If we really care about those in need, we must understand that wealth and the wealthy are not the problem of the poor. This misunderstanding hinders all positive progress in our efforts to alleviate poverty and offer meaningful assistance to the poor.
Because it is a serious issue, we need an accurate understanding of both wealth and poverty in the United States if we want to assist those in need. There are many Americans who go through periods without enough to eat, and without adequate shelter, health care, and clothing. I know this firsthand. Born out of wedlock, I was placed in foster care with a pastor and his wife until I was five years old. For the next 10 years I lived in poverty with my mother and a stepfather who couldn’t read or write. During that time, my mother divorced him and then married my biological father—an alcoholic who had actually raped her, which resulted in my birth. I was shocked by her decision and life became a hell on earth. I moved 15 times during that chaotic period. We were always dirt poor. Most of the homes we lived in did not sit on a normal street. One was on a dirty river in which I bathed and another was on the backside of a garbage dump. Our mail had to be delivered to other people’s homes.
I know all about material poverty. I also know that the poverty I experienced was like most American poverty in that it was not so much an economic problem as an economic symptom of moral and social problems. Even as a child, though, I never resented people who were better off than I was. I knew that if I wanted anything, I would have to go to work. I did at age 12, and I’ve never stopped. I am so grateful I did not sit back with animosity toward others and wait for the state or a government agency to take care of me. I knew that I was not poor because other people were rich.
An income gap, by itself, is a non-issue. If you earn $100,000 one year, and some big stock investor earns $100,000,000 during the same year, there’s a huge gap between your incomes. In absolute dollars, the gap is $99,900,000. As a ratio, the investor earns a thousand times more than you. So what? Assuming it wasn’t illegally gained, then he earned it, probably by making several risky but wise, wealth-creating choices about where to allocate capital.
Now imagine a poor fruit picker in Costa Rica, with a wife and four kids, earning $1,000 a year. The gap between his income and yours is much less significant: $99,000. Your income is a hundred times greater than his. So the gap between you and the fruit picker is much smaller than the gap between you and the investor. And yet the latter case is more troubling. Why? It can’t be the size or magnitude of gaps in income. If it were, we should be 10 times more troubled by the gap between you and the investor. We’re much more troubled by the gap between you and the fruit picker because we assume that if the picker is only bringing in $1,000 a year, then he’s extremely poor.
The problem with defining poverty in relative terms is that the bottom 10 percent of income earners could be much better off than the bottom 10 percent were 40 years ago, but they would still be labeled “poor.” Using this logic, if you make $100,000 a year (with the purchasing power of 2013 dollars), but 90 percent of the population makes at least $1 million a year, you’d be defined as poor. This is absurd. Rather than helping us grasp a complicated reality, our statistical method blinds us to it.
When we talk about material poverty, we need to focus on real deprivation. Gaps are not the problem. Poverty—real, hope-crushing, disease-inducing, absolute poverty—is the problem. Alleviating real poverty should be our goal. Getting rid of gaps should not be.
Kevin Drum of the left wing magazine Mother Jones recently commented on some current statistics. “This income shift is real,” he complained. “We can debate its effects all day long, but it’s real. The super rich have a much bigger piece of the pie than they used to, and that means a smaller piece of the pie for all the rest of us.”[i]
In a market economy, however, wealth is not a physical object like an apple pie. The pie image is just as misleading as the gap image. Wealth is not fixed; over time, free economies grow. Even when the gap between rich and poor grows, the poor may not have become poorer, because the total amount of wealth may have increased. If the pie grows, someone can get a bigger slice without taking someone else’s piece.
And when people grow their own slice, they almost always grow others as well. Needless to say, this is not like any pie we’ve ever eaten. It’s more like a farmer raising geese that lay golden eggs, some of which hatch into other geese that lay golden eggs. He only has room for one such goose, though, so he sells the goslings.
We’re not sure if that analogy works, either. Whatever wealth creation in a market is like, though, it’s not like a pie. The important questions, then, are not about gaps or slices of pie, but poverty. For instance, (1) Is there statistical evidence that the rich are getting richer by making the poor poorer? (2) How well are the people at the bottom doing (compared to absolute poverty)? And (3) Do the people at the bottom of the economic ladder have opportunities to move up that ladder, can they create more wealth for themselves and their families? Does study and hard work tend to pay off, or does it not make any difference?
The answer to (1) is no. If you look at the Census Bureau stats, you don’t find that the top 20 percent are getting richer and richer and the bottom 20 percent are getting poorer and poorer. The answer to (3) is yes, hard work pays off, though our current economic policies don’t do enough to encourage entrepreneurship. The answer to (2) is that even the bottom 20 percent of the population gets better off over time, and few Americans suffer absolute poverty. Every income category has gone up from 1967 to 2009, even though the population has nearly doubled and there has been stagnation in the middle incomes for the last several years.[ii] In other words, the wealth of individual families and the total amount of wealth has gone up. The rich did get richer, but they didn’t do so by making the poor poorer. Every income category got richer.
Because all men are created equal, we should seek a society of widespread opportunities, not equality of incomes or outcomes. We should not use the coercive power of the state to confiscate the wealth of some and give it to others. Rather, people should be free to pursue their lawful endeavors, to create wealth for themselves and others, because human beings, under the right conditions, become prosperous. As church leaders and Christians, we should diligently seek to encourage and even inspire those who have been blessed to look for effective ways to assist their neighbors, especially the poor. It must no longer just be turned over to the federal government and manipulating politicians.
Believers must faithfully heed the challenge Paul told Titus to share with the New Testament churches: “Let our people also learn to engage in good deeds to meet pressing needs, that they may not be unfruitful.”[iii]
Adapted from Indivisible: Restoring Faith, Family, and Freedom Before It’s Too Late, by James Robison and Jay W. Richards. Copyright @2012 by James Robison and Jay W. Richards. Published by FaithWords/Hachette Book Group. All rights reserved.