Interesting report on the poor

[sandy6879]

Having gone through a NUMBER of circumstances, and overcoming them, I have nothing but compassion for people who are trying to improve their lives and working towards that goal.

However, due to the ever increasing cost of everything, the middle class is taking home a lower percentage than they were before and risks falling into the poverty category when it takes into account the rate of inflation. The cost of gas, increasing cost of medical insurance, utilities, groceries, etc are all ever increasing at a much higher rate than wages, if wages go up at all. Plenty of people haven't seen a raise in a long time.

The country really is going to need a major overhaul if it doesn't do something, and I don't know what, soon. People are not going to be able to afford to go to work due to the cost of gas - I live in an area where public transportation is non-existant. You would need to drive 15 minutes to get to a busline, and trust me, I don't live in a high class neighborhood, just a regular working middle class one. When you combine all these factors, the future of the middle class doesn't look much better than that of the poverty level. just my opinion - hoping to not get flamed away.

 

[Chicago526]

Two other factors keeping the poor, poor. Insurance, and a support system.

And I'm not just talking medical insurance, although that's a big part. Many entry level jobs don't offer medical coverage, so even a minor illness can cause havok in a tight budget. Not to mention, entry level jobs often don't have paid leave. You either work sick or stay home and not get paid (and right at a time when you need more money, not less). But I'm talking about life insurance and disability insurance. Middle class families can afford to insure themselves against what I'm sure are huge contributors to being or becoming poor, death or disability of a wage earner.

Heaven forbid, but if my DH died tomorrow, the life insureance would be enough to clear all our debts (including the house) with some left over. I would only have to earn enough to cover property taxes, food, transportation expenses (on a paid for car), and utilities. If I was frugal, I could live on $1000 a month. Now I don't have kids, but if even if I did, I'd still be able to work a minimum amount and keep my head above water. It wouldn't be fun and it sure as heck wouldn't be easy, but I'd be able to keep a middle class lifestyle (although lower one than I'm used to).

If DH became disabled instead of dieing, we have both short term and long term disability insurance. It only covers 2/3 of his base income (doesn't include his substantial overtime pay) but even so, we could make do on it. And I have life and short/long term disability as well, so if something happened to me, DH is also covered.

And the other factor I mentioned was a support system. All of my friends and family are middle class and could help us out, not just in terms of financial aid but just helping out in general (especially with child care if we had kids). Poor people may have family and friends like anyone else, but often they aren't in any kind of condition to help, they're in the boat afterall. Having people that can help you out with transportation, clothes, food, childcare, job networking and other areas can make a huge, huge differance for a family facing hard times.

The causes of poverty are so complex and also so individual that there isn't any one-size-fits-all (or even most) answer. And even when the right resources are given to people, you then have that "personal responsibility" factor. Some people are just better able to take advantage of oprotunities than others, and that's true in ALL income brackets, the poor haven't cornered the market in missed oprotunities.

 

[DisneyGirl4188]

However, due to the ever increasing cost of everything, the middle class is taking home a lower percentage than they were before and risks falling into the poverty category when it takes into account the rate of inflation. The cost of gas, increasing cost of medical insurance, utilities, groceries, etc are all ever increasing at a much higher rate than wages, if wages go up at all. Plenty of people haven't seen a raise in a long time.

The country really is going to need a major overhaul if it doesn't do something, and I don't know what, soon. People are not going to be able to afford to go to work due to the cost of gas - I live in an area where public transportation is non-existant. You would need to drive 15 minutes to get to a busline, and trust me, I don't live in a high class neighborhood, just a regular working middle class one. When you combine all these factors, the future of the middle class doesn't look much better than that of the poverty level. just my opinion - hoping to not get flamed away.

I agree.

I am lucky that I work a mile from my home and DH drives me (using his company car) so I don't have to spend much on gas at all. I used to work over an hour away and if I was still there, I would not be able to afford gas. I did make more, but I had to pay for gas and I didn't have health insurance. Now, I do have insurance and I pay alot for it.

DH hasn't received a raise in almost two years. My last job I did get a raise; a whopping .5 an hour. That is NOT a raise at all (many people didn't even get that).

