The Story of Eric Harwood

Eric Harwood, a 47-year-old man from Henderson, Nevada, has embarked upon a somewhat quixotic quest to draw attention to his desperate plight. Due to a serious physical disability, Harwood was discharged from his locksmithing job of 15 years in August and has been battling with the Social Security Administration to receive disability insurance ever since. As the battle dragged on, Harwood scrambled to keep his life afloat. He sold many of his possessions through yard sales and the internet. He set up a GoFundMe page and asked friends and family to donate. And he, embarrassingly, enrolled in Food Stamps, Medicaid, and LIHEAP. These stop-gap strategies have reached their end, however. In early February, if something doesn’t change, he will be booted from the house he rents, and he and his wife will be forced to move in with family in Arizona.

I initially stumbled upon Harwood on Twitter. The Social Security Administration had tweeted about disability insurance, and Harwood responded with a YouTube video claiming that the SSA was jerking him around.

I watched the video and then watched three others that he had also posted to his account (1, 2, 3). All posted in the last few weeks, the videos compellingly document Harwood’s increasing frustration and desperation. Also interesting in the videos are Harwood’s politics. He is disgusted by the fact that United States has so many homeless veterans, struggling seniors, and needy children. And he is especially disgusted that these people’s needs are being unmet while the US provides aid to refugees, immigrants, and countries abroad. According to Harwood, we need to ensure economic security for our own first and then worry about everyone else.

Perhaps unknown to him, Harwood finds himself at the center of so many current debates in the United States. He is trying (and so far failing) to receive disability insurance at a time when many conservatives are trying to scale back the program, which they believe is overenrolled and abused. He is a working-class, middle-aged white man, a group whose mortality has startlingly increased in the last few decades, primarily because of suicide and substance abuse. And he is a supporter of Trump and Cruz, two outsiders who have so far shocked the political establishment by grabbing the majority of the Republican electorate in poll after poll.

After seeing his videos, I reached out to Harwood by email and asked him if he would be willing to talk to me about his situation over the phone. He obliged and what follows is his story, as told by him.

Harwood was born in 1968 and was raised in the foster system. In 1984, at age 16, he started working, initially in whatever odd job he could get. By age 19, he had secured a job in a plastics factory, working in the warehouse. While still working for that same company, Harwood began driving trucks at age 21. In 1994, at age 26, Harwood switched to a new company to work as an over-the-road trucker. Around 6 or 7 years later, after completing a trade school course in locksmithing, Harwood found a job in another company as a locksmith.

He loved his locksmithing job more than any of the others he ever had. Over the phone, he explained that he has a very mechanical mind and that locks interest him for that reason. He stayed on at his locksmithing job for 15 years. Over that time, his body slowly deteriorated. Around March of 2013, Harwood was first diagnosed with a number of physical ailments and prescribed pain medication, physical therapy, and classes in pain management. According to Harwood, he has degenerative discs in his lower back and nerve damage in his legs. The resulting pain made it harder and harder for him to keep up at work and it became increasingly clear that it was just a matter of time before he wouldn’t be able to work at all.

Despite the pain, Harwood stuck it out at his job for another couple of years. Around the middle of 2014, he could no longer really perform his job, and so he made his first application for disability insurance. His employer, whom Harwood describes as very sympathetic and supportive, gave him a part-time office job mostly just to keep him employed and provide him with some income until he could receive benefits. He was making $12 an hour. Although he could not confirm this, one has to imagine that this friendly gesture from his employer actually made it harder for him to receive disability benefits given the way eligibility is determined. In any case, Harwood’s application was denied in late 2014 and his appeal of that denial was dismissed in May of 2015.

In August of 2015, after 31 years in the labor force and 15 years at his current job, Harwood’s employer finally let him go. On that same day, Harwood filed a new disability insurance application and that application is still pending.

