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C. E.

Maurice Irvin

CO150-038

31 March 2017

Stakeholder Analysis

The American Dream of being able to rise from rags to riches has been deeply embedded

within American culture since The Industrial Revolution. Unfortunately for many people this

dream of economic mobility is unattainable, and they find themselves trapped in a cycle of

poverty. According to the United States Census Bureau, in 2013 14.5% or 45 million people

were living at or below the national poverty line. This cycle of poverty persisting through

generations of a family is known as intergenerational poverty. Due to unfortunate circumstances

and numerous other factors, “vulnerable families are unable to get ahead financially and, as a

result, experience increasing rates of intergenerational poverty” (Shobe 36). So, what should be

done to address intergenerational poverty? When answering this question, the four main

stakeholders that must be considered are children, minorities, the rural poor, and American

taxpayers.

Generally speaking, children have a lot at stake when it comes to the detrimental issue of

persistent poverty. According to Marcia Shobe, “Approximately 17%, or 5.3 million youth, were

living in impoverished households in 1999,” (38) a number which has only continue to increase

since. Children are the most vulnerable and impressionable group affected, because they are in

the midst of their development and are extremely dependent on others for their well-being.

Although their own values and beliefs are not fully established yet, their common desire is to be

loved and nurtured. World-renowned child development researchers Craig and Sharon Ramey

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assert that “when children do not receive essential early learning experiences—that is, when their

care is neglectful, inadequately stimulating, overly harsh or punitive, or unpredictable and

inconsistent, they can be harmed in permanent ways” (61). The permanent harm many

impoverished children face can destroy their chances of rising up the economic ladder and

escaping poverty. If underprivileged communities could enact highly effective programs that

were “comprehensive, flexible, responsive, and persevering,” and managed by “competent and

committed individuals with clearly identifiable skills,” (Schorr 5-9) then these children would

have a legitimate opportunity to better their lives and end their families’ cycle of poverty. If no

changes are made, then these children will be underdeveloped, illiterate, and unprepared for

adulthood. Out of all the stakeholders, children are the most defenseless, but they also have the

most potential to benefit from systematic change.

Another stakeholder group that is disproportionately affected by intergenerational

poverty is minorities. In our modern society we would like to believe we have come a long way

from the racism and segregation of our ancestors. Believing this to be true creates a post-racial

rhetoric “that our society has transcended the racial divide and that the remaining racial

disparities are due primarily to self-sabotaging attitudes and behaviors on the part of blacks

themselves” (Darity and Hamilton 80). The harsh reality is that racial inequalities and economic

disparities are still extremely prevalent in society today. One example economists Darity and

Hamilton point out is that, “black males earn only 74% of what white males earn” (80) with the

same education. This example of inequality demonstrates one of the main reasons why minorities

are unable to climb the economic ladder and escape poverty. Just like the majority of society,

minorities believe that they should be able to provide for their families and leave their children

better off than they were. Being unable to do so because they have a different skin color or

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culture is an injustice to society. If racial inequality could be diminished through “a federal job

guarantee” and a “substantial child development account” (Darity and Hamilton 79) then society

as a whole would be better off and minorities would be able to adequately support their families.

If nothing is done, then minorities will continue to live in an unjust cycle of poverty and

proceeding generations will be disadvantaged because they are “different.” In comparison to

other stakeholders most people are aware of but choose to ignore the racial disparities in society,

because acknowledging it means accepting the fact that our nation is not as progressive as we

would like to think.

One stakeholder group often ignored but still deeply affected by intergenerational poverty

are those who are poor in rural communities. Although rapid urbanization has benefitted many

people economically, it has left rural communities neglected and disadvantaged. These rural

communities value locally owned businesses, locally produced goods, and sustainable use of

land. These values conflict with the way the majority of society lives, (i.e. shopping at Wal-Mart

and buying factory farmed goods) in turn leaving little room for rural communities to expand

their market. Rural sociologist Conner Bailey offers the solution of “reorient[ing] our economy

to a more human scale” by “organizing economic exchanges that utilize local resources, talents,

and knowledge” (412). By shifting the focus of the economy to meet each community’s local

needs, rural communities will be able to generate wealth consequently ending their cycle of

poverty. Unlike other stakeholders this group has the resources to support its economy but does

not have the demand or financial stability to do so. For example, there is an abundance of land in

rural communities which, if utilized properly, could be extremely beneficial. Bailey gives the

solution of using “small-diameter woods from thinnings” for “direct conversion to thermal

energy” (421) for not only residential properties but also all buildings in the community. If

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communities were able to depended on wood or other forms of biomass for their energy, then a

profitable market would emerge and the local economy could be stimulated. The potential for

generating wealth is there, it just has to be acknowledged. Like some of the other stakeholders

much of what needs to be done to end their suffering is out of their control and will take national

reform to enact change.

The last group that has stake in intergenerational poverty is the American taxpayer who

funds much of the efforts towards fighting the problem. This stakeholder group is extremely

broad and therefore the individuals who comprise it have differing values and beliefs making it

particularly difficult to accurately analyze. In fact, those who make up this stakeholder group are

basically the same as those individuals who make up the stakeholders previously mentioned.

Author Lisbeth Schorr acknowledges the potentially only shared belief among the group which is

that they “are convinced that their taxes are not being spent wisely” (117). Schorr argues that the

best way to ensure that citizens know their taxes are being used beneficially is through results-

based accountability. Sharing results with the taxpayers gives the public proof of results, enables

communication to be more deliberate in support of shared purposes, and illuminates whether

investments are sufficient to achieve results (117-119). If taxpayers know that their taxes are

being used adequately then they will not have an issue with paying them and all of society will

benefit. On the other hand, if the taxpayers do not believe that their taxes are being used

beneficially then their faith in the government will only continue to dissipate.

Intergenerational poverty is an extremely complex issue affecting numerous stakeholders

in a variety of ways. In regards to impoverished children, there should be effective programs in

place to ensure that they receive a satisfactory education and the nourishment necessary to

develop into fully functioning adults with the ability to escape poverty. Minorities would argue

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that in order for them to escape poverty they must have the same opportunities as Caucasians,

which could be guaranteed through a federal job grant and child/parent IDAs. Those who are

poverty-stricken in rural areas would claim that scaling back the economy to a local level would

decrease intergenerational poverty. American taxpayers would debate that when it comes to

intergenerational poverty, the solution should be cost-effective and efficient with result based

accountability. Overall, there is immense debate over what should be done to address

intergenerational poverty, but the one thing everyone can agree on is that it is a serious injustice

to society to ignore such an important issue.