New Underclass Has More Problems Than Being Poor, Economist Finds

“To many, the underclass is simply a new and more pejorative label for the poor,” writes Urban Institute economist Isabel V. Sawhill.

But that is a misconception, she argues in an article to be published this month in The Public Interest, a quarterly journal. The underclass is far smaller. Its most distinctive and troubling characteristic is “dysfunctional behavior,” not low income.

In the underclass, according to a definition developed by Sawhill and her colleagues, are people who do not follow the accepted behavioral norms most likely to produce a stable, responsible life and job success. A cash-rich drug dealer may be a member of the underclass, while a low-income widow may not.

To Be Officially Poor

The poor, under the official government definition, are people who lack money. A family of four was considered poor in 1987 if its cash income was less than $11,611.

Sawhill and her colleagues have not calculated a precise number for the underclass, but using their definition, they identified neighborhoods with a large number of underclass members. In 1980, that total was 2.5 million--far lower than the 33 million Americans officially counted as poor in 1987.

“In present-day American society,” Sawhill said, “certain norms are widely held. First, children are expected to study hard and complete their education. . . .

“Second, no one is expected to parent a child before they have the personal and financial resources to support that child; this usually means delaying child-bearing until one has completed one’s schooling and until at least one parent has secured regular employment.

Expected to Work

“Third, adults, whether or not they are parents, are expected to work at a regular job” unless retired, disabled or supported by a family breadwinner.

“Fourth, everyone is expected to be law-abiding.”

Sawhill and her colleagues decided to classify areas with a high proportion of people who violate these norms as being underclass neighborhoods.

Virtually all of the 880 predominantly underclass neighborhoods that Sawhill identified were in inner cities. The population was 59% black and 12% Latino. Two-thirds of the adults had not finished high school, 60% of the families with children were headed by women and half the men had jobs less than half of the year.

The underclass is growing--the 2.5 million underclass population in 1980 was triple that for underclass neighborhoods in 1970. Sawhill attributes part of this growth to an education system unable to overcome “the initial handicaps of children born into low-income, often unstable families.”

Normal Children Engulfed

In inner cities, Sawhill speculates, normal working-class children may be sucked into the orbit of the underclass by “poor schools, crime-infested neighborhoods and peer pressures to become involved in drugs or early sexual activity.”

Increasingly, inner-city residents with little education find it hard to get work and are attracted to “alternative sources of income, which make regular work less necessary.” Often, “crime, welfare and hustling pay a lot better than the kinds of jobs that inner-city residents can get. In 23 states, welfare and related benefits for a mother and two children exceed what someone can earn working full-time at a minimum-wage job,” Sawhill writes.

What to do? Set up a system “to reward those who take responsibility for their own lives” and give underclass children a better chance, Sawhill said.

Up to $15 Billion

It should include more prenatal care so fewer ghetto children are born with physical and mental handicaps; more preschool programs like Head Start that stimulate intellectual development, and more compensatory education. “It would cost $10 (billion) to $15 billion to expand such programs to serve a reasonable proportion of the eligible,” she said.

Other needs Sawhill cited include: “Serious efforts to improve inner-city schools. It is a travesty that successful investment bankers, lawyers and business executives make 10 times as much money as inner-city school principals. The inner city is a war zone, and those willing to serve on this battlefront ought to be compensated accordingly.”

Other Sawhill strategies include giving housing vouchers to families who want to move out of the inner city and shifting government assistance from pure welfare aid to aid that stimulates work and training. An inducement to work, Sawhill suggests, would be larger earnings subsidies for those who work for low pay such as expansion of the earned income tax credit.

School-Based Clinics

She would reward every teen-ager in an underclass area who finishes high school without bearing or fathering a baby with a $5,000 voucher for job training or college. Also to prevent teen-agers from having children, “sex education, more school-based clinics where contraceptives are available and abortion all have a role to play, as does the possible deterrent effect on young males of stronger and more consistent enforcement of child-support obligations.