THE RICH AND THE POOR Are the Haves responsible for the disquieting plight of the Have-Nots?
By Myron Magnet REPORTER ASSOCIATE Patricia A. Langan

(FORTUNE Magazine) – NO NOVELIST would dare put into a book the most extreme of the dizzying contrasts of wealth and poverty that make up the ordinary texture of life in today's American cities. The details are too outlandish to seem credible. Directly under the windows of the $6 million apartments that loom over Fifth Avenue, for instance, where grandees like Jacqueline Onassis or Laurence Rockefeller sleep, sleep the homeless, one and sometimes two on each park bench, huddled among bundles turned dead gray by dirt and wear. Across town last Christmas the line of fur-coated holiday makers waiting outside a fashionable delicatessen to buy caviar at only $259.95 a pound literally adjoined the ragged line of paupers waiting for the soup kitchen to open at the church around the corner. In the shiny atriums of the urban skyscrapers * where 40-year-old investment bankers make seven figures restructuring the industrial landscape, derelicts with no place to go kill time. And every train or bus commuter knows that his way home to suburban comfort lies through a dreary gauntlet of homelessness and beggary. Like Death stalking into the terror-struck banquet, the poverty that inescapably intrudes into America's cities fills the prosperous with disquiet. What's wrong with the country, they worry, that these pathetic souls are everywhere? Does the same system that enriches me degrade them? Am I responsible for their poverty -- or for getting them out of it? Says historian Gertrude Himmelfarb, author of The Idea of Poverty: ''We're beginning to feel they're permanent, and they demoralize the whole society.'' What really is the relation of the Haves to the Have-Nots -- to the homeless and underclass -- in the America of the late Eighties? When the Haves think about this question, they generally reach for outmoded images: A reformed Scrooge gives meek Bob Cratchit a raise and a dose of paternalism, so that Tiny Tim doesn't die; Good King Wenceslas carries a feast through the snow to his needy subject. But today's abject poor are nobody's exploited employees, nor are they bound to the Haves in anything like the organic hierarchy that was only a memory even when ''Good King Wenceslas'' was written 135 years ago. Deeper thinkers analyze the problem in more sophisticated but not much more accurate terms. According to a popular theory, the same Reagan Administration mind-set that unfettered the rich, helping to create the Wall Street baby tycoons, simultaneously immiserated the poor by unraveling the social safety net. The rich got a tax break, leaving less revenue to go to the poor. One trouble with this theory that the rich have robbed the poor -- ''economic violence,'' as candidate Jesse Jackson calls it -- is that, while some programs of dubious efficacy indeed were cut, overall means-tested social spending has risen about 5% in real terms in the Eighties. More to the point, the Eighties boom that has enriched the tycoons has so far created an astonishing 14 million new jobs, close to a third of them unskilled, offering a way out of poverty to almost any poor person with no more than the willingness and discipline to work. Pointing up the tendentiousness of the ''economic violence'' argument, Hoover Institution economist Thomas Sowell refers to a centimillionaire landlord and a highly publicized homeless woman: | ''In other words, Donald Trump is making his millions off of Joyce Brown?'' ANOTHER ARGUMENT blames large changes in the U.S. economy for the persistence of poverty. These changes have in fact caused upheavals in the labor market, but they do not account for the specific plight of the underclass and the vast majority of the homeless. In this explanation, the same global economic forces that benefit the Haves by creating richly rewarded high-skill jobs impoverish the Have-Nots by sending low-skill jobs abroad or abolishing them altogether. If the poor had the necessary skills, there would be no problem. But, says William Woodside, chairman of Primerica's executive committee, ''We're creating a two-tier society. The educational requirement for jobs is going up rapidly, and we're not giving the poor the kind of education required to handle the jobs that are around today.'' True, well-paid jobs requiring more than basic skills have mushroomed in the Eighties and will go on proliferating in the Nineties. But unskilled and low- skill jobs -- expanding at a slower rate but from a much higher base -- grew more in absolute numbers and will do so for the rest of the century. Just look at the Help Wanted signs in McDonald's windows and at the several million illegal aliens working in restaurant kitchens and the like across the U.S. These facts suggest no shortage of opportunity to enter the labor market and, with ambition and energy enough to get training, to advance up the ladder. But this gets to the heart