In our conversation, Harwood intimated that his whole life has been marred by various economic setbacks. For instance, in 2005, he and his wife bought a modest condo for them and their daughter, who was 13 years old at the time. This was the first property he had ever bought and he feels like he was duped into signing a very unfavorable variable-rate loan. In 2008, when the economic crisis hit, he lost his condo along with so many millions of others. All together, that misadventure drained his family of as much as $30,000 of wealth.

These days, when he’s not bedridden with pain, he’s mainly preparing to move while continuing his fight with the Social Security Administration. His $875 rent is paid up until February 1st but he does not have the means to pay any further. His landlord, who Harwood also describes as sympathetic to his plight, has given him until February 11th to vacate the unit. The few bonus days were extended to allow Harwood to attend a scheduled doctor appointment before he leaves the state to live with his wife’s parents in Arizona. Harwood expressed embarrassment about having to move like this, and also expressed fear that, by moving to a new state, he would lose Medicaid eligibility and not be able to regain it, a fate that would leave him without medicine and in excruciating pain.

Near the end of our conversation, I asked Harwood about his politics, since they make an appearance in his YouTube videos. He explained that he is an independent but that he leans conservative. When asked what his main issues are, he talked at length about the bank bailout. In his view, the bailout was an incredible mistake. The money that went to the banks should have been given out to the people more generally, who then could have used it to pay off their loans (and thus save the banks) and to pump up demand more generally. He explained further that the bank bailout is just one part of a broader problem with the way the government spends money. Specifically, he thinks it spends too much money on foreign aid, refugees, and immigrants, when it should be spending it on struggling veterans, seniors, needy children, and those who cannot work. He also confirmed that he is, at least in some respects, a social conservative and that he believes abortion is murder. In the 2016 campaign, he says he wants a Trump and Cruz ticket and he doesn’t care who leads it.

Altogether, Harwood struck me as a basically kind and decent man. He’s been economically wrecked by so many of the trends that have hit working-class people in the country over the last few decades. He lost his home in the Great Recession. He has had lower-paying work for much of his life. And now he has a work-limiting disability that may soon cause him to become, in effect, homeless. He has experienced his latest setback as an abandonment of him by society and government institutions: he contributed in the labor force for 31 years and yet he can’t get the social benefits he is justly owed.

His concern about foreign aid, immigrants, and refugees, though misguided in my opinion, has a very clear connection to his economic situation. Put bluntly, he wonders why his country can somehow help these people while he drowns. In the grand scheme of things, the reality is that the US does not spend that much of its GDP on foreign aid, refugees, and immigrants. The reason there are so many poor veterans, elderly, children, and disabled (the four populations Harwood kept bringing up) is not because the government doesn’t have the means to help these groups. It just chooses not to for various ideological reasons. This is something I know because I spend most of my waking hours studying the shape of government spending and the US welfare state. But you could certainly see how someone like Eric Harwood might think otherwise.

Please, if you can, donate to Eric’s GoFundMe.

The Muddled Globalization Debate

Travel journalist Paul Theroux wrote a piece in the New York Times about some of the negative effects of globalization on US workers. Generally I advise never listening to travel journalists opine on political economic questions for the obvious reason that they are not well-equipped to do so (going somewhere to visit does not make you an expert on it). And Theroux is no different in this regard. But in his piece Theroux made points about the negatives of globalization that others have not adequately responded to.

Here is Theroux:

But if there was one experience of the Deep South that stayed with me it was the sight of shutdown factories and towns with their hearts torn out of them, and few jobs. There are outsourcing stories all over America, but the effects are stark in the Deep South.

This is a common observation: outsourcing, whatever its other merits, have hurt many working class people and communities in the US.

More to the point, in human terms, globalization has absolutely, completely proven positive-sum. Think back to that World Bank announcement about extreme poverty falling into the single digits: That is one of the products of globalization and global growth, in particular of China soaking up manufacturing jobs and growing at a breakneck pace over the past few decades. Millions and millions and millions of deeply impoverished people becoming less impoverished, Americans benefiting from cheaper, better goods at the same time.

