>> Frederick Wherry: And today we will hear from Pulitzer Prize winning author Matthew Desmond about his new book, "Poverty by America." Matt Desmond is the author of a number of books, including number one New York Times bestseller "Evicted" that won the Pulitzer. My name is Fred Wherry and I'm a vice dean and a professor of sociology at Princeton University, where I work on issues of debt and economic justice. Matt and I literally work down the hall from one another. He's a dear colleague in the sociology department and an even dearer friend. So let me just give you a little bit of background about why I'm so excited about talking about this book with you, Matt. Because much of what we hear about poverty, even from trusted sources, is wrong. Matt tells us that we act as if poverty is just natural, something that must be among us. But he shows us that you don't get the kind of poverty that we have in America without a whole lot of people doing some lobbying work and doing some design work to make it so. Now, his book details how some people get pressed down so that others are unnecessarily lifted up. But the book also tells us that we can do something about it. Before we begin our conversation, let me thank the James Madison Council for their sponsorship of the Inspiration stage. Let me also thank the literary director at the Library of Congress, Clay Smith, for pulling all of these things together. And let me remind you, our audience, that there will be about 15 minutes for a question and answer so that you can talk directly with the author at the end of our session, followed by a book signing. And now we turn to the book. So, Matt, at Princeton, you've taught a very popular class over the years called Poverty in America. But for this book, you went from poverty in America to poverty by America. So can you talk a little bit about why you made that move? >> Matthew Desmond: Yeah, but it's awesome to see you. Thank you so much for doing this. But it's hard at work on a giant book on debt and exploitation and consumer activism in America, so I hope in a couple of years we'll be flipping seats and we can hear about your incredibly morally urgent work. So thank you for all you do. Thanks for doing this. So I've been studying poverty all my adult life. I've lived in really poor neighborhoods. I've read the statistics, I've taught these classes. But I was just left with this conviction that, like, if someone stopped me on the street and was like, Look, why is there so much poverty in this rich nation and how can we end it? What would be my answer? And I feel like I had an answer and I felt wrong about that. And, you know, Toni Morrison said she wrote books that she wanted to read. And I kind of felt this way about this book, like I wanted at least just for me, my case to make a case for myself and part of working that out is part of really trying to understand how many of us are implicated in all this poverty in our midst. That it's not just the guy a little richer than us, and it's not just the other political party. A lot of us are connected to the problem and connected to the solution. So this is this is really poverty by America. And I got that title because I was in an airport. And, you know, like you go by those luxury stores and they have like the perfume ads and it'd be like number five by Chanel, you know, and I was just like Poverty by America, you know what I am saying? That's how the title came. >> Frederick Wherry: So we can thank Chanel. >> Matthew Desmond: Yeah, I think so, yeah. [Laughing] >> Frederick Wherry: And before you started studying poverty as a sociologist, you saw it up close and personal. So your father lost his job. You and your family, you lost your house. You saw it in ways that some of our colleagues have not. So how do you think that influenced the ways that you decided to study poverty? >> Matthew Desmond: As you know, Fred, I grew up in a small town called Winslow, Arizona, which is in that Eagle song that you're remembering right now. The railroad town, Route 66 down. The best job you can get is railroad, get on the railroad to a union job. But my dad was a preacher in a in a small church. And we didn't have any money. You know, our gas got shut off often. We felt the pressures and strains of poverty. And then we lost our home to foreclosure before everyone else was doing it. And I think that those experiences allowed me to see how my family was diminished by economic scarcity. And then I scraped together all the loans and scholarships I had and went to my state college, and then I saw like a bunch of money, you know, I saw like my classmates driving, like BMW and Jeep Wranglers, and they were going out for sushi. And I was like collecting canned tuna in my room. And I was just confused, actually confused by that. Like why all this inequality? And then for my last book, I moved to Milwaukee and spent time with families getting evicted. And that's when I saw kind of poverty that I'd never experienced. I'd never seen. Right. I saw like kids getting evicted on a routine basis. I