Tag Archives: EMMF

Poverty Management vs Poverty Reduction

Our communities are organized to manage growing poverty. They are not organized to reduce poverty.

Every community spends a lot of money to help people manage crises . A mayor in a Utah community once told me that 90% of the 911 calls came from a relatively small but heavily concentrated area of people in poverty. Rather than investing in understanding the problems of poverty and solutions, we often just keep investing as much money as we can in reacting to it.

State and federal agencies spend billions on programs aimed to stabilize people in poverty: SNAP, HUD, TANF, Medicaid, childcare assistance, to name a few of the big ones. These programs are not organized to help people out of poverty. If they were, there would not be the problem known as the cliff effect in which people lose more assistance than the increase in pay that comes from getting a new job, taking more hours, and/or getting a raise. According to Ballotpedia.org, more than 40% of the residents in my home state of New Mexico receive Medicaid. Government spending is $18.2 billion in our state. Medicaid expenses are 30.3% of total government spending.

WOW. More than $5.5 billion for Medicaid in our relatively small population of just less than 2.1 million. How much would be saved by fixing the cliff effect? See our website for the most recent report regarding the cliff effect problem and what is being done about it. www.circlesusa.org

Employers in New Mexico and numerous other communities served by Circles USA are complaining they cannot find enough qualified workers to fill jobs and expand their businesses. The economy depends on having people who can consistently show up for work and get their jobs done.

Poverty Reduction

Poverty reduction requires that teams of organizations work together to support a targeted number of households through the entire process of economic mobility noted in these five stages:

● Crisis intervention
● Stabilization
● Readiness for the workforce
● Placement into jobs
● Advancement to a good-paying job

 

Poverty reduction requires that federal, state, and local funders recognize they are rewarding poverty management when they pay for units of services that do not connect the dots between these stages of the process. They inadvertently contribute to increasing poverty and reducing economic vitality. Managing poverty generates that “phantom workforce”—people who should work, want to work, could work, but won’t or can’t because of the cliff effect and the lack of comprehensive programs that support people through the entire process.

Poverty reduction systems will change our nation. We currently tolerate far too much poverty, given the immense resources, talent, and innovation we possess. The old model of paying for random units of services to manage poverty will one day give way to a more powerful approach.

In the meantime, Circles USA is cultivating a national community of transformational leaders who are building the new model that will truly address poverty. You can learn more about the poverty reduction labs in my book, Transformational Leadership, a Framework for Ending Poverty.

From the book: Enough Money, Meaning & Friends ~ By Scott C. Miller

To learn more about Scott Miller, please see his website here.

A Comprehensive Approach to Poverty

Our nation’s economy was designed by settlers who came from countries with economic systems that included plutocracies, castes, feudal systems, and slavery. They all had in common a belief that a few deserve to be wealthy and that almost everyone else should be poor.

In the United States today, 30% of our citizens live in poverty or near poverty levels. We need to change our economic system. Poverty is abusive and Americans must see it as intolerable and unnecessary. That some should be extremely wealthy while others are extremely poor remains an indefensible result of the norms we inherited from our mixed heritages.

My wife, Jan, was in line at Walgreens recently, and the woman ahead of her was told her bill for a 90-day supply of medicine would be $500. She obviously did not have insurance, which means she was much less able to take care of herself than somebody who could afford insurance. This country’s hardened attitude and myopic bent to reward the winners and kick the losers in our economy are morally corrupt. All of this has to change.

A recent proposal to slash the safety net by $1.7 trillion before increasing jobs and addressing the systemic problems causing poverty will only delay solutions and increase poverty and suffering.

We need a comprehensive plan that includes:

● adopting state-of-the-art economic development practices so that communities can adjust to new economic realities and develop better-paying jobs;

● investing more heavily in both soft skills and hard skills so that people can find new work as their previous jobs become automated or outsourced;

● updating our educational approaches so that children have the critical thinking skills to adapt to the rapidly changing economy;

● pro-rating the safety net programs so that when people do earn more money, they are not worse off for doing so; and,

● increasing investments in mental health and drug abuse treatment to help more people address these barriers to entering the workforce.

