Chapter 2 Poverty and Wealth

Economic Inequality in the United States  Social stratification: the system by which society ranks categories of people in a hierarchy  Stratification produces social classes categories of people who have similar access to resources and opportunities

Economic Inequality in the United States  Any discussion of problems such as poverty must include a discussion of income and wealth  Taxation is a common device used by the government to reduce economic inequality

Economic Inequality in the United States  Income refers to salary or wages from jobs plus earnings from investments or any other source The median family income in 2004 was $55,327.  Wealth refers to the value of all the economic assets owned by a person or family minus any debts. The wealthiest 1 percent of families in the U.S. own 60 percent of all wealth. About half of all families in the U.S. have no wealth at all.

Economic Inequality in the United States  The government attempts to reduce economic inequality through progressive taxation, a policy that raises tax rates as income increases.

The Rich and the Poor: A Social Profile  “The Rich”: those families who fall within the top 10 percent of income distribution.  The “poverty line”: A standard set by the U.S. government for the purpose of counting the poor, referring to the level of annual income below which a person or family is defined as poor and thus entitled to government assistance  The “poverty gap”: the difference between the official poverty line and the actual income of the typical poor household

The Poor: A Closer Look  Profile of the U.S. poor Age: at greatest risk are children Race: African Americans and Hispanics Gender: women Family Patterns: single mothers Region: the South and the West

Working vs. Non-Working Poor Working Poor 19% of the heads of poor families work full time Remain below poverty line Non-Working Poor May have bad health and/or Lack skills or self-confidence

The Underclass  Poor people who live in areas with high concentrations of poverty and limited opportunities  Persistent poverty versus temporary poverty

Problems Linked to Poverty  Poor health The link between poverty and health is evident from birth to old age The infant mortality among the poor is twice the national average Death comes earlier to the poor, who are more likely to die from infectious diseases and violence at any age

Problems Linked to Poverty Substandard Housing or Homelessness About 500,000 people are homeless in the U.S. on a given night Up to 4 million people are homeless at some point during the year Low income coupled with a decrease in available low-income housing leads to homelessness

Social Problems Linked to Poverty  Limited schooling Poor children are less likely than rich children to complete high school Fewer poor children enter college and have less of a chance of completing an advanced degree Tracking- poor children seen as less able

Social Problems Linked to Poverty  Crime and Punishment Due to the focus on street crime, the poor are more likely to face arrest, trial, conviction, and prison The poor depend more on public defenders and court-appointed attorneys, most of whom are underpaid and overworked

Social Problems Linked to Poverty  Political Alienation In the 2004 election, 76% of people earning $75,000 or more voted as compared with 60% of those earning $10,000 or less.

Responding to Poverty: The Welfare System  Social welfare program: an organized effort by government, private organizations, or individuals to assist needy people defined as worthy of assistance

Responding to Poverty: The Welfare System  Large government-run welfare programs have three characteristics: They benefit people or activities that are defined as worthy. They benefit most people (e.g., the elderly, veterans, students, and farmers); and They do not significantly change income disparity.

Social welfare has a long and controversial history in the US  The Colonial era (the 1600s and 1700s);  The earlier Industrial era (the 19 th century – when attitudes toward the poor became more negative);  The Twentieth Century (with its soaring immigration and the 1929 great depression, and Franklin Roosevelt’s “New Deal.”)

Recent Welfare Reform  Changes in the welfare system began to occur when President Clinton pledged in 1992 to “end welfare as we know it.”  The result was the Welfare Reform Act of 1996  The public remains divided over whether people deserve help

W elfare Reform Act of 1996  Replaced federal AFDC program with a new state related program – Temporary Assistance for Needy Families (TANF).  New rules require able-bodied people receiving benefits to find a job or enroll for job retraining within two years.

Structural Functional Analysis: Some Poverty is Inevitable Social pathology theories  focus on personal deficiency Social disorganization theory  Focuses idea of too much change Recent functional theory  Davis and Moore – inequality actually helps society function efficiently  Herbert Gans – poverty exists because many people benefit from it

Symbolic Interaction Analysis: Defining the Problem  Highlights the social construction of problems and solutions  Explores the meanings that people attach to those who are poor and how these views lead to particular understandings of who or what is responsible for poverty

Symbolic Interaction Analysis: Who’s to Blame?  Based on research by William Ryan Pick a social problem Decide how people who suffer from the problem differ from everyone else Define these differences as the cause of the problem Respond to the problem by trying to change the victims, not the larger society

Social-Conflict Analysis: Poverty Can Be Eliminated  Marxist Theory: Poverty and Capitalism  Poverty Involves More than Money: Cultural Capital  Multicultural Theory: Poverty, Race, and Ethnicity  Feminist Theory: Poverty and Patriarchy  Intersection Theory: Multiple Disadvantage

Criticisms of the Respective Theories  Criticism of structural-functionalism: poverty is not necessarily something people bring on themselves  Criticism of symbolic-interactionism: although this approach points to society as the cause of poverty, it says little about how society makes some people poor  Criticism of social-conflict theory: Capitalism has improved living standards Doesn’t reflect choices people make nor talents of individuals Opportunities for women and minorities have improved

Politics and Poverty: Constructing Problems and Defining Solutions Conservatives: Personal Responsibility focus on personal responsibility, stressing the importance of self-reliance Liberals: Societal Responsibility view poverty as more structural than it is individual; thus they look for societal solutions

Politics and Poverty: Constructing Problems and Defining Solutions Radicals: Change the System Poverty is inherent in capitalist society, They dismiss social welfare programs and tax plans advocated by liberals as little more than a Band-Aid applied to the body of a person with an incurable disease Replace capitalism with more humane system