And competition from imports from poor countries does not necessarily lead to poverty — indeed, overall it has been an “absolutely, completely proven positive-sum” as New York Magazine’s Annie Lowrey notes in her superb critique of this very same Theroux column. Other rich countries have managed the decline of manufacturing jobs (a global phenomenon) and preserved considerably more equal outcomes in terms of income and health than have ever existed in the United States. Globalization is a force to be managed, not an evil to be resisted.

Neither Kenny nor Lowrey have actually responded to the point that outsourcing has hurt specific groups of people. They say they are responding to that point, but once you finally get to the money shot, they retreat back into pointing to aggregate gains.

Cheap Imports Don’t Rebut Concentrated Harms

Both Kenny and Lowrey try to paper over the existence of harms concentrated among certain groups by saying that cheap imports have actually made Americans overall better off. This is a common refrain (I’ve read it from the same sources they have) but it doesn’t actually respond to the point at all. The fact that goods cost 10% less than they would in the alternative doesn’t help someone whose income is 30% less than the alternative. This is because 30 percents is more than 10 percents.

Kenny hints at the fact that Lowrey’s rebuttal doesn’t work, but still remains very obtuse about it, saying only that “other rich countries” manage to deal well with outsourcing’s propensity for delivering concentrated harms and that globalization is simply a “force to be managed.” But this too doesn’t answer Theroux’s point: globalization has wrecked certain swaths of Americans and the US has not managed the forces of globalization so as to avoid this.

What’s sad about the sort of handwaving Kenny and Lowrey give us in their efforts to insist globalization is an unalloyed good is that the basic terrain of this debate is actually very simple. Conservative economist Greg Mankiw explains it well:

Trade can make everyone better off. … [T]he gains of the winners exceed the losses of the losers, so the winners could compensate the losers and still be better off. … But will trade make everyone better off? Probably not. In practice, compensation for the losers from international trade is rare. …

We can now see why the debate over trade policy is often contentious. Whenever a policy creates winners and losers, the stage is set for a political battle.

In theory, the US could set up its institutions to ensure that the gains from trade (e.g. those cheap imports Lowrey likes) were distributed in such a way that even those who lost their jobs to outsourcing would be better off. Where globalization or trade makes the US better off in aggregate, the US has the ability to ensue that nobody in the US is worse off for it.

But the US does not do that. No extended unemployment benefits were provided to the people Theroux talks about. There was no concerted effort to provide them free training, free schooling, free relocation assistance. There was no increase in social incomes to broadly share the GDP gains. Instead, the US just let working class people and communities flounder. The US even allowed entire great American cities to rot back to nothing, wasting massive amounts of built up housing and infrastructure. That’s how unbelievably negligent and cruel it has been.

None of this is to say that you can’t make an argument for globalization even despite the concentrated harms it delivers in the US. But if that’s your argument, actually make it. Don’t vaguely gesture at the idea that eveyone wins when they clearly don’t and haven’t. That’s dishonest.

Going forward, it’s important to keep this point in mind in the coming discussions of the TPP trade deal, which is still in limbo as Bernie Sanders and now Hillary Clinton have come out against it. The proponents of TPP will push the Lowrey/Kenny line, chanting over and over again “gains from trade, gains from trade, gains from trade.” Meanwhile, representatives of working class groups (such as unions) will respond with “gains from trade won’t be broadly shared, and concentrated harms will hit working class people and communities.” The obvious approach of jacking up the share of GDP going to social benefits and providing more generous unemployment benefits and job assistance to ensure the gains from trade are broadly shared will remain totally out of the realm of possibility. So we’ll keep having this muddled debate.

Want to Fight Poverty? Expand Welfare. Always Expand Welfare.

