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Poverty, by America

Matthew Desmond

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70 quotes

social-science

Chapter 2

  • Poverty is embarrassing, shame inducing. Misery (misère), the French sociologist Eugène Buret once remarked, “is poverty felt morally.” You feel it in the degradation rituals of the welfare office, where you are made to wait half a day for a ten-minute appointment with a caseworker who seems annoyed you showed up. You feel it when you go home to an apartment with cracked windows and cupboards full of cockroaches, an infestation the landlord blames on you. You feel it in how effortlessly poor people are omitted from movies and television shows and popular music and children’s books, erasures reminding you of your own irrelevance to wider society.Mar 10 2024 10:21PM

Chapter 4

  • On the one hand, as the late composer Stephen Sondheim once wrote, “The history of the world, my sweet—is who gets eaten and who gets to eat.” Clans, families, tribes, and nation-states collide, and one side is annihilated or enslaved or colonized or dispossessed to enrich the other. One side ascends to a higher place on the backs of the vanquished. Why should we think of poverty today as the result of anything different?Mar 10 2024 10:23PM
  • More shifting in chairs. It’s more complicated than that, some will say. Most social problems are complicated, of course, but a retreat into complexity is more often a reflection of our social standing than evidence of critical intelligence. Hungry people want bread. The rich convene a panel of experts. Complexity is the refuge of the powerful.Mar 10 2024 10:25PM
  • But capitalism is inherently about workers trying to get as much, and owners trying to give as little, as possible. With unions largely out of the picture, corporations have chipped away at the conventional mid-century work arrangement, which involved steady employment, opportunities for advancement and raises, and decent pay with some benefits. As the sociologist Gerald Davis has put it: Our grandparents had careers. Our parents had jobs. We complete tasks.Mar 10 2024 10:29PM
  • Corporations have not only drastically reshaped the nature of work; they’ve also bent the rules that govern it, turning economic coin into political muscle. The most powerful lobbying force in the nation (as measured in sheer dollars spent) is the U.S. Chamber of Commerce, which has mobilized against proposals to raise the corporate tax rate and the minimum wage and has come out against legislation designed to make it easier for workers to organize. In 2022, the U.S. Chamber dedicated more than $35 million to influencing government policy, while unions spent a combined total of roughly $25 million. But keep in mind that the U.S. Chamber is just a single pro-business organization. All but five of the top one hundred organizations that spend the most on lobbying represent business interests. Just three corporations alone—Meta, Amazon, and Comcast—spent more in 2022 than all labor unions combined. That kind of money allows corporate lobbyists to be everywhere at once, stalking not only the halls of Congress but also state legislatures and city council offices, pushing hundreds of bills. In 2016, Uber had 370 lobbyists working in forty-four states. Against that, what chance did the taxi unions have?Mar 10 2024 10:28PM

