Anti-poverty effort good for everybody

Several studies over the past couple of weeks have shown that, by-and-large, Americans are under the impression that they live in a far more equal country than the facts bear out.

Dan Ariely, of Duke University, and Michael I. Norton, of Harvard Business School, released research in which they asked thousands of Americans what their conception was of wealth distribution in the United States and what that distribution should look like in an ideal world.

In that study, respondents estimated that the wealthiest 20 percent of Americans own 59 percent of the wealth. The truth is that the top 20 percent owns 84 percent of the wealth. Of that portion, the top 1 percent has 34 percent of the wealth, and the next 19 percent has 50 percent of the wealth. Respondents also estimated the bottom 20 percent as owning 3.7 percent of the wealth. The reality is that this portion of the population owns 0.1 percent of the wealth. That's 1/10th of 1 percent.

In an ideal world, these respondents said, the top 20 percent should own 32 percent of the wealth, while the poorest should own just over 10 percent.

Another study, done by Edward Wolff of New York University, showed remarkably similar findings that also pointed out that many in the bottom 40 percent not only have no assets, they have negative net worth.

In an article published by the Los Angeles Times, Norton and Ariely said that in their study they surveyed 5,000 Americans across the political and socio-economic spectrum.

"While liberals and the poor favored slightly more equal distributions than conservatives and the wealthy, a large majority of every group we surveyed - from the poorest to the richest, from the most conservative to the most liberal - agreed that the current level of wealth inequality was too high and wanted a more equitable distribution of wealth," the researchers wrote.

And yet, the idea of "wealth redistribution" has been roundly criticized in American punditry, with the political right disparaging anyone who raises the income-gap issue as waging "class warfare."

President Barack Obama was hammered mercilessly when as a candidate he famously told Joe "The Plumber" Wurzelbacher, "I think when you spread the wealth around, it's good for everybody."

President Obama was more correct with that sentence than he may have known. In America, redistribution in the form of taxes, quotas, welfare, enterprise zones, etc., is conceived of as a form of charity or compassion. The left buys into this notion just as much as the right. The left, in fact, often undermines its own efforts by making this rhetorical, tactical and perhaps ideological mistake. And as long as that's the case, the debate is focused on efficiency. The argument becomes whether bloated government bureaucracy is effective in dispensing charity. Or the argument focuses on whether forms of aid truly lift people out of poverty, or instead foster dependence.

The truth is that President Obama was right; alleviating poverty benefits everybody in the community. The higher the standard of living is for our neighbors, the higher the standard of living is for ourselves. What the national debate often ignores is that those who are well off should be willing to share more of what they have with the poor, not purely for the poor's sake, but for their own. It's in their self-interest, on various levels.

If I live in a mansion, and my neighbor across the way lives in a mud hut, my property value goes down. If I live in a gated community, but just outside those gates the streets are rife with crime, drug abuse and homelessness, my gated community no longer seems like a very attractive place of residence. If I have a comfortable life but my neighbors do not, that burden manifests itself as my own in empty storefronts, deteriorating streets, deteriorating public education and disincentives for businesses to invest in my community. In its simplest, most capitalistic terms, the poor need more money so they can buy what the rich people's companies make.

Moreover, those with means have an even more personal rationale to advocate the lifting up of their fellow citizens. Sharing, on an individual level, allows people to become less narrow, isolated and self-centered. Sharing is rewarding on communal, emotional and psychological levels for the one who shares. It really is in a person's self-interest, as benefits are often reaped in one way or another.

I mentioned earlier that the left often shoots itself in the foot when it buys into the notion that these forms of redistribution should be done for charitable reasons, or out of compassion. The idea leads the left to paint itself as uniquely generous, which opens it up to be painted by the right as elitist and/or "bleeding heart." More seriously, it allows the right to frame the debate in these terms. The left is then resigned to talking about giving a "hand up, not a handout." And the real discussion, the one about self-interest - not short-term financial self-interest, but long-term personal and socio-economic self-interest - falls by the wayside.

But as the studies show, left or right, rich or poor, Americans perceive this inequality. Their ideal is far more fair. And it's in all of our self-interests to strive for that.

This is the eighth and final installment in a series focused on working people facing financial hardship in Athens County. This is the story of residents who have had to take on low-wage jobs to make ends meet, and the difficulties they face. This column focuses on the distribution of wealth in the United States, and argues that alleviating poverty shouldn't be thought of so much as charity as an effort in everybody's self-interest to raise the community's standard of living.