saw grandmas living without heat in the winter, just buried below blankets and praying that the space heaters didn't go out. And I think seeing that level of deprivation in this country really made me angry and really kind of drove and inspired this book as well. >> Frederick Wherry: Anger can be really productive apparently. So some of the people we meet in the book, we see some of these stories. And then I start to get angry as I'm reading some of these stories. And one of these people, his name is Julio Paez, who lived in California. And so could you tell us a little bit about his story? >> Matthew Desmond: Yeah, I met Julio a few years ago. He was living in Emeryville, California. He was working two jobs. So he'd start his day at 10:00 at night, working the graveyard shift at McDonalds. So 10 p.m. to 6 a.m. and then he'd have two hours to rest and shower, and then he would clock in at Aerotek going anywhere the temp service sent him between 8 a.m. and 4 p.m. and then he'd shower and rest as much as he could. And then he was back to McDonald's. Now, both jobs paid minimum wage. And so he didn't have a life. He was either working or sleeping. And he told me like, I feel like a zombie. And but he told me that he had to put in those hours just to afford the basic apartment that he shared with his mom and his younger brother in California. And one day his younger brother, Alexander, who was eight at the time, went up to Julio and was like, I'm going to buy-- I'm saving up. I'm saving up my money. And Julio was like, Why? And he's like, I want to buy an hour of your time and how much for an hour to play with me? And when Julio heard that, he wept. And then not long after, he collapsed in the aisle of a grocery store from just sheer exhaustion, he was 24 years old. So I think that, you know, there's a lot of academic and policy debates about things like the minimum wage. Can we raise the minimum wage without causing unemployment and that kind of stuff. And those are important conversations to have. But I think spending time with someone like Julio leads you to ask a different kind of question, which is like, what do we deny people? Like Julio when we deny them a living wage. And what we deny them is like like family, health life itself. >> Frederick Wherry: And how is it that we do this when from year to year? And I will confess my politics. I regularly vote for a party that includes poverty reduction in its platform. And so from year to year, we're voting and we're saying we're going to address poverty and we're going to make sure there's opportunity for everyone. But it doesn't seem as if we're moving the needle so much. What's going on? >> Matthew Desmond: Yeah. Frankly, the poor in America deserve better than either party has delivered for them over the last 50 years. [Applause] But you're right that there's a paradox here. I'm going to be a little wonky if you let me. >> Frederick Wherry: Oh, no. I love it when you're wonky. [Laughing] >> Matthew Desmond: So you look at different measures of poverty and over the last 50 years and you see a lot of stability. You see that in the official poverty line. But the official poverty line is flawed. It doesn't account for a lot of government spending and stuff. And so there's another poverty line called the supplemental poverty measure that the government released in the 90s. And even that measure, which accounts for a bunch of government spending that the official poverty line ignores, it's still an incredible amount of stability. So 50 years ago in 1973, poverty according to that measure, was about 15%. 40 years later, it's 15%. It drops a little bit before Covid and then plunges during Covid because the flex that the American government did to rescue the country from economic collapse and then it's back up again. That's weird because government spending on programs that matter and work have increased in real terms like inflation adjusted terms. So if you look at, this is a wonky part. The only wonky part. But if you look at government spending on the 13th biggest means tested programs like food stamps, Medicaid, housing assistance, the first year under Reagan's administration, we spent about $1,000 a person on those programs. The first year of Donald Trump's, we spent about $3,400 a person on those programs adjusted for inflation. That's a 237% increase. That's a puzzle because it's like we know these programs work. We know they're life savers, the families. We know that things like food stamps and housing assistance for millions of families above the poverty line, we've invested deeper in those programs, and yet we're stuck. And even if you want to quibble with how poverty is measured, there's all sorts of really scary indicators going on, like evictions have increased 20% since 2000. The number of homeless school kids have increased 74% since the Great Recession. A troubling thing. So what's going on? And what's going on is the fundamentals of society are breaking down for so many Americans that we have to spend more to stay in the same place. And so