Poverty is complicated, and numerous other local, state and national strategies must be deployed in concert to reduce poverty rates. Even with all of the best ideas, the current economy might be inadequate and require massive changes in order to reduce poverty rates. At this moment in time, slashing the safety net in hopes that it will stimulate the economy and reduce poverty rates on its own will not work. That would be akin to burning down the hospital because there is an epidemic. Let’s focus on solutions that address the complexity of poverty.

From the book: Enough Money, Meaning & Friends ~ By Scott C. Miller

To learn more about Scott Miller, please see his website here.

Shifting the Mindset on Poverty: Part 3 of 3

Three more bullet points to finish off the previous blog post, “So, at the risk of sounding overly simplistic about how to fix a problem that we have spent trillions of dollars not solving since the War on Poverty was launched 50-plus years ago, let me break it down in this way…”

● Insist that all government benefit programs be coordinated for a user-friendly experience with one intake, with one simple process of determining eligibility, and with a simple pro-rated exit ramp as people earn more income. Currently, there are too many agencies running benefit programs that have built-in disincentives that punish people for making too much income. For example, if you make an extra dollar per hour you may lose all of your childcare assistance and/or Medicaid. This is a lazy public policy designed for administrative convenience and is a complete waste of tax dollars. Even worse, such a policy makes people squander valuable time navigating complex programs instead of using their time to become self-sufficient. Current benefit programs cause people to avoid new jobs and salary increases, and, as designed, they guarantee a steady level of poverty in America.

● Appreciate that if people are going to move out of generational poverty, they are going to need jobs they can handle; peer support from others who are succeeding; networking opportunities from volunteers with middle-income and upper-income means; and a powerful game plan to overcome their personal barriers to getting, keeping, and advancing in a good-paying job. A program such as Circles USA provides all of these supports. Without a complementary community-building strategy, typical programs do not have the staying power to interrupt generational poverty.

● Finally, if you want to increase your poverty IQ and make an effective contribution to the cause, you must find a way to form a relationship with someone who has experienced poverty. Without this, your ideas are likely to be just off enough to have the unintended consequence of delaying the real solution to eradicating poverty in our communities.

Yes, we all must take responsibility for ensuring our economic stability. And yes, we must design systems that incentivize people to do the right thing. Solving poverty is a “both-and” approach rather than an “either-or” choice. As my co-author, Denise Rhoades, and I argue in our book, Bootstraps and Benefits, we need to have more meaningful community dialogue that results in strategies that effectively address poverty and allow more people to thrive.

From the book: Enough Money, Meaning & Friends ~ By Scott C. Miller

To learn more about Scott Miller, please see his website here.

Shifting the Mindset on Poverty: Part 2 of 3

So, at the risk of sounding overly simplistic about how to fix a problem that we have spent trillions of dollars not solving since the War on Poverty was launched 50-plus years ago, let me break it down in this way:

● Get over the idea that “the poor will always be with us.” My theological colleagues have assured me that our society takes this biblical quote out of context, using it as an excuse for not committing to the moral imperative of ending poverty within our lifetime.

● Let go of addressing poverty as simply a humanitarian cause. Poverty is a major economic development problem. It must be solved in order to sustain and grow our local economies. The greater the number of qualified workers in our community, the abler we are to attract and grow businesses. The more good jobs, the less poverty burden we carry as taxpayers. The economic development strategies in most communities are antiquated and must be updated to meet a rapidly changing economy. If your community does not have a robust and well-staffed economic development program, your community’s poverty will rise without question. The more poverty you have, the less able you are to achieve new economic growth.

● Realize that those of us who were raised in middle-income and upper-income backgrounds typically have a poverty IQ that is too low to create effective policy. We are not qualified to run anti-poverty programs on our own. We must have the input, guidance, and poverty IQ of those who have experienced poverty. That is why Circles USA programs have been co-designed by people who found ways out of poverty.

