Social Problems
Darryl Hall
Department of Sociology
University of Nevada, Reno
Poverty and Wealth
• Social Stratification refers to the unequal manner in which scarce resources and social rewards are distributed among different social categories and groups.
• Social Classes are categories of people who have similar access to resources and opportunities.
• Life Chances refer to the likelihood of realizing a certain standard of living or quality of life, including health and well-being.
- Wealth refers to the total economic assets owned by a person or family; it consists of property and income. Property comes in many forms, such as buildings, land, animals, machinery, cars, stocks, bonds, businesses, and bank accounts. Income is money received as wages, rents, interest, royalties, or the proceeds from a business.
- Large differences of income and wealth have existed as long as these data have been collected. Wealth is highly concentrated. The majority of wealth, 68 percent, is owned by only 10 percent of the nation’s families. The super-rich, the richest 1 percent of U.S. families, are worth more than the entire bottom 90 percent of Americans. This unequal distribution of income and wealth has been remarkably stable; the changes that do occur indicate growing inequality.
- Also, there have been persistent differences in income and wealth between men and women, the young and old, and white and non-white Americans.
• The income inequality of a population is commonly measured using the Gini index. The Gini index ranges from 0, indicating perfect equality to 1, indicating perfect inequality. The increase in the Gini index for household income between 1970 and 1999 indicates a significant increase in income inequality.
Global Stratification
• There is a huge inequality gap worldwide. Consider:
- In 1900, people in the ten richest nations earned nine times as much per capita as did people in the ten poorest nations. This gap increased to thirty to one in 1960 and to seventy-two to one in 2001.
- The top fifth of nations possess 86 percent of the world’s gross domestic product, 68 percent of direct foreign investment, and 74 percent of the world’s telephone lines.
- The richest 20 percent of the world’s people receive at least 150 times more income than the poorest 20 percent.
- The top 20 percent consume 86 percent of the world’s goods and services, while the poorest fifth consumes only 1 percent.
- The three richest people on Earth have wealth that exceeds the combined economic output of the 47 least-developed countries. The richest 200 people have more money than the combined income of the lowest 40 percent of the world’s population, or about 2.4 billion people.
- About half of the world’s people live on less than $2 a day, the World Bank’s definition of poverty.
• Absolute poverty refers to a condition of life that is so degraded by disease, illiteracy, malnutrition, and squalor as to deny its victims the basic necessities of life.
• Relative poverty refers to a standard of living below that of most others in society, but not necessarily threatening to life or health.
The Rich and the Poor
The Rich
- Although there is no standard definition of what it means to be rich, the following observations can be made:
1) Those in the top 10 percent of the income distribution have at least a six-figure income ($150,000 or more).
2) Those who are very rich or superrich own their own large companies or possess a great deal of stock in many corporations. These families have wealth that reaches tens or hundreds of millions of dollars or even more (e.g., the wealth of Bill Gates exceeds $90 Billion, which is more that the total wealth of a million average people).
3) The wealthy have tremendous political clout and buy political influence with huge financial contributions to politicians and political candidates.
The Poor
- The poverty line is a standard set by the U.S. government for the purpose of counting the poor. The poverty line is a level of annual income below which a person or family is defined as poor and thus entitled to government assistance. There are millions of people in the U.S. who work full-time but are still below the poverty line.
- In 1999, 12% of the population (about 32 million people) lived in a household with income below the poverty line. The poorest half of families make only half of the poverty line standard (the poverty gap refers to the difference between the official poverty line and the actual income of the typical poor household).
- Critics claim that the poverty line actually underestimates the amount of income necessary to live. Realistically, it would take an income that is 25% higher than this standard to provide a family with basic economic security.
Who are the Poor?
1) Age – The age category at the greatest risk of poverty today is children, who make up 37.5% of the U.S. poor. In 1999, 12.1 million young people (16.9% of people under the age of eighteen) were living in poor households.
2) Race – Despite popular culture in the U.S., the poor is comprised of more white people than black people as well as more non-Hispanic people than Hispanic people. However, in terms of specific populations, African Americans and Hispanics are overrepresented among the poor (at 24% and 23% of the population, respectively, compared to 8% of non-Hispanic whites).
3) Sex – Women are at the greatest risk of poverty; sixty-two percent of poor U.S. adults are women. The feminization of poverty refers to the trend by which women represent an increasing share of the poor.
4) Family Patterns – Single mothers are at higher risk of poverty than single fathers (36% and 16%, respectively). Divorce raises the risk of poverty for all families—and especially the children. Within a year, one in eight children of divorcing parents slips below the poverty line.
