More Uses for Poverty

"The number of people in the US who are in poverty is on track for a record increase on President Barack Obama's watch, with ranks of working poor approaching 1960's levels that led to the national war on poverty," says an AP story on recent census figures. And considering all the low-income paranoids I know (and maybe you know) who dodge the census while their coworkers land stopgap gigs walking for the Census Bureau, not to mention how hard it always is to count the very people who need counting the most, we can safely assume that like most dire government statistics, these are optimistic.



You might think that news like this would automatically wind up as fuel for a fire to shake up our economic structure beyond ankle-deep. That is, you might think that if you hadn't been paying attention for, I don't know, your whole life.

The story earns play in conservative outlets, like my local rag, most likely because it reflects badly on the -er- "socialist" Administration, which of course is anything but. (Witness: Summers, Geithner, etc.)

But in fact, news like this - and the reality behind it - has much more insidious uses. Job losses, poverty or other economic instability drive down wages through competition, for one thing, and often lead to a chill on workers' rabble-rousing. If nothing else, bosses use it to gain leverage against their workers' demands, knowing how much of the public will - perhaps with a little hint - see workers demands in hard times. It's disaster capitalism by the book.

This goes double for public employees, easy targets for teabagger and other frustrated taxpayer anger. In my immediate vicinity here in Central Illinois alone, a recent teachers' strike in the little white-flight town of Mahomet drew a number of hateful comments in the local paper from readers citing the recession, a la 'you should be glad you have a job.' The fact that the school district had millions on hand had no observable effect on letter writers.

An ongoing teacher's strike in nearby Danville is another case of a local economy in shambles, a school district with surpluses and reserves, and a pay freeze on the table for teachers on the front lines of social breakdown.

Then there's the $4 billion University of Illinois, with record fundrising, over a billion in its UI Foundation coffers, and a new president reeling in a big fat raise of 37.5% over his predecessor and an executive assistant getting an additional 81%. The previous president is still earning $300,000 a year and the Urbana campus Chancellor another $250,000 after being forced to resign in a "clout" scandal involving admissions for rich kids. But when it comes to workers' demands or parents or students' desires not to see tuition raise, the University has "lint in [its] pockets."

A strike of 3000 union members on the Chicago looms, as the UI offers pay freezes, cuts and wails of poverty at the bargaining table with unions on both major campuses. After all, there's a much-touted IOU from the State. The fact that the UI is looking forward to a growing budget once again is also somehow a non-issue.

Even aside from the lies, however, paycuts and layoffs are exactly the opposite of the appropriate strategy during a recession like this especially for public employers. The employees who spend their money and pay their taxes are the anchor of the economy, as Keynes realized, even if you're not a commie, as Keynes certainly wasn't. Massive growth in public expenditures, employment, and public wages and benefits, could be the ticket out of this.

Trouble is, the "Great Recession," much like the Great Depression 75 years before, holds such promise for the decision-makers, they may not exactly want out.