Catherine Rampell has a piece at the Washington Post titled “Want to fight poverty? Expand access to contraception.” As you can probably guess, the poverty solution here is to try to nudge women with low market incomes away from having families, a troubling strategy that rich folks have been eager to push in one form or another for the last couple of centuries. Despite their sometimes vicious animosity towards one another, rich liberals and rich conservatives always seem to be able to agree that poor women have too many damn babies.

Philip N. Cohen has a wonderful response to Rampell at his blog (here). In addition to Cohen’s points, I think it’s important to consider the following two points: 1) “delay or poverty” does not present a genuine choice, and 2) welfare is incredibly good and we should be trying to spend more on it, not less.

1. What Choice?

Rampell makes the point (and it’s not just her) that giving women with low market incomes free IUDs gives them “more choice over whether, when and with whom they decide to have a baby.” Rampell doesn’t spell this out entirely, but the way this sort of argument works is as follows:

Premise 1: If you can’t afford to do X, then you don’t have the choice to do X.

Premise 2: Women with low market incomes cannot afford to contracept.

Conclusion: Women with low market incomes don’t have a choice to contracept.

When put in contraception terms, Rampell and her ilk find this Senian formulation extremely compelling. But what happens if we swap out “have a child” for “contracept”?

Premise 1: If you can’t afford to do X, then you don’t have the choice to do X.

Premise 2: Women with low market incomes cannot afford to have a child.

Conclusion: Women with low market incomes don’t have a choice to have a child.

Since having a child is more costly than contracepting, it is necessarily true that any person who does not have the choice to contracept also does not have the choice to have a child. Thus, it follows that the only way to actually give women with low market incomes a choice over “whether, when and with whom they have a child” is to ensure that they have robust welfare incomes enabling them to afford to have a kid.

But Rampell does not advocate that. In fact, she specifically says the goal of free contraception is to reduce welfare outlays. Like Isabell Sawhill before her, Rampell’s goal cannot possibly be to give women with low market incomes the genuine choice to have or not have a kid, as that would require putting in place much more generous welfare benefits that make both contraception and having a kid affordable. Instead, the goal is simply to reduce the fertility of women with low market incomes by making contracepting affordable while keeping child-bearing unaffordable.

2. Welfare Is Incredibly Good And Cool

Like Nicholas Kristof and the rest of the professional liberal pundit class, Rampell is eager to tout her contraception “solution” as a welfare reducer. This bizarre desire among American liberals to cut welfare really needs to die.

Compared to other OECD countries, the US has a remarkably high rate of child poverty:

This is in no small part because it has such an extremely low level of family welfare benefits:

How an American liberal looks at this sort of graph and concludes that what we should be targeting is lower welfare outlays is beyond me. Is the concern that we aren’t enough like Turkey, whose child poverty rate is actually higher than ours?

I’d submit that we should want to be more like the high-income European countries with much lower child poverty rates. Getting there would mean increasing family welfare benefit expenditures by as much a 470%. In dollar terms, we should be talking about increasing outlays on family welfare benefits by over $400 billion per year. Done well, such a welfare expansion would dramatically cut poverty and, by making child-having universally affordable, actually give all women the genuine capability to make the family choices that the Sawhill/Rampell position claims to be interested in.

I don’t know if American liberals think it’s a mark of seriousness to talk about how their plans will reduce welfare spending, or if they think they are really sticking it to conservatives by taking their anti-welfare terrain. But whatever the reason, this sort of stuff needs to stop. The US welfare state is extremely tiny compared to other countries elsewhere in the world and this accounts (in large part) for why we have much higher levels of poverty, inequality, economic insecurity, health uninsurance, and so on. The liberal goal should not be to find minor ways to reduce welfare outlays, but instead to push for massively increasing them.

Race and Class Part 2

In my last post, I broke down five social indicators — poverty, health coverage, employment, incarceration, and life expectancy — by race and class (using educational attainment to stand in for class). The point was to show that, while the disparities across classes are the biggest, there remains significant racial disparities within classes. This suggests race and class both operate in society as drags on well-being.

