“Inequality is a threat to democracy because it deprives poor people of their rights”
Janet Currie, Profesora de Economía y Asuntos Públicos en la Universidad de Princeton (Nueva Jersey)
Janet Currie is a professor of Economic and Public Affairs at Princeton University, New Jersey, co-director of the Program on Families and Children at the National Bureau of Economic Research of the United States and is a member of the National Academy of Sciences, the National Academy of Medicine and the American Academy of Arts and Sciences. Her analyses on the effects of socio-economic differences, environmental threats and the lack of access to medical care in child poverty are pioneering and are a worldwide point of reference. Born in Canada, she was the first woman to preside over the Department of Economy of the prestigious Columbia (2006-2009) and Princeton (2014-2018) universities.
What led an expert in the economy like you to make child poverty her main field of research?
The reason has a lot to do with the way in which I was brought up. My mother was a social worker. Therefore, from a very early age, I was aware of the problems facing people with a lack of resources. I have always felt very committed towards social injustices, particularly those from which children suffer. In the case of adults with needs, there is always the doubt about whether their poverty is due to poor decisions they have made or to the actions they have undertaken; but in the case of children it is quite clear that they have no responsibility, they simply suffer from the misfortune of having been born into poverty. I believe that, as a society, we have the obligation to help them.
In developed countries, there are enormous differences in the levels of child poverty. The United States or Spain, for example, have very high rates even though they are not poor countries. How can this be explained?
In the first place, we need to consider a technical question: in the United States poverty is measured in a different way than in Europe and this partly explains the differences. In Europe, people with incomes lower than a given value with respect to the average income are considered to be poor, while in the United States, the official poverty measurements are based on income and on the cost of a basket of food that covers basic nutritional needs.
In recent decades, most of the money that the United States destines to fighting poverty is in the form of assets and services that are not measured in monetary terms (the so called ‘in-kind’ programs): help at home, financial aid, medical care, etc. However, these features are not taken into consideration when measuring poverty, which means that the public opinion has an incorrect perception of poverty statistics.
Citizens think “Well! We’ve spent lots of money since the 1960s on reducing child poverty and we have the same ratio of poor children as then. This means that the social programs don’t work.” Which, of course, is not the case.
As a result of this misunderstanding, governmental programs were created, such as the Earned Income Tax Credit (EITC) and the Supplemental Nutrition Assistance Program (SNAP), which did affect the variables that the Census Bureau takes into account to define the poverty threshold and that, in fact, contributed towards child poverty being reduced by 50% between 1970 and 2016.
One of the recurrent debates in the political arena is precisely that of whether poverty should be measured based on family income or related to consumption.
In the 1960s, both in the United States as well as in Spain, there were a lot of people who did not have running water in their home or any kind of electrical household appliance. Nowadays, practically everyone has basic services in their home or a fridge. In fact, even the poorest people have a smart phone. The standard of living has changed a lot in just a few decades. There is no sense in measuring poverty by only taking into account access to items of consumption, because the cost of living is very different in each country and even in different areas of the same country.
In any case, even when taking all these factors into consideration, it continues to be true that the United States has a high poverty level in relation to other countries. The latest data we have are from 2015. It is calculated that then there were more than 9.6 million children (13% of the total) living in households below the poverty threshold; of those, 2.1 million (2.9% of the total) were living in extreme poverty. It goes without saying that these figures are scandalously excessive. I think they are mainly due to a very simple question: we do not spend as much money as most European countries in protecting the people who occupy the lower part of the income distribution scale.
In your experience, which kinds of program to fight child poverty are the most effective ones?
I have recently participated in research for the United States National Academy of Sciences, the aim of which was to reduce poverty by half in the United States in 10 years. After carefully analyzing the various projects and the actions that could be undertaken, we reached the conclusion that the objective set would be met by simply applying the programs that are already under way.
“Child poverty dropped by 50% in the United States between 1970 and 2016, thanks to the social aid programs, but the figures continue to be too high”
In broad terms, there are two kinds of social program that affect the reduction of poverty. In the first place, those that represent an increase in the income (for example, subsidies for children). These are the most effective ones. The ideal thing would be to expand the EITC: an economic aid that is granted to low income workers generally with children in their care. To be able to receive this benefit, the only requirement is to make a tax declaration. The EITC allows people to pay lower taxes and even to get money back.
But the problem of child poverty is not completely solved by offering money to families with low income, because often these children live with dysfunctional adults who are not able to provide them with their basic needs. Therefore, these children need some kind of security, in the form of a good quality child health system (having medical insurance is of crucial importance in the United States as opposed to most European countries) or a warm, nutritious meal on the table (to this end, school feeding programs are essential).