Chapter 5

  • Racism and exploitation feed on each other, and Black families who moved north during the Great Migration, which stretched from 1915 to 1970, experienced this fact afresh when they arrived in cities like Cleveland and Philadelphia. There, they were hemmed into ghettos, forced to accept housing options no one else wanted. The districts where Black families could live were written into the law and enforced by the police. Ghetto landlords had a captive tenant base, and because they could charge more, they did. For much of the migration, Blacks often paid double what white tenants had previously been charged for the worst housing in the city.Mar 22 2024 8:15PM
  • There exists a long history of slum exploitation in America. Money made slums because slums made money.Mar 22 2024 8:15PM
  • We found that landlords in poor neighborhoods earn roughly $300 a month per apartment unit after regular expenses are deducted from rent. Landlords in middle-class neighborhoods take home $225 a month per apartment unit, and landlords in rich neighborhoods take home $250 a month per unit after regular expensesMar 22 2024 8:16PM
  • Across the United States, landlords in poor neighborhoods do not just come out ahead. After accounting for all their costs, they typically enjoy profits that are double those of landlords operating in affluent communities.Mar 22 2024 8:16PM
  • Why do landlords in poor neighborhoods make more? Because their regular expenses (especially their mortgages and property tax bills) are considerably lower than those in more affluent neighborhoods, but their rents are only slightly lower. In many cities with average or below-average housing costs—think Buffalo, not Boston—rents in the poorest neighborhoods are not drastically lower than rents in the middle-class sections of town. Between 2015 and 2019, median monthly rent for a two-bedroom apartment in the Indianapolis metropolitan area was $991; it was $816 in neighborhoods with poverty rates above percent, just around percent less. Rents are lower in extremely poor neighborhoods, but not by as much as you’d thinkMar 22 2024 8:17PM
  • Even if Lakia had had a decent credit score, and even if she’d managed to save enough for a down payment, her chances of securing a mortgage for an affordable home would have remained slim because banks aren’t interested in financing the kind of homes she could afford. With no access to such mortgages, poor families must pay high rents on otherwise affordable homes. In the not-so-distant past (from 1934 to 1968), banks didn’t do business in poor and Black communities because the federal government refused to insure mortgages there. Today, banks don’t do much business in these same neighborhoods because they can make more money elsewhere. Redlining may no longer be official U.S. policy, but poor and predominately Black neighborhoods, and even whole towns, continue to function as “mortgage deserts.” If millions of poor renters accept exploitative housing conditions, it’s not because they can’t afford better alternatives; it’s because they often aren’t offered any.Mar 22 2024 8:21PM
  • None of these efforts did much to stem the practice, but they do reveal that the unprincipled act of trapping the poor in a cycle of debt has existed at least as long as the written word. It might be the oldest form of exploitation after slavery. Many writers have depicted America’s poor as unseen, shadowed, and forgotten people: as “other” or “invisible.” But markets have never failed to notice the poor, and this has been particularly true of the market for money itself.Mar 22 2024 8:21PM
  • A 2021 study found that middle-class Black homeowners (with incomes between $75,000 and $100,000) carried higher interest rates on their mortgages than white homeowners with incomes at or below $30,000.Mar 22 2024 8:22PM
  • “Predatory inclusion” is what historian Keeanga-Yamahtta Taylor calls it in her book Race for Profit, describing the long-standing American tradition of incorporating marginalized people into housing and financial schemes through bad deals when they are denied good ones. The exclusion of poor people from traditional banking and credit systems has forced them to find alternative ways to cash checks and secure loans, which has led to a normalization of their exploitation. This is all perfectly legal, after all, and subsidized by the nation’s richest commercial banks. The fringe banking sector would not exist without lines of credit extended by the conventional one. Wells Fargo and JPMorgan Chase bankroll payday lenders like Advance America and Cash America. It’s expropriators all the way down, orders from the East and all that. Everybody gets a cutMar 22 2024 8:34PM
  • There is not one banking sector. There are two—one for the poor and one for the rest of us—just as there are two housing markets and two labor markets. The duality of American life can make it difficult for some of us who benefit from the current arrangement to remember that the poor are exploited laborers, exploited consumers, and exploited borrowers, precisely because we are not. Many features of our society are not broken, just bifurcatedMar 22 2024 8:35PM
  • Poverty isn’t simply the condition of not having enough money. It’s the condition of not having enough choice and being taken advantage of because of that. When we ignore the role that exploitation plays in trapping people in poverty, we end up designing policy that is weak at best and ineffective at worstMar 22 2024 8:35PM
  • In Tommy Orange’s début novel, There There, a man trying to describe the problem of suicides on Native American reservations says, “Kids are jumping out the windows of burning buildings, falling to their deaths. And we think the problem is that they’re jumping.”Mar 22 2024 8:36PM