5) Region – The official poverty rate varies from state to state (the highest rate of poverty is New Mexico at 20.5% and the lowest is 7.2% in Maryland). By region, the South (13.1%) and the West (12.5%) have the highest rates of poverty, followed by the Northeast (10.9%) and the Midwest (9.8%). Also, urban areas have higher average household incomes and lower poverty rates than rural areas (11.2% and 14.3%, respectively).
The Underclass
• The underclass refers to those poor people who live in areas with high concentrations of poverty and few opportunities to improve their lives. These individuals suffer from extreme forms of segregation, resulting in a lack of good schooling and well-paying jobs.
• The underclass includes about one in seven poor people and only a small percentage of the country’s entire population. Although the underclass faces persistent poverty, the poor is generally characterized as dynamic: roughly 25% of the U.S. population falls below the poverty line at some point over a ten-year period (usually due to illness, unemployment, or divorce) and remain poor for only a year or two.
The Middle Class
• Beginning around 1970, many U.S. families found themselves working harder than ever, yet feeling that they were falling behind. For a large share of workers, earnings have stalled, forcing them to work longer hours to meet the rising costs of housing and college.
• Underlying this pattern of stalled earnings are economic changes. Specifically, lower-paid service work (e.g., sales positions, computer data entry, and fast-food restaurant work) has replaced factory work.
• Young people are also feeling this pinch, which is why more than half (53%) of those between the ages of eighteen and twenty-four now live with their parents.
Social Problems Linked to Poverty
1) Poor Health - Many poor people can not afford adequate nutrition; about 15% of poor families are undernourished.
- Poor families receive little medical care; at least one-third lack health insurance—more than twice the national average. Further, the poor have higher rates of infant mortality, the risk of death within the first year of life.
- The poor experience more stress and are more likely to suffer from alcoholism, drug abuse, and violence.
- The poor, who are more likely to die from infectious diseases and violence at any age, have a lower life expectancy than other groups. Thus, life expectancy for whites is about 77.5 years, while that of African Americans (who typically earn 65% as much income) is 72.2 years.
2) Substandard Housing - Poor people must contend with crowding, dangerous lead-based paint, lack of heat, broken windows and locks, and collapsing walls and ceilings.
- The National Coalition for the Homeless reports that at least 600,000 people are homeless in the U.S. on any given night, and as many as 2 million people are homeless at some point during a year. The number of homeless grow higher each year; the U.S. Conference of Mayors reports a steady increase in requests for emergency shelters throughout the 1990s, with a 15% increase from 1999 to 2000. The average length of time a person remains homeless is five months.
- Conservatives point to personal problems in some homeless people, noting that they may suffer from mental disorders and many abuse alcohol and other drugs. In contrast, liberals point out that low wages and lack of low-income housing are the prime causes of homelessness.
3) Limited Schooling - Poor children are less likely than rich children to complete high school, enter college, and complete advanced degrees.
- A key part of educational inequality involves tracking, the practice of placing some students in college-bound (“academic”) tracks and others in job-oriented (“vocational”) tracks.
- Although the stated goal of tracking is to educate children according to their academic aptitude, research suggests that school personnel typically label poor children as less able; as a result, they are taught by the worst teachers, in the most crowded classrooms, and learn by rote rather than by creative problem solving.
4) Uncertain Work and the Working Poor
- Some poor people (e.g., children, the elderly, and the disabled) can not work. But for those who can, jobs are hard to find. According to government statistics, 40% of the heads of poor families did not work at all during 1999. The most common reason offered by poor, healthy men is that there were no jobs to be found within reasonable commuting distance. Most women without jobs are single parents who can not afford childcare even if they could find a job.
- Many heads of poor households (about 21% of the heads of poor families) make up the working poor, those who worked full-time at least fifty weeks during the year but remain poor because of low wages. Even full-time, year-round work at the minimum wage yields $15,350, almost $2,000 below the poverty threshold for a family of four. Another 39% of the heads of poor families worked only part-time, making their poverty even more serious.
5) Crime and Punishment
- Poor people are more likely to be involved in street crimes (e.g., assault, robbery, burglary, auto theft) than affluent people, both as offenders and victims.
- However, the public pays little attention to the kinds of crime committed by wealthy people--including tax evasion, stock fraud, false advertising, bribery, and environmental pollution--even though such offenses may well cause greater damage to society as a whole.
