The Great Society was the panacea for poverty, right? And it especially helped blacks, who had been held back by years of racism, didn’t it? For those who think that the government is the most efficient dispensary of public welfare, the answer is yes. But the historical facts and figures disagree markedly, and it’s hard to paint this disparity as sheer coincidence. Those facts indicate that the plight of blacks had been improving up until the passage of the Great Society program, but that in the forty-some-odd years since, blacks’ economic, social, familial, and educational situations have gotten much worse.
Service is more than an idea. It is action. Real service gets benificent results, not just the hope of them. Based on results, the Great Society has been an abysmal failure.
The Facts: The Great Society was Severely Detrimental to Blacks
Jonah Goldberg reminds us that
…one tragic consequence of [Great Society] strategy was that the government used child poverty to crush individualism and pride among inner-city blacks. …when Congress mandated food stamps, welfare “recruiters”…went into the cities to convince poor people to enroll.
..at the end of the day, their welfare state–based though it may have been on love, concern, and niceness–resulted in more damage to the black family… Today black childern are less likely to be raised by two parents than they were during the era of slavery.
Liberal Fascism, pp. 346, 347
Prior to the advent of the Great Society, black families were much better off. Poverty was on the decline, and crime was at a low level, but not for long. Goldberg writes
Crime soared because of the Great Society and the attitudes of which it partook. In the decade after the Great Society, the murder rate effectively doubled. Black-on-black crime soared in particular. Riots exploded… [A]s Thomas Sowell has cataloged, the biggest drop in black poverty took place during the two decades before the Great Society.
Liberal Fascism, pp. 269-270
Additional negative results of the Great Society’s expansion of the welfare state are detailed in A Patriot’s History of the United States. For example:
[Aid to Families with Dependent Children’s–AFDC] no-father policy…left inner-city black boys with no male role models. After a few years [in] one of “the projects”…a young man could literally look in any direction and not see an intact black family. Stepping up as role models, the gang leaders…inducted thousands of impressionable young males into drug running, gun battles, and often death. No amount of jobs programs would fill the void produced by the Great Society’s perverted incentives that presumed as unnecessary the role of the father.
A Patriot’s History of the United States, pp. 689
The New Deal originated the AFDC program. Until the Great Society, however, AFDC had the exclusive purpose of providing for widows–previously married women who had lost the breadwinner in their homes.
In the 1960s, however, Johnson and Congress quietly changed AFDC qualifications to include any household where there was no male family head present, a shift that made virtually any divorced or single mother of low income eligible for taxpayer money. The incentives of the program made it financially more lucrative not to be married than to be married.
Seen in the numbers, the changes from the previous decade were shocking. In 1950, 88 percent of white families and 78 percent of black families consisted of a husband and wife in a traditional marriage. These numbers had not changed since the Great Depression…
A Patriot’s History of the United States, pp. 688
But as the Great Society came to fruition, the black family began a steep decline. Within 12 years, the percentage of traditional black families dropped nearly 20 percent in relation to population. Schweikart and Allen write that
This was nothing less than a prescription for the utter destruction of traditional black families, and had it been proposed by the Imperial Wizard of the KKK…such a program would have met with a quick and well-deserved fate. But embraced by liberal intellectuals and politicians, the war on poverty…was the policy equivalent of smallpox on inner-city black families…
A Patriot’s History of the United States, pp. 68
The Idea and the Reality are Worlds Apart
What passion drives those who advocated a government welfare solution to–at that time–a diminishing problem? Guilt. Racial guilt. Wrote Goldberg:
The rationales for the Great Society are almost always suffused with racial guilt. Liberals have fallen in love with the idea behind the racial welfare state.
Liberal Fascism, pp. 269, 270
Three problems result from being enamored by an idea that does not comport with reality.
- Liberal condescension toward blacks.
- A feeling that one’s political adversaries don’t want to solve the problem.
- A blind spot–an inability to admit that one’s benevolent desires made things worse.
In 1964, as the economic statuses of blacks and other poor Americans were improving, Lyndon Johnson engaged poverty
as an enemy to be defeated. In his 1964 State of the Union message, he announced, “This administration tgoday…declares unconditional war on poverty,” and he declared that only “total victory” would suffice.