Chapter 6

  • Perhaps it’s because we’ve been trained since the earliest days of capitalism to see the poor as idle and unmotivated. The world’s first capitalists faced a problem that titans of industry still face today: how to get the masses to file into their mills and slaughterhouses to work for as little pay as the law and market allow. Hunger was the capitalists’ solution to the labor question.Mar 22 2024 8:40PM
  • Big money required big government. But big government could also hand out bread. Realizing this, early capitalists decried the corrosive effects of government aid long before it was extended to the so-called able-bodied poor. In 1704, the English writer Daniel Defoe published a pamphlet arguing that the poor would not work for wages if they were given alms. This argument was repeated over and again by leading thinkers, including Thomas Malthus in his famous 1798 treatise, An Essay on the Principle of Population.[] Early converts to capitalism saw poor aid not merely as a burden or as bad policy but as an existential threat, something that could sever the reliance of workers on owners.Mar 22 2024 8:41PM
  • President Donald Trump’s Council of Economic Advisers issued a report endorsing work requirements for the nation’s largest welfare programs and claiming that America’s welfare policies have brought about a “decline in self-sufficiency”; or when Kansas senator Roger Marshall in June 2021 said that the “number one impediment” to his state’s slack labor market was unemployment insurance that effectively meant “paying [people] more to stay home than to go to work,” they were rehashing an old story—call it the propaganda of capitalism—a story that has been handed down from one generation to the next: that our medicine (aid to the poor) is poison. The message has been received. Half the country appears to believe that social benefits from the government make people lazyMar 22 2024 8:43PM
  • The U.S. Bureau of Labor Statistics (BLS) has meticulously tracked the spending patterns of families receiving means-tested government assistance. Not surprisingly, those receiving assistance spend a larger share of their income on necessities (housing, food) and a smaller share on entertainment, alcohol, and tobacco than other American families. The BLS also found that families with incomes in the top percent of the distribution dedicate twice as much of their budget to alcohol as families with incomes in the bottom  percent. It’s been this way for generations. In 1899, the sociologist Thorstein Veblen wrote about rich people’s taste for “intoxicating beverages and narcotics” and the poor’s “enforced continence,” on account of the cost of booze and other drugsMar 22 2024 8:45PM
  • If you dig into the data, you quickly realize that the problem isn’t welfare dependency but welfare avoidance. Simply put, many poor families don’t take advantage of aid that’s available to them. Only a quarter of families who qualify for Temporary Assistance for Needy Families apply for it. Less than half ( percent) of elderly Americans who qualify for food stamps sign up to receive them. One in five parents eligible for government health insurance (in the form of Medicaid and the Children’s Health Insurance Program) do not enroll, just as one in five workers who qualify for the Earned Income Tax Credit do not claim it.[] Welfare avoidance persists through bumper years and downturns. At the height of the Great Recession, one in ten Americans was out of work, but only one in three drew unemployment.Mar 10 2024 10:30PM
  • Almost half of all Americans receive government-subsidized health benefits through their employers, and over a third are enrolled in government-subsidized retirement benefits. These participation rates, driven primarily by rich and middle-class Americans, far exceed those of even the largest programs directed at low-income families, such as food stamps ( percent of Americans) and the Earned Income Tax Credit ( percent).[24]Mar 10 2024 10:32PM
  • Today, the biggest beneficiaries of federal aid are affluent families. To benefit from employer-sponsored health insurance, you need a good job, usually one that requires a college degree. To benefit from the mortgage interest deduction, you need to be able to afford a home, and those who can afford the biggest mortgages reap the biggest deductions. To benefit from a 529 plan, you need to be able to squirrel away cash for your children’s college costs, and the more you save, the bigger your tax break, which is why this subsidy is almost exclusively used by the well-off.[] As far as I know, there are no PhD dissertations being drafted, no studies being conducted, no grant applications being submitted to figure out how to increase take-up rates for the mortgage interest deduction, student loans, or employer-sponsored health insurance, because the participation rates for these kinds of programs are quite impressive already.Mar 10 2024 10:33PM
  • The American government gives the most help to those who need it least. This is the true nature of our welfare state, and it has far-reaching implications, not only for our bank accounts and poverty levels, but also for our psychology and civic spiritMar 22 2024 8:48PM
  • Studies have found that Americans who claimed the Earned Income Tax Credit weren’t more likely to see themselves as government beneficiaries than those with a similar background who didn’t or couldn’t claim the benefit. But people who received cash welfare did see themselves as beneficiaries of government aid. Similarly, those who relied on student loans or drew on 529 plans were not more likely to recognize the government’s role in their lives than people from similar walks of life who didn’t rely on these programs. But Americans who benefitted from the GI Bill had a clear sense that they had been granted new opportunities through state action. In fact, Americans who rely on the most visible social programs (like public housing or food stamps) are also the most likely to recognize that the government had been a force for good in their lives, but Americans who rely on the most invisible programs (namely tax breaks) are the least likely to believe that the government had given them a leg up.[29]Mar 10 2024 10:34PM