The country really needs to look at what is happening and find a way to fix it.

 

[sanctus]

The other reality of the poverty trap - and it can definitely be a trap - is that getting a job is sometimes not the best answer.

Take a single mother, high school diploma, 2 kids under 5. All figures here are for East Tennessee, where I work in food stamp/welfare, so your amounts will vary. The economy here has "turned over" to a service industry. Basically, the jobs for those without a college degree are retail and food service, the manufacturing jobs have been outsourced overseas.

So:
Work full time for $6.00 per hour (not bad, most places here start you lower) and actually get 40 hours per week. Gross pay is 1032 per month. ($6.00 x 40 hours x 4.3 weeks a month) That's before any taxes come out. And your employer does not offer insurance or sick leave. Miss work, miss pay, and maybe get fired.

Day care for 2 kids at $95 per week per child x 4.3 weeks: $817

Now you have $215 to live on. Oh wait, you have less, because taxes will come out of your check. And you still don't have gas, an apartment, groceries, electricity........

And public transportation doesn't really exist here.

The fact is, without programs to provide day care, get a job is really not the answer until the kids are school age. And everytime the budget gets tight, day care funding gets cut.

Day care, medical care, and transportation. Until these 3 issues are resolved, "get a job" just doesn't solve the problem.

 

[dvcgirl]

Having gone through a NUMBER of circumstances, and overcoming them, I have nothing but compassion for people who are trying to improve their lives and working towards that goal.

However, due to the ever increasing cost of everything, the middle class is taking home a lower percentage than they were before and risks falling into the poverty category when it takes into account the rate of inflation. The cost of gas, increasing cost of medical insurance, utilities, groceries, etc are all ever increasing at a much higher rate than wages, if wages go up at all. Plenty of people haven't seen a raise in a long time.

The country really is going to need a major overhaul if it doesn't do something, and I don't know what, soon. People are not going to be able to afford to go to work due to the cost of gas - I live in an area where public transportation is non-existant. You would need to drive 15 minutes to get to a busline, and trust me, I don't live in a high class neighborhood, just a regular working middle class one. When you combine all these factors, the future of the middle class doesn't look much better than that of the poverty level. just my opinion - hoping to not get flamed away.

Well, the cost of gas is only going one way ultimately. Up. And forget the crisis in the Middle East, or the hurricane of the month. It is simply a supply issue. With India and China developing like gangbusters, and because we haven't drilled for new oil in our country in 30 years....well, the demand for oil worldwide will very likely exceed the supply, and soon. And even if we being drilling in Alaska, or offshore here in Florida, it takes a very long time to see oil. And so we'll need to adapt...alternative fuel is our only hope here.

It used to be that when one oil analyst said we'd soon hit $100 per barrel that everyone would write him off as looney, or trying to drive the price up. These days, lots of analysts are saying we'll hit $100, and in the not too distant future. $100 oil puts us at $4.00 a gallon, and that is going to hurt.

As for the economy, well, I hear the government putting out the good news and yet, I think we're heading for a recession, very soon. They could tell us six months from now that we've been in a recession for the last six months and I wouldn't be surprised. We're overdue actually...so it's not necessarily a bad thing. Lending practices have been ridiculous as of late, and that's already beginning to reign itself in with higher interest rates. Housing is cooling, rapidly in some areas, and that certainly needed to happen.

The bigger and more worrisome issues are our debt as individuals and as a nation. The housing market has been fueling consumer spending for a few years now as people began using their homes as personal ATM machines.....and as rates rise, and people lose some equity as prices drop, consumer spending will certainly go down with it. As for the government, well, if we don't stop borrowing money from China and Japan our good ole US dollar isn't going to be worth very much around the world anymore.

Having said all of that, we're doing as well personally as we've ever done. And I don't believe that we're all a "pink-slip away from depending on the state". We've worked very hard to achieve financial independence and we would be just fine without any assistance. We've done this by being different from most people....we live on a lot less than we make. We're not expecting anything from the government quite frankly. If Social Security and Medicare are still around when we need it...great, but we're not depending on it. The only people we depend on 110% is ourselves.

