This is the holiday season that calls for acts of giving and philanthropy. Both are commendable but to build fair and good societies we need more than reliance on individual generosity. We need to turn our attention to those areas we perform below our true capacities and where we leave many of our fellow citizens behind and adopt policies that minimize pain and unfairness. This call to action is all the more imperative because we live in a country with no short supply of riches or creativity.
Our lack of attention to the weak spots in our society is all the more glaring when compared to our enthusiasm for anything that relates to new frontiers of discoveries and opportunities for profits. Our indifference may be explained by the belief that if there is general progress then everybody will be better. Or by the attitude that in a free economy all those who wish to improve their lot can do so without the support of any public policies.
However, the persistence of certain social ills signifies that we need better collective action and better policies. Here, I will focus on four areas of underperformance and unfair treatment that deserve our attention and action.
Poverty and homelessness. We brag that we live in the richest country history has ever known. However, in 2024 the official poverty measure showed that 10.6% or 36 million Americans lived in poverty. And by the supplemental poverty measure 12.9% or 44 million of Americans were classified poor. Poverty among children was even higher standing at 14.3%. In a past blogpost, I had explained how poverty in childhood sets up children for adult lives with less educational attainment, poorer health, and higher crime rates.
A byproduct of poverty is homelessness. A record 770,000 Americans are now homeless with 36% of them being unsheltered, meaning they live out in the streets. And regrettably this number is 18% higher than in the previous year.
Our dismal record in poverty and homelessness is not due to the fact that America has too many people failing to do better but because, as Matthew Desmomd explains in Poverty by America, our policies are conducive to it. Similarly, many homeless people are denied the conditions and breaks that would enable them to escape homelessness. A recent book And Housing for All by Maria Foscarinis, a veteran advocate of homeless people, presents the causes and the blight of homelessness in America in full relief.
Health care. It is well established that Americans live shorter and less healthy lives than people in peer countries. Although costlier than in any other country, our health care system fails to deliver equal health care to all Americans. Individuals and families without employer-financed health insurance face prohibitively expensive policies that force many to opt out or receive inferior coverage. The current debate about extending the subsidies to buy health insurance under the Affordable Care Act and the failure of Congress to offer a solution highlights our collective failure to secure the right of health care for all Americans.
Education. Despite the importance of education as a pillar of economic success and social mobility, we continue to perform unevenly across states as well as in comparison to foreign peers. In recent years we have experienced declines in math and reading scores and our K to 12 educational system ill-prepares students for higher level studies.
Poverty, homelessness, wanting health care, and subpar education are all connected in creating the conditions that lead to drug and alcohol abuse, suicides, and crime, all of which contribute to a lower level of collective wellbeing and safety. Sadly, all three ills affect Americans unevenly with Black and Latino people bearing the brunt of our inadequate performance.
Care givers. These are the Good Samaritans of our society that our economic and public policies fail to appreciate in tangible terms. I am talking about the people who take care of our elderly, people with disabilities, and the infirm. Care giving among humans is part of our biological evolution. We are born unable to survive alone for several years without care from parents, grandparents, and even alloparents. When we moved into organized societies, care giving was often delegated to slaves and servants. Even in the modern era, we perceive care giving as done by those without better choices or out of altruism. These convenient motives have led to underpaying some of the most vulnerable workers in our society.
If the value we place on receivers of care is reflected in the wages we pay their care givers, then America falls behind other countries. I checked the wages of care givers in several countries and our very wealthy country ranks 9th, behind Germany, Austria, Australia, Finland, Canada, and several other countries. What is common in the countries that remunerate care giving better than we is that they have stronger welfare systems.
The interesting thing is that although care givers often receive subpar wages, the direct and indirect cost of care giving is quite high. One thing we miss is that because of the malfunction of the care giving labor market, the families with elderly members or individuals with disabilities bear the brunt of a very high turnover and lapses in care giving itself. Even when individuals in need of care are placed with professional agencies, families have to step in and fill in the gaps in care giving at an immense cost of direct expenses, lost work, and stress. A recent estimate by the AARP placed the annual out of pocket expenses of family caregivers at $7200 with the value of their unpaid work estimated at $873.5 billion in 2024.
Another important aspect of care giving as a paid-for service is the asymmetry between the care giver and the cared for. The elderly, the infirm, and individuals with disabilities are not in a position to transact with the care giver as independent decision makers to obtain the best care possible. Nor can the families of the cared-for effectively monitor the quality of the care given. And yet despite these asymmetries, the care giving labor market lacks the conditions in terms of incentives, professionalization, and social status to ensure that care giving matches the expectations of those who need it or those who pay for it. The introduction of AI personal assistants interacting with human care givers will further complicate the conditions for proper delivery and compensation of care giving services.
Our capacity to create wealth, new science, and innovations are not enough to define what kind of society we are. How effectively we reduce the blight of poverty, homelessness, sickness, and subpar education and how much we value care giving can tell a lot more about the character of our society.
May 2026 be a better year for all of us.
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