To the Editor:
Lewis A. Coser’s review (in February) of America in the Sixties, a collection of articles by “the Editors of Fortune,” carries on at some length about “the Luce mind” and “the ‘midtown view’ of economic realities.” I would be inclined to let him have some innocent downtown fun with these subjects except that he seems unable to have it without misrepresenting almost everything the editors (myself especially) actually said. Throughout his review he has relentlessly satirized our formulations, or restated them without our qualifications, or simply misstated them altogether, always making them seem foolishly optimistic; then matched them against some very pessimistic (sometimes very dubious) figures of his own; and, finally, used the contrast to prove our “willed commitment to a roseate view of the future.” He has also taxed us for not mentioning a number of unpleasant facts like the low operating rate in steel since mid-1960, though how we could have mentioned such facts in a series of articles written in 1959 (as the introduction states), or why we should have mentioned them in a book dealing with the decade as a whole, is very unclear to me.
In one characteristic passage, Mr. Coser writes that the authors of America in the Sixties are “momentarily brought up short when they consider the high divorce rates of the postwar years. But they console themselves by reflecting that the many divorces can be explained by the high level of income: in earlier years ‘a lot of Americans simply could not afford them.’ In the prosperous sixties, no doubt we shall all be able to afford a second divorce along with a second car and a second television set. Cheer up, boys!” Since Mr. Coser is manifestly laboring to be satirical in this passage, your readers would be entitled to assume that he has something to satirize, i.e., that our “willed commitment” had led us to write a passage arguing that the high divorce rate really showed the U.S. in a good light—or something equally fatuous. But we didn’t write anything of the sort. In a discussion of the phenomenon of teen-age marriages, we dropped a footnote raising the question whether these were responsible for the high level of divorces, concluding that the evidence for this view was not very good—and suggesting a connection between more divorces and higher incomes. This connection is not exactly a new idea—the sharp drop in divorces during the depression has frequently been noted. In any event, the notion we were “brought up short” by the divorce figures, or felt in need of consolation after viewing them, is Mr. Coser’s own fantasy.
He summarizes another section of our book like this: “Fortune writes that soon the poor will no longer be with us; and in the meantime ‘only’ 3,600,000 families have incomes under $2,000, and if a family makes over $2,000, it cannot ‘really’ be considered poor at all!” Mr. Coser’s use of quotation marks here is interesting. We didn’t say “only” and we also didn’t say “really,” and the words do not aptly summarize what we did say. Our point about the 3,600,000 figure was, not that it’s okay, but that it’s not as bad as it looks—that most of these families were either unemployed or retired, “i.e., the low income was temporary or it was being bolstered by savings or help from relatives.” This was in a discussion of Americans who are “permanently poor” because they hold bad jobs; it was this kind of poverty that we suggested was disappearing—surely not an original suggestion. (Even an article in Dissent last August suggested that “the proportions of ‘status poverty’ in the U.S. seem likely to contract. . . .”) As for the number of families who can be considered poor, we didn’t make any explicit pronouncements relating poverty to an exact income level, and if we had, we certainly wouldn’t have said anything as silly as Mr. Coser credits us with. . . . Our $2,000 figure is higher than the standard set by most public-assistance programs, although it is lower than the $2,500 standard used by Professor Robert J. Lampman in the widely acclaimed study paper he prepared for Senator Douglas’ Joint Economic Committee. (Professor Lampman notes, however, that there “is some precedent” for using a $2,000 figure, and several of his tables break down the low-income population according to both standards.)
One other point about poverty. In the course of explaining how much worse things are than Fortune admits they are, Mr. Coser says that “according to governmental investigations, more than one family in four lives below an income level considered essential to maintaining even minimum standards of health and decency.” I am tolerably familiar with all the serious government studies made of distressed or low-income families recently, and I know of none that reached such conclusions; possibly Mr. Coser is applying his own adjectives to the government’s statistics, or possibly he is stretching the definition of a “family.” Any. way, the Lampman study does not support a “more-than-one-in-four” view. It shows that on a $2,000 definition of poverty, either 8 or 15 per cent of families were under the line in 1957, depending on whether the income included any non-cash items (which are principally important to farm families); and on a $2,500 definition of poverty, either 13 or 19 per cent were under the line. Professor Lampman notes that between 1947 and 1957, “the share of the population in low-income status fell over one-fourth of the way to zero.”
