Money doesn’t solve poverty. Say repeatedly what politicians don’t grasp. Republican politicians used to understand that money is unequal to poverty, but in modern times they’ve become as wedded to redistributionist big government as the opposition.
Take the so-called Trump Accounts. They exemplify just how much the Republicans and conservatives have retreated as a source of innovative ideas. Conservatives of old would have recoiled at this wholly redistributionist policy concept that is a total non sequitur when it comes to poverty.
The modern Republicans? Not so much. It’s evident from Trump Accounts that the moderns still don’t understand that poverty isn’t a state of existence that can be bought off, rather it’s a state of mind. Alas, we’re getting ahead of ourselves.
What’s particularly bothersome on its face is the redistributive nature of the “Trump Accounts.” For the longest time Republicans disdained wealth redistribution as the path to achieving anything, but when one of their own is the redistributor, suddenly government as the solution to societal maladies becomes something to cheer.
Please remember this while contemplating who will fund the Trump Accounts. It’s the rich. Yes, the money is coming from the federal government, but since the top 1 percent of earners account for over 40 percent of federal tax revenues, Trump Accounts are at their core a redistribution of wealth created by the richest taxpayers and directed toward the poor.
Naturally the rich being fleeced can’t say anything. It’s about the kids after all. But even there, it used to be accepted wisdom among Republicans that the best “charity” is economic growth. It was and is so true. And with the rich it’s especially true: there are no companies and no jobs without investment first, and since the top 10 percent of taxpayers account for north of 80 percent of total equity ownership in the U.S., we can clearly see whose savings account for most of the opportunity-enhancing investment. Oh well.
To which GOP supporters of the “Trump Accounts” have said, and will say that accounts funded to the tune of $1,000 each by the top 1% will break the cycle of poverty thanks to the genius of compound returns (Trump Accounts will track the S&P 500), not to mention that broad exposure to the stock market will align incentives across economic classes. Put another way, we’ll all have a vested interest in the pro-growth policies most associated with stock market health.
It perhaps sounds good at first glance, but at second glance it’s once again a poverty non sequitur. Just give the poor what the rich have, specifically monthly statements showing the genius of compounding, only for Americans of all income classes to become capitalist and well-to-do all at once. But for one problem.
Belief in good policy and free markets can’t be legislated as much as believers in both frequently invest. No doubt some will embrace the genius of compound returns in Trump Accounts, but those who do won’t have needed the Trump Accounts. Which is the point.
Persistent, generational poverty isn’t an effect of lack of money, rather it’s a consequence of bad values that reveal themselves through poverty. Which means decades of high returns enjoyed by Trump Account holders won’t do anything to fix what causes poverty in the first place.
Say it repeatedly that poverty is about bad values, not a lack of money. LBJ and the Democrats failed to understand this decades ago at great cost to taxpayers, and now it seems it’s the Republicans’ turn.