● Know that providing charity in isolation without long-term problem solving is typically counterproductive. The safety net must be tightly coupled to long-term goal setting, support, and career development. Do you ever wonder why the food pantries need more money every year? Ask them if they are referring people to programs that provide long-term supports and pathways out of poverty. But understand, too, that in many communities there are no programs to refer people to which focus on supporting people out of poverty.

From the book: Enough Money, Meaning & Friends ~ By Scott C. Miller

To learn more about Scott Miller, please see his website here.

Shifting the Mindset on Poverty: Part 1 of 3

The United States has the largest GDP on earth, estimated at $18 trillion. For perspective, China is the second-largest at about $11 trillion; Russia has an estimated GDP less than the state of Texas, and North Korea’s economy is smaller than Vermont’s. As Warren Buffet recently said about America’s high poverty rate, “You expect unequal results in a market economy, very unequal. But you really shouldn’t have an economy with over $50,000 in GDP per person and have lots of people living in poverty who are willing to work. I mean, that does not make sense.”

We have been conditioned to believe poverty is an unavoidable problem in society. What if that’s not true? What if we have normalized an abusive condition that we could actually  solve? That seems to be what Buffet is suggesting.

One could say that the United States has a 70% success rate in generating prosperity for its citizens. More than 15% of our households live at less than 100% of the Federal Poverty Guidelines, which means that a family of three makes less than $20,008 a year in income. If you double that rate to 30%, which is $40,016 a year for a family of three, you come closer to estimating just how many households do not earn enough income to meet their basic needs and to set something aside for the future.

The 70% rate is not bad if you put our nation’s history in the proper context. We came from a European feudal system in which most people were poor. The United States was founded on the high ideals of democracy and meritocracy, even though much of our political, legal, cultural, and social structures continue to create disparity. Nonetheless, these fundamental principles run deep in our psyches and remain intact due to our belief that everything in life is possible if you work for it. I own this amazing optimism, so much so that I have built my career around the idea that our nation “can and should end its poverty in our lifetime.”

For many of us, getting over our initial refusal to become emotionally committed to the journey of ending poverty requires a better sense of how it might be accomplished. People want clear direction as well as proof that these ideas can work. The strategies to ending poverty in the United States, while somewhat complex, are not rocket science as “experts” would have us believe. We have made it far too complicated to motivate people to take necessary actions. And we have allowed ourselves to be distracted by arguments that mostly protect our cherished ideals, values, principles, mythology, and beliefs. What the United States needs is a straightforward agenda to end poverty.

From the book: Enough Money, Meaning & Friends ~ By Scott C. Miller

To learn more about Scott Miller, please see his website here.

Core Beliefs about Poverty

The call to adventure is influenced by one’s belief system about how the world operates. In early 2001, a national poll conducted by National Public Radio (NPR), the Kaiser Family Foundation, and Harvard University’s Kennedy School asked nearly 2,000 Americans 18 or older, “Which is the bigger cause of poverty today: that people are not doing enough to help themselves out of poverty, or that circumstances beyond their control cause them to be poor?” Respondents were roughly divided equally between “people not doing enough” (48%) and “circumstances” (45%).

Additionally, a 2016 poll conducted by the Los Angeles Times and the conservative think tank American Enterprise showed similar results in terms of who or what is responsible for poverty — but with interesting nuances. For example, White blue-collar workers were more likely to blame the poor for their situation than Whites with college educations. When it comes to solutions, the study showed that more Blacks than Whites believed that government programs put people back on their feet and allowed them to get jobs and out of poverty. A majority of Whites believed that government programs create dependency and encourage people to stay poor. People in poverty believe that government programs fail primarily because not enough money has been put into them. More affluent people than working-class people believe that government programs are badly designed.

When people first get involved in Circles USA, they usually have a strong set of opinions about why someone is in poverty …

When people first get involved in Circles USA, they usually have a strong set of opinions about why someone is in poverty and what help is needed to get them out. Because of their experience with Circles, they often change their opinions over time toward the middle ground. Many people discover that it is the combination of self-responsibility and planning skills coupled with better jobs, new support systems and better designed private and public programs that can best help people escape poverty.