Mr. Coser works hard in another passage to prove that our statements about “discretionary income” were also roseate: “Families with after-tax incomes of over $4,000, according to Fortune, have a supply of ‘discretionary income’ which allows them to spend freely over and above the necessities of food, clothing, shelter, medical care, etc. Such families ‘can take a small flyer in the stock market.’ . . . Were Fortune’s writers to take an occasional trip some sixty blocks further downtown, they would learn that people with this income might sometimes try their luck at the races or with the numbers game, but hardly in the stock market. Indeed, George Katona, in The Powerful Consumer, sets the limits above which income can allow some ‘discretionary spending’ at a more realistic $6,000. . . .”
First of all, it is absurd to talk as though the discretionary-income level were a matter of hard reality, rather than opinion; we all have different notions as to what a necessity is, and Fortune’s mention of a $4,000 dividing line indicated that the figure “has to be set somewhat arbitrarily.” Katona does not attempt to prove that discretionary spending begins only at $6,000; furthermore, his $6,000 figure refers to total income before taxes, while our $4,000 figure is cash income only, after taxes. Since the articles were written, the $4,000 figure has been supported indirectly by the U.S. Labor Department. . . . Contrary to what Mr. Coser would have your readers believe, we did not suggest that a family can “spend freely” just by getting over the $4,000 line; instead, we said that “a family whose income goes up from, say $4,000 to $5,000 has only a limited range of discretion,” and we suggested that a family cannot alter its style of life very successfully until it approaches a range around $7,500. As for stock holdings, it is unclear to me what I am supposed to find by going sixty blocks South. By my calculations, that would get me to about Morton Street, where I happen to know a few big plungers in the market; but if Mr. Coser intends me to end up on Wall Street, then I can report that the New York Stock Exchange says that over a million families with incomes under $3,000 own stock. No doubt many of these families are not really poor, i.e., they are young couples just starting out or retired couples living on savings rather than income (such families always swell the reported low-income figures), and no doubt most of the families don’t own much stock (we never said they did).
I might add that I am fascinated by the logical processes of a reviewer who allows that families just over $4,000 “might sometimes try their luck at the races,” but in the next breath contends that discretionary spending only begins at $6,000.
New York City
Mr. Coser writes:
Mr. Seligman’s letter reached me in Oslo where neither the book under discussion nor some of the statistical materials needed to answer him in detail are available. Hence a few general observations must suffice.
Mr. Seligman does not see why I should have mentioned the persistent under-utilization of our steel capacity since mid-1960 given the fact that the book I reviewed was written in 1959. He misses the point: the book purported to forecast trends in the 60’s; this forecast is so far dismally wrong.
The length of Mr. Seligman’s letter, I cannot help but feel, is directly proportional to the extent of the unease felt in Fortune’s editorial offices about the fact that their predictions square so little with the situation in which we now find ourselves. Granted, these predictions dealt with the decade as a whole; but a prediction that turns out to be rotten so far as the near future is concerned does not inspire much confidence as to its power to forecast the more remote future.
In re that divorce business: Mr. Seligman lacks a sense of humor; perhaps he worries too much.
When I used the terms “only” and “really” in connection with Fortune’s discussion of poverty, I did not mean to quote directly but rather to suggest the complacency with which Fortune regards the situation. Mr. Seligman now reiterates that “it’s not as bad as it looks.” This is precisely what I meant with the midtown view of economic realities. Mr. Seligman should go to one of the depressed areas or, say, to the Puerto Rican and Negro areas of New York City, either uptown or downtown, and tell people that “it’s not as bad as it looks”—he will get some surprising reactions. I for one find such smug complacency about other people’s fate insufferable.
Congress, Presidential messages, newspaper headlines talk almost daily about depressed areas, lapsed unemployment compensations, low minimum wages, and so on. In view of this, Fortune’s roseate forecast is ludicrously inaccurate, and its moral callousness is appalling.
Of course, definitions of poverty as well as the determination of income levels beyond which discretionary spending becomes possible is partly a matter of opinion. But I find it as revealing that Fortune considers that family income above $2,000 does not indicate poverty when most studies use higher figures, as I find it indicative that Fortune uses a $4,000 dividing line for discretionary spending when most other studies use a higher figure. This seems at least prima facie evidence of systematic bias.