 

[anniem8]

Very interesting thread! Having been homeless with a 3 year old and pregnant, I can truly say "Been there." Some people make stupid choices.(Me) Things become complicated when you add innocents into the equation. My children did not make choices, good or bad, they did have to suffer the consequences. Luckily, I had a support system to lend me a helping hand. And government assistance that helped by providing child care and healthcare for my kids until I got on my feet. I am past that now. I have a decent job and can actually take Disney vacations! That doesn't mean I will ever forget what it was like to eat only beets for a week because that's all the food closet at the shelter had, or that I would ever blame the poor for their circumstances. Until you've been there, don't judge.

 

[sanctus]

As for the economy, well, I hear the government putting out the good news and yet, I think we're heading for a recession, very soon.
.

The good news they love to put out in a low unemployment rate. The problem with that is that it doesn't address the TYPE of job. Locally, the decent paying manufacturing sector, jobs that paid a living wage with benefits, are gone. But there are tons of minimum wage no benefit jobs that are hiring. So on one level, employment rate, things look great. On the other level, standard of living, it's not so pretty.

 

[disneysteve]

DH became disabled instead of dieing, we have both short term and long term disability insurance. It only covers 2/3 of his base income (doesn't include his substantial overtime pay) but even so, we could make do on it.

Depending on who pays for this coverage, the proceeds may be tax-free, so 2/3 of salary isn't as bad as it sounds if no taxes are due on that amount.

 

[disneysteve]

The fact is, without programs to provide day care, get a job is really not the answer until the kids are school age. And everytime the budget gets tight, day care funding gets cut.

As I've said, I work in a very poor area. Around here, there are plenty of working moms and they don't use paid daycare. Many of them have family members, usually grandparents, watch the kids. Often, they live with the grandparents anyway so it isn't a terrible arrangement. Another common arrangement is for one parent to work nites and the other to work days so there is always someone home with the kids. People do what they need to do to get by. Obviously, not everyone has grandparents around but almost everyone around here seems to have someone who can watch the kids while they work.

 

[NotUrsula]

talked to clients about comparing prices and trying to get the best value for the money-many had the mindset of 'i won't go to 'x' store-i ONLY shop at 'y' (the realy high end 'trendy' grocery store that was a good distance away from them in the wealthier end of town), 'pack my lunch for work?-no-way, i NEED my 'lunch dates' every day with the 'girls'' (paid more for lunch and their starbucks than they made each day ), 'drop all the premium channels and pay per views-NO WAY!". they opted out of free checking/savings accounts (with no fees for atm use) at large national banks that had special programs for our clients because they did'nt want to be 'seen' at that bank. it realy got frustrating when you tried to explain that if they were on a program that provided funding for a limited period of time after which they had to pick up the full cost (like child care or housing subsidies that helped for 6 months until their probation period at a job was passed and they were making a decent wage) it was best to go with a child care program or house that their anticipated wage could cover-nope, they opted most times to go with the 'fast food' high end child care center whose monthly fee was over 50% of their gross, and the house that once their subsidy ended would rent at twice their total monthly income. the attitude was 'i want it now, i'll worry about it when it happens'

Yes, this all sounds very bad, but there is a reason for it. (I'll grant it isn't an especially defensible reason, but this whole topic is pretty indefensible on some level.) I think of it as the Cinderella syndrome.

Most people who live in poverty in the US have substandard educations, and they watch way too much TV. TV is their window onto the greater world, and while they know that a lot of what they see is fantasy, they can't help but think, "Wow, wouldn't it be cool to live like that?" If by some miracle they *do* get the chance to live a beyond-their-dreams lifestyle, most of them will not be able to resist doing so, even if they KNOW that it is only a matter of time until the bottom falls out. Cinderella knew it was all ending at midnight, but she still went to the ball, because she wanted to take advantage of every moment of happiness she could snatch, and she never believed that any of the things her fairy godmother did for her were going to last forever.