if you look at the war on poverty, right, it launches in 1964. It's this giant platform of investments in the poorest families in America. Ten years later, it cuts poverty in half. Right? Big difference. But the war on poverty was launched when a time where one in three American workers belonged to a union. Right. Incomes are going up every year. You had a shot at advancing in a company, but as unions lost power, our jobs got a lot worse. And so, like, our grandparents had careers and our parents have jobs and we complete tasks. That's kind of like the story of the American working poor. And so, you know, when the job market was delivering for the average worker, anti-poverty programs were cures. Today, they're like dialysis. You know, they make poverty less painful, but they don't make it disappear. And we can repeat that story in the housing market in other ways, too, which means the implication of all this, I think, means we don't just need deeper investments in fighting poverty. We need different ones. We need anti-poverty solutions that cut poverty at its root. >> Frederick Wherry: And one of the other things that you do is you talk about the way that the money is being delivered to states to fight poverty. Can you talk a little bit about sort of money that we think is going towards poverty but somehow doesn't make it to the poor? >> Matthew Desmond: Yeah. So in Covid, we heard nonstop about welfare dependency, right? We're paying people to stay home. Welfare dependency. But as you know, like if you look at the data, there's really not a lot of data about welfare dependency. There's a ton of data about this other thing, welfare avoidance. The fact that a lot of folks that qualify for programs like food stamps or this thing called the Earned Income Tax Credit that working poor families receive pass on those programs. By my estimate, they collectively pass on like $140 billion a year in unused aid. That's not a picture of welfare dependency. That's a picture of us doing a terrible job connecting families to programs that they need and deserve. And one reason for that is because we have given states a lot of discretion about how to spend anti-poverty money, and they are very creative about how they use that discretion. So one example in the book is welfare, which officially is called Temporary Assistance for Needy Families, or TANF. This is when Clinton reformed welfare in the country, made it not an entitlement but connected to work, limited it. But a big thing that he did is made it a block grant, which is just a wonky way of saying, Hey, Missouri or Kansas or California, here's some money it says designated for these families. But you guys can spend it kind of in ways you think is best. And states are like, cool. So you know, for every dollar dedicated to cash welfare, only $0.22 arrives in the pockets of a family. And so where does the other money go? Or some states use it to fund Christian summer camps or abstinence only education or marriage initiatives, or they don't spend it at all like Tennessee. Last time I checked, was sitting on over $700 million in unused welfare. Hawaii, our bluest state, was sitting on so much unused welfare money that they could give every poor kid in Hawaii $10,000. And so I think that what we're talking about when we're talking about that is we're talking about kids not getting enough to eat. Right. We're talking about kids getting evicted. We're talking about kids having a toothache and not being able to go to the dentist and letting the rot take it. That's the kind of implication we're talking about when we're talking about not getting connected to families, to programs that are life giving. >> Frederick Wherry: And that's all by design. >> Matthew Desmond: That is literally by design. It's a legal for the federal government to oversee how states use TANF funds. >> Frederick Wherry: And so... So we have programs that aren't delivering to the people who need it. We also have diminished worker power, although that seems to be tilting a bit. So when we're thinking about it overall, what is it that keeps us as a country from insisting that people receive a life affirming wage? >> Matthew Desmond: I think we like it like this. I think part of the part of the honest reason is that we have entered a social contract where some lives are made small so others may grow. And we like it. Race plays a huge role in this story, and it always has. But the bottom line is, like the countries that are like ours, the advanced democracies that have far less poverty, they collect a lot more taxes than we do. And they can make much deeper investments in the public good. But many of us have accepted this kind of relationship of private opulence and public poverty. More for me and less for we. And and so I think that's kind of what it is. And so the least we can do, I feel for poor families in America is just be honest. Right and be like, Yeah, we like it like this. This is how it's how it's going to be. I think many of us are pining for a different kind of America and do not want to be