$2.00 a Day: Living on Almost Nothing in America

$2-a-day poverty has been an unintended consequence of the 1996 reform, but the authors argue that the solution is not to simply reinstate the old welfare system. AFDC did help people, but because it was at odds with American values—being seen as rewarding laziness and single motherhood—it also stigmatized those who received it, creating a “class of outcasts” (158). Edin and Shaefer instead recommend policies aimed at creating more work opportunities.

At present, there simply aren’t enough jobs for everyone who needs one. People living in extreme poverty are furthermore among the least likely to be extended a job offer due to their circumstances (see Chapter 2). More private sector jobs can be created through government subsidies, and more government jobs can be created as well, as was done during the Great Depression. There is no shortage of work needed to be done at national parks, daycare centers, public libraries, and addiction treatment centers, to name just a few services that are underfunded and in need of workers. The quantity of jobs needs to increase, but the quality needs to improve as well. Raising the minimum wage, doing more to combat wage theft, and mandating that employers provide guaranteed hours would do a lot to provide the poor with more financial security. Programs to help the poor maintain their jobs could help too, by providing assistance with things like transportation and childcare. Consumers can hold employers accountable by choosing to support businesses that treat their workers well.

To overcome the problems they face, the $2-a-day poor clearly need to have jobs available to them. They also need to be able to afford a place to live—not doubled up with relatives, and not bouncing from one homeless shelter to the next. Simply increasing their incomes can go a long way to solving the affordable housing crisis. The government could also do more to build affordable housing and provide rent subsidies. If the incomes of families with housing subsidies were to rise, then the government could potentially help a greater number of families overall, since each individual household would need less help to cover rent each month.

Even if these measures are implemented, people will still go through rough patches. There needs to be a cash safety net to prevent those people from spiraling into extreme poverty. TANF is supposed to fill this role, but it hasn’t done a good job of it. States receive money for TANF from the federal government, but there is little oversight of how the states use it, with the result that two-thirds of the money intended for TANF goes toward other uses. States often try to discourage people from applying for aid by making the application process lengthy and convoluted. Even if a family manages to receive TANF, the amount of money they get would not bring them even halfway to the poverty line in 49 out of 50 states.

Clearly, we need something better. A large problem with TANF is that people feel ashamed to take it. They are made to jump through hoops, which carries the obvious implication that the applicants may be trying to take what they don’t deserve. The EITC, on the other hand, is a benefit that people can claim with their dignity intact. It is simple to receive, and people feel they have earned it as a reward for their hard work. The authors argue that we need “an antipoverty program that incorporates rather than divides” (172), one that doesn’t put up barriers or shame people when they need help.