What is happening to our Youth??

Okay, I work in public schools. Our school is in a repressed socio-economical area. We have LOTS of students on free or reduced lunches, reduced school fees, and etc. Jobs in our area are scarce, and it's hard to make ends meet, even if both parents work. More than half of our our school population come from 1 parent homes. All in all, our school suffers from being low funded, and a great amount of apathy on the part of the parents and even from the town.
On to the problem I am seeing. It is call disrespect. When we have to waste class time combating students on a daily basis, there is something wrong. Dicipline must be non-existant at home, because students in some of my classes certainly don't know how to behave, and have respect. I am talking not only respect for me as a teacher, but for their peers as well. They are mean to each other, and say awful things. Degrading things. When I call them on it, they turn their venom on me. Many of theses students don't have respect for themselves, either.
I try to treat every student the same. I know who the ones are that are from the poor families. I have eyes and can see the difference in clothing, hair cuts, and overall appearance. But that doesn't matter to me. It's what is inside them that counts. Why can't they see that?
I have a chubby, cheerful boy that is repeating seventh grade for the second time. He's not even a special ed student. He just doesn't have enough respect for himself to try to pull himself up by the boot straps and do better. Today I made a tiny step forward with him by having him explain a math concept to me. I admitted to him that I hadn't done this kind of math for about 45 years and that I had forgotten. He did himself proud and I could tell it made him feel special. For about five minutes. Then it was back to being self-depreciating and disrespectful.
I don't have an answer. I have an opinion, of course. I think that respect for others and self needs to be taught at home. That should be taught just like parents teach their children to walk and talk. But I also think that schools have been forced to be more lenient and cannot discipline students like they should be disciplined. I don't believe in corporal punishment at school, but just sticking a student in "in school suspension" is not enough.
We recently had a student who distroyed some school property. For two weeks he had to be at school at 6:30 a m and work with the janitors until first bell, and "worked off" the cost of the property he had ruined. I think it made him a better person and also gave him a wake up call.
Another student was caught stealing supplies from our supply cabinet, and was "sentenced" to 3 days in ISS. That taught him nothing. He is still denying that he stole, even after a locker search turned up the stolen merchandise.
Is there an answer. I am sure it is. Is poverty the cause for this problem. I am sure that it adds to the problem, but I know that being poor is no excuse for apathy, disrespect, rudeness and being cruel to others.

Cheers

JE