embroiled in this morally compromised situation. But we often don't know how to do it. And the book is kind of a way of asking us to kind of interrogate these ways we are connected to this kind of issue in ways that maybe we didn't realize. >> Frederick Wherry: One of the things that I often hear. . Something that we often take for granted is I have friends, we have colleagues, and they will say, you know, it's capitalism. They'll say, so long as you're supporting free enterprises, poor people will always be in chains. There's no exit in our current financial arrangements. But it seems that in the book that you're arguing that is not so. So why is it that it's possible to have capitalism? Perhaps not as we know it, but it's possible to have capitalism and it's also possible to abolish poverty? >> Matthew Desmond: Yeah. So I had the honor of writing the 1619 essay on capitalism and did a deep dive into the origins of our kind of unique American form of capitalism and how is completely informed and connected to the enslavement of Black folks. And because of that, America started on and continues to be on a very low road capitalism. Right. This is a capitalism of union busting. This is a capitalism where the minimum wage has increased in 14 years. This is the capitalism of incredible inequality. This is a capitalism where we as a nation spin $1.8 trillion on tax breaks. Most of which is accrued by families in the top 20% of the income distribution. That's double what we spent on the military. You know, this is kind of a different form of capitalism than we see in other countries. We as a nation collect about 25% of our GDP in taxes every year. Italy, Sweden, the Netherlands, even Ireland collect around 35 to 38%. And so I think that we should be striving for a capitalism that serves the people, not the other way around. I think we should be striving for a capitalism that's informed by democracy. And so I don't think that we need to throw everything out about capitalism. But I do think that we need to trouble the kind of capitalism that we've accepted. I also like it's interesting, like the early capitalists, right? You read like John Stuart Mill or someone and they're like, this thing, it's going to solve poverty, right? If this doesn't solve poverty, I'm going to be a communist. And today we have defenders of capitalism where they're just like, You just have to live with all this poverty. Their intellectual forefathers and foremothers would be embarrassed by that. Like, you know, pessimism that's gripped this kind of fair market thinking today. >> Frederick Wherry: I still have some pessimism, of course. You know, I wouldn't be a good sociologist without a little bit of it. And and I think part of it is informed by James Baldwin when he said, you know, it's really expensive to be poor. And then I'm reading your book and I'm seeing that the reason it's so expensive is because if you're low or moderate income, then you're having to subsidize those of us who are better off. And so can you talk a little bit about how we get-- A little bit more about sort of you know, you mentioned in the book the no cost checking and some of us get lots of perks and low interest rates on our credit cards, etc. And I love my perks. And so I'm reading this and I'm thinking, oh, my goodness. What do I need to give up? Or what needs to change for this to be more just? >> Matthew Desmond: Yeah. Yeah. So let's talk about financial exploitation of the poor. And so, every year if you add up check cashing fees, payday loan fees, but also and this is in your bailiwick, fed overdraft fees that banks are charging. You learn that, you know, poor families pay about $11 billion in these fees every single year. That's $61 million pulled out of the pockets of the poor every single day. Justin Fines and fees from financial institutions. Banks charge folks more than payday loan industry. It's banks that are doing a giant chunk of these overdraft fees. And as I've learned from you, my man, you know, a small percentage of bank customers, like 9%, are paying 84% of those fees. So these are the poor who are made to pay for their poverty. Who benefits from that? So the banks do. Sure. But like many of us have free checking accounts. Which aren't free. They're just subsidized by all those overdraft fees that are pushed down to the bottom of the market. And I think we can ask that kind of question. Who benefits from that with a lot of different things. The housing crisis. You know, we've got a housing crisis on our hands. Most poor families spend at least half of their income on housing costs. We've got over a million public school kids that are homeless right now in America. And who benefits from this? Who benefits from rents doubling since 2000? Well, property owners benefit. You know, corporate landlords benefit. But many homeowners benefit, too, because our housing values are propped up by our collective efforts to make housing scarce and expensive. It's also propped up by this tax structure that many of us who are homeowners collect through the