  • Those who benefit most from government largesse—generally white families with accountants—harbor the strongest antigovernment sentiments. And those people vote at higher rates than their fellow citizens who appreciate the role of government in their lives.Mar 22 2024 8:49PM
  • Overwhelmingly, voters who claim the mortgage interest deduction are the very ones who oppose deeper investments in affordable housing, just as those who received employer-sponsored health insurance were the ones pushing to repeal the Affordable Care Act. It’s one of the more maddening paradoxes of political life.[30]Mar 22 2024 8:49PM
  • How do we square this? How do we reconcile the fact that massive government tax benefits go unnoticed by middle- and upper-class families who claim them, which in turn spreads resentment among those families toward a government perceived to be giving handouts to poor families, which in turn leads well-off voters to mobilize against government spending on the poor while also protecting their own tax breaks that supposedly aren’t even noticed in the first place?Mar 10 2024 10:35PM
  • The first is that many of us understandably have a hard time viewing a tax break as something akin to a government check. We see taxation as a burden and tax breaks as the state allowing us to keep more of what is rightfully ours. Psychologists have shown that we tend to feel losses more acutely than gains. The pain of losing $1,000 is stronger than the satisfaction of winning that amount.[] It’s no different with taxes. We’re apt to think much more about the taxes we have to pay (the loss) than about the money delivered to us through tax breaks (the gain).Mar 22 2024 8:54PM
  • This is by design, the result of the United States intentionally making tax filing exasperating and time-consuming. In Japan, Great Britain, Estonia, the Netherlands, and several other countries, citizens don’t file taxes; the government does it automatically.Mar 22 2024 8:54PM
  • In those countries, taxpayers check the government’s math, sign the form, and mail it back in. The process can be completed in a matter of minutes, and more important, it better ensures that citizens pay the taxes they owe and receive the benefits owed to them. If Japanese or Dutch taxpayers believe their government has overcharged them, they can appeal their bill, but most don’t. There’s no reason Americans’ taxes couldn’t be collected this way, except for the fact that corporate lobbyists and many Republican lawmakers want the process to be painful. “Taxes should hurt,” President Reagan famously said. If they don’t, we might come to see taxpaying as a normal and straightforward part of membership in society, instead of what happens that irksome time of year when the government takes our money.[33]Mar 22 2024 8:55PM
  • With respect to the federal income tax, some believe that middle-class taxpayers are carrying the poor on their backs. But let’s look at the data. In 2018, the average middle-class family had an income of $63,900, paid $9,900 in federal taxes after all deductions, and received $13,600 in social insurance benefits (like disability and unemployment) along with $3,400 from means-tested programs (like Medicaid and food stamps). In other words, the average middle-class family received $7,100 more in government aid than it paid in federal taxes, a serious return on investment. The claim that middle-class Americans are subsidizing the poor with their tax dollars and receiving nothing in return just isn’t true.[Mar 22 2024 8:56PM
  • Most of us believe that working hard helps us get ahead—because of course it does—but most of us also recognize that advantages flow from being white or having highly educated parents or knowing the right people. We sense that our bootstraps can be pulled up only so far, that self-help platitudes about grit and self-control and putting in the hours is fine advice for our children, but it’s no substitute for a theory of how the world works. For as long as there has been poverty alongside great wealth, the winners have cultivated rationalizations for that arrangement. Those who remain poor haven’t tried hard enough. Welfare creates long-term dependency. Expanding opportunity to the poor is an act of destruction, leading to socialism and tyranny. Such propaganda was repeated not because these ideas persuaded us but because they organized us, allowing us to avoid a more painful truth, which is that our lives are interlaced with the lives of the poor.[38]Mar 22 2024 8:59PM
  • But these old tropes and stereotypes are dying. We’ve seen through them. Most Democrats and most Republicans today believe that poverty is caused by unfair circumstances, not by a lack of work ethic.[] This brings us to the third possible explanation for why we accept the current state of affairs: We like it. It’s the rudest explanation, I know, which is probably why we cloak it behind all sorts of justifications and quick evasions. But as the civil rights activist Ella Baker once put it, “Those who are well-heeled don’t want to get un-well-heeled,” no matter how they came by their coin.Mar 22 2024 8:59PM
  • Frankly, tax breaks are nice to have if you can get them. In 2020, the mortgage interest deduction allowed more than million Americans to keep $24.7 billion. Homeowners with annual family incomes below $20,000 enjoyed $4 million in savings, and those with annual incomes above $200,000 enjoyed $15.5 billion. Also in 2020, more than million taxpayers deducted interest on their student loans, saving low-income borrowers $12 million and those with incomes between $100,000 and $200,000 $432 million. In all, the top percent of income earners receives six times what the bottom percent receives in tax breaks. Money granted by bizarre government subsidies is still money, and once we have it, we prefer to keep itMar 22 2024 8:59PM
  • Help from the government is a zero-sum affair. The biggest government subsidies are not directed at families trying to climb out of poverty but instead go to ensure that well-off families stay well-off. This leaves fewer resources for the poor. If this is our design, our social contract, then we should at least own up to it. We should at least stand up and profess, Yes, this is the kind of nation we want. What we cannot do is look the American poor in the face and say, We’d love to help you, but we just can’t afford to, because that is a lie.Mar 10 2024 10:38PM

