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Sunday, February 9, 2014

Class Notes 2/6

Jim Zilliack
Director of the Institute of Poverty Research at The University of Kentucky

This year is the 50th anniversary of the war on poverty.

Lyndon B. Johnson declared a war on poverty during his time in office, he toured around the US and was shocked with how large of a problem poverty was.
-War On Poverty included - rejuvenating the food stamp program that began in WWII, establishing the President's Appalachian Regional commission and the Medicaid and Medicare programs.
- In programs that were already established Johnson expanded the eligibility requirements in order to encompass a greater number of Americans - none of these programs are straight cash, many are voucher programs ( This is a common misconception among Americans today) .
- Today 3/4 of the money spent on poverty goes to older Americans.


50 years later the question is today, was the war on poverty won. Many would say NO.
- The poverty line was previously calculated by looking at families food budget and multiplying it by 3, as families traditionally spent 1/3 of their money on food. Today, however, these spending habits have changed.

1) How do we claim this war on Poverty we still face as a country?
- promote economic literacy
- adults taking the time to understand poverty as a complex issue
- people in the know taking the time to share their knowledge

2) Has the private market stepped up to the plate to help?
-Yes. EX: Costco
- there are still differences however in philosophical beliefs regarding poverty, they need to get on the same page.

3) CEO's are a problem. Yes.
- They earn 300- 400 times the amount of money as their average workers
- Companies need to invest in more long run profits
- large investors need to speak up more about this issue
- greater accountability of CEO's needs to happen
- tax policies need to change.

- The top 1 percent of Americans are earning over 20 percent of the income available in this country.
- To change, it will take social will .
- The US also spends more on defense than the next 19 countries on the list combined.

- Because countries spend their tax money differently, they have better outcomes
 ex: France has a good child care system and Sweden has an excellent education system.

- Average American mother spends 20 percent of her income on childcare. ( 4,000 to 16,000 dollars a year for center based childcare in the US per child.)
- 7/10 children born to single mothers are born to African American Mothers.
-  informal care ( such as grandma taking care of children) is bad.

4) Minimum Wage is low
- $7.25 per hour since 2007
- states can raise it above this
-  due to inflation, minimum wage should be roughly $15
- this change can only be made by an act of congress.
-If we raise the minimum some people will lose their jobs though,  a 10 percent raise in the minimum wage will result in the employment rate dropping 1-2 percent.
- Only 4-6 million people make minimum wage in this country.






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