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Income inequality is at an 80 year high.
The problem with our economy isn't just at the top or at the bottom. It's how the whole thing is organized, and the power structure that sustains that.
Millions of Americans are living in the kind of poverty you generally associate with those "you can save a child for the price of a cup of coffee a day" ads. Deep poverty, defined as 50 percent or less of the official poverty level, hit a new high in 2010, with 20.5 million people—6.7 percent of the population—in deep poverty. But sociologist Kathryn Edin and H. Luke Shaefer, a social work professor, are looking at a level below deep poverty, occupied by nearly 1.4 million households:
In doing so, they relied on a World Bank marker used to study the poor in developing nations: This designation, which they dubbed "extreme" poverty, makes deep poverty look like a cakewalk. It means scraping by on less than $2 per person per day, or $2,920 per year for a family of four.

In a report published earlier this year by the University of Michigan's National Poverty Center, Edin and Shaefer estimated that nearly 1 in 5 low-income American households has been living in extreme povery; since 1996, the number of households in that category had increased by about 130 percent. Among the truly destitute were 2.8 million children. Even if you counted food stamps as cash, half of those kids were still being raised in homes whose weekly take wasn't enough to cover a trip to Applebees.

This is in line with the Agriculture Department's finding that 20 percent of households receiving food stamps had no cash income in 2010.

How does this happen? It happens when there's no work for millions of people, where there are 3.3 job-seekers for every job. It happens when unemployment insurance benefits expire, as they are about to do for two million people. It happens when single mothers don't have child care and don't want to leave their kids alone, making work outside the home impossible—they don't get Ann Romney's choices. It happens when the jobs people do find are just a few hours a week, at or below minimum wage.

It happens as it has for two men Mother Jones' Gabriel Thompson talked to waiting outside a temp agency in Fresno. Both had been laid off, one from a job installing phone boxes, one from a job delivering radiators. Both had had to move in with family. And both were desperately looking for work, showing up at temp agencies before sunrise and taking even the worst jobs:

when the temp office clerk announces that there's a job available, Harper leaps at it even though the gig starts at 2 a.m. and he knows he'll have to arrive at the work site in the early evening, thanks to Fresno's limited bus service. He shrugs off the six hours he'll waste "twiddling his thumbs." What matters, Harper says, is to keep knocking on doors and making the calls, because "you never know when you might get your foot in the door."
In such an environment, other people give up on finding jobs, and fall out of the unemployment statistics. But if those people were at the temp agency before sunrise every day, it wouldn't create anymore jobs, it would just mean that more people were counted as trying to find jobs that aren't there.

Maybe there's someone in America who's so ascetic or so lazy that living on $2 a day, or even $10 a day, is a choice freely made. There are not millions of such people. Rather, there is an economy that has failed millions of people completely, utterly, beyond belief, that has failed these people beyond growing income and wealth inequality and stagnant wages and wages as the lowest-ever share of GDP.

The breathtaking range of ways the American economy has failed the American people—or around 90 percent of them, anyway—shows how fruitless it would be to focus on one group of people suffering in this economy and propose a fix for that single group. Yes, we should have a more robust safety net that ensures that deep poverty just does not happen. Yes, we should raise the minimum wage so that it's impossible to work full-time and still be below the poverty line. Yes, we should tax more at the top. But if we don't rebuild our economy at every level, we leave the power structure that produced this disaster intact, ready to reproduce it.

Originally posted to Daily Kos Labor on Sun Dec 16, 2012 at 09:55 AM PST.

Also republished by Daily Kos.

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