ago of this plan even before it came about,” he says. “A very expensive way of spending all the resources on a few and leaving the many out in the cold.”

In Los Angeles, three out of four homeless people live unsheltered on the street. Bales had wanted the city to allocate a portion of the money to nonprofits and churches like his to provide temporary relief but says critics dismissed and even laughed at him.

“There’s this group that is so dogmatic about permanent supportive housing as the solution,” he says. “And they think the only solution is the perfect rather than good.”

Bales says that, given the current emergency, the city should reconsider its heavy focus on finding a long term solution.

Union Rescue Mission just opened what’s called a Sprung structure, a relatively inexpensive but sturdy and weather-resistant tent with 120 beds. He encourages the city to invest more in Sprung structures and other cheap, easily constructed solutions like mobile homes, container homes, or even 3-D printed concrete houses.

“We cannot spend $600,000 per person per unit and ever get it done,” says Bales. “We’ve got to think innovatively or we’re going to have a bigger disaster on our hands.”

In terms of where to put these structures, the L.A. Controller’s Office reports that the city owns more than 7,500 lots, though neighborhood councils regularly fight to keep shelters out.

Property owners in Skid Row and elsewhere in the city would like to see the police clear homeless encampments out of their neighborhoods, which could also help to avert the emerging public health crisis.

But past court settlements prevent that, and a September ruling on a case out of Idaho from the U.S. Court of Appeals for the 9th Circuit found that doing so constitutes cruel and unusual punishment when cities don’t have “adequate shelter” to accommodate everyone living on the streets. Los Angeles and Los Angeles County have signed onto a lawsuit challenging that ruling.

“We just firmly believe that the police are not an answer to homelessness,” says Becky Dennison of the Venice Community Housing Corporation, which opposes the criminalization of sidewalk camping in Los Angeles.

Dennison says that the focus should remain on building more housing, not arresting people for being unable to find shelter. But proponents of the lawsuit say the city needs guidance from the courts on what constitutes “adequate shelter” before investing in solutions that might free them to enforce anti-camping laws.

“We don’t actually ever need to criminalize low income people for non-criminal behaviors,” Dennison says.

Given the lack of progress on permanent or temporary housing, Bales is also hesitant to sign onto the lawsuit for the time being.

“I’m not signing on to remove people from the streets until we have enough places to go,” Bales says. “When we get that, then we can worry about asking somebody to leave the streets.”

Under the increasing pressure in recent months, the city has erected a few of its own Sprung structures to address the crisis. Bales says it’s still not nearly enough.

“It’s ridiculous. I mean, who would want to leave 44,000 people on the streets to die while you stick with your very expensive plan to help a few?”

See https://reason.com/video/los-angeles-is-spending-over-1-billion-to-house-the-homeless-its-failing/# (emphasis added)

Rev. Andy Bales is correct, and should be heeded.


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