Poverty, By America by Matthew Desmond. 

2/5 rating. 189 pages.

Book #9 of 2024. Finished February 19, 2024.

This book talks very openly about poverty: its causes and why it is perpetuated. The topic is very interesting, but I struggled soooo much to get through this book. It just wasn’t written in a very engaging way.

Matthew discusses that poverty is not something that has just happened, it is perpetuated by institutions who could choose differently. All of us gain something from the status quo which make us at least implicitly support the continuation of poverty. “This is who we are: the richest country on earth, with more poverty than any other advanced democracy.”

The cost to end poverty in the scheme of things, is not that high. One estimate to end poverty is around $177 billion. This may sound like a lot, but the IRS estimates that $1 trillion a year are lost in unpaid taxes mostly by multinational companies and wealthy families. “When corporations hide profits in tax havens, and when rich families stash valuable assets in offshore accounts, they defraud the American public, forcing everyone else to pay for their greed.”

Some quotes I found interesting:

“More than a million of our public schoolchildren are homeless, living in motels, cars, shelters, and abandoned buildings.”

“America’s poverty is not for lack of resources. We lack something else.”

“The number of homeless children, as reported by the nation’s public schools, rose from 794,617 in 2007 to 1.3 million in 2018.”

“By the time they reach their mid-thirties, almost seven in ten Black men who didn’t finish high school will have spent a portion of their life in a cage.”

“Poverty measures exclude everyone in prison and jail—not to mention those housed in psych wards, halfway houses, and homeless shelters—which means there are millions more poor Americans than official statistics let on.”

“It’s more socially acceptable today to disclose a mental illness than to tell someone you’re broke. When politicians propose antipoverty legislation, they say it will help ‘the middle class.’ When social movement organizers mobilize for higher wages or housing justice, they announce that they are fighting on behalf of ‘working people’ or ‘families’ or ‘tenants’ or ‘the many.’”

“The Black unemployment rate remains nearly double the white unemployment rate, and studies have shown that Black jobseekers are just as likely to face discrimination in the labor market today as they were thirty years ago. There has been no progress in a generation.”

“In 2019, the median white household had a net worth of $188,200, compared with $24,100 for the median Black household. The average white household headed by someone with a high school diploma has more wealth than the average Black household headed by someone with a college degree.”

“Nationwide, for every dollar budgeted for TANF in 2020, poor families directly received just 22 cents.”

“States aren’t required to spend all of their TANF dollars each year, and many don’t, carrying over the unused money into the next year. In 2020, states had in their possession almost $6 billion in unspent welfare funds.”

“But I can’t get over the fact that each year, over a billion dollars of Social Security funds are spent not on getting people disability but on getting people lawyers so that they can get disability.”

“A study of eighteen rich democracies found that single mothers outside the United States were not poorer than the general population.”

“Choosing to have a child outside of marriage may be an individual choice, but condemning many of those parents and their children to a life of poverty is a societal one.”

“In 2020, Americans spent $1.6 billion just to cash checks. If the poor had a costless way to access their own money, over a billion dollars would have remained in their pockets during the pandemic-induced recession.”

“By one estimate, commercial banks could offer payday loans with fees up to eight times less than the standard market price and still turn a profit. But so far, they’ve shown no interest in doing so. It’s one thing to soak low-income customers with overdraft fees because those fees apply to everybody, even if they are borne primarily by the poorest customers. But getting into the payday loan business would mean offering financial products designed specifically for a down-market clientele, loans that would come with APRs between 40 and 80 percent and serious reputational baggage.”

“Payday lenders do not charge high fees because lending to the poor is risky—even after multiple extensions, most borrowers pay up. Lenders extort because they can.”

“Every year: over $11 billion in overdraft fees, $1.6 billion in check cashing fees, and up to $9.8 billion in payday loan fees. That’s over $61 million in fees collected predominately from low-income Americans each day—not even counting the annual revenue collected by pawnshops and title loan services and rent-to-own schemes. When James Baldwin remarked in 1961 how ‘extremely expensive it is to be poor,’ he couldn’t have imagined these receipts.”

“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.”

“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 20 percent of the distribution dedicate twice as much of their budget to alcohol as families with incomes in the bottom 20 percent. It’s been this way for generations.”

“We also have solid data on welfare dependency. Researchers set out to study the issue in the 1980s and ’90s, when it dominated public debate. They didn’t find much evidence for it. Most young mothers on welfare stopped relying on it within two years of starting the program. Most of those mothers returned to welfare sometime down the road, leaning on it for limited periods of time when between jobs or after a divorce. Some stayed on the rolls for long stretches, but they were the exception to the norm.”

“When politicians and pundits fume about long-term welfare addiction among the poor, or the social safety net functioning like ‘a hammock that lulls able-bodied people into lives of dependency and complacency,’ to quote former Republican congressman Paul Ryan, they are either deeply misinformed, or they are lying.”

“The rest of us, on the other hand—we members of the protected classes—have grown increasingly dependent on our welfare programs. In 2020 the federal government spent more than $193 billion on homeowner subsidies, a figure that far exceeded the amount spent on direct housing assistance for low-income families ($53 billion). Most families who enjoy those subsidies have six-figure incomes and are white.”

“Altogether, the United States spent $1.8 trillion on tax breaks in 2021. That amount exceeded total spending on law enforcement, education, housing, healthcare, diplomacy, and everything else that makes up our discretionary budget. Roughly half the benefits of the thirteen largest individual tax breaks accrue to the richest families, those with incomes that put them in the top 20 percent. The top 1 percent of income earners take home more than all middle-class families and double that of families in the bottom 20 percent. I can’t tell you how many times someone has informed me that we should reduce military spending and redirect the savings to the poor. When this suggestion is made in a public venue, it always garners applause. I’ve met far fewer people who have suggested we boost aid to the poor by reducing tax breaks that mostly benefit the upper class, even though we spend over twice as much on them as on the military and national defense.”

“The most recent data compiling spending on social insurance, means-tested programs, tax benefits, and financial aid for higher education show that the average household in the bottom 20 percent of the income distribution receives roughly $25,733 in government benefits a year, while the average household in the top 20 percent receives about $35,363. Every year, the richest American families receive almost 40 percent more in government subsidies than the poorest American families.”

“There are countless ways to deepen our investments in economic opportunity and security without increasing the deficit. We just have to stop spending so much on the rich. This, to me, is what it truly means to be fiscally responsible.”

“‘The conversation is, “Oh, this issue is so polarizing. We’re so polarized. We think so differently”,’ Saru told me. ‘And it’s just such bullshit. We are not polarized from each other. We are polarized from our electeds.’ The majority of Americans believe the economy is benefitting the rich and harming the poor. The majority believe the rich aren’t paying their fair share in taxes.”

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