mortgage interest deduction, for example. We spend about $190 Billion a year on homeowner tax subsidies. It's been about $50 Billion a year in direct housing assistance to the needy. And then we have like the audacity to look at a program that would expand housing assistance or alleviate poverty and be like, how can we afford this? You know, and the answer is really clear. We could afford it if we did a lot more in this country to fight poverty instead of guarding fortunes and protecting affluence. [Applause] >> Frederick Wherry: This is probably the reason why you have declared yourself to be a poverty abolitionist and you have issued a call in the book for the rest of us to join in the abolitionist movement. So can you talk a little bit about what it means to be a poverty abolitionist and the kinds of things that we can do now to make the end of poverty possible in our lifetime? >> Matthew Desmond: So poverty abolitionism, shares with other abolitionist movements like the movement to abolish slavery or the prison, the conviction that poverty is an abomination. It's not something we want to reduce. It's something we want to end. And it also shares with those movements the belief that profiting from someone else's pain corrupts all of us. So this is a personal project and it's a political one. So those of us who commit ourselves to this project seek to divest from poverty in our consumer choices, in our investment decisions. We support a government actively trying to end poverty through fair tax implementation. We detest all forms of exploitation, even if. Especially if we benefit from them and we oppose segregation and we fight for broad open communities. How do we do that? So here's five concrete things we can do today. I'm going to be that guy. Here's five things. [Laughing] Like a preacher's kid. Here's the three takeaways. One, all of us have influence somewhere. So Fred and I work at a university. If we're poverty abolitionists, we should start asking, what are we paying our landscapers? Are we taking care of our adjunct faculty? What is our university investment? What is the endowment going? You know, what are we invested in? Every one of us has influence somewhere. We can flex that influence. Second, we can vote with our wallet. So many of us know what kind of shoes to wear or coffee to drink to signal, like I'm this kind of political person and like we be like, this is my organic local cucumber and I'm married to an organic farmer. I appreciate organic local cucumbers, but like, how much did the farm worker get paid? What's the barista getting paid? And so I think that we can do our homework and consult organizations like B Corp or Union Plus and support corporations that are doing right by their workers and divest from corporations that aren't. Same with our stock market portfolios. Half of the countries is invested in the stock market. And if we are lucky enough to have 401Ks or 529s, we should be like, what is our money investing in? What am I supporting? Remember we used to talk about sin stocks back in the day like I'm getting out of sin stocks. I don't want to support weapons or oil. We should do that with union busting exploitative companies, too, and shift our money. [Applause] We got to talk about taxes differently. You know, we got to talk about the imbalanced welfare state and the fact that the country gives the most to families that need it the least. And so we all talk about taxes like this, no matter our politics, oh taxes, you know, and it's natural. We're actually wired this way like we're wired. There's this deep psychological finding called loss aversion, which is if we lose a thousand bucks, that hurts worse than if we find a thousand bucks on the sidewalk or something. And so it makes sense that when tax season comes around, we forget all the ways that government's propping us up. And just think about the check we have to write. So let's change the way we talk about that. So the next time your neighbor leans over the fence or hits you up in the elevator, it's like, oh my gosh, taxes. And what if I was like, You know what's insane? I am a homeowner and I get a benefit from owning my home, which is crazy because we have like 2 million kids getting evicted every year. And so I've donated the money I get from the mortgage interest deduction to my legal defense eviction fund. And I've written my congressperson saying, take this benefit away. I don't want this anymore. So that's a weird conversation. [Applause] That's a weird conversation over the fence. [Laughing] But that's how we change the common sense. We do this all the time with environmentalism, right? If you're a Princeton professor and the student catches you drinking one of these, you're going to get it. And so why don't we do that with economic justice? Fourth, we need to end segregation. And a lot of that happens on a day to day basis. And for those of us and I'm specifically talking to affluent white folks in the room, we're the most segregated group in the country, and we need to go down to our local zoning board meetings