of the matter: The problem afflicting today's poorest Americans is that they chronically do not work -- for a variety of reasons -- and are radically disconnected from the larger society. Says New York University political scientist Lawrence Mead, whose Beyond Entitlement is one of the key statements in the current welfare reform debate: ''Many jobs exist. You can't say there's no work. The mystery is why people who are poor -- particularly welfare mothers and single men -- don't go to work, because work gets you above poverty. You can't really see poverty any longer as something that's just visited on people.'' The key to the mystery of why the poorest poor don't work in the face of opportunity is that their poverty is less an economic matter than a cultural one. Their upbringing has in many cases deprived them of the inner resources to seize their chance, and they pass on to their children a self-defeating set of values and attitudes, along with an impoverished intellectual and emotional development that generally imprisons them in failure as well. Now in their third generation, these poor are locked in the familiar pathology that, even more than poverty, defines the underclass: leaving school, out-of-wedlock teen pregnancy, nonwork, drug and alcohol abuse, welfare dependency, and crime. The prosperous are indeed implicated in the poverty of the poor. They are implicated even though they don't extract their BMWs from the hides of the underclass, the way mine owners extracted profits from the children who pulled the pit carts in the early days of the Industrial Revolution, when ''economic violence'' was more than a catch phrase. Instead, over the past 25 years the Haves have created a culture -- a set of values, attitudes, expectations, and social policies -- that accords respect to behavior that, when poor people practice it, keeps them in poverty. Worse, the culture of the Haves withdrew respect from the behavior and attitudes that have traditionally boosted people up the economic ladder -- deferral of gratification, sobriety, thrift, dogged industry, and so on through the whole catalogue of antique-sounding virtues. Says Irving Kristol, co-editor of The Public Interest magazine: ''It's hard to rise above poverty if society keeps deriding the human qualities that allow you to escape from it.'' NOWADAYS it's easy to dismiss the idea that the values and beliefs that make up culture can determine the kind of lives people lead by shaping behavior and institutions. Formerly only Marxists scoffed at that idea. What's really real, they argued, are economic relations. Beliefs and values just float above, like insubstantial froth on the waves. Change the economic relations and you change the beliefs and values that passively reflect them. University of Chicago sociologist William Julius Wilson, in his influential book, The Truly Disadvantaged, advances an argument that is an up-to-the-minute case in point: Underclass women have babies out of wedlock because underclass men, unable to find jobs, aren't ''marriageable'' from an economic point of view. If you want to change that custom, he asserts, the only way to do it is to change the economic circumstances and give the men jobs. But the relationship between culture and economic circumstances works the other way too. Says economist Walter E. Williams of George Mason University: ''Cultural values such as being neat, paying attention to details, or showing up on time may explain economic mobility, rather than economic mobility occurring in the first place and then people acquiring those cultural characteristics.'' The main theme of Thomas Sowell's Ethnic America is that cultural differences account in large measure for the differing kinds, degrees, and rates of success among the various ethnic groups that have peopled America. The spectacular flourishing of America's Asian immigrants -- including many who arrived destitute -- is the most recent illustration of that truth. Minorities make up a substantial majority of the underclass; blacks account for over half, (though these are a small proportion of the U.S. black population). The new culture created by the Haves has been cruel to these minorities, especially poor blacks. In the Sixties, just when the successes of the civil rights movement were removing racial barriers to mainstream opportunities, the mainstream values that many poor blacks needed to seize those chances -- values such as hard work and self-denial -- came under sharp attack. Moreover, poor blacks needed all the support and encouragement to make their own fates that mainstream culture could give them. But mainstream culture -- transformed from within by an adversarial ''counterculture'' -- let them down. Issuing the opposite of a call to responsibility and self-reliance, the larger culture told blacks that they were victims and that society, not they themselves, was responsible for their present and future condition. Except for America's original settlers, all ethnic groups have