For example, people in Circles have said:

“I was broke, broken, and homeless with three kids. Now, I have a home, money in the bank, attend school, and most of all, I have a purpose. Circles was like a rescue team that came into my life while I was dying. They revived me, and I’m grateful.”

—LeAundrea Robinson, Circles USA Leader

“Circles has exposed me to economic and social circumstances which I knew existed, but I didn’t really understand all the personal implications…”

—Bill Mitchell, Ally

… the beginning of the end of poverty must start with understanding our current beliefs.

Since people do not change their belief systems easily, and because our beliefs ultimately drive what we do as an individual, community, and nation about poverty, the beginning of the end of poverty must start with understanding our current beliefs. While Circles USA has books and training programs that can increase people’s awareness of their beliefs, the most important strategy of Circles USA is the opportunity to build healthy and effective relationships across socioeconomic class lines. We want people in poverty to get to know people of middle-income and upper-income means and vice versa. It is through these relationships that people challenge their assumptions and arrive at more informed views of poverty.

From the book: Enough Money, Meaning & Friends ~ By Scott C. Miller

To learn more about Scott Miller, please see his website here.

New Standards for Ending Poverty So Everyone Has Enough Money

Ending poverty in the United States means embracing a radically new economy that makes it possible for everyone to have enough money, meaning, and friends.

Circles USA is an intentional community-building process, building relationships between haves and have-nots for the purpose of giving everyone involved more peace of mind regarding money. Whether you are Libertarian, Socialist, Democrat, or Republican, one thing we do have in common is the fear of being controlled by others who may not have our best interests in mind.

Money has long been a way to control the behavior of others. One of many paths to freedom is to determine what amount of money one absolutely needs to be happy and then decide that this is enough money to have rolling in each month.

If you Google “how much money to be happy,” you will find several articles related to recent Princeton and Town and Country surveys. Bottom-line: Making about $75,000 to $95,000 a year is very satisfying to most people. After that, people are often chasing more money but getting diminishing returns on happiness from it. However, 75% of U.S. households make less than $75,000 a year. So, this means three of every four homes may want and might need to make more money. Conversely, the other 25% may do well to relax their attention on making money and find new ways to help others.

Science shows that the stress hormone cortisol goes down when we are focused on helping others. Having an economic system that incentivizes giving to others is attractive to those who want to evolve into happier beings. For those who have made a lot of money and noticed the limits of its ability to make them happy (think of the modernists described in Cultural Creatives) or for those who cannot see a pathway to making larger sums of money, shareable economies offer hopeful alternatives.

The Nature of Humans is to Evolve Consciousness.

Numerous systems have been constructed to help define various levels of consciousness. Those of us who aspire to live more like Jesus, or Buddha, or Krishna, or other spiritual masters require structures that can help us attain higher levels of consciousness. Belonging to a group, studying spiritual teachings, and walking the talk is all-important. But what about the economy that we use to meet our needs and to serve others? Is it reinforcing our spiritual goals? Perhaps it holds us back, and we should upgrade to a system that better supports the well-being of all.

Sharing economies will likely become more popular with 75% of Americans living on less than $75,000 a year and who are exhausted, discouraged, and ready to give up on the old American Dream. According to a 2017 Banking Rates survey, more than half of Americans (57 percent) have less than $1,000 in their savings accounts.

We do not yet have a collective understanding of how to manage money. We have yet to formalize financial education for our citizens through the public schools. It’s like telling the people that they are going to live in the ocean, but they won’t be getting mandatory swimming lessons. Should we then be surprised that so many drown?

It’s time to align the American Dream with a newfound sense of how much is enough.

From the book: Enough Money, Meaning & Friends ~ By Scott C. Miller

To learn more about Scott Miller, please see his website here.

The Emerging Responsibility of Business

Paul Poler, CEO of Unilever, a massive multinational corporation, wrote an editorial in the Huffington Post in July 2014. Poler realized such a shift cannot happen in a vacuum. The driving force for companies cannot continue to be posting quarter-to-quarter gains. Not only is it too hard on both people and the environment and it’s not sustainable.