and stand up and be like, I want you to build affordable housing in my neighborhood. [Applause] So when we talk about these changes, yeah, we're talking about policies and social movements, but this starts with us and we have to start making those moves. And then finally, you can join an anti poverty movement. And if you don't know where to start, I have a website for you. It's called EndPovertyUsa.org. EndPovertyUsa.org. And you go to this website and you can find organizations working all around the country putting in work to fight for economic justice and fairness and in poverty in this country. >> Frederick Wherry: EndPovertyUSA.org. Thank you. >> Matthew Desmond: I should have a t shirt. >> Frederick Wherry: So, you know. [Applause] Maybe next year we can have some t shirts by Chanel. [Laughing] >> Matthew Desmond: Corporate sponsorship. >> Frederick Wherry: If possible. Yes. >> Matthew Desmond: Good luck. Now we're going to-- I promise time for the audience. So now we're going to open up the floor. There's a microphone there. And I think there if my eyes are still working. So make your way to the mic. We'll have some time for you to ask Matt questions directly. So here we go. >> Okay. Thank you. And thank you for your talk. This was very interesting. I wanted to just ask a question about the fact that state you were talking at the beginning about the state sitting on all of this extra money that's supposed to be going to the poor families. And then I don't see-- Are there any proposals on how that can be changed? Because when you said we like it that way, that's how it is. Those folks who hear you talk about all of this money sitting in state's coffers are going to say, well, the money is there. Can we do something about that? That's my question. Is there a way to move that money and to advocate for that kind of thing? And the second thing I want to talk about, I really think education needs to be part of any talk on ending poverty, educational opportunities. Thank you. >> Matthew Desmond: Thank you. Yeah. So on the first question, I think that there's absolutely opportunity to put pressure on like your local human services organization and start asking, hey, where's this money going? What are we doing with this thing? And start having some more oversight and transparency. And I think that this book, it's not a win win book. It is true that those of us who have found privilege and prosperity and opulence in this country will need to take less from the government for this to work for us to in poverty. But what we get with that deal is a safer, freer, more vibrant country. So it's like that old line in the book, "The Book of Sands," where he says, "If you want your people to build a boat, don't assemble the wood, but make them long for the edge of the sea." And so I think part of our work, too, is saying, yeah, like this is going to cost us stuff, right? But what we get from that trade off is a country that I'd rather live in. On your second question of education, you're right. We have to pay our public school teachers more. They get something that-- [Applause] They get something called a teacher penalty. This is like a thing sociologists talk about where they get paid a lot less than college folks at their level. So we need to make these deeper investments. That's part of the solution, but not the whole thing. Right. We can't educate our way out of the-- Country has actually gotten a lot more educated over the last 50 years and a lot more unequal. And so I think that education is fundamentally a part of this story, but it can't be reduced to education either. >> Frederick Wherry: Over here. >> Perhaps you addressed this before they let me into the room, but missed the very beginning of the presentation. I'm very curious about the politics in the-- poorest states are sending members of Congress who are opposing poverty alleviating measures. I mean, I found that Joe Manchin compromise particularly interesting, where he's willing, despite owning coal interests, willing to accept some of the climate part of the build back better agenda, but threw out the stuff that would be especially beneficial to his state. I'm very supportive of the climate stuff, but the child care, the early-- I mean, the whole range of things that he just sort of said no to and he wasn't getting, it wasn't like he was counteracted by senators from Mississippi, Arkansas, Alabama. No, they were lockstep opposed to all of these things. And those states in particular, and most especially would benefit from these. So I'm wondering if you have any insights on that. Thank you. >> Matthew Desmond: So on the one hand, the political dynamics that we're up against are incredibly challenging. And you're right, like if you look what happened in Covid, where we reduce child poverty by 46% in six months. With one program called the Child Tax Credit, which is basically a guaranteed basic income for moderate and low income families. You know, we were one senator away from that becoming permanent. That's true. And I also think that reality can