found their passage into mainstream middle-class culture difficult and sometimes painful. But even more than Irishmen fleeing famine and political oppression or Jews fleeing pogroms, blacks have faced particular disadvantages in making that transition. Their historical experience in America includes plenty of possible causes: a slave system that intentionally kept slaves in deep ignorance, especially of self-reliance; a sharecropping system that perpetuated dependency and that helped form, says journalist Nicholas Lemann in the Atlantic, the forebears of the underclass in Chicago's ghettos; generations of poverty, which, social psychologists have found, fosters the belief that one is the passive plaything of chance; and long-simmering resentments engendered by racism. Other, more advantageous legacies permitted many blacks to flow out of the ghettos and into the middle class in the Sixties and Seventies. But as a residue of a painful history, black culture preserved tendencies potentially & unhelpful to some blacks in mastering opportunities that called for initiative, perseverance, and a tradition of education. IN THE FACE of all of this, when it behooved mainstream culture to assert traditional mainstream values with conviction, the Haves lost confidence even in the most fundamental of those values: the worth of the respectable working life, however humble. When it is pointed out that jobs are widely available to the low skilled, many Haves contemptuously ask, almost by reflex, why anyone would or should be willing to flip hamburgers for not much more than the minimum wage. Even so insightful an observer as Lazard Freres partner Felix Rohatyn can sometimes strike this note. He speaks, for instance, of ''the man and the wife slogging away in menial jobs that are dead-end jobs, with three kids, trying to deal with an environment that is very depressing'' as ''people who are living dead-end lives.'' Think about that judgment. Suppose that the man spends his working life as a short-order cook or janitor while his wife makes beds at the motel or cleans up at the nursing home. If both earned only the minimum wage, they could together support their family of five just above the poverty line. But in fact a big-city short-order cook would make two to three times the minimum wage and an urban nursing-home cleaner perhaps 50% more than it. From a material point of view, their lives would be threadbare but tolerable. While it would be nice for everyone to make millions doing deals, even the world's richest society isn't that rich. But you do not judge people's lives only from the material point of view. Suppose that these two have brought up their children to respect the parents' hard work, to be curious about the world, to study in school, to take pleasure in family and community life, to consider themselves worthwhile people, to work hard and think about the future, to become skilled tradesmen or even professionals as adults, and to bring grandchildren to visit. If this is a dead end rather than a human accomplishment worthy of honor and admiration, then it's hard to know what life is about. And what makes it not a dead end is the cultural tissue of beliefs, values, and relationships that make family life meaningful and sustaining and that permit the rise of the next generation. Change that dimension, without changing the economic circumstances, and you've changed everything. To say that young people are right to choose not to work rather than to | take ''dead-end'' jobs flipping hamburgers is an equally destructive devaluation of the work ethic that lifts people out of poverty. Says Wharton professor Herbert Northrup: ''Dead-end jobs get people into the system. Fast- food outlets teach people how to go to work, to dress clean, to deal with people. Those who can go forward, do.'' Adds Harvard psychologist Jerome Kagan: ''That's the American story -- you start by flipping hamburgers.'' How radically the great American Cultural Revolution changed values, assumptions, and institutions is a familiar story that needs only brief retelling. It happened in the Sixties and Seventies, though it was foreshadowed a century ago, when writers and artists first started thinking of themselves as an avant-garde dedicated to dumbfounding the bourgeoisie and dancing upon its straitlaced values. A generation ago, ten years before the Summer of Love, a young and promising Norman Mailer proclaimed in an essay, ''The White Negro,'' a new kind of man. He was the hipster, who knew from the atom bomb and the concentration camps that societies and states were murderous, and that under the shadow of mass annihilation one should learn what ghetto blacks already knew. One should learn from ghetto culture, Mailer said, to give up ''the sophisticated inhibitions of civilization,'' to live in the moment, to follow the body and not the mind, ''to divorce oneself from society'' and ''follow the rebellious imperative of the self,'' to forget ''the single mate, the solid family, and