- The poor are more likely than the rich to face arrest, trial, conviction, and prison. Further, the poor enter the criminal justice system having to rely on public defenders who are generally underpaid and overworked. In contrast, the wealthy can enlist the help of private counsel and employ psychiatrists and other specialists, which greatly lowers the odds of conviction.
Responding to Poverty: The Welfare System
• All high-income nations have enacted some type of social welfare program, an organized effort by government, private organizations, or individuals to assist needy people defined as worthy of assistance.
• The largest government welfare programs 1) are paid for by the public through their taxes, 2) direct money to many different categories of people, and 3) do not significantly change income inequality.
• Although people in the U.S. like to think that we are compassionate, the public remains divided over whether the poor deserve a hand. Part of the problem lies in the widespread assumptions and beliefs that the poor are undeserving.
Welfare in the United States: Myths and Realities
1. People on welfare are lazy and have no work ethic
- Single parents on welfare already do work—they do the work of parenting, which is invaluable even though we do not place a monetary value on it. Secondly, most adults receiving public assistance are either employed or in the labor force looking for work. Nevertheless, there are not enough jobs—especially for low-skill workers.
2. Welfare encourages single women to have children
- Mothers receiving welfare have no more children, on average, than women in the general population. Research consistently shows that receiving welfare does not significantly increase out-of-wedlock births.
3. Once on welfare, always on welfare
- In 1998, one-third (34 percent) of welfare families have stayed on welfare for 1 year or less; 27 percent stayed on welfare for 1 to 3 years, 15 percent for 3 to 5 years, and 22 percent for 5 or more years.
4. Most welfare benefits are granted to people who are not really eligible to receive them
- Although some people obtain welfare benefits through fraudulent means, it is much more common for people who are eligible to receive welfare to not receive benefits. A main reason for not receiving benefits is the lack of information; people do not know that they are eligible. Also, many do not want to apply for it because they do not want to be stigmatized as lazy people who just want a “free ride” at taxpayers’ expense. Others want to avoid the administrative and transportation hassles involved in obtaining welfare.
5. Public assistance to the poor creates an enormous burden on taxpayers
- Public assistance to the poor is a small part of government spending. In the 1999 federal budget, 6 percent was allocated to Medicaid and another 6 percent was allocated to other assistance to the poor. Meanwhile, 15 percent of the budget was allocated for national defense and another 23 percent was allocated for Social Security. Moreover, the estimated cost of tax breaks to corporations and wealthy individuals in 1996 was $440 billion, more than 17 times combined state and federal spending on AFDC. Despite the public perception that welfare benefits are too generous, assistance for the poor does not meet the basic needs for many individuals and families who receive such benefits.
Corporate Welfare
• Corporate welfare refers to laws and policies that favor corporations and the wealthy, such as low-interest government loans to failing businesses and special subsidies and tax breaks to corporations.
- Between 1990 and 1997, Seaboard Corporation, an agribusiness corporate giant, received at least $150 million in economic incentives from federal, state, and local governments to build and staff poultry- and hog-processing plants in the US, support its operations in foreign countries, and sell its products. Taxpayers picked up the tab for this corporate welfare, as well as the costs of homelessness (due to the inability of Seaboard’s low-paid employees to afford housing) and dwindling property values resulting from smells of hog waste and rotting hog carcasses in areas surrounding Seaboard’s hog plants. Meanwhile, wealthy investors in Seaboard have earned millions in increased stock values.
Blaming the Poor: Two Deficiency Theories
1) Innate Inferiority – the British philosopher and sociologist Herbert Spencer put forward a position referred to as Social Darwinism, where he argued that the poor were poor because they are unfit. Poverty was nature’s way of getting rid of those members who are unhealthy, slow, faithless, imbeciles in order to make room for the “fit,” who were entitled to the rewards of wealth. In this view, the poor should not be given any type of state or private charity, because such acts would interfere with nature’s way of disposing of the weak.
2) Cultural Inferiority – One prominent explanation of poverty, called the culture-of-poverty hypothesis, contends that the poor are qualitatively different in values and lifestyles from the rest of society and that these cultural differences explain poverty. This position argues that the poor, in adapting to their deprived conditions, are more permissive in raising their children, less verbal, more fatalistic, less likely to defer gratification, and less likely to be interested in formal education than the well-to-do. These cultural patterns are held to be transmitted from generation to generation. The assumption is that poverty is created by the life-ways of the poor.
Structural Theory of Poverty
• In contrast to blaming the biological or cultural deficiencies of the poor, the structural theory states that how society is organized creates poverty and makes certain kinds of people especially vulnerable to being poor.