be very absolving to us. You know where we say, oh, if that guy would just head or oh, if we just had the house, you know? And I think that I really take a lot of heart from the 60s where Congress was polarized and divided, where senators were sleeping in their offices to filibuster, where Southern Dixiecrats were aligning with Republicans to block any progressive reform. And in that political mess, we got these giant civil rights bills and we got the war on Poverty and the Great Society. And I think that if so much was accomplished despite the political odds, it's because social movements put unrelenting pressure on the government. And so that's why the anti poverty movement has to grow. And so the political pressure is real. But I'm grateful that our movement foremothers and forefathers didn't take those realities. then as a, well, I'll wait for the next election. I think we have to just take what hand were dealt and keep putting upward pressure. >> Frederick Wherry: And now I'm going to take one question here, one question there, and then at the same time so that we get more questions in. So one here. >> My name is Yang. Thanks for coming to talk to us about the society problem. Whether you are talking to poor or rich, the rich get a lot of violation or a law, and the poor got a lot of subsidies. But who are the victims? We are talking about education. Whoever gets a better way will be the leader in the society. But they got no job. So just one if you can address these issues. Now, currently a lot of places, let's say capitalism is not there, something is wrong. And this type of thing is really around the world, whether you are French or whether you are in England, they just don't solve the problem. But they are all capitalism and we are capitalism, but we are all poor. And people got a very best characteristic about honesty is not having a job, but the people who cheat and get people's money and wealth, they are millionaires and millionaires is not subsidized. The poor is-- little rob the poor. So I just wonder if you solve this type of problem. [Laughing] >> Frederick Wherry: And then the question here. >> Okay. I don't want to get too wonky, but I do want to address two things. I'd be curious for your comments. One, you didn't mention military spending as a major driver in the U.S. in comparison to Europe, where military spending is a small fraction per capita of the U.S. And related to that, you talk about taxes sort of writ large for privileged people, but I notice you didn't distinguish like I'm a privileged white person, I live in Washington D.C. My total tax rate is about 45%. My brother lives in supposedly high tax. Germany, also upper middle class. He pays a total tax rate of only 30% because there's only a federal tax. Right. So I think when you were comparing, I suspect that's what you were doing. In the U.S., yes, my federal tax rate is only 25%, but then there's property taxes is a 10%. D.C. tax. So actually the Republicans have been very skilled at kind of making skin of the game for upper middle class people. And yet the Warren Buffetts of the world, they boast about the fact that their tax rate is only 20%. So for super wealthy, it's very low. But it doesn't seem like you're really distinguishing. I sense what you're saying is everybody should pay quite a bit more taxes. And I was just wondering if you had thoughts on that. >> Matthew Desmond: Chairman of the IRS told Congress this year that we lose about $1 trillion a year in tax avoidance and tax evasion. A study came out two years ago that showed that at the top 1% of Americans just paid the taxes they owed. Knockout tax hire just paid what they owed. The we as a nation could collect around $175 billion more every year. That's almost enough to close the poverty gap. That's almost enough to bring everyone below the official poverty line above it. So even if we just did nothing with the tax code and made sure our enforcement was on point, we could get a lot there. We spent about $700 Billion a year on military spending. We spent $1.8 trillion on tax breaks. Most of that goes to the wealthy. Many of us in this room probably don't have kids or cousins that are in the military. And we like talking about military spending. But the government spends twice as much as it does on tax breaks that accrue to the upper class. So that's the conversation I want to have. I think that we can have a conversation about military spending that makes a lot of sense, but sometimes it makes it feel far away, too. And I think that the mission of this book is trying to make it personal. I think that if you add up everything that the government does for us in terms of tax breaks, insurance programs means tested programs. What you learn is that families in the bottom 20% of the income distribution receive about $26,000 a year from the government. The families in the top 20% of the income distribution receive about $35,000 a year from the government. That's a 40% difference. That's the imbalance that I'm talking about. So I don't like talking about