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Excerpted From: Tricia Young, A Change must Come: the Intersection of Intergenerational Poverty and Public Benefits, 14 DePaul Journal for Social Justice 1 (Winter, 2021) (60 Footnotes) (Full Document)
Despite being one of the wealthiest countries in the world, the United States continues on in its trend of passing on a low quality of life from one generation of the poor to the next--thereby exacerbating and perpetuating poverty into the foreseeable future. Intergenerational poverty, as this concept is aptly named, disproportionately impacts people of color. While poverty has many origins, this Article specifically discusses two public benefits that contribute to intergenerational poverty--Medicaid and Social Security Income. These public “benefits” permeate the country while simultaneously and disproportionately impacting communities of color.
“Poverty is not an abstraction. People wear it on their faces, carry it on their backs as a constant companion, and it is heavy.” - Dennis Kucinich
Poverty affects millions of Americans but disproportionately affects people of color. Statistics show that just 8.7 percent of whites are poor, compared to 21.2 percent of Black Americans and 18.3 percent of Hispanics. Being a person of color means you are “more than twice as likely to experience poverty in the United States as [your] white counterpart.” The disparity is further illustrated when evaluating the alarming rates of intergenerational poverty. Just one-fourth of African American adults whose parents were poor make it to the middle class, while twice as many white adults whose parents were poor make it to the middle class. Further, only six percent of black households are able to inherit wealth in comparison to four times as many white households.
One aspect of intergenerational poverty is that there are few to no advantages a parent can pass on to their children. It means that poverty, and its associated lesser quality of life, is passed on to future generations. Parents who are stuck in a cycle of intergenerational poverty due to their economic and social circumstances are unfortunately doomed to pass those circumstances on to their children. Take for example a lack of assets, which can serve as a long-term cause and effect of intergenerational poverty. Assets can be comprised of physical assets, such as a home, and financial assets, such as money. Assets can serve as a critical element of the perpetuation of poverty because society's “efforts to prevent intergenerational poverty depend on their ability to sustainably increase family economic security and to prevent or ameliorate the adverse social conditions that make it more likely that children from impoverished homes will remain poor as adults.” Without assets to pass from one generation to another, poverty is destined to be cyclical.
Before the 1900s, public benefits were primarily administered by private charitable organizations with some help from the government. The Social Security Act of 1935 was the federal government's first formal step toward providing national public benefits. Public benefits were created to lift people out of poverty and create a path toward equal opportunity. The purpose of public benefits was to eliminate a barrier for those in need to receive government support. Nevertheless, restrictions on public benefits have done just that--created barriers. Thus, it seems that the original goal of addressing and eliminating poverty has been significantly compromised.
Everyone who receives public benefits is subject to restrictions, regardless of how much an individual pays into the system. Public benefits even have restrictions for the retired and elderly--despite these groups having paid into the system that supports the public benefits they receive. In fact, the majority of public benefits are spent on the retired and the elderly.
Some of these restrictions, such as Medicaid's lien and asset recovery restriction and the Supplemental Security Income program's asset limitation, impact the assets of the recipient of public benefits. When public benefits programs implement asset restrictions, those restrictions not only impact the people that have spent a lifetime paying into the system, but they also prevent the passage of their assets to future generations.
It is consistently debated in the public discourse and on both sides of the political aisle, how to cut public benefits and which public benefits should be cut. However, the idea that our government will be able to simultaneously cut public benefits to reduce debt and still be able to help lower poverty is not only astoundingly nonsensical, but also oxymoronic. Eliminating or reducing public benefits does the exact opposite of addressing poverty. Rather, a reduction in public benefits increases poverty. Cutting public benefits would see more people go hungry, more people without health insurance, and more people without affordable housing. In short, reducing public benefits increases poverty in general, and so logically, it would reason that it also increases intergenerational poverty specifically.
[. . .]
For years, the federal government has been waging war on the poor in an effort to reduce the budget. When President Trump proposed to redefine “poverty,” he was unequivocally attempting to reduce the number of people that would be eligible for public benefits. This attempt by President Trump is telling. “An administration genuinely concerned about how best to serve the poor with government assistance programs wouldn't start with tweaking the inflation rate. It would start with examining years of research examining whether the poverty line itself is adequate, or--as seems to be the case--too low.”
When public policies are guided primarily by a desire to reduce the government budget, as the United States' public policies undoubtedly are, they are destined to harm the people that need them most. As benevolent as the government may claim its actions to be, in the end, the desire for more and more commerce often contradicts whatever good intentions there may have been. It is easy to see that the government's decision-making regarding public benefits and, more generally, poverty itself, has at least one glaring problem: the rich continue to get richer and the poor remain poor and even become poorer.
Our federal government's fundamental failure to put the interests of profit over the genuine pursuit of ending poverty in the United States has been catastrophic and will echo throughout generations. To address and creating lasting solutions to the problem of intergenerational poverty, the United States cannot limit itself simply to Medicaid liens, asset recovery, and SSI asset limit restrictions as discussed herein.
It is worth mentioning that the racism and classism deeply rooted in the history of the United States extends far beyond the discussion included here. However, understanding, evaluating, and critically analyzing these public benefits can provide us with a valuable framework for eradicating intergenerational poverty--or at the very least avoid further hampering the transfer of intergenerational wealth.
“The quality of life in U.S. society depends on the personal accumulation of wealth.” But when public benefits act to create a barrier to the accumulation of wealth and prevent the ability to pass on wealth to future generations, society, particularly people of color, suffers. These barriers “continue to play themselves out in the contemporary moment, as Black and white wealth disparities remain entrenched because of their deep roots in a systemically racist and unequal” society. However, society should not be confined to remaining in this moment and repeating the mistakes of the past. A change must come.
Tricia Young, J.D. Candidate, May 2021, DePaul University College of Law.
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