Poverty is not just material deprivation: it is social deprivation

A common argument put forward by defenders of capitalism is that capitalism has made even today’s poor far more rich than the savage kings of the primitive “old days.” A poor man today has far more than anybody did before the age of industrial capitalism, thanks to the “trickle-down” effect — an effect which Adam Smith describes in some detail in The Wealth of Nations. Smith even goes so far as to claim that capital owners who enjoy an excess of wealth naturally tend to let that wealth trickle down to the poor, by some natural process, even without having to directly increase worker wages. The wealth of a nation is calculated by that nation’s productivity, a productivity which directly benefits capital owners, without regard to the distribution of that wealth across the whole society — because the assumption, which Smith makes explicit, is that somehow capital wealth trickles down to the poor.

But this image of capitalism seems untrue to history. I do not deny that there is a kind of trickle-down effect — I go to thrift stores a lot when I do my clothes-shopping or furniture-shopping, and some of the things I buy have probably been in the possession of a rich person before; who knows. But this is beside the point. Adam Smith’s assumption that wealthy owners naturally tend to bestow their excess wealth upon their communities is simply not true; if anything, the rich tend to be the most miserly of all people. Many of them openly admit that they have more wealth than they can possibly put to use; but that does not strike them as odd or in any way detrimental to society, because… well, because “trickle-down economics” or “invisible hands” or something.

As a result, worker wages have stagnated for decades, as the wealth of the nations (especially the U.S.) has dramatically increased by trillions. What this has caused is a break in the cohesion of society, a chasm between the classes so wide that the feeling of being part of a whole community is less and less attainable for those in the working class or below. Note that this phenomenon is somewhat independent of the fact that poor people today “have more stuff” than the people of bygone ages; that is irrelevant. Poverty means more than material deprivation, it also means marginalization from society, exclusion from participation in common goods and common life. The signal of poverty in a society is the breaking down of social relations, turning society into something more like anti-society.

This is immediately a bit more philosophical than economically minded people are used to thinking. But consider a more concrete example of what I mean by the breaking down of social relations: capitalism may enable Joe Smith to buy himself a TV, an iPhone, and maybe pay his monthly rent. These are moderate expenses — not cheap, to be sure, but many such things are certainly made possible by regular wages, and perhaps some of these items become available through trickling down to thrift-stores, eBay, or Craigslist. But consider this: Joe Smith is only one man, an individual. He can take care of himself, he can provide his own food, clothing, television set, rent, etc. When it comes to the matter of social relations, however, can he do all this and more for others too? E.g. a family? Does capitalism empower the average Joe to enter into the social relations that make up the family?

In a capitalist economy, children — and very often stay-at-home mothers likewise — are effectively the beneficiaries of what the capitalists call “trickle down economics,” in a radical sense. This is because children do not work or own capital; the wealth they receive is received only indirectly, as part of the income of a parent who does work or own capital. Statistically, that is more likely to be the father, although this is not necessarily the case. What does the trickle-down effect mean in this case? It means that if a father is making an average working-class wage, which is barely above minimum wage, he has to share that barely-above-minimum-wage income with his child, and probably with his wife too. And if they have multiple children, one can only imagine what that would look like… So capitalism, which pays only workers and owners — and which privileges owners over workers — effectively puts families into poverty. This is the argument made by Matt Bruenig in his “Family Fun Pack.” And since the majority of American citizens are not capital owners, but working class people, this means that family life is increasingly difficult for the majority of the population — and poverty is more and more of a threat.

“Trickle-down economics” is not a description of an economics that makes people rich; to be the beneficiary of trickle-down wealth is in almost all cases to be poor: to have to share with your parents or your spouse a sparse income that barely suffices to support just one man.

There are many families who do this, and manage to get by. I know many of them. They are wonderful people, and many of them are even very large families with lots of kids. It takes an immense degree of courage to do that in this economy, and with enough courage poor parents can often still manage to make a happy life for their children. Such individual virtue and motivation is a wonderful thing, and more people should cultivate it; but the fact is, it is a rare thing, and a economics which counts on most — most poor people, even — to have such courage is a lazy and selfish economics.

