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Poverty would be less concerning if it were a brief transition to a better life. But modern scholarship has called into question the cherished notion that the United States is a country of exceptional class mobility. The authors of Poorly Understood cite the economist Miles Corak, a professor at the Graduate Center of the City University of New York, who has examined the degree to which a father’s earnings predict those of his sons. (Studies of intergenerational mobility often focus on men since they include earlier generations when women were less uniformly engaged in paid labor.) In Denmark, “intergenerational elasticity” is 0.15—about 15 percent of a father’s economic status is passed along to his sons. In Germany, the figure is about a third. In the US, the share of advantage or disadvantage passed from fathers to sons rises to nearly half. Among the fifteen wealthy countries that Corak examined, only two (the United Kingdom and Italy) were more class-bound than the US, and only slightly so.
Other researchers have found the “stickiness” of class status especially pronounced at the top and the bottom—people born rich or poor tend to stay that way. Inequality is a consequence of blocked mobility. But it is also a cause: the more that wealth concentrates at the top, the more power the wealthy have to pull up the ladder. If you doubt the lengths to which rich parents go to protect their children’s advantages, think of the Varsity Blues scandal, in which parents bribed counselors, falsified test scores, and faked athletic résumés to get their children into selective schools, including Stanford, Yale, and USC. For all the salience of the rags-to-riches tale, the authors of Poorly Understood write, Americans’ economic status is determined “to a much greater extent” by family resources than it is in many comparably wealthy nations.
Poorly Understood also attacks the idea, advanced by many conservatives, that the needy are already protected by an extensive safety net. As a share of GDP, France, Austria, Denmark, and Finland all spend at least 50 percent more than the US to help people of modest means and their poverty rates are roughly half as high. A pre-Covid study by Jared Bernstein, now a member of the White House Council of Economic Advisers, looked at poverty in rich countries on four continents. Before accounting for taxes and government aid, the American poverty rate was in the middle. But the safety net cut poverty by 80 percent in Sweden and by more than two thirds in Britain and Germany, while it cut poverty by only about one third in the US. That left the US with the highest poverty levels of all twenty countries reviewed.
Why does the US tolerate more poverty than its peers? In part, the authors argue, it is because the US is more racially diverse. (Or, one might add, it was for most of the twentieth century, when the safety net took shape—European demography is changing.) Some whites have been reluctant to support antipoverty programs because they believe, correctly, that the aid disproportionately helps minorities (who after centuries of exclusion are more likely to be poor). Blacks are nearly twice as likely as whites to live in poverty, though in absolute terms poor whites are more numerous. America’s individualist ethos—the idea that anyone can get ahead—also inhibits safety-net spending. And the dynamics of American politics favor the rich: money dominates, unions are weak, voter turnout is low, the Senate is antidemocratic, and the Electoral College gives small, conservative states outsized clout.