Let’s stick with the same three from the causes page:

Poverty–We’ll discuss those adversely (negatively) affected (those who benefit to come later). Obviously, those with low incomes; those with less opportunity for a decent education. Which can limit employment and living wage opportunities. Follow the logic here: when school funding is based on property tax revenue, those in neighborhoods with low property values will have poorly funded schools and attract teachers with fewer other options, who will themselves have less resources to work with. People of color as groups are disproportionately poor–meaning their rate of poverty is higher than one would expect looking at their numbers in the general population. So a higher percentage are poor (as the article for week 1 makes pretty clear–if you go through the slide show–in so many ways: education, income, wealth, home ownership, political representation, corporate leadership, and it’s important to include the wildly disproportionate rates of incarceration of blacks vs whites). Women are also disproportionately poor (graph). Imagine then prospects for black women, and then add the complication of single parent head-of-household. That represents a lot of challenges. How could anyone who is able to hold such a household together be considered lazy or unmotivated??

Some authors will blame poverty on ‘bad choices‘, others, even social scientist Charles Murray, have claimed that blacks are genetically inferior (the ‘bell curve‘ thesis), a specious argument that used differences in IQ to explain differences in SES (socioeconomic status). Reversing the causal order paints a more accurate and defensible picture–differences in SES affect IQ scores. In other words–when opportunities are comparable, racial differences melt away. Ironically (or not), Murray was very influential in welfare policy circles in the 1980s.

Children, the elderly and those with disabilities are the groups that tend to suffer most in poverty. Certainly people experiencing poverty will pay a harsher price for ‘bad’ choices or even laziness than those living more comfortably. And those on the bottom rungs of the economic ladder will be the first to lose their toe holds during hard economic times. Poverty can mean lower education attainment, worse health, higher infant mortality, lower life expectancy, etc. But don’t think there aren’t groups who don’t benefit from poverty, either ….

Divorce–Consequences of divorce include greater risk of poverty for all ages, including those retiring (women being more likely to suffer because on average they have worked and earned less, and may have less Social Security on which to draw), children, (disproportionately) women, etc. This puts a greater strain on public welfare programs, funded by tax revenue. But do welfare programs address changes in marriage, divorce, the changing nature of the American family (where half of children are born out of wedlock, and one of two marriages ends in divorce), and their relationship to poverty? Here’s a ‘conservative‘ view (from a think tank), and a ‘progressive‘ view (from academics).

A different question might be, ‘Have welfare policies responded to the changing nature and structure of the American family?’ The answer to that is a resounding ‘no.’ They’re pretty much unchanged over a half-century, if not more austere. Definitely more austere, given the Welfare ‘Reform’ Act of 1996. 

Financial crisis–Obviously, in a widespread financial crisis those already poor, with the least resources, fewest job prospects, and greatest job insecurity, will be hit first and hardest. How? Let’s count some of the ways. Those who have their mortgages foreclosed or who face eviction may be scrambling for housing; the economic downturn  increased unemployment (and the least qualified in the labor force would get pushed off the bottom rung of the ladder by others having to settle for lower-paying jobs, ending up seeking public assistance). If banks aren’t willing to lend, that will affect the economy and production; those with credit burdens they can’t pay off may have to file for bankruptcy. All of these things will affect local economies, where businesses depend on people to spend money so that they can hire and pay their workers.  Less income means less consumption, means less goods produced, means less workers needed–see how this quickly spirals into a larger economic problem, beyond the control of most individuals affected by it? It was worldwide in 2008. And because so many of the ‘predatory’ loans were refinancing loans–where people were encouraged to borrow against the equity they already had in their houses–much of the value distributed among homeowners across the country got sucked into the bundled investments, making traders and brokers and investors lots of money (unless they went and invested in real estate …).

The financial services industry saw more corporate consolidation after the recession. Bank of America bought Merrill Lynch and Countrywide (one of the worst of the predatory lenders–our home loan was sold to them the day after we closed). Wells Fargo bought Wachovia. Barclays Bank in the UK tried to purchase Lehman Brothers, but the Bush/Cheney Administration wouldn’t provide loan guarantees, and Lehman went bankrupt, shutting down offices worldwide and adding over $1 trillion to the overall economic losses (a tragic case of incompetence on the part of the White House economic advisers). So anyway less players than before, and still many corporations claiming to be ‘too big to fail’ (that is, requiring ‘bailout’ funds), and vultures swooping in to scour the real estate market for bargains on foreclosed mortgages.

So while those at the bottom of the socioeconomic ladder may be struggling to hang on to the lowest rung, those at the top can use their political clout to great advantage, even while they may be (figuratively, in this case) kicking other groups down the rungs. So many of the actors whose actions caused the small avalanches that led to much bigger ones were actually rewarded (and could then purchase housing at steep discounts and ‘flip’ it when its value returned).

The economic stresses may lead to other sorts of social and cultural stresses, in society, in the household, in communities, etc. Those who had invested heavily in banks may see their fortunes turn sour, but that depends on how the government decides to manage the ‘bailout.’ People making a living trading stocks, as financial managers, may see their incomes drop. And lots of people with money invested in retirement pensions may see the value of those pensions decline sharply, especially if they were heavily invested in real estate. The construction industry, and those who supply the construction industry (from sawmills to hardware stores) were adversely affected . . . And here’s a concept for you. We can’t just talk about the effects and distribution of harm on current populations. When it comes to something involving debt, or unsustainable resource use, or pollution, for instance, we have to consider the effects on future generations.

How you gonna get this in your 3-minute TV news segment? Because if you can’t, you either do what the bosses say (don’t upset our corporate advertisers), grossly oversimplify, or do it journalistic justice and literally watch the audience shrink. 

As you think about consequences, think about which groups are most likely harmed. We’re interested in understanding structural forces, so understanding that certain groups will be more likely affected than others is a good start. Remember the analogy of the building and structure. Regardless of which individuals are poor at any given time, we can make some basic predictions about how the financial crisis might affect them as a group. And we’re not just talking about classes of individuals. Communities suffered as well. Here’s an example–house construction dropped off, so lumber mills were laying off workers, industries like trailer manufacturing also dropped off (describing La Grande here), and suddenly hundreds of people are without work, filing for unemployment, having to use the local food banks, looking for resources wherever they can, and communities, places of worship, volunteer groups, try to take up the slack where welfare assistance is inadequate. It’s hard really to grasp how many people’s economic fortunes were ruined by the recession. Huge public losses with huge private gains going to a very small minority of people.

And when you add to this reductions in government spending, rural areas are hit even harder. Those SNAP (food stamp) dollars, Medicaid (health insurance)? That’s money that circulates in local communities, and is spent at local businesses.