I remember hearing Sean Hannity once complain (in one of his rants against socialism) that because America is “the land of the free,” and thus the land of individual responsibility, the rich shouldn’t be expected or obligated to direct their resources to the poor; rather, the poor should be expected to fend for themselves and become rich on their own, by their own motivation, without the help of society. Hannity even had the nerve to associate freedom with fear: because you are free and fully self-responsible, you have to face the fact that you might one day lose your job, lose your home, die because you couldn’t afford healthcare, etc. That is American freedom in a nutshell right there. Hannity basically defended an ethic of selfishness and refusing to help those in need: let those in need help themselves, because they’re “free” after all. That is the ethic I describe as anti-social, signifying the breakdown of social relations in America — doubly so, in fact, because it effectively forbids those in need from raising families, and it forbids them from receiving the help needed to do so from others in their communities who can help them.

A different Fox News talk show host, Tucker Carlson, famously caused a stir in his recent remarks on capitalism and families, where he claimed that the American Dream is dying for working-class and low income families. Carlson is no left-winger or socialist; he even joins his fellow Republicans in decrying the evils of socialism; he is a social conservative; yet unlike his fellow conservatives, Carlson joins left-wingers in recognizing that the current set-up of the American market economy has effectively pushed average families into poverty. He even pins this as a partial cause of the disappearance of social conservative family values. It is worth quoting part of monologue:

The overriding goal for America is more prosperity, meaning cheaper consumer goods. But is that still true? Does anyone still believe that cheaper iPhones, or more Amazon deliveries of plastic garbage from China are going to make us happy? They haven’t so far. A lot of Americans are drowning in stuff. And yet drug addiction and suicide are depopulating large parts of the country. Anyone who thinks the health of a nation can be summed up in GDP is an idiot.

The goal for America is both simpler and more elusive than mere prosperity. It’s happiness. There are a lot of ingredients in being happy: Dignity. Purpose. Self-control. Independence. Above all, deep relationships with other people. Those are the things that you want for your children. They’re what our leaders should want for us, and would want if they cared.

This is insightful, because it acknowledges that poverty means far more than material deprivation —i.e. not having a lot of stuff. In fact, one can take a quick look at America’s poor and see that they do have lots of stuff; they are drowning in it; America is far and away one of the most consumeristic countries in the world. The question is: are they happy? Is all that stuff really good for them? Is it enabling them to build their relationships with other people, and especially with their spouses, parents, and children? Poverty is social deprivation as much as it is material deprivation.

An old tradition, dating as far back as the philosopher Plato, holds that the common good is superior to the private or individual good; and what’s more, that it is the job of the government to directly pursue the common good, and not merely to facilitate the individual search for his own good. In fact, according to Plato (and a whole tradition following him), individuals only attain their true good when they seek first the goods which they can share in community with others. Capitalism, by contrast, hails from the liberal tradition, which exalts individual freedom and rights to individual goods over any concern for the common good as such. If the common good enters the picture at all, it is only as a tool for individual happiness — however one individual might define his own happiness (usually it is unlimited wealth, pleasure, or power). If one gives free reign to selfishness, it turns out — pace Adam Smith — that the happiness of all in common is not assured by the guidance of some invisible hand.

Maybe it would be good to recover a more Platonic and traditional view of ethical politics: seek the common good before the selfish, individualistic good. Actively try to build society, strengthen social relations, encourage families, create networks of social support, etc. This requires an adjustment of a whole mindset, away from individualism towards communal-mindedness — and maybe even away from the wealth of nations and towards the happiness of nations. I do not claim that this will fix material poverty immediately; actual policy should continue to be crafted that genuinely addresses material poverty. But this kind of policy won’t make much sense to a capitalist frame of mind, for whom the poor are just a necessary evil, kind of like bodily waste. But a frame of mind for whom the common good is paramount will see that social deprivation is an evil that must and can be remedied, even by economic policy and redistribution if necessary.

I write about Philosophy, Politics, Economics, Culture, and Religion.

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