Some commentators are now claiming that New Orleans poverty was a result of “the shredding of the social safety net.” The implication is that, if we had only been willing to spend more money, much of the unfolding tragedy could have been avoided. In reality, however, the federal government has spent nearly $1.3 billion on cash welfare (TANF) in Louisiana since the start of the Bush administration. That doesn’t count nearly $3 billion in food stamps. Throw in public housing, Medicaid, Child Care Development Fund, Social Service Block Grant and more than 60 other federal anti-poverty programs, and we’ve spent well over $10 billion fighting poverty in Louisiana. This doesn’t even begin to count state and local welfare spending. Shredding the social safety net? Hardly. Welfare spending rose steadily throughout the Bush administration.
Yet, nearly a third of New Orleans residents had incomes below the poverty line, one of the highest poverty rates of any major American city. Statewide, Louisiana’s poverty rate is fourth highest in the nation. The state’s child poverty rate is the country’s second worst. When it comes to fighting poverty in New Orleans, we’ve spent billions, and accomplished almost nothing.
Making this failure even worse, we’ve long known the keys to effectively fighting poverty. The first of these is a quality education. Those who graduate high school with the skills necessary for employment are far less likely to end up in poverty than those who don’t. But New Orleans schools are a dismal failure. More than 40 percent of the city’s adults are functionally illiterate, and the school dropout rate is estimated between 35 and 50 percent. Yet the state has repeatedly rejected attempts to give students in failing schools more choice. The state has one of the nation’s weakest charter-school laws. The legislature has regularly killed proposals for even limited voucher programs, most recently in June of this year. Even public-school choice is weak and limited.
Having children without being married is one of the surest routes into poverty for women and their children. Forty percent of babies born in Louisiana are out of wedlock, second highest in the nation. Roughly 80 percent of teen births are out of wedlock. In New Orleans, the out-of-wedlock birth rate is roughly 60 percent and an astounding 96 percent of teen births are to unwed mothers. Study after study has shown the link between welfare payments and out-of-wedlock birth. Louisiana’s welfare policies seem oblivious to this connection. Not only does the state have no cap on benefits for additional children born out of wedlock — a program found to reduce illegitimacy in other states — but the state continues to offer benefits to set teen mothers up in homes of their own, “independent” of their parents.
Of course, jobs are another key to fighting poverty. Unemployment in Louisiana runs above the national average. New Orleans unemployment ran nearly a full percentage point higher than the national rate. Part of this was undoubtedly due to the state’s general hostility to business. The nonpartisan Tax Foundation puts Louisiana in the bottom half of its rankings for state business tax climate. The Public Policy Institute of the Business Council of New York rates Louisiana 40th of the fifty states in terms of economic freedom. The state’s tort-prone legal system is rated 47th.
And, finally, we know that asset accumulation plays a vital role in escaping poverty. Yet many of those most vocal in decrying the poverty of New Orleans, have been in the forefront of blocking President Bush’s proposals for allowing workers to save and invest a portion of their Social Security payroll taxes.
In the wake of Hurricane Katrina, there will justifiably be calls to do something about the poverty that existed unseen in New Orleans and still exists in so many cities across America. Most of those speaking longest and loudest will be telling us to pour more money into various welfare programs. Doing so will help salve our conscience and tuck the poor safely out of sight until the next disaster forces us to face the consequences again. But it will do little to help these people escape poverty.
The poor of New Orleans have been victims twice: of the storm and of the failed welfare state. As we pick up the pieces, let’s not victimize them a third time. Let’s try fighting poverty in ways that work.