the respectable love life,'' to choose a life of ''Saturday night kicks,'' especially orgasm and marijuana. For 1957, this was prophetic: It contained in a nutshell much of the cultural program of the Sixties. Says political scientist Lawrence Mead: ''It's precisely the more anarchic aspects of black culture that became popularized as white culture in the Sixties.'' Yes, the Sixties were 20 years ago and more, and yes, belaboring them now might seem like flogging a dead horse. But large, ingrained, intergenerational social pathologies such as homelessness and underclass culture don't spring up overnight from trivial causes. They are the mature harvest of seed sown by the Haves and rooted years ago. You can't hope to cure them without knowing what caused and furthered them. What's more, while culture does evolve by gradual steps, the really important shifts often occur in wholesale leaps that change the entire game rather than only a rule or two. In important cultural respects, America is still living under the sign of Aquarius, however worn and faded after the eras of hyperinflation and Reagan. You doubt it? Then take a walk through the encampments of the homeless in America's western cities -- in Phoenix, say, or Santa Barbara -- and look at the crowds of young men, mostly white, in their 20s, dressed like refugees from the Summer of Love: calico headbands, shoulder-length hair, torn jeans, black T-shirts emblazoned with Harley-Davidson or Grateful Dead logos. Many of them are homeless because they are enslaved by the specious liberation whose troops have worn that uniform for the past two decades. When middle-class college kids began their fling with ''protest,'' drugs, sexual experimentation, and dropping out in the Sixties, they had a margin of safety because of their class. Working-class kids who today enlist under that washed- out banner, now demode, run a bigger risk. Once they drop out, some may never get back in, like these young men in the homeless encampments, devoid of skills, discipline, or direction, and most of them -- along with one-third of the homeless nationwide -- dependent on drugs, alcohol, or both. MANY HAVE apparently been neglected or abused by families whose disturbance or breakup is part of the general cultural unraveling. Deprived of family support and guidance, these young people feel they have little to turn to in the larger culture beyond the ''freedom'' that has landed them here, with petulantly angry looks understandably on their faces. Says Northwestern University sociologist Christopher Jencks: ''One way to read the Sixties is to say it was a failed experiment whose price was paid by the Have-Nots. The rest of us landed on our feet.'' Leave the poor of these sunny, open-air encampments for the ghetto underclass and you come upon a nightmare parody of liberated Sixties culture. Sexual liberation? In urban ghettos like New York's central Harlem, around 80% of all babies are born out of wedlock, many to women still in their teens. Calvin Watkins, 31, liberated with a vengeance, boasts to reporters that he has 19 children by four women, two of whom live with him in a Brooklyn welfare hotel with nine of the kids -- a tax-supported commune. Drugs? Just when college kids started turning on with marijuana, the heroin epidemic overwhelmed the ghetto: Harlem and Newark after 1966, Detroit after 1970. Now with crack cheap and pervasive, the drug epidemic and the + criminality that attends it are even more nightmarish: 13-year-old pushers walk the streets, one pocket crammed with a pistol they don't hesitate to use, the other with twenties, fifties, hundreds. And crack is one of the main roads to big-city homeless shelters, the subbasement of underclass life, where you find pathology much more often than mere misfortune. As for dropping out, 40% to 60% of inner city high school kids don't graduate; as adults, a large but unknown proportion do not work. WHAT MADE THE SIXTIES so decisive a cultural break was that protesting students won over many professors to their adversarial stance. Once established in such central culture-disseminating institutions as the universities, the Sixties liberation mentality went on to change the characters of other important American institutions -- the law and the welfare system, for instance -- through which it reached out to affect the lives of the poor in concrete ways. Shot through with racism, elitism, repression, capitalist exploitation, and militarism -- shouted the students -- the existing social order had no legitimacy, and had even less by the early Seventies, when radical feminists added sexism to the indictment. What relevance, students demanded, had a traditional college education to all this injustice? In response, professors jettisoned Paradise Lost, Plato, and Machiavelli in favor of One Flew Over the Cuckoo's Nest and an array of now-forgotten contemporary leftist ideologues. Soon professors decided that the Western cultural inheritance they were entrusted to transmit