True poverty is never a good audience for sermons of self-denial. They have no experience with the concept of choice and delayed gratification, because they are so far down that there is no such thing as *choosing* to do without; you do without precisely because you don't have a choice about it. They tend to have shorter life expectancies, too, and they really don't see much point to waiting years for anything, because who knows what fresh disaster might strike tomorrow that will blow it all to h***?

There is another point that I always make with middle-class folks when it comes to (for want of a better word) "bling": you can carry it. If for some reason your situation goes bad and you have to move in a hurry, that wealth is portable and tangible. People can see it, and people who have the same background that you do will respect you for having it, just as they will respect you for having the means to buy a Starbucks every day. To someone who is poor, the rarest and most valuable commodity in the universe is respect. Just look at some of the comments here, how they disparage the choices of the poverty-stricken and conclude that poverty is their own fault ... what that boils down to in the simplest terms is that we look down on them for not being able to do what we do, or else we pity them. Either way we don't give them the sort of respect that we give our socioeconomic peers. They crave respect like a junkie craves heroin, and if conspicuous consumption on a small scale will earn it, even for a week, then that is the path they will take. (I have actually known people who will buy one Starbucks and reuse the cup until it shreds; because they want their peers to see that cup.)

 

[4formickey]

I have some extra popcorn. Anyone care for some. you must have dental insurance to get a hand full 'll say this thread will get about 150 post and about 5 online fights.

 

[disneysteve]

I have some extra popcorn. Anyone care for some. you must have dental insurance to get a hand full 'll say this thread will get about 150 post and about 5 online fights.

I don't know why you are trying to start trouble. So far, this thread has gone 6 pages and everyone has been quite reasonable. Some people have been a little broad with their generalizations, but other than that I'd like to thank everyone for keeping this very civil.

 

[crisi]

As I've said, I work in a very poor area. Around here, there are plenty of working moms and they don't use paid daycare. Many of them have family members, usually grandparents, watch the kids. Often, they live with the grandparents anyway so it isn't a terrible arrangement. Another common arrangement is for one parent to work nites and the other to work days so there is always someone home with the kids. People do what they need to do to get by. Obviously, not everyone has grandparents around but almost everyone around here seems to have someone who can watch the kids while they work.

And, at the same time, that creates another kind of trap. There may be better opportunities or a lower cost of living in another part of the country (state - or even town!), but if you are dependant on a support network to provide free daycare, you can't leave that support network unless the short term benefits are enough to make it up. Most climbing out of poverty will be incremental, but you have to have the resources to take advantage of the incremental change.

And, because you rely on the support network, you are expected to support back. So when one person DOES get a decent job, it can go to supporting a large extended family - that isn't going to lift anyone out of poverty.

 

[disneysteve]

If for some reason your situation goes bad and you have to move in a hurry, that wealth is portable and tangible. People can see it, and people who have the same background that you do will respect you for having it, just as they will respect you for having the means to buy a Starbucks every day.

I really can't say I agree with this. I learned long ago that you can't judge anything about someone's financial circumstances by the "stuff" they surround themselves with. That big screen tv might be from a rent-to-own store. That snazzy car in the driveway might be leased or bought with a 7-year loan. Your neighbor might have 5-figure credit card debt from buying all the "bling." I don't respect someone for going to Starbucks every day. I'm much more likely to respect the person who brings in a travel mug of coffee that they brew at home each morning.

 

[aka-mad4themouse]

I have some extra popcorn. Anyone care for some. you must have dental insurance to get a hand full 'll say this thread will get about 150 post and about 5 online fights.

Hopefully there will be many posts, lots of viewing and NO ONLINE FIGHTS!!!! We don't encourage that. So put the popcorn away if that's what you're expecting. It will be a big disappointment for you. There's plenty of room for civil dialogue with intelligent comments and insightful observations. Please feel free to add your own.

 

[MrsPete]

What I especially remembered from the book was Ehrenreich's (and her friends') surprise that no one "found her out." Her upper middle class income and education (i.e. her presumed higher class) was not readily apparent. Our class pretenses are irrelevent; we are what we do - a middle class educated woman who is waiting tables is treated like a waitress; if she's cleaning a house she's treated like a maid.

