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Published online by Cambridge University Press: 01 December 2004
Economics, Bureaucracy, and Race: How Keynesians Misguided the War on Poverty. By Judith Russell. New York: Columbia University Press, 2004. 244p. $62.50 cloth, $24.50 paper.
The question Judith Russell asks in her book is why the War on Poverty did not include an assault on adult unemployment. The Economic Opportunity Act (EOA) of 1964, the centerpiece of the War, chiefly provided service and education programs for children and youth. Russell believes that only “jobs programs” for adults could have cured poverty. With them, the emerging problem of black joblessness might have been forestalled. Without them, she asserts, the War failed, leading to a conservative era where poverty persists.
The question Judith Russell asks in her book is why the War on Poverty did not include an assault on adult unemployment. The Economic Opportunity Act (EOA) of 1964, the centerpiece of the War, chiefly provided service and education programs for children and youth. Russell believes that only “jobs programs” for adults could have cured poverty. With them, the emerging problem of black joblessness might have been forestalled. Without them, she asserts, the War failed, leading to a conservative era where poverty persists.
The key explanation, Russell argues, is that the Council of Economic Advisors, led by Walter Heller, convinced the Kennedy administration to fight joblessness by Keynesian means—cutting taxes to heat up the economy. Russell sides with Willard Wirtz, Kennedy's secretary of labor, who argued in vain for “jobs programs” aimed at “structural unemployment.” By this she seems to mean training to raise skills and, above all, government jobs to guarantee employment. She thinks that Lyndon Johnson, who became president upon Kennedy's assassination in late 1963, might have supported such efforts. But by then, the planning for EOA was too advanced to challenge.
Secondarily, the drafters of EOA doubted that the Department of Labor (DOL) could administer an ambitious jobs program. The DOL was dominated by the Employment Service, a labor exchange that catered to employers and resisted control from Washington. Policymakers outside the DOL doubted that it would serve disadvantaged job seekers well, a view that later experience confirmed. Thirdly, the administration ignored pleas from black organizations to address joblessness, something Russell blames on “institutional racism.”
The author did exhaustive research in the Kennedy and Johnson presidential papers. These sources, plus interviews with Wirtz and other policymakers, give her book a “you are there” authenticity. In this respect, she surpasses other accounts of EOA that I have read. Her analysis of the DOL's internal problems is valuable. She puts on paper shortcomings of the Employment Service that experts on federal training policy have long known. She also writes forcefully, though with some repetition. In most respects, Economics, Bureaucracy, and Race is solid policy history.
I do question her claim that black pleas for jobs programs were ignored. On her own evidence, black leaders did decry black joblessness and demand employment, but what they recommended was not principally government jobs but antidiscrimination measures, economic expansion, and improved education and training to widen black opportunity in the private sector. This they got from the Civil Rights Act and tax cut of 1964, and from federal education subsidies, leading to the emergence of a black middle class.
The author's policy argument fails to persuade. While adult employment programs were omitted from EOA, some were enacted outside it, Russell admits. The Manpower Demonstration Training Act (MDTA) provided adult training. Other programs offered government jobs and development in depressed areas, albeit on a small scale. In the 1970s, the Comprehensive Employment and Training Act (CETA), the successor to MDTA, provided government jobs on a larger scale—up to 750,000 slots a year. But none of these programs evaluated well. This, not just conservative politics, motivated cutbacks in them after 1980.
Meanwhile, Keynesianism triumphed. The 1964 tax cut helped to trigger the boom of the later 1960s, creating more and better jobs for rich and poor alike. Over 1961–69, unemployment for nonwhites fell from 12% to 6%. Over 1959–74, black poverty plummeted from 55% to 30%, the sharpest fall ever recorded. Over 1990–2000, driven by a later boom, black poverty dropped from 32% to 23%. Russell believes, with Marx, that a capitalist economy is “incapable of creating enough jobs in normal times for everyone who needs a job” (pp. 38, 163–64). That view is hard to credit when, in recent decades, the nation has attracted millions of unskilled immigrants to fill jobs that, for whatever reason, poor adults do not take.
It is true that entrenched joblessness and poverty remain, especially among blacks. But, experience suggests, this is not due to “structural unemployment” in the impersonal sense spoken of in the 1960s. Already under MDTA, administrators realized that the work problem lay not in discrimination or automation but in “hardcore, disadvantaged individuals” with very low skills (pp. 44–45). The structures that bar employment lie chiefly not in the labor market but in a culture of defeat where the poor want to work but lack the hope to do so regularly. Russell treats the culture of poverty as blaming the victim, but no other approach explains how long-term, working-age poverty can exist in an affluent society where jobs sufficient to overcome poverty are readily available.
In the 1990s, legions of black welfare mothers left aid for jobs, driven by new work requirements, a hot economy, and higher spending in child care and wage subsidies. Except in New York City, public employment played little role. The key, rather, was that society both enforced work and facilitated it with new benefits other than jobs. Meanwhile, black men continued to withdraw from the labor force. In light of the welfare success and immigration, the reason cannot be that jobs are literally unavailable to them. Rather, it is harder to obligate poor men to work because they seldom draw welfare. Perhaps more men might be made to work to pay child support obligations or fulfill the conditions of probation or parole. Such thinking reflects an analysis opposite to Russell's. The work problem is seen to lie not in special barriers but in a lack of a serious onus to work. The jobless are seen not as too restricted to work but as too free.
Russell omits or barely mentions CETA, immigration, welfare reform, or policy events that cause one to question her viewpoint. This is partly because of her close focus on the framing of EOA. A deeper reason is her neglect of serious policy argument. She simply assumes that a more generous welfare state is the answer to poverty. That case must be argued more seriously, or long-ago decisions about the War on Poverty cannot appear as the missteps she claims.