Mind the (age) gap

Economists love to argue about redistributive policies. The act of taking money or resources and spreading them around get to the art of many fundamental disagreements. To the libertarian, all that matters when evaluating circumstances and fairness is how individuals started. One such believer, Charles Murray, perceives that "inequalities in wealth that result from people's choices are nonproblematic." (1) Rawls, on the other hand, argues that "society is not something private." (2) From his perspective, inequalities in wealth are problematic if the general pool of resources can solve them.

These arguments are obviously made from a theoretical standpoint and there are always complications when applying them to a real live society. But to further complicate the validity of their application: when these theories talk about individuals, they really mean adults. Where do children fit into the equation?

Spending on children comprises one of the lowest federal expenses. The US government spends about 2.2 percent of the GDP on children and various services directed at them. In comparison, about 5.3 percent of the GDP is spent on the elderly.

The view from the budget is even more shocking: less than ten percent went to children; more than a third went to the elderly.

Since 1975, spending on children has only risen with inflation and Medicaid costs, whereas spending on the elderly has skyrocketed. Benefits for children — paid through their parents — have shifted away from cash payments to in-kind benefits, through initiatives like food stamps, health care and programs such as Head Start. But within the next decade, spending on children is actually expected to decline.

This seems like an unequal split when viewed with any philosophical lens. The economic state in which children live is, in nearly all cases, irrespective of the choices they themselves have made. A child's opportunities are determined by the sheer chance of where they are born and to whom. An older person, however, has had a lifetime of choice-making. Sure, everyone is entitled to a little assistance when they can no longer care for themselves, but from the libertarian perspective — perhaps they should have made better choices in their youth to ensure a more comfortable future.

From the Rawlsian perspective, why should one age bracket be given significantly more assistance than another? Where's the fairness in that? If resources are not private, but rather societal, shouldn't aid be spread around equally?

If "inequalities must work to the greatest benefit of the working poor," it doesn't seem that this particular inequality meets the philosophical bar. Subjecting children to poverty, despite the happenstance way in which they found themselves impoverished in the first place, is unfair on all counts.

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(1) (2) Tomasi, John. Market Democracy, chapter 6

Drawing the line

One of the first concepts taught in introductory economics is the measure of poverty. How is it decided who will receive the label and who will not? For the final exam we memorized numbers like $20,000 (for a family of four) and $10,000 (individual), but with little thought to how the numbers were derived or what they meant. The standard from which these numbers come dates as far back as the Johnson Administration, based upon a formula stipulating that the average family would spend a third of its income on food. The measure has not changed except to be adjusted for inflation in the intervening time period since.

Many argue that the measure is not only inaccurate, but makes calculating the impact of anti-poverty measures (like food stamps, housing assistance, etc.) very difficult. Based upon data gathered in this census this year, the federal government will actually retool the metric upon which we draw the poverty line. What exactly this new formula will look like is still up in the air, though that has not stopped economists from trying to postulate what it may look like.

Statistics are a fickle tool and numbers can often be tweaked, pushed and prodded to generate the results one wants to hear. Under an administration against welfare, the poverty line might be edged a little lower, whereas an administration looking to implement welfare programs, the line will be placed such that a sizable enough population falls below it to merit action.

In an art-imitates-life moment, here's an excerpt from a "West Wing" episode that explains how the poverty model was derived and how it works. The fictional Democratic administration was obviously less than thrilled that more people had become classified as poor under their watch due to inflationary adjustments, but viewed the ability to pass greater welfare reform as "good news." The show always was heralded for sticking to realistic, relevant topics.

Ethnic enigma

When we try and place ourselves on a spectrum, rate how things are going, we often use a scale of 1 to 10. But here's a new scale: South Dakota Native Americans to New Jersey Asian Americans.

According to a recent study of well-being, broken down by ethnic group and state of residence, these are the endpoints. Asians in New Jersey will live, "on average, an astonishing 26 years longer, are 11 times more likely to have a graduate degree, and earn $35,610 more per year" than Native Americans in South Dakota.

The results prove a number of shockingly wide disparities — the life expectancy of an African American is roughly equivalent to that of the average American … three decades ago.

The report also presents a number of "factoids" about well-being in America, everything from health to education to economic mobility. And here's the not-so-surprising reality: we're falling behind.

A poor child born in Germany, France, Canada, or one of the Nordic countries has a better chance to join the middle class in adulthood than an American child born into similar circumstances.




The U.S. ranks second among 177 countries in per-capita income but 12th on human development, according to the global Human Development Index, published annually by the United Nations Development Programme. Each of the 11 countries ahead of the U.S. has a lower per-capita income than the U.S., but all perform better on the health and knowledge dimensions.




The U.S. infant mortality rate is on par with that of Croatia, Cuba, Estonia, and Poland.




If the U.S. infant mortality rate were equal to that of first-ranked Sweden, twenty-one thousand more American babies would have lived to celebrate their first birthdays in 2005.




In 98 countries, new mothers have 14 or more weeks of paid maternity leave. The U.S. has no federally mandated paid maternity leave.




The United States ranks second in the world in per-capita income (behind Luxembourg), but thirty-fourth in survival of infants to age one.




The U.S. ranks forty-second in global life expectancy and first among the world’s twenty-five richest countries in the percentage of children living in poverty.




In the 2006 OECD international assessment of fifteen-year-olds, in math, the U.S. came in twenty-fourth, and in science, the U.S. came in seventeenth.