Chapter 7

  • It’s an old problem, one documented by the Roman historian Sallust in his first monograph, Bellum Catilinae, which recounts the political turmoil that roiled Rome in b.c.e., during the time of Julius Caesar.[] But the mid-century economist John Kenneth Galbraith popularized the predicament in his 1958 book, The Affluent Society. Galbraith did not spill much ink (or any ink, really) on the issue of exploitation. His great concern had to do with the fact that private fortunes were significantly outpacing investments in public services like schools, parks, and safety net programs. The process tends to begin gradually before accelerating under its own momentum. As people accumulate more money, they become less dependent on public goods and, in turn, less interested in supporting them. If they get their way, through tax breaks and other means, personal fortunes grow while public goods are allowed to deteriorate. As public housing, public education, and public transportation become poorer, they become increasingly, then almost exclusively, used only by the poor themselves.[6]Mar 11 2024 9:37AM
  • We drive our Apple CarPlay–equipped SUVs past homeless encampments by the sides of highways. We spend an enormous amount of time stuck in traffic because we’ve neglected to invest in public transportation projects like high-speed trains. We step from our Manhattan condo, nod to the doorman, and walk streets piled with trash, perhaps hopping on a derelict subway car to meet friends for sushi. We avoid public parks, some of which we’ve allowed to become dangerous and unsettling, but have memberships to private clubs and golf courses. We finish our basements and remodel our kitchens, while public housing is allowed to fester and fall to pieces. When we find ourselves in legal entanglements, we hire a team of lawyers from white-shoe firms but defund legal services for the indigent. This somehow feels normal to us: that those most in need of aggressive, committed legal defense get assigned attorneys with massive caseloads who sometimes can’t remember their names.Mar 11 2024 9:40AM
  • As our incomes have grown, we’ve chosen to spend more on personal consumption and less on public works. Our vacations are more lavish, but schoolteachers must now buy their own school supplies. We put more money into savings to fuel intergenerational wealth creation but collectively spend less on expanding opportunity to all children.Mar 11 2024 9:41AM
  • Tax cuts are one of the main engines of private opulence and public squalor, and in recent decades we have grown used to the Republican Party delivering them. But this is a recent trend—President Kennedy cut taxes; Nixon and Ford raised them—and if the modern flight from public investments can be said to have started anywhere, it started in a state that had elected a Democratic governor and a Democratic legislature: California.Mar 11 2024 9:42AM
  • The drive toward private opulence and public squalor harms the poor not only because it leads to widespread disinvestment in public goods but also because that disinvestment creates new private enterprises that eventually replace public institutions as the primary suppliers of opportunity. As more affluent citizens come to rely on those private enterprises, they withdraw their support from public institutions even more. In this way, disinvestment from public goods does not spur renewed attention or motivate reinvestment; it brings further disinvestment and, at the extreme, energizes calls to privatize even our most treasured public institutions such as the U.S. Postal Service and popular programs like Social Security.[] Equal opportunity is possible only if everyone can access childcare centers, good schools, and safe neighborhoods—all of which serve as engines of social mobility. But private opulence and public squalor leads to “the commodification of opportunity,” where those engines of social mobility now cost something. The best way to ensure that opportunity is unequal and unfair is to charge for it.[17]Mar 11 2024 9:44AM
  • President Trump called his signature policy achievement “the biggest tax cut in U.S. history.” It wasn’t, but it was plenty big and will reduce public investment by an estimated $1.9 trillion by 2027.[18] More for me. Less for we.Mar 22 2024 9:04PM
  • For decades, social scientists and policymakers have tried to engineer ways to pluck low-income families out of high-crime and high-poverty blocks and relocate them to neighborhoods brimming with promise. We started with the kids, busing them across town to integrate public schools. Forced busing turned out to be one of the most loathed domestic policies of the second half of the twentieth century, particularly among the white working class, who were most affected by the change. When busing didn’t work, we tried to devise ways for whole families to “move to opportunity” (as the effort was called) by doing things like passing out housing vouchers that could be used anywhere, including in upscale communities. This helped families keep a roof over their heads, but it did little to pull families out of poor neighborhoods. People used their vouchers to rent nicer apartments around the block. We then figured that if we couldn’t move the poor to opportunity, maybe we could move opportunity to the poor. This line of thought gave rise to programs like “opportunity zones,” which offer tax breaks to developers and people who invest in distressed neighborhoods (very broadly defined). Each of these social policies has accomplished important ends. But none of them did much to integrate neighborhoods or social networks along the lines of race or class.[] Why? Because most of us who live in safe, prosperous communities don’t want poor people for neighbors, particularly if we are white and they are Black.Mar 11 2024 9:46AM
  • You can learn a lot about a town from its walls. Our first walls were primitive things: sharpened tree trunks, mud and stone. We learned to dig trenches and build parapets. Someone in the American West invented barbed wire. Today, we fashion our walls out of something much more durable and dispiriting: money and laws. Zoning laws govern what kinds of properties can be built in a community, and because different kinds of properties generally house different kinds of people, those laws also govern who gets in and who does not. Like all walls, they determine so much; and like all walls, they are boring. There may be no phrase more soulless in the English language than “municipal zoning ordinance.” Yet there is perhaps no better way to grasp the soul of a community than this.Mar 11 2024 9:47AM
  • Today, many American cities remain in large part “R- dwelling house districts.” As The New York Times put it in 2019: “It is illegal on percent of the residential land in many American cities to build anything other than a detached single-family home.” A 2021 study of one hundred large cities found that the median central city permitted apartment dwellers to live on only percent of its residential land. This is a distinctly American approach to city planning. Greece and Bulgaria don’t distinguish between single-family and multifamily housing in their zoning laws, for example, while Germany has outwardly acknowledged the benefits of integrating different housing types in the same neighborhood.[Mar 11 2024 9:47AM
  • It is true, as Heather McGhee has argued in her book, The Sum of Us, that one group’s gain need not always come at another group’s expense and that adopting such a zero-sum mindset has time and again led poor whites to choose poverty and sickness over parity with Black Americans.[] But it is also true that hoarding resources and passing laws that block the less fortunate from those resources is an incredibly effective way to grow wealthier while the undesirables languish outside the wall.Mar 22 2024 9:09PM
  • If you erect a community of expensive, beautiful homes and prop up the value of those homes by making it illegal to build more housing, which turns your home into a resource so scarce that potential buyers do things like write pleading letters or make cash offers above the asking price or bid sight unseen—behavior that has become commonplace in liberal cities like Austin, Seattle, and Cambridge—then you pretty much want to keep things as they areMar 22 2024 9:10PM