redistribution, which I feel is a scary word. I want to talk about the fact that we need to bring that kind of prioritization back into balance. And I think that is a way of connecting the fortunes of the rich as being something that's deeply government subsidized with the deprivation of the poor. >> Frederick Wherry: Oh, that was lovely. But because of our time constraints, I'm going to have two people here to-- One, one. One, one. Quick questions. And when we're at our last minute, which we're almost there, you'll have the last word. So I just want to gather up some questions quickly. And then the last word from Matt. So a question. >> Hey, Matt. So it feels like especially in the early chapters of your book, you sort of question the idea that it's fiscal policy and government spending that play a central role in our failure to alleviate poverty. I mean, you cite often the fact that anti-poverty programs spending has increased in real terms, although given that the ITC funding does sometimes flow to middle income families or working class families, it's not totally clear that that's always true. But even taking for granted that fact, it seems like anti-poverty spending has still been declining as a share of GDP and that our ability to fund, for example, by collecting more taxes, programs that might help alleviate these barriers is real. And so I'm curious, you still seem to have this resistance to the idea that it's funding that plays the central role. And given that, what else do you think really needs to happen? Like what are the major sticking points that can't be addressed with funding alone? >> Matthew Desmond: Got it. >> Frederick Wherry: Here. >> Thank you for your work. You mentioned banks and you also mentioned using our consumer power. So I just want to ask a little about the role you think that CDFIs play community development, financial institutions, because CDFIs are not charging usurious rates to their customers and their part of the solution. So many people don't know about them. So I just wanted to flag that question for you. >> Matthew Desmond: It's a great flag. >> Frederick Wherry: Here. >> Hi. Thank you so much. I really appreciated some of the recommendations that you gave, such as finding out where our investments are going and things of that nature. I am looking forward to when those become very mainstream ideas. I work for a nonprofit and often I'm asked to kind of coordinate youth programs to address poverty. And all of the activities that we do are pretty much useless. I would rather do the kind of things that you're talking about. So you gave that website EndPovertyUsa.org. I'm hoping that I could get ideas there on how to design youth programs that would really address the issue and open all of our eyes to the issue in such a way that would not alienate the parents from sending their youth to these programs. >> Frederick Wherry: Oh. Do we have one minute? We don't even have one minute. So, Matt, you should take 30 seconds even though we don't have it. >> Matthew Desmond: All right, I'll try. I'll try. And looking forward to continuing the conversation. So I think that there's a paradox that the book meditates on about spending, but that doesn't mean spending isn't important. It means it is. But it also means we have to not just deepen our investments. We need different ones and we need ones that kind of end and address exploitation. Just a quick example like federal spending on housing has gone up 16.5% since 2000, but rents adjusted have basically gone up by that much, which is why there's 4.5 million families housed in those programs in 2000 and 4.5 million houses now. We're spending more to stay in the same place. So do I think we need to deepen those investments? Absolutely. I basically spent the last eight years stumping for that in this town. Do I think that we need different ones, so we need to expand housing choice for those families? Absolutely. On the CDFI recommendation, I love that's a super wonky, wonderful recommendation. And I think that looking into CDFIs make a lot of sense. I think a lot of us can just start asking our bank reps like, what are you charging folks? What are we doing for overdraft fees? And we can move. That kind of consumer activism really matters. On the youth question. We don't have a mass anti-poverty movement in America. One of the most tragic things that has happened in the last few years is we had a different country for like a moment, and we let that country slip away. We plunged evictions to the lowest on record. We plunged child poverty down. We were like Norway. We were like that literally. And then we just let it go and we let it go because the movement wasn't strong enough. It wasn't just that Senator. It was us not picking up the phone, not emailing, not advocating, not demanding it stay. And the youth movement can be a huge part of the next anti-poverty movement. We need a lot of young folks involved in that. Thank you, Fred, so much. >> Frederick Wherry: So thank you. This is remarkable. Remarkable. Thank you. [Applause] [Music] [Music]