Multiple commenters have correctly pointed out that the analysis does not make note of the fact that there is a racial disparity in how people are concentrated in each class. A full account of the racial and class effects needs to include that fact as well. I avoided the concentration point in the prior post because this point is normally the one used to suggest that racial disparity is just about class disparity. I wanted to show that racial disparity remains even after you’ve essentially controlled out the racial disparity in who winds up in what class.

Nonetheless, it’s easy enough to present figures that take into account this concentration effect as well. Below, what I do is compare for each indicator:

  1. The overall black:white disparity. This will reflect both 1) the within-class racial disparity and 2) the racial disparity in class concentration.
  2. The black-low:black-high disparity. This is the disparity between black less-than-high-school (low) and black college-educated (high).
  3. The white-low:white-high disparity. Same as (2), but for whites.
  4. The white-low:black-high disparity. This is the disparity between white less-than-high-school and black college-educated.

1. Poverty
Here is poverty broken down this way.

The first bar says that blacks are, overall, 2.3x as likely as whites to be in poverty. The second bar says blacks in the “lower class” are 10.1x as likely as blacks in the “upper class” to be in poverty. The third bar says whites in the “lower class” are 8.7x as likely as whites in the “upper class” to be in poverty. The fourth bar says whites in the “lower class” are 6.3x as likely as blacks in the “upper class” to be in poverty.

Where the two bars in the middle are higher than the bar on the left, as in this case, that suggests the class effects are bigger than the combined effects of 1) racial disparity within classes and 2) racial disparity in the who winds up in each class. The bar on the right is just kind of interesting to consider.

2. Health Insurance
Here are the same figures for health insurance.

3. Employment
Here are the same figures for employment. Because a higher employment rate is the better outcome in this indicator (unlike the above rates), I have done 1/ratio in order to make the bars visually comparable with the above.

4. Incarceration
Same figures but for incarceration.

Conclusion
So, as you can see, bringing in descriptive stats that reflect the class concentration disparity between races just confirms the basic story in the prior post. In all cases, the within-race class disparity dwarfs the overall racial disparity. Nonetheless, for the reasons explained in the prior post, it would be wrong to say, as some do, that class is the only thing going on here. It does not explain within-class racial disparity and does not explain racial disparity in class concentration, both of which are very significant disparities.

Class and Race

There was a time a great while ago where leftists struggled over the question of whether race or class is the motive force of oppression and suffering in society. These days, with the intervention of intersectionality and considerable progress in sociology, this question has largely been answered by discarding its faulty premise. It needn’t be the case that only one is the force of oppression and, in fact, what you find empirically is that race and class operate separately and together to immiserate large swaths of people in society.

To see this, consider the following social indicators broken down by race and educational attainment, the latter being a common way to identify socioeconomic status or class.

1. Poverty

Using the 2013 ASEC, I produced the following poverty figures.

2. Health Insurance

Using the 2013 ASEC, I produced the following figures for the percentage of people lacking health insurance.

3. Employment

Using the January 2014 through December 2014 CPS files, I produced the following figures for the average percentage of people who were employed that year in a given month.

4. Incarceration

From an analysis of the National Longitudinal Survey of Youth discussed in Western & Pettit (2010), here are figures for the incarceration risk of young men.

5. Life Expectancy

From the Appendix of Olshansky (2013), here are figures for the life expectancy of men.

Here are the same figures for the life expectancy of women.

Conclusion

These indicators, and others not featured here, all follow the same basic pattern. Socioeconomic status or “class” (as proxied here with educational attainment) exerts the largest force in determining whether one will be hit with poverty, joblessness, lack of health insurance, incarceration, and a premature death. But, at the same time, class does not explain everything, as very significant racial disparities exist even within socioeconomic groups.