Chapter 8

  • having published War and Peace and Anna Karenina, Leo Tolstoy moved to Moscow from the Russian countryside. He was fifty-three and a man of means, able to employ a team of servants who ran his household. One of the first things Tolstoy noticed about Moscow was its poverty. “I knew country poverty,” he wrote, “but town poverty was new and incomprehensible to me.” He was shocked to walk the streets of the city and see such hunger and hopelessness commingling with such ostentation and frivolity. The problem haunted Tolstoy, and he went looking for an answer. He visited houses of prostitution, questioned a police officer who had arrested a beggar, and even adopted a young boy, who eventually ran away. The problem wasn’t work, the great writer quickly learned. The poor seemed to never stop working. The problem, he ultimately decided, was himself and his fellow affluents, who lived idle lives. “I sit on a man’s back, choking him and making him carry me, and yet assure myself and others that I am very sorry for him and wish to ease his lot by all possible means—except by getting off his back.”[1]Mar 11 2024 9:57AM
  • How do we, today, make the poor in America poor? In at least three ways. First, we exploit them. We constrain their choice and power in the labor market, the housing market, and the financial market, driving down wages while forcing the poor to overpay for housing and access to cash and credit. Those of us who are not poor benefit from these arrangements. Corporations benefit from worker exploitation, sure, but so do consumers who buy the cheap goods and services the working poor produce, and so do those of us directly or indirectly invested in the stock market. Landlords are not the only ones who benefit from housing exploitation; many homeowners do, too, their property values propped up by the collective effort to make housing scarce and expensive. The banking and payday lending industries profit from the financial exploitation of the poor, but so do those of us with free checking accounts at Bank of America or Wells Fargo, as those accounts are subsidized by billions of dollars in overdraft fees.[] If we burn coal, we get electricity, but we get sulfur dioxide and nitrogen oxide and other airborne toxins, too. We can’t have the electricity without producing the pollution. Opulence in America works the same way. Someone bears the cost.Mar 11 2024 9:58AM
  • Second, we prioritize the subsidization of affluence over the alleviation of poverty. The United States could effectively end poverty in America tomorrow without increasing the deficit if it cracked down on corporations and families who cheat on their taxes, reallocating the newfound revenue to those most in need of it.[] Instead, we let the rich slide and give the most to those who have plenty already, creating a welfare state that heavily favors the upper class. And then our elected officials have the audacity—the shamelessness, really—to fabricate stories about poor people’s dependency on government aid and shoot down proposals to reduce poverty because they would cost too much. Glancing at the price tag of some program that would cut child poverty in half or give all Americans access to a doctor, they suck their teeth and ask, “But how can we afford it?” How can we afford it? What a sinful question. What a selfish, dishonest question, one asked as if the answer wasn’t staring us straight in the face. We could afford it if we allowed the IRS to do its job. We could afford it if the well-off among us took less from the government. We could afford it if we designed our welfare state to expand opportunity and not guard fortunes.Mar 11 2024 9:59AM
  • Third, we create prosperous and exclusive communities. And in doing so, we not only create neighborhoods with concentrated riches but also neighborhoods with concentrated despair—the externality of stockpiled opportunity. Wealth traps breed poverty traps.[] The concentration of affluence breeds more affluence, and the concentration of poverty, more poverty. To be poor is miserable, but to be poor and surrounded by poverty on all sides is a much deeper cut.[] Likewise, to be rich and surrounded by riches on all sides is a level of privilege of another order. We need not be debt collectors or private prison wardens to play a role in producing poverty in America. We need only to vote yes on policies that lead to private opulence and public squalor and, with that opulence, build a life behind a wall that we tend and maintain. We may plaster our wall with Gadsden flags or rainbow flags, All Lives Matter signs or Black Lives Matter signs. The wall remains the wall, indifferent to our decorations.[7]Mar 11 2024 10:00AM
  • If the answer isn’t stigma, what is going on? The bulk of the evidence indicates that low-income Americans are not taking full advantage of government programs for a much more banal reason: We’ve made it hard and confusing. People often don’t know about aid designated for them or are burdened by the application process. When it comes to increasing enrollment in social programs, the most successful behavioral adjustments have been those that simply raised awareness and cut through red tape and hassle.[10]Mar 11 2024 10:01AM
  • No kidding: Using Frutiger font—that sturdy, confident typeface adorning Swiss road signs and prescription labels—helped bring millions of more dollars to low-income working familiesMar 12 2024 7:32PM
  • In recent decades, corporations have parked more and more of their profits in shell companies registered in countries with bottom-level tax rates. The trick is to pretend that a sizable part of your Silicon Valley– or Wall Street–based company is really located in places like Ireland and Bermuda. Facebook recently logged $15 billion in profit in Ireland, which amounted to $10 million per Irish employee, while Bristol Myers Squibb reported making $5 billion on the Emerald Isle, or roughly $7.5 million per employee. Clearly, companies are doing all they can to avoid paying what they owe.Mar 12 2024 7:35PM
  • Wealthy families, too, have found new ways to weasel out of paying taxes. Studies have shown that most Americans pay percent of the taxes they owe, but the ultra-rich pay only percent.Mar 12 2024 7:36PM
  • Income inequality has endowed rich families with more political power, which they have used to campaign for lower taxes, which in turn boosts their economic and political power even more, locking in an undemocratic and unjust cycle.[] We need to interrupt that cycle, which is why I also support increasing the top marginal tax rate and the corporate tax rate. Since 1962, the effective tax rate for poor, working-class, and middle-class Americans has increased, while it has decreased for the top  percent of income earners, and particularly for the richest among us. This is absurd. We should bump up the top marginal tax rate—perhaps to percent, as it was in 1986; or  percent, as it was in 1975—and expand our tax brackets so that an investment banker’s income is taxed differently than a dentist’s. Meanwhile, at percent, the corporate tax rate in America is the lowest it’s been in more than eighty years. We could fund a good deal of antipoverty initiatives by increasing it to  percent, as it was from 1993 through 2017, or to percent, as it was from 1979 through 1986Mar 12 2024 7:37PM