I have excerpted portions of this radical and optimistic call to adventure to the business community. It is worth reading the entire editorial.

It was Winston Churchill who famously said that ‘democracy was the worst form of government apart from all the others that had been tried.’ Much the same can be said for capitalism, particularly the form of capitalism that has been practiced over the past 20 years.’ … Capitalism, with all its faults, is the only game in town. The task confronting the present generation of leaders is to improve on it, to build on its strengths and eradicate its weaknesses. … If business is to regain the trust of society, it must start to tackle the big social and environmental issues that confront humanity, especially at a time when governments seem increasingly to be caught in shorter and shorter election cycles and have a hard time internalizing the global challenges in an increasingly interdependent world…As I have said many times, ‘Business cannot be a mere bystander in the system that gives it life.’ The environmentalist Paul Hawken believes that if there is any deficit we are facing right now, it’s a deficit of meaning….

Organizations are embracing similar thoughts to those of Poler. The B Corps movement in the United States is gaining traction with the formal adoption of triple-bottom lines: profits, people, and the planet. From the B-Corps website: “Collectively, B Corps leads a growing global movement of people using business as a force for good . Through the power of their collective voice, one day all companies will compete to be best for the world , and society will enjoy more shared and durable prosperity for all.”

Circles USA has also developed its talking points, which follow, about the intersection of reducing poverty in the emerging economy. We cannot reduce poverty rates without understanding where the economy is heading. There are clear indications that the nature of work is changing, placing new demands on people to be their own contractors rather than counting on a traditional job. For the time being, there is a major opportunity for people to prepare for and secure middle-skill jobs that employers are struggling to fill. We make it too hard for people to take jobs and leave subsidy programs because of the Cliff Effect that decreases subsidies faster than income can replace these basic expenses.

1. The New On-Demand, 1099 Economy

Companies can generate more wealth with fewer workers than ever before. They are rapidly shedding U.S. blue-collar jobs through automation, artificial intelligence, and globalization. More of the working poor no longer enjoy the security of being on a company’s payroll (w2 jobs ) and must take more temporary jobs, now being described as on-demand or 1099 jobs. While this change can be exciting for middle-income and upper-income people, the working poor and those leaving welfare will need relationship programs such as Circles USA to help them navigate this new environment.

2. The Middle-Skill Gap

Baby boomers are leaving the workforce in massive numbers. However, increasing numbers of younger people are unqualified for today’s workforce, creating a temporary crisis in filling middle-skill jobs (high-school graduation required but not a college degree). We are making the argument that solving poverty is no longer just a humanitarian cause. It is an economic imperative. Circles USA understands what it takes for people with backgrounds in poverty to make it in the workplace. And we know how to recruit and train Allies to provide much-needed support both inside and outside the workplace.

3. The Phantom Workforce

Many employers are struggling to find enough qualified workers to fill their job demands. In communities with higher poverty rates than the norm, it can be difficult to attract new talent from other places. People associate high poverty rates with more crime, weak schools, and aging infrastructure, among other undesirable community conditions. Employers must mine their own local talent from the unqualified labor pool. In other words, if employers want to grow their businesses and need more qualified workers, they must work in new ways to increase the qualified local workforce.

There is an untapped “phantom workforce”—people who should work, want to work, could work, but won’t or can’t– because of the cliff effect and the lack of comprehensive programs that support people through the entire process. The phantom workforce will resist entry- and middle-skill work opportunities until the government eliminates the cliff effect in benefit programs. The cliff effect occurs when assistance programs such as childcare subsidies and Medicaid remove benefits faster than people can earn enough income to replace them. By not pro-rating the exit ramp from these programs, the government creates a financial crisis for workers as they earn more income.

Circles USA is collaborating with organizations across the country to educate policymakers on the urgency and benefits of eliminating the cliff effect. We have built cliff effect calculators to beta test this impact. Cliff effect calculators give people the information they need to understand how increased income will affect their overall spending power as they leave benefit programs. These calculators also educate policymakers about the disincentives and harm caused by programs that do not have pro-rated exit ramps.

