Published on January 24th, 2014 | by Todd Smekens0
Free Markets and Good Choices Won’t Solve Poverty Issues
Poverty and Income Inequality Deserve Our Immediate Attention
MUNCIE, Indiana – Without a doubt, my favorite economist from Ball State is Michael Hicks with Ball State’s CBER department. We agree on many issues even though we are on the opposite ends of the political spectrum. For instance, we both agree that Governor Mike Pence should avoid cutting $1 billion from the business property tax, since it will shift the bill of operating government services to small businesses and individuals who have been hurt the hardest in Indiana.
He and his wife are also strong advocates in the local and regional swim community, but when I saw his article about poverty, I was a little skeptical. His last attempt prompted my article titled, Income Inequality: A Free Marketers Blind Spot. Generally, complex issues like poverty shouldn’t be tackled by finance people, but another polar vortex is heading our way, so I thought what the heck. How bad could it be?
So, Mike starts out his recent OpEd article, creating a hypothetical scenario consisting of the following job titles: a bartender, finance professor, and professional baseball pitcher in a World Series game. This could almost be the start of joke…in fact, I vaguely remember a joke when these three guys walked into a local bar.
He talks a little about the skill set required for these occupations. Then, he throws the wickedest curve ball I ever saw. I mean I should have known it was coming, but I thought he’d make us wait until the end of his article. Instead, just several paragraphs in, he writes, “Still, the overwhelming difference between these skills is not a gift of birth, but the result of hard work over many years.”
Oh no, he did not!
My professional idol threw me such a mean slider that I whiffed so hard, I literally twisted up like a pretzel and fell straight over head first into the dust. I was expecting an 85 mph fast ball, but instead, got a 65 mph slider which was coming for my head and curved over the outside edge of the plate. Wicked.
Apparently, Dr. Hicks has never coached Little League baseball. Every coach I know has the discussion when the little guys come to play each spring or early summer. Many young boys dream of playing professional baseball, and pitching in Game Seven, against the best batters in the world. How many times did I run through this scenario with a plastic wiffle ball or tennis ball in my hand as I wound up and threw pitch after pitch into the garage door or the side of the house over the imaginary home plate – calling balls and strikes.
The parents bring their kids hoping with some good coaching and hard work that their kids will make it to play for the Philadelphia Phillies or Boston Red Sox. Yet, every baseball coach knows, there is a certain innate instinct for certain sports. You are either born with it, or you’re not. Then comes the physical limitations. If you’re shorter than 5’11”, than your chances of becoming a professional baseball pitcher are 0%.
Assuming you are born with the right instincts, and have the genes which will see you grow north of 6’0′ tall, there are only 750 professional big league players, so the odds are not in your favor even with hard work.
From there, the rest of the article never gets out of the batters box. Mike touches on personal choices, technology and then presents a possible loophole to his neoliberal economic theory on poverty by introducing “chance”.
He writes, “For those who are ill or disabled, wealth will be far harder to acquire than it is for those who are essentially healthy. I do not believe there is broad disagreement on this issue. But, beyond that, most income determining factors are the result of life’s choices.”
Well, Mike’s imaginary baseball player just got hit in the dugout with a broken piece of the wooden bat severing his carotid artery – it must have that “chance” thingy.
As you can imagine, Dr. Hicks anticipates those in “poverty circles” to object to his rather crude explanation of life – “All you need to do after being born is make good choices, work hard, and avoid bad luck, and you too can be wealthy or at least avoid poverty.”
Anticipating pushback from those who study the complex issue of poverty was his only reasonable point in the article.
Earlier this week, David Brooks wrote in the New York Times, “Using the income inequality frame contributes to our tendency to simplify complex cultural, social, behavioral and economic problems into strictly economic problems.”
Aside from the unrealistic use of a professional baseball player, anyone with social training will tell you that being born into poverty creates a mindset whose outcome is incredibly predictable. Where you are born is critical and so are your genes. Social conditioning influences behavioral problems which can lead to economic problems.
Last month, we wrote about why income inequality is important, and while we should all agree that just throwing money at poverty isn’t going to help the problem long-term, we have to be able to agree that our economy is tilted more to being run by businesses, and with their hands in both the flow of information (media) and our democratic government (lobbyists and campaign financing), the wealth of our country is flowing in one direction while austerity is being prescribed for the rest of the country.
Only when we can move our discourse away from the absurd notion that free markets and good choices will fulfill all small boys dreams of being major league baseball pitcher, then we might be able to make some progress on the globally important subject of income inequality and poverty.