The U.S. incarceration rate is five-to-nine times greater than that of our peer nations.

So what is the greatest nation in the world to do? Accept our inequalities and move forward? Face up to them? Work to equalize the disparities that exist within our own boundaries (and then look to change the world)?

We may be providing for the Asian Americans in New Jersey, but are we failing others at the same time?

Servicing the public service

Public service is often regarded as noble work — thankless jobs for minimal pay. But perhaps the stereotypes are being turned upside down. According to recent data from the Bureau of Labor Statistics, salaries for government workers are beginning to outpace those of private industry employees, at least as an aggregate.

Countless Brown students enter the public workforce annually — for altruistic ideals, for hopes of someday ruling the world, for the promise of loan paybacks. And obviously, we are not alone in our interest. So here's the question: Is this a good thing, because it means that public service is being adequately rewarded? Or does this explain why so many states and municipalities are drowning in debt? Are we being too generous in an attempt to reinforce the public labor force?

School daze

I recently "pondered" the high unemployment rate in youths, worldwide, but here's an interesting and complementary graph… College enrollment is higher than ever, verging on 70 percent. The numbers have been trending upward for years anyway, but some experts posit the plummeting job opportunities may have something to do with the renewed quest for higher education.

UPDATE, 5/2/2010: On the other hand, it seems college students are working less hard than they used to. An excellent message as we head into finals period.

Young, restless and ... unemployed?

New studies indicate the in the developed world, individuals under 25 are more likely to be unemployed than their older counterparts. Three times as likely, when the numbers are examined as an aggregate.

Youth who are full-time students are not counted in these numbers, meaning that countless young adults (well, not entirely countless - some reports say up to 15 million) who reside in relatively affluent countries are without a job or education. In Spain, which suffers from high unemployment across the board, nearly 40 percent of the youth is unemployed.

One reader of the Times' report on these numbers made an astute observation:

Basically all this is measuring is the effects of education on employment status. Those who are 15 to 24 are either full time students (and thus not counted in employment statistics at all), or are high school dropouts and/or those with only high school educations. It shouldn't be surprising that they find themselves unemployed at higher rates than those who graduate from college and/or have more experience in the workforce.

The value of a college education is a rarely disputed fact. But in the current economic climate, the normal laws of education and job possibilities do not necessarily apply. In countries around the world, college graduates are forced to take jobs for which they are overqualified because there is nothing else available. Consequently, those who have no college education at all -but in a vacuum would be qualified for these entry-level positions - are left without employment. This is the case in Spain, where "the risk of overeducation" has become a conscious phenomenon. Youth are opting out of college because the rewards of attending are no longer worth the time and cost. In effect, the opportunity cost of a college education has become too high - especially if unemployment is the result nonetheless.

For those with money to spare, unpaid internships have become the option. But for those without a college education or a fallback option, what do these facts mean? Is an entire generation, worldwide, being crippled by the economic crisis? If youth are unemployable and therefore unable to gain beginner experiences, how will they ever rise up? Though the numbers do not appear to exist, statistics on the employment of those aged 25-30 would be helpful for understanding the implications of this mass unemployment.

For more: a video by the Organization for Economic Cooperation and Development on what these statistics mean.

She works hard for the money

Today was Equal Pay Day, a holiday many assumed would be obsolete by 2010. Women still earn only 77 cents to every dollar men earn. Some argue skill, some argue education, some argue lifestyle choice, but at the end of the day — women now comprise 2/5 of the nation's primary breadwinners. So does that mean that 40 percent of households should suffer the consequences?

Equal Pay Day marks the point in 2010 where women who began working on January 1, 2009 will match their male counterpart's 2009 income.

Countless laws have been put into place — and even more have been proposed — that theoretically would eradicate the disparity. But is bridging the 23 cent divide possible overnight through legislation? Does society require a cultural shift? Can we ever expect the two genders to be treated equally in the workplace?

There is a gap everywhere. This is not just an American problem (if we think it is a problem). The 23 cent difference boils down to about 19 percent; in Belgium, the difference hovers at about 9 percent, while South Korea and Japan are flirting with a 30 percent difference. But is the middle of the heap the best we can hope for?

In countries like Sweden, government policies are put in place to work toward better income equality. State-sponsored leave (föräldraledighet) entitles every family to 480 days of parental leave — but only if both partners split the time. If only the mother takes leave, she can only have up to 420 days off, depriving the family of 60 days that could have been spent with the child. Most couples actually do split the time, fairly dividing the work and childcare responsibilities. Does a policy like this ensure greater income equality? Hard to say, but it is worth noting that Scandinavian countries, which do all have policies like this, have greater income equality between men and women.

An interesting detail of the inequality is that the gap is widest at the top — in sectors that pay the most, the disparity is greatest. It is impossible to pinpoint why this occurs. Is it because women are less likely to be promoted, or because they choose not to be for lifestyle reasons? Is leadership an inherently gender-based quality? Is society biased or are we carrying out self-fulfilling prophecies? Women are scientifically less aggressive, so does this translate to mean that they are less go-getter professionally?

As elite universities like Brown begin to tip in the other direction when it comes to gender balance, enrolling more women and fighting for male applicants, one has to wonder if our generation will be the one to turn things around. Will we prove, once and for all, that men and women are capable of reaching the same level of prosperity? Or will we serve as the ultimate validation for the gap, proving that there are just some inequalities that will never be solved for variables outside of our control?