Mises Wire

Home | Wire | How Alexandria Ocasio-Cortez Misunderstands American Poverty

How Alexandria Ocasio-Cortez Misunderstands American Poverty

  • money1.PNG
0 Views

Tags PovertyU.S. Economy

07/18/2018

Democratic socialism is in the news again. Following Alexandria Ocasio-Cortez’s stunning victory, helping her become a darling of the mainstream media, Americans are becoming interested in democratic socialism again – a philosophy that involves voting to steal your stuff. Two key planks of democratic socialism are to rail against the rich and promise everything for free, which then leads to the next question: Who’s going to pay for all that free stuff?

Building upon her national spotlight, Ocasio-Cortez recently appeared on The Late Show with Stephen Colbert to discuss her political brand and a wide array of issues important to her and socialists everywhere. But there was one moment in the interview that opened a can of worms.

She told the alleged comedian:

“For me, democratic socialism is about — really, the value for me is that I believe that in a modern, moral and wealthy society, no person in America should be too poor to live.

I think that no person should be homeless. If we can have public structures and public policy to allow for people to have homes and food and lead a dignified life in the United States.”

Ocasio-Cortez, may be a politician with good intentions. But that's the most dangerous type of politician. She suggested two interesting things: the poor are destitute, and poverty can be cured with even more government.

Let’s explore further.

What Is Poverty in America? 

There are three points that the left likes to make: the poor are getting poorer, the U.S. has the highest childhood poverty rate, and 32 million Americans are impoverished – higher than when the first bullet in the War on Poverty was fired.

How dare the U.S. create such horrific conditions that are reminiscent of Charles Dickens novels.

If you’re indigent in the U.S., then you’re better off than most people in the world. A hipster sporting a Che Guevara t-shirt and drinking a Starbucks latte would scoff at this assertion, but it is the truth.

Income inequality is a myth , while income mobility is still a thing. Yes, it is true that the top 1% are getting richer, but the poor and middle-class are becoming prosperous, too. Why is this a debated fact? The problem is with how the data is compiled and analyzed.

When we study Census Bureau data or any other information emanating from the government, we simply compare rich Americans to poor Americans in one year and the next. The better route is to examine the data over an extended period. When you do, the bottom 20% witness their incomes rise, and most Americans will see their income status change throughout the years – half of the country will be in the top 10% of incomes for at least one year, while two-thirds of Americans will park themselves in the top 20% for at least two years.

Now, are American children worse off than Asian and European kids? Not quite. When Sanders and others make that claim, it can easily be disputed if you take a look at Organisation for Economic Co-operation and Development (OECD) figures. The U.S. is ahead of Russia, Israel, China, Spain, and several others – Denmark and Finland have the lowest.

But how could the biggest economy in the world not eradicate poverty for both adults and children?

Well, perhaps it is time to examine what being poor in America is like compared to other places.

It is correct to state that the U.S. has a higher poverty rate than other developed nations. However, the American poor have higher median incomes than in other countries, and the poverty income in the U.S. matches the median income in Spain, the U.K., and Japan. Plus, American living standards are higher for the poor than the impecunious residing in the U.K., New Zealand, France, and Japan.

Let’s look at what it’s really like to be poor in the Land of the Free:

  • 80% have air conditioning.
  • 94% have Internet access.
  • 75% have an automobile – a third have two or more vehicles.
  • Half of poor families have a video game system.
  • 66% have cable television.

What about the basic essentials, like food and housing? That’s easy enough:

  • 83% of poor households reported having enough to eat.
  • 96% of underprivileged families reported their children were never hungry at any time.
  • 42% of poor households own their homes.

Moreover, the average poor American has more living space than the average middle- or high-income person in the U.K., France, and Sweden. Also, consumption of vitamins and minerals is the same as the those in the wealthier brackets.

Should an American fall on hard times, they have access to a generous welfare system, paid for by the private sector. Despite claims that the U.S. allows the impecunious to perish on the streets or starve in their homes, the government has spent trillions of dollars over the last 50 years on entitlements, healthcare, and social-benefits programs.

The rectitude and efficacy of welfare can be debated, but the government gives citizens money to purchase unhealthy food and smartphones – and a basic income guarantee is all but inevitable . That’s how wealthy the U.S. is.

Originally published at Liberty Nation. 

Andrew Moran is the Economics Correspondent at LibertyNation.com and is the author of The War on Cash. You can find more of his work at AndrewMoran.net.

Note: The views expressed on Mises.org are not necessarily those of the Mises Institute.
Image source:
iStock
When commenting, please post a concise, civil, and informative comment. Full comment policy here

Add Comment

Shield icon wire