The riots in Baltimore hit home for me. I grew up about an hour away in Washington DC. I lived there for 25 years before chasing a girl across the country to California. But I grew up going to Camden Yards and the National Aquarium. I’m always stunned when I go back home and I see how much Baltimore and Washington DC have changed. It appears as though a huge amount of public investment has poured into these cities. Yet here we are in the 7th year of a mediocre economic recovery and the issue of urban poverty appears to be more important than ever.
David Brooks has an interesting piece this morning that highlights just how much money has been poured into this battle:
“in 2013 the federal government spent nearly $14,000 per poor person. If you simply took that money and handed it to the poor, a family of four would have a household income roughly twice the poverty rate.
Yet over the last 30 years the poverty rate has scarcely changed.
In addition, American public spending on schools is high by global standards. As Peter Wehner pointed out in Commentary, in 2011 Baltimore ranked second among the nation’s largest 100 school districts in how much it spent per pupil, $15,483 per year.”
Okay. If we’re spending more money on the problem and it doesn’t seem to be going away then what is the problem here? I am going to be very careful about my views here. I think Buck Showalter had a great line in an interview yesterday where he discussed something I often repeat on this site:
I’ve never been black, OK? So I don’t know, I can’t put myself there. I’ve never faced the challenges that they face, so I understand the emotion, but I can’t. … It’s a pet peeve of mine when somebody says, ‘Well, I know what they’re feeling. Why don’t they do this? Why doesn’t somebody do that?’ You have never been black, OK, so just slow down a little bit. I try not to get involved in something that I don’t know about…
We shouldn’t dabble in arenas we don’t understand. And I have no experience being a black person. But I do have experience being white and privileged. In my book I write that I won the parental lottery. I was born into a white upper middle class family that was pretty unique. My 8 brothers and sisters are my best friends. My mom and dad are my heroes and they guided us through life when we most needed it. I made plenty of mistakes along the way, but I was always set back on the right path thanks to a strong family structure. I didn’t get anywhere alone.
It’s all a bit funny to look back on because some people might look at me and say I am the prototypical “self made man”. I started my own companies from nothing, became financially independent before 30 and worked my tail off to become a better person. But I know that I didn’t do that alone. I got A LOT of help along the way. As I’ve said before, there is no such thing as a truly “self made” person. We all get a lot of help along the way. And I have been fortunate in ways that many others have not. I never let myself forget that.
No matter how far away I currently am, there’s always been one constant in my life – my family. The support mechanism of my family has been immeasurable in helping me develop skills and to stop me from hurting myself along the way. When I read these stories about Baltimore, Ferguson and the problems of urban poverty I seem to see some consistencies – the family structure is broken. And when the family structure is broken the odds of poverty and hardship increase. This isn’t just an anecdotal story though. This is one that is well founded in economic fact.¹
So, why is it that some urban families seem to be disproportionately broken? We can again turn to the data here. It has been shown time and time again that the War on Drugs is destroying urban America.² ³ In trying to fight a battle against drugs we are destroying whole segments of our own population because we are destroying the family structure that that population is built on. Some people want to say that it’s racist or corrupt police causing the problem. While that might be contributing to the issue maybe the bigger problem is that we don’t have very effective drug legislation in place guiding these police officers in what they should be focusing on?
The war on drugs has turned into a war on ourselves. And sadly, we won’t fix all of this in a generation. It could take several generations to see significant improvement. But we should start now. We should not only continue to invest more in urban America, but we should end these policies that, while perhaps well intentioned, are helping to destroy the very people they seek to protect.
Mr. Roche is the Founder and Chief Investment Officer of Discipline Funds.Discipline Funds is a low fee financial advisory firm with a focus on helping people be more disciplined with their finances.
He is also the author of Pragmatic Capitalism: What Every Investor Needs to Understand About Money and Finance, Understanding the Modern Monetary System and Understanding Modern Portfolio Construction.