This will sound elitist, but I don't buy that. When I was in college I had several "poor jobs", and people -- customers and supervisors -- commented on a regular basis that I was "different" from the other workers. I didn't dress better, I didn't drive a better car, and I didn't make more money -- I couldn't -- I was genuinely poor then. But I certainly did have better communication skills than the others, I did behave professionally, I didn't drink or do drugs (not that all my co-workers were drunks or druggies, but I did find more in those jobs than I found post-college in professional jobs).

I'll give you an example -- just one of many: Early in my college career, I had a clerical job, and I was responsible for answering the phones during the receptionist's lunch break. After a while, my supervisor told me that I was being made the full-time receptionist. She told me that customers were giving her feedback that they liked talking to me, and the guys in the offices were telling her that I could take their messages properly. So I was moved to the receptionist job, but I got to keep my higher salary. At the same time, the guys I'd been working for continued to bring me typing work because they knew I'd smooth out their grammar and return it to them without mistakes. Communication skills that go along with a higher level of education do show.

 

[MrsPete]

Actually the poor DO pay taxes.

Sure, we all pay sales taxes at the store and the gas pump -- and since we all pay the same amount for those taxes, the poor are stuck paying a higher percentage of their salary towards those unpleasant necessities.

Mega-corporations, which employee a vast amount of people, get tax breaks - a form of welfare. Hospitals, schools/universities, retailers, etc etc etc all receive some form of welfare.

Statistics can be reported in such a way to make taxes look unfair in any direction. The truth is that big companies are paying a smaller percentage of their gross product towards taxes, but they are paying many, many, many more dollars into the tax pot than the rest of the world.

 

[SleepyatDVC]

Interesting report and topic.

 

[NotUrsula]

Please note that I didn't say that *I* respect someone because I see them with a Starbucks cup in their hands every day, but there are people who do, and seeking the respect of those people is part of the reason why some people who really can't afford it will keep buying it. (The other reason, of course, beyond a taste for good coffee, is that it represents just a tiny little bit of good life that they can indulge themselves with.)

I'm formerly poor, and I have lifelong familiarity with the art of faking it to keep up appearances. Because of what they did for a living, my parents were in a position to receive cast-offs from wealthy families, so we didn't spend money on the effort, but I know that we kids undoubtedly avoided a whole lot of grief that we would otherwise have experienced had we not managed to look more prosperous than we really were. The thing is, we were poor enough for it to be painful, but not so poor as to lose hope or ambition. We also knew old-money families at first hand, and we were able to learn from observing them, which is a tremendous advantage that most poor people do not have.

Most of the formerly poor people who I know that were REALLY poor but have gotten out because of marriage, insurance settlements, etc., cannot manage money with dexterity, and tend to place a lot of importance on where they shop and what brands they buy. Whenever I see that, I know that it is tied to pride and a desire for respect. I don't think it is a wise thing for them to do, but I understand why they do it and empathize with what they are trying to achieve by it. (I might also note that people who have climbed out of poverty by scraping for an education and earning the money a little at a time tend not to be conspicuous consumers, because they have learned the value of self-denial, and have over time absorbed the middle-class tenet that conspicuous consumption is crass.)

I can recommend another book, Limbo, by Alfred Lubrano. He is a journalist on staff with the Philadelphia Inquirer, and the book is a memoir of his working-class upbringing and his struggle to feel comfortable in the white-collar middle class. It isn't about dire poverty, but about why "bettering oneself" is a double-edged sword -- many people simply do not have the courage to risk cutting themselves with it. (Just reading the reader reviews on the Amazon site will be illuminating to those who have never climbed upward over class barriers. http://www.amazon.com/gp/product/0471263761/104-1112011-2351101?v=glance&n=283155)

 

[crisi]

Statistics can be reported in such a way to make taxes look unfair in any direction. The truth is that big companies are paying a smaller percentage of their gross product towards taxes, but they are paying many, many, many more dollars into the tax pot than the rest of the world.

For the U.S. - as far as income taxes go (which is most of what corporations pay), that isn't the case. Individuals paid 4x what corporations paid in 2005:

http://www.irs.gov/taxstats/article/0,,id=102886,00.html