  • Some claim that such proposals would hamstring the economy by disincentivizing innovation and entrepreneurship. But no serious social scientist believes that the economy slows down when we reasonably increase taxes on the rich or on multinational corporations. There were go-getters aplenty in past decades, when top tax rates were much higher, while in recent years productivity has declined right alongside taxes on wealthy individuals and companies. Commentators have taken to describing today’s America as having entered “The Age of Decadence” or “A Dark Age of Invention and Innovation,” a time of stagnation and slowdown. Since the rich haven’t given the country all that economic dynamism they promised when we cut their taxes, they can at least put in more for public investmentsMar 12 2024 7:38PM
  • Should we seek out more targeted programs or more universal ones? This is an old question in the policy debate. Targeted programs (like food stamps) are reserved for the poorest families. Because they direct themselves to marginalized people with specific needs (like hunger), they are cost-efficient and typically successful. But they are also divisive, as families just above an arbitrary income cutoff are denied help, causing a rift to form between officially poor families and a much larger group of Americans who live above the poverty line but without much economic security. We saw this happen during the rollout of the Affordable Care Act. Some working-class families had to pay upward of $1,000 a month for coverage, while poorer families qualified for free Medicaid. After seeing her healthcare costs jump, Gwen Hurd, a worker at an outlet mall, told a reporter in 2018: “It seems to me that people who earn nothing and contribute nothing get everything for free. And the people who work hard and struggle for every penny barely end up surviving.”[] Universal programs, like a universal basic income (UBI), get rid of this baggage. Designed to benefit a large number of people, sometimes irrespective of their standing, universal programs are less polarizing and so are considered more politically durable. (“Programs for the poor are poor programs,” the old policy-school adage goes.) But universal programs are also much more expensive—some popular UBI proposals would cost north of $1 trillion a year—and their one-size-fits-all design can underserve the neediest familiesMar 12 2024 7:42PM
  • For me, the fundamental lesson that emerges from this debate is that if we want to abolish poverty, we need to embrace policies that foster goodwill and be suspicious of those that kindle resentment. Will the policy unite people struggling with economic insecurity, those below the poverty line and those above it? Will it drive down poverty and promote economic opportunity? A policy that checks both of these boxes deserves serious consideration. In fact, a guiding set of principles for an antipoverty agenda might be the following: Rebalance the safety net and insist on tax fairness in order to make significant investments in eliminating poverty through policies supported by broad coalitions. We should go big: No more nudges, no more tinkering, no more underfunding an initiative and then asking why it didn’t work. Ambitious interventions should be funded by progressive tax policies and a redesigned welfare state and delivered in ways that do not sow division among struggling families who should for all intents and purposes be political alliesMar 12 2024 7:45PM
  • Are you calling for the redistribution of wealth? “Redistribution.” I hate the word. It distracts and triggers, causing us to instinctively fly to our respective political corners and regurgitate the same old talking points. No one should be that rich! Ingenuity and hard work should be rewarded! It’s tiresome. Even worse, the notion of redistribution has the pernicious effect of framing social progress as a taking, as if the government were a greedy, many-tentacled monster seeking to reach deeper into your pocket.Mar 12 2024 7:46PM
  • PayPal founder Peter Thiel’s Roth IRA is worth $5 billion. That money is completely tax free if the billionaire doesn’t withdraw it before he is fifty-nine and a half.Mar 12 2024 7:47PM
  • Politics in America is a dismal, ugly business these days. During a time of intense polarization, disturbing threats to democratic institutions, and partisan gridlock in Washington, calling for transformative federal policies to abolish poverty might sound hopelessly naïve. Then again, Congress responded with bold, bipartisan relief during the pandemic, making more progress on poverty than we’ve seen in generations. After the Great Recession that began in 2008, families in the bottom half of the income distribution had to wait nearly ten years before their incomes returned to pre-recession levels. After the COVID--induced recession, they waited just a year and a half. Government aid played a major role in the recovery.Mar 12 2024 7:48PM
  • I thought the bureaucrats who had overseen the Emergency Rental Assistance program deserved a parade. They had to settle for scattered applause. When the ERA program was sputtering in the unsteady early days, it seemed that everyone was writing and tweeting about it. Later, when the rollout was working, it was ignored. Because journalists and pundits and social influencers did not celebrate the program, ERA garnered few champions in Washington. Elected leaders learned that they could direct serious federal resources to fighting evictions, make a real dent in the problem, and reap little credit for it. So, the Emergency Rental Assistance program became a temporary program, and we returned to normal, to a society where seven eviction filings are issued every minuteMar 12 2024 7:51PM
  • The War on Poverty and the Great Society were launched during a time when organized labor was strong and incomes were climbing. In today’s labor market, unions are weak and real wages are falling for far too many Americans. When the economy delivered for the average worker, and even those near the bottom of the pay scale, antipoverty programs were cures. Today, the labor market has turned those programs into something like dialysis, a treatment designed to make poverty less lethal, not to make it disappear.[] Meanwhile, the housing market now recoups many of the gains workers make. After wages began to rise in 2021, following worker shortages, rents rose as well, and soon people found themselves back where they started or worse. It’s an old pattern. Since 1985, rent prices have exceeded income gains by 325 percentMar 12 2024 7:56PM
  • A big reason why is that we insist on supporting policies that accommodate poverty, not ones that disrupt it. Our largest cash assistance program is the Earned Income Tax Credit, which props up corporate profits and depresses wages. Our biggest affordable housing initiative is the Housing Choice Voucher Program, which, by paying a portion of a family’s rent, subsidizes private landlords and pushes up costs.[] Do tax credits for low-income workers and housing vouchers for low-income renters make a difference? Unquestionably. Millions more families would be impoverished if these programs didn’t exist. I have spent years advocating for more housing vouchers as a politically viable solution to the affordability crisis. But over the course of writing this book, I’ve been forced to face the fact that poverty has refused to decline significantly in the years since the Earned Income Tax Credit and the Housing Choice Voucher Program were rolled out and expanded. These policies are at once solutions to poverty and stanchions of it. They rescue millions of families from a social ill, but they do nothing to address its root causes.Mar 12 2024 7:58PM