A Patriot’s History of the United States, p. 687
Bill Moyers, for a time the press secretary for LBJ, exults in the ideals of the Great Society, heaping scorn on those who disagree with him, and not seeming to be able to recognize that Great Society policies are the main reason that economic improvement for blacks has stagnated or that black college and university attendance is far below their representational percentage of the American population. Moyers, having been in the middle of it all, extols the virtues of Lyndon Johnson and his Great Society. According to Moyers, it would have reduced poverty in the United States, and it would have given more blacks a chance to attend college, except for the fact that conservatives got in the way.
Setting the Stage for the Mortgage Meltdown
The mortgage meltdown of 2008 is a problem perched on a problem (The Great Society) that was an intended solution to a problem (racism in America). In an effort to fix the supposed effects of racism in 1960’s America, the Great Society paved the way for at least a part of a gigantic economic bubble that popped in 2008. (Other factors also helped to cause the meltdown, the fundamental cause of which is liberal Federal Reserve monetary policies, but here we will focus on the cause-and-effect relationship between the Great Society and the Mortgage Meltdown.)
Whether or not it was intended–I think not–the Great Society destroyed the black family. Since that day, more than ever before, blacks have been lower than whites and other races on the economic ladder (…find links…), and their proportional entrance into the post-secondary education market, to include prestigious universities, has declined.
In an emotional appeal that runs counter to facts, liberal and socialist politicians began claiming in the early 1990’s that blacks’ mortgage applications were being unfairly rejected at a much higher rate than whites. The comparative rejection rates were true, but for good reason. National Review pointed out that this rate was
…28 per cent versus 10 per cent. No surprise there, since white applicants also had higher incomes, better credit histories, and lower appraisal/loan ratios. A close look at the raw data shows, if anything, signs of reverse discrimination:
Old-fashioned discrimination, where clearly qualified black applicants are rejected – and unqualified whites accepted – is nowhere to be seen. Even subtle discrimination seems unlikely, given that blacks and whites receiving mortgages defaulted on them at the same rates. If bankers had rejected a larger percentage of equally qualified blacks, the black default rate would be lower than that of whites.
It was all based on a faulty study that began to make the rounds in political circles, and that was uncritically latched onto by those whose socialist assumptions it matched. A critique of the study uncovered many inconsistencies.
The data used in the study were riddled with typos and other serious errors. For example, of the 3,000 mortgages studied, 50 of the loans supposedly had the banks paying interest to the borrowers, 500 of the mortgages were not even in the data set from which the data was supposedly obtained, and some mortgages were supposedly approved for individuals who had negative net worth in the millions of dollars. When those mistakes were corrected, no evidence of discrimination remained.
Professor Liebowitz told FOX News that Lawrence Lindsey, then a member of the Federal Reserve’s Board of Governors, “was warned about these errors in this study but the Fed ignored them.”
Banking institutions became scared into tipping the delicate balance in favor of giving loans to unqualified borrowers–simply because of their race. Why? Because of the Equal Credit Opportunity Act, and/or draconian interpretations thereof. This began during the Clinton Administration
In 1995, President Clinton mandated new regulations that coerced banks to make significantly more subprime loans to inner-city residents previously viewed as unqualified buyers in high-risk areas. Banks were rated on how well they complied and faced big fines if they didn’t do what government regulators wanted.
The government’s worst decision was allowing and encouraging banks, for the first time, to bundle these subprime loans in giant packages with prime loans.
The entire problem began with social policy in the mid-1960’s, which, although emotionally intended to help the poor–and particularly minorities–in reality caused the opposite effect. With the poor–and especially minorities–dragged down by ill-conceived policies, a new solution was needed. Cut from the same decayed fabric as the initial “solution” (which was really the original problem), the 1995 Clinton Administration policy of loaning to unqualified homebuyers was a recipe for disaster.
With the ulterior motivation of feel-good, do-nothing socialism, and without historically honest hindsight, it is extremely difficult to associate the two events (The Great Society and the Great Mortgage Meltdown). Nonetheless and inexorably, the one paved the way for the other.
Barney Frank quote…
Bush calls for zero down payments…