• Institutional discrimination refers to the situation where the customary way of doing things, prevailing attitudes and expectations, and accepted structural arrangements work to the disadvantage of the poor.
• Further, the basic tenet of capitalism--who gets what is determined by private profit rather than collective need--explains the persistence of poverty. Employers are constrained to pay their workers in the least possible in wages and benefits. Only a portion of the wealth created by labor is returned to it; the rest, referred to as surplus value, goes to the owners for investment and profit. An abundance of laborers helps to depress wages. If costs can be reduced, technologies are introduced to replace workers.
Theoretical Approaches to Poverty
1) Functionalism – contemporary functionalists assert that inequality is a cultural universal because it is beneficial to the operation of society.
- Kingsley Davis and Wilbert Moore argue that some jobs are more important than others. In order to motivate people to fill positions that require more training and talent, it is important to offer greater rewards (including higher income, greater prestige, and more power) to these positions. Davis and Moore argue that an egalitarian society would be inefficient because it would not encourage people to excel.
- Davis and Moore see society as a meritocracy, a system of social inequality in which social standing corresponds to personal ability and effort.
Criticisms of the Davis-Moore Thesis:
1) How do you measure the importance of a position?
2) Is the relationship between the importance of a position and its rewards as straightforward as the theory suggests?
3) Why isn’t society a meritocracy? That is, why are many positions not awarded on the basis of merit?
4) Is inequality actually functional for society?
- Herbert Gans argues that inequality exists because people benefit from it; inequality performs a number of functions:
1) The poor are willing to perform unpleasant tasks
2) They are willing to purchase things that no one else wants
3) They remind others that it is important to work hard
4) They serve as scapegoats for many of our social problems
5) They create work for the rest of us (e.g., social workers, pawn shop owners, less qualified doctors and lawyers)
2) The Conflict Perspective views social stratification as avoidable, unnecessary, and not promoting the optimal functioning of society.
• Stratification is created and maintained by classes and powerful groups in order to protect and enhance their interests; focuses on competition over scarce societal resources (e.g., power, wealth, and prestige).
• The risk of poverty is far greater for certain groups of people—racial minorities and women—than others. Single mothers, for example, are ten times more likely than single fathers to be poor.
3) Symbolic Interactionism focuses on the meanings that people attach to those who are poor.
• William Ryan described the process of blaming the victim, where one finds the cause of a social problem in the behavior of people who suffer from it. Blaming the victim comes easily in a society that stresses individual responsibility. This process of blaming involves four steps:
1) Pick a social problem (e.g., poverty)
2) Decide how people who suffer from the problem differ from everyone else (e.g., dress, language, education, housing)
3) Define these differences as the cause of the problem
4) Respond to the problem by trying to change the victim rather than changing the larger society
Politics and Poverty
The Conservative Position
• A conservative view points out that almost all poverty in the U.S. is relative poverty (i.e., the poor have less than what government officials claim people living in our rich society ought to have) rather than absolute poverty (i.e., poverty where day-to-day survival is the issue).
• Conservatives argue that our system is doing a pretty good job of providing for the U.S. population. Half of today’s poor own their own homes, most have at least one car, and almost all have a television set and other household conveniences.
• Conservatives point to the importance of personal responsibility and self-reliance for their own well-being. They argue that there are plenty of opportunities available to anyone who is willing to take advantage of them.
The Liberal Position
• Liberals argue that poverty is more of a structural problem than an individual problem. Most people become poor not because they are irresponsible, but because of the way our society operates.
• Most unemployment is caused by economic recession or corporate mergers and downsizing that reduce the number of available jobs. Also, some people are disadvantaged because of racism and other forms of discrimination that prevent them from obtaining good jobs.
• Liberals seek to have the laws that ban discrimination in education and the workplace actively enforced. Also, they support government assistance programs that offer some financial security to everyone. They support higher taxes—especially on the rich—to pay for such programs.
The Radical Position
• Radicals agree with liberals that poverty is a societal issue, and that we can not expect poor people to improve their situation on their own. Radicals, however, see poverty as a problem that is inherent in the capitalist economic system.
• Karl Marx regarded poverty as one of the internal contradictions of capitalism. While industrial capitalism is highly productive, it is controlled by a few (the wealthy capitalists) for their own benefit. Thus, a society that is exceedingly rich can contain millions of people who are exceedingly poor.
• The way to solve the problem of poverty is to solve the broader problem of capitalism. Marx argued that the masses of people must recognize the source of their suffering and act together to replace capitalism with a more just and humane economic system, where the goal would be to meet social needs rather than increasing private profits.