From the book: Enough Money, Meaning & Friends ~ By Scott C. Miller

To learn more about Scott Miller, please see his website here.

Circles USA as a Strategy for Navigating the Emerging Economy

Circles USA is pursuing a 10-year goal to inspire a 10% reduction of poverty rates in 10% of all U.S. counties (300 of them). We are building Poverty Reduction System models that are synced with the emerging economy. While the idea of ending poverty seems impossible to many people, reducing it by 10% in 10 years seems more doable to the audiences I have shared my vision with over the past five years.

Perhaps the 10% number in 10 years harkens back to reaching the moon by the end of the ’60s, or 10% tithing as a reasonable amount to give back to one’s community of faith. Whatever it represents to people, we now have 60 counties on board in 21 states and counting to pursue this goal. When people get their minds around what this might take, everything that works against the goal comes to the surface with new clarity. The needs I keep hearing are for:

    • Better, updated job-creation strategies
    • More powerful and better-targeted training programs for the job demands of the emerging economy
    • Performance metrics and payment systems that reward workforce programs that help people make progress to 200% of the Federal Poverty Guidelines
    • A strong safety net with the complete elimination of the Cliff Effect (disproportionate decreases in safety-net benefits when earning increases), incentivizing and rewarding work with pro-rated, easy-to-manage benefit schedules
    • Community-building programs that give people weekly support to manage poverty issues while they pursue a self-directed pathway to economic stability.

From the book: Enough Money, Meaning & Friends ~ By Scott C. Miller

To learn more about Scott Miller, please see his website here.

The Cultural Creatives

Paul H. Ray and Sherry Ruth Anderson, in their 2000 publication Cultural Creatives, estimated that 50 million adult Americans focus on values that actively support the goal of ensuring everyone can pursue enough money, meaning, and friends to thrive, including an aggressive approach toward mitigating the problems of climate change.

According to a Huffington Post article, “Cultural Creatives Are Changing the World ,” updated on Dec 6, 2017, it was estimated that Cultural Creatives could now make up over half of the American population. This number may seem high to many of us because one thing Cultural Creatives have in common is the feeling of being alone in our values. We are not yet connected in ways that give us the common experience of changing the world together to reflect these values.

The values of the Cultural Creatives could be the key to creating the transformation we desire, values such as seeing nature as sacred, viewing relationships as important, and focusing less on material success. They want self-actualization and don’t believe in financial materialism. They want to be conscious activists for a world that works for everyone.

On the other hand, Traditionalists, as Ray and Anderson label them, do not embrace change, hold conservative political and religious beliefs, and are generally fearful. This market is dying off. Modernists believe in financial materialism and are secular. Success is a high priority, but they are being recruited to join the Cultural Creatives as they mature and realize that material success is not as satisfying anymore.

If you are a baby boomer like me, almost everything you think is normal is already changing: from the houses we live in; to how we get energy, transport ourselves, grow and buy our food; the materials we use for clothing and household items; and on and on. What has been an almost hidden force of cultural values is beginning to show itself. A recent poll done by NPR/PBS NewsHour and Marist conducted July 15-17, 2019 reveals that the majority of Americans believe in the following ideas:

    • Free public college
    • $15 minimum wage
    • A “Green New Deal”
    • Millionaire tax
    • Pathway to citizenship
    • Regulate drug prices
    • Voluntary Medicare for all
    • Gun background checks

The underlying values that support these ideas include fairness, society-mindedness, global-mindedness, and the diffusion of power from the hands of the few. While Modernists continue to press for free-market, deregulation, freedom to use the environment as you wish, lower taxes, etc. and Traditionalists fight for border security, nationalism and a merging of state and religion, the cultural creatives are gaining in numbers that will eventually change politics, the economy, how people practice their faith, our community infrastructure, the treatment of the planet, animals and each other.

Image Credit: By Source, Fair use, https://en.wikipedia.org/w/index.php?curid=58681355

From the book: Enough Money, Meaning & Friends ~ By Scott C. Miller

To learn more about Scott Miller, please see his website here.