The 50th anniversary last week of President Lyndon Johnson's declaration of the War on Poverty provoked an outpouring of interest in (or, at least commentary on) the enduring levels of poverty in the United States. Unfortunately, most of this followed the predictable path of using the subject as just another opportunity for the same old debate about Big Government versus No Government.
This coming week is the anniversary of the birth of Dr. Martin Luther King. While King is remembered largely as a civil rights leader, at the time of his death he was focused on not just traditional civil rights issues but also poverty in particular. King saw these issues, of course, as inter-related, and his greatest contribution may be his challenge to all Americans to think differently, and more deeply, about them, their interconnection with each other and, in fact, our interconnections with each other.
King declared not that it was wrong to be rich, but that, in a society where many are poor, no one can truly be rich, and in a society where many are insecure, no one can truly be secure. It is worth trying to think differently about such interconnections in this week between these two anniversaries.
For instance, it is almost a stock critique nowadays that we declared war on poverty, and poverty won. In fact, however, some War on Poverty-era programs actually worked. Most notably, 50 years ago, poverty was rampant amongst the elderly; today this is no longer the case, and there is one main reason: Medicare. The enactment of Medicare dramatically, permanently and almost immediately reduced poverty rates amongst the elderly. That's worth remembering in the contexts both of assertions that nothing government does ever works and of the fact that perhaps the leading cause of poverty today is health care cost-induced bankruptcy.
On the other hand, this doesn't mean that every government program works or that more government is the solution to every problem, including poverty. To propose a solution, one needs first to identify the problem – and the problem of "poverty" is complex.
Our ideas about how to treat poverty have evolved in much the same way as our understanding of health and disease: In pre-modern times, the sick were blamed for their afflictions, and often punished for it. People slowly learned that most symptoms could be treated, but this didn't always cure the condition. Eventually, we learned to treat the underlying disease rather than the symptoms. A more sophisticated understanding of disease has emerged more recently, however, that recognizes individual health issues as resulting from a complex of factors – some personal, but many produced by environmental and social conditions.
When it comes to poverty, we've advanced to somewhere in the middle of that continuum. It's become clear that treating symptoms doesn't really address causes; simply giving away money may alleviate some important aspects of poverty, but that generally isn't enough to end it for the individual, let alone for society as a whole. In fact, the easy assumption that poverty is, by definition, about lack of money may be too easy.
As with health, it's time to recognize poverty as a complex phenomenon implicating social and environmental, as well as personal, factors. Financial resources may alleviate the condition, but, by themselves, will not cure it.
So if "it's not about the money," what is poverty about? To borrow another phrase, it's the network. Poverty, like so many other aspects of our social and economic world, is a network phenomenon – or, more accurately, a lack-of-network phenomenon.
The most incisive statement I've seen on this was attributed to Robert G. Evans of the University of British Columbia in a December 2005 Scientific American article, "Sick of Poverty": "Most graduate students have had the experience of having very little money, but not of poverty. They are very different things." What is the difference? In a word, connections. Sure, the grad student can expect high future earnings thanks to educational advantages. But that "earning potential" is built on a robust collection of networks – financial, familial, informational, social – including access to the job market; financing for food, rent and tuition and the means to consider graduate school in the first place.
People in poverty don't simply lack financial resources – they lack access to the means to obtain, grow and enjoy those resources. These include social networks, within which middle-class children, not to mention the ultra-rich, grow up; transit networks, essential for many to reach jobs (especially those for whom "third shift" jobs are often a necessity) and school; distribution channels for healthy food, provision of medical services and insurance – all part of the so-called "high price of being poor"; and often the network of networks, the Internet.
Defeating poverty ultimately means not more traditional transfer programs but better access to connections – to institutions, to information, to markets, to networks. The key to networks is that their value increases for everyone whenever another individual joins it (the classic example is email, worthless when there is only one user, essential now that it is ubiquitous). In a networked economy, which turns many basic notions of traditional economics on its head, cross-subsidization – such as "charity" or "welfare" – actually can be profitable, turning poverty reduction from a zero-sum game into a "win-win." Ending poverty would then be perhaps not "free," at last, but at least highly remunerative.
Reducing poverty, in short, would be beneficial for society as a whole, and virtually everyone in it. As work on the economics of networks demonstrates, networked individuals and groups produce value 10 or 100 times greater than traditional top-down systems – whether command-and-control governments or strictly hierarchical, and pyramidal, social structures. As King observed, even the richest people in a poor society are rarely as rich as in those that are more equal, just and vibrant. It is in our connections to others that we grow richer in all ways. That, in fact, is a proposition on which America has staked its future from the beginning – and won.