was really part of the problem. Plato, Milton, and their ilk were themselves elitists, sexists, racists. For that reason, the values such writers embodied, however seemingly worthwhile, were fatally flawed and without authority. Men like this couldn't really know what is true and good. The study of literature and history became a study of how Western society and culture had victimized women, blacks, workers, the exploited poor. Don't think this is ancient history: The much-publicized dropping of some core classics from Stanford University's Western Culture program in favor of works by or about women, blacks, and non-Westerners is a new example. Utterly lost is the understanding that Western culture and society in general -- and American society in particular, despite Vietnam and Watergate -- are stupendous human achievements. Inevitably these attitudes have filtered down into public schools. There the children of the underclass, who get so little acculturation into the mainstream at home, no longer find a value-laden curriculum of myths and imagination-stirring tales of the Pilgrims and Squanto, say, or of the life of Marie Curie, that are the way a culture transmits its values and beliefs to children. Instead they find a curriculum so dedicated to escape being racist, sexist, and the rest that it has become virtually content-free. Laws embody a culture's most strongly held values. But the confusion about values that has pervaded the less tangible areas of American culture has also seeped into the legal system. In criminal law the results have been devastating, above all to the poor. Says Walter Williams: ''The Sixties and Seventies accepted the whole philosophy of victimization -- the criminal is viewed as the victim of society.'' Because of unjust economic deprivation, racism, or inequality, society rather than the criminal is responsible for his crime; he was driven to it, and society only compounds the injury by arresting and punishing him. At least partly in this spirit, the federal courts vastly expanded the procedural rights of criminal suspects. Exactly when they were doing it, crime soared. Between 1963 and 1980 the robbery and rape rates almost quadrupled, the burglary and assault rates tripled, the murder rate more than doubled. And in the Sixties, while the overall crime rate was doubling, the prison population fell. In the mid- Seventies the average Chicago youthful offender was arrested more than 13 times before being sent to reform school. Today, if you're convicted of a serious crime in the U.S., the odds are better than 2 to 1 that you will not go to jail. By reducing the risk that crime will bring punishment and by asserting that a lawbreaker is not fully responsible for the evil he does, the culture of the Haves has affected the Have-Nots by making it easier for them to become criminals. And the poor who don't choose crime? The culture of the Haves devalues their achievement and the tremendous effort their respectability has cost them by not holding the wrongdoers responsible. That's one less incentive to struggle. The poor who do right suffer from the law's flaccidity in starker ways. Says lawyer Edward Hayes, a former Bronx prosecutor and the model for the defense lawyer in Tom Wolfe's The Bonfire of the Vanities: ''Most victims of crime are honest working people who happen to live in neighborhoods that have the . underclass. In urban areas the hardest physical jobs are held by people who have to kill themselves to stay one step ahead of the underclass -- and then they go home and the underclass is jumping on their backs.'' Even more than the law, the welfare system is the institution that the culture of the Haves reshaped in the Sixties to give the supposedly victimized poor little incentive to struggle out of their poverty. Since the mid-Sixties, a combination of Aid to Families with Dependent Children (the main welfare program), food stamps, Medicaid, and other benefits has provided welfare mothers with enough money to allow them to support their babies. In big, urban states, the financial package provides even more purchasing power than they could earn from a minimum-wage job. Becoming pregnant without a husband -- something for which ample incentives already exist -- is hardly a worry if one consequence is an income on which you can get by. Because welfare fosters passivity and a sense of worthlessness, it is especially hard to break out of the system and stop having illegitimate babies once you've started. Instead of helping the poor succeed, welfare gives them ''incentives to fail,'' says political scientist Charles Murray, whose pioneering book Losing Ground showed how welfare helps perpetuate the underclass way of life. ONE OF THE SIXTIES cliches was that society was like a mental institution in which the gentle inhabitants were sane and the sadistic officials were crazy. That's the theme of One Flew Over the Cuckoo's Nest, and counterculture psychiatrists of the time presented madness as a rational response