The poor seem to a get behind the “Eight Ball”

The poor seem to exacerbate their condition due to their own internal attributes, and more importantly due to their poor choices in their external environment, for which many times they few alternatives. The primary focus of my article today is how the poor are a great profit source for those business providers primarily in the financial sector and rental markets. Few have the benefit of a trust fund or having inherited affluence.
What are some of the typical “poor person” profiles? Usually these folks have limited formal education and are many times high school drop outs. Single parents, who have limited education, weak job skills, and failing health many times, fall into this quick unending sand trap of poverty. Addiction to alcohol and drugs is a sure fire way to poverty. Health and other physical and mental disabilities are many times a ticket to the poor house.
In addition to having limited or little earning capacity, the poor are not always the most prudent budgeters of their money or have the knowledge and physical resources to be prudent purchasers. I believe that learning how to make their acquisition dollars go further is a faster road to moving up the ladder, than sometimes gaining better jobs skills and earning more money.
Minority status is fortunately not the impediment to affluence that it was in the past specifically for those who are intelligent, educated, focused, and hard working. Even though that a great deal of progress has been made in our society relating to minority rights and opportunities, there still remains subtle societal discrimination and feelings of being less than worthy.
The poor do not have any highly paid lobbyists such as the oil industry, agri-business, Wall Street, the health and pharmaceutical sector, and the biggest extorters of all the Military Industrial Complex. With the great decrease in private labor unions who also advocate for human rights and better living conditions, the poor have lost a very helpful advocate in the political spectrum. The poor get some public assistance for two reasons, our collective guilt about the “Brothers Keeper” slogan, and by giving those in need a meager public assistance we probably are insuring ourselves against riots, street beggars, and revolution.
The poor and uneducated are almost three times as likely to be cigarette smokers, than the more educated and affluent. I calculated that one who smoked a $6 pack of cigarettes a day for 50 years, escalating the purchase price by 3% per year, the money spent, if invested at 4% per year and compounded would amount to $513,000; a comfortable retirement sum. Lottery tickets are primarily marketed to the poor in convenience stores, who little hope of getting ahead. The average ticket purchaser who spends $5 a day on a lottery ticket will easily throw away as much money as a cigarette smoker.
Those who smoke are fifteen times as likely to also have alcohol and drug addiction issues as those who do not smoke. If we assume a beer habit of a six pack a day at $3, that equates to $1,100 per year. Escalate the costs of the beer habit to purchasing alcohol in bars, or using drugs, these addictions could easily consume 20% to 99% of a person’s income.
The poor are typically greater impulse buyers and sometimes will pay high costs of unhealthy food and beverages in convenience stores, or feel that they need a pair of high priced jeans or sneakers to uplift their eroding self esteem. Burial plots, burial insurance, and funerals is also a scam that drain the assets of the poor. My partner and I have donated our remains to UC Medical Center, it’s free and may support a doctors education or further medical research.
In addition to poor lifestyle choices the external market of check cashing stores, convenience stores, bank NSF check fees, credit card late fees, high interest, tax refund loans, pawn loans, of furniture rented to purchase, and less access to affordable merchandise extracts a relatively princely sum from their meager incomes. Someone earning $20,000 per year will lose approximately $1,000 per year in spendable income. Those who rent to buy furniture will sometimes pay up to two and half times the value of the item in rental payments.
Entrepreneurs such as H&R Block, Jackson Hewitt, and Liberty Tax Service, see the naïve poor purchasers as low hanging fruit to extract RAL loan fees and high income tax preparation fees. This RAL (refund anticipation loan) market is very lucrative for the burgeoning amount of providers who conveniently position themselves in poorer working person neighborhoods usually next to check cashing or convenience stores. A typical person going into Jackson Hewitt for income tax preparation and a RAL loan will spend $431, when they could have their taxes prepared free by the IRS, and receive their tax refund in less than two weeks by electronic deposit.
The Earned Income Tax Credit which is a subsidy for those earning below a certain level is available once a person files their tax return. Service and goods providers to the poor are great proponents of this government subsidy because it funnels windfall profit into the hands of the providers at the expense of all the tax payers. I agree that the poor do receive some value from income tax credits for the goods and services provided them, but those who lobby for these credits are the ultimate receivers; the business providers. As an analogy loans to third world countries by the IMF and World Bank do not usually benefit the poor in those countries, but rather the contractors such as Bechtel and Halliburton who build major infrastructure in those countries.
We have higher priorities for defense spending and corporate subsidies than we have for people in the U.S. Our spending for defense, far out strips all the rest of the other developed nations.
A person of means has access to professional mental health support, which is not easily accessed by the poor. It is very easy to voice a quick fix solution for the poor to elevate themselves from poverty, but depression, addictions, and hopelessness are not easy states of being to arise from. Our society relative to other developed nations has a less inclusive and caring attitude, which is clearly reflected in how we structure, or at this juncture de-structure our safety nets to help those in need.
Sweden and Switzerland spend more than the U.S. on public education as a percentage of GDP. Raising tuition in public universities, increasing class room sizes, and decreasing skill building courses in community colleges directly affect the poor. We have cut back on services for childcare for poor working parents. Many times it is more cost efficient for a poor single parent to collect a minimal welfare check and stay home with their children, than to have that child in costly day care so that the parent may go to community college or hold down a poorly paying job at a fast food restaurant or Walmart.
Due to our short sided uncaring view of poverty in the U.S. we actually continue to perpetuate its existence.
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