I think that the ideal answer is the combination of the two measures: on the one hand, reinforcing family income and, on the other hand, social benefits that provide children with a safety net. This second aspect refers to programs for reassigning housing, employment placement, subsidies to pay household bills and other equivalents to acquire food. Any subvention that guarantees that no child should have to suffer from severe shortages, even if their parents are irresponsible when spending the income they obtain and the material benefits they receive.
What are the factors that determine poverty?
Working stability is a very important factor. Usually, a family is poor because the parents do not have work or they are employed in a precarious job. Having a very low salary and having no control over your working hours is an additional source of stress and makes it very difficult to act as a parent. If you do not know how much you are going to work next week, how can you organize childcare? How can you be available when your children need you? It is very difficult. I believe that many poor families find themselves in this situation.
Often, people believe that if the parents do not work, they should have more time to do activities with their children: take them to free, public places, such as the library or the park. This is a naive thought, because they do not take into account the tremendous anxiety and uncertainty of a parent in a precarious situation. The stress caused by job insecurity exhausts a person’s resources to deal with their child’s education in a suitable way.
Is there any stage in infancy in which the effects of poverty are more intense and have longer-lasting consequences?
Most evidence regarding the effects of poverty on the development of people’s lives appears in early childhood. During the first years of life, when people’s brains are forming, it is easy for the shortages caused by poverty to affect the psychomotor development of the child. This is not just limited to their brain, but also to the maturing of the nervous system. All the structures of the human body develop with some delay, meaning that being born under these circumstances has a biological effect
“The stress caused by job insecurity exhausts a person’s resources to deal with their child’s education in a suitable way”
There is an interesting essay by Richard Wilkinson and Kate Pickett [reviewed on page 36 in this Dossier] that deals with this matter, in which they explain how inequality affects several aspects of the physical and mental health of people in developed countries. As far as infancy is concerned, the conclusion they reach is that the consequences of inequality on the development of children are permanent. For example, by analyzing the plasticity of the brain, they show that stress during pregnancy or complicated family situations influence the child’s cerebral development. It has been shown, for example, that babies whose mothers have suffered from psychological stress during pregnancy have lower levels of cortisol at birth. This is a problem because, among other functions, it is a hormone that helps with lung maturation and with controlling stress in a newborn baby.
Adolescence is also a period of great risk. It is the time when a young person can veer away from the correct path in a relatively fast and easy way, and this can have very long-lasting harmful effects on their life. When a family becomes poor during the adolescent stage of the children, anything can become the trigger to take the wrong path with negative consequences; I’m thinking about the girl who gets pregnant too soon; or the youth who has become fed up with an oppressive environment, who runs away from home and gets into problems; or the young lad who has to look for a job to help at home because his parents are unemployed and he does not have time to study, so he fails an important exam and cannot get into university. In poor families, all these scenarios are much more likely.
How far do social inequalities influence school results?
Statistics show a notable correlation between the level of family income and school results. This is the same case with behavioral problems or the number of young people who neither study nor work. This type of lack of commitment to educational institutions is much more frequently found in unstructured or poor families. The children start to miss class, they have to repeat the year because they did not work hard enough, they have disciplinary problems at school, etc.
The issue of behavior is relevant. We all know boys and girls who do not show any cognitive problem or are even highly intelligent but show behavioral problems that eventually prevent them from being successful in their lives.
What relationship is there between inequality —which is growing throughout the world— and child poverty?
This is a very important matter. Inequality is often confused with poverty; however, they are quite different conceptually. Let me explain: there are societies in which there is no significant poverty but in which there might be a lot of inequality. It is true that there are not many examples of this.
People may think “If everybody is more or less okay, what is wrong if some people live very well? If they do what they want with their money? Besides, some of them contribute to society with charitable works.” In my opinion, this is a reasonable position if it were not for the fact that what we see is that the political powers seem to be very sensitive to the interests of people with large amounts of money.
The problem of inequality being so marked in developed societies —and the fact that it continues growing on a daily basis— is not inequality in itself. What hurts people is poverty. However, what does lead to inequality is weakening political support to social programs destined to poor people. We are seeing this in the United States: parties that have raised a lot of money during their electoral campaigns, when they come into power, the first thing they do is to cut back the benefits for social programs.
To this end, I believe that inequality is a threat for democracy because people without money can be deprived of their rights.
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