to an insane social order, an ''alternate lifestyle'' that didn't justify locking people up. These notions were part of a climate of opinion that utterly transformed the nation's mental health system, starting in 1963. The result: 100,000 to 150,000 severely mentally ill people, who in a more rational state of society would be under psychiatric care, now wander the streets homeless -- one-third of America's homeless population, and the most visible and disturbing fraction of it. Patients dumped from state hospitals into a virtually nonexistent care system stopped taking their medicine, got crazier, and formed the first wave of the homeless. The current wave of the mentally ill homeless are younger people who were never institutionalized or medicated and who often make themselves sicker by using dope or alcohol to try to quiet the voices they hear. & WHEN THE HAVES ask what responsibility they bear for the plight of the poor, they ask because they want to help. It would debase their lives, they feel, to be implicated in degradation they didn't try to relieve. What more, they wonder, should they be doing? Says Charles Murray: ''The emotional problem for the middle class is very real -- but unrelated to the actual problem.'' The bitter paradox is that much of what the Haves have done to help the poor -- out of decent and generous motives -- is part of the problem. Like a driver pumping the gas into a flooded engine, the more help they bestow, the less able do the poor become to help themselves. The first thing the Haves should do is to stop pouring on more of what doesn't work. Says Thomas Sowell: ''If people could just stop making things worse, it would be an enormously greater contribution than they're likely to make any other way.'' Several signs hint that the culture might be turning in the direction Sowell indicates. Citizens are assessing the full menace of crack and its consequences, of an underclass that not only commits crimes but creates an atmosphere of pervasive threat in urban public spaces, of an untreated mentally ill population that not only erupts in brutal murders but also regularly yells threats at luckless passers-by, grabs or shoves them, and terrorizes children. Longtime liberal journalist Pete Hamill recently wrote a lead article in Esquire saying that after 25 years of enormous racial progress in America, it is no longer possible to blame white racism when trying to explain why so many black Americans fall into the underclass. Tom Wolfe's The Bonfire of the Vanities, a novel that emphatically does not depict the poor as victims, has been a best-seller for months. The welfare reform movement is the most visible trend in the right direction. The best workfare systems that welfare reform has produced aim at establishing a new norm: People are responsible for working for a living. Says Lawrence Mead: ''That's the thing that's lacking in their lives -- the sense of being responsible for anything at all.'' What remains to do? It is often said that U.S. poverty is especially cruel because ever larger numbers of those below the poverty line are children. But how could it be otherwise, when the qualification for getting on welfare is having a child? The really iniquitous feature of the welfare system is that it offers incentives for the least competent women to become the mothers of the next generation, perpetuating the underclass. Welfare reform will come to grips with the underclass problem only if it removes every incentive to have an illegitimate child that the state will have to support -- for instance by requiring girls under 18, at least, to live either with their parents or in state-run, supervised group homes to receive welfare benefits. Reformers will also need to include these woman in workfare programs, most of which now miss them by exempting women with children under 6. Chances for the most dramatic improvement are not with welfare mothers but with their children. Why wait until they are welfare mothers themselves to rescue them? Helping them requires child care and child development courses for the mothers and an expanded Head Start program for the kids. After that, schools must pass on values and aspirations that make children citizens rather than dependents. The most useful contribution America's mainstream can make to the poor is to carve a new channel toward such values. They form a familiar destination, for these are the old American norms: that everyone is responsible for his fate; that we believe in freedom under the rule of law; that the public, communal life is a boon and not an oppression; that with energy, ingenuity, and skill you can make your own fate; that poverty should not so disable a child that he can't grow up to be President. If America ever really declines, it will not be because of military obligations that outstrip its economic capacity, as Paul Kennedy's best-selling The Rise and Fall of the Great Powers argues. It will be because it has lost confidence in its own most basic beliefs.