Chapter 9

  • Those who have amassed the most power and capital bear the most responsibility for America’s vast poverty: political elites who have utterly failed low-income Americans over the past half century; corporate bosses who have spent and schemed to prioritize profits over people; lobbyists blocking the will of the American people with their self-serving interests; property owners who have exiled the poor from entire cities and fueled the affordable housing crisis. Acknowledging this is both crucial and deliciously absolving, directing our attention upward and distracting us from all the ways (many unintentional) we also contribute to the problemMar 22 2024 10:48PM
  • There is considerable evidence that it’s easier to change norms than beliefs. “You’re wrong” is a less influential message than “Yeah, we’re not really doing that anymore.”[] You might worry about climate change but install solar panels only after your neighbors do. You might acknowledge the impact of fast fashion but change your shopping habits only after your classmates do. We hold many ethical beliefs, but we tend to act on them only when we receive a social push. As the psychologist Betsy Levy Paluck put it to me once, “Norms license us to do things we already believe in.”Mar 22 2024 10:50PM

Chapter 10

  • “Any real change,” writes James Baldwin, “implies the breakup of the world as one has always known it, the loss of all that gave one an identity, the end of safety. And at such a moment, unable to see and not daring to imagine what the future will now bring forth, one clings to what one knew, or thought one knew; to what one possessed or dreamed that one possessed.”Mar 22 2024 11:00PM

nts

  • Saurabh Bhargava and Dayanand Manoli, “Psychological Frictions and the Incomplete Take-Up of Social Benefits: Evidence from an IRS Field Experiment,” American Economic Review 105 (2015): 3489–529; Amy Finkelstein and Matthew Notowidigdo, “Take-Up and Targeting: Experimental Evidence from SNAP,” The Quarterly Journal of Economics 134 (2019): 1505–556.Mar 12 2024 7:33PM

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