Ever wondered why, despite remarkable technological advancements and increased government spending, poverty in the U.S. remains persistent? How does systemic exploitation in labor, housing, and finance keep the poor impoverished while benefiting the affluent? What role does segregation play in perpetuating poverty and how can integration disrupt this trend? Dive into this compelling narrative to find answers and understand the complex web of social issues that enshroud poverty in America.

Poverty, by America

Poverty, as defined by Mollie Orshansky in the 1960s, is about not being able to afford life’s necessities. But poverty is far more than just a lack of money; it’s a relentless piling on of problems, as poet Layli Long Soldier puts it, it’s the “oil at the surface.”

Take Crystal Mayberry, for example. Born prematurely after her pregnant mother was stabbed, she grew up in an abusive, drug-addicted household. Shuffled through more than 25 foster placements, Crystal faced molestation, neglect, and physical fights. 

Diagnosed with multiple mental health disorders, she aged out of foster care with nowhere to go. Her $754 monthly SSI check barely covered her rent, leading to evictions and homelessness. She turned to prostitution for survival, all while grappling with the instability and violence that marked her life.

Across America, poverty manifests in physical pain—backaches of home health aides, rashes of maids using harsh cleaning products, and asthma from slum housing. It’s also the instability from soaring rents and shrinking incomes. With federal housing assistance reaching only one in four eligible families, eviction is a common fate for many low-income renters. 

Jobs, too, are unstable, with half of new positions disappearing within a year and temp jobs proliferating even in sectors like healthcare and manufacturing. This job market churn leaves workers feeling expendable, affecting their mental and economic stability.

Poverty is also about fear and shame. It’s the degradation of waiting half a day for a ten-minute welfare appointment, living in roach-infested apartments, and being erased from popular culture. It’s the constant worry that things will get worse, a fear shared by a third of Americans living without economic security.

Race compounds poverty’s effects. Black and Hispanic Americans face higher rates of poverty, unemployment, and neighborhood disadvantage compared to their white counterparts. The wealth gap remains stubbornly wide, with systemic denial of opportunities for Black families perpetuating cycles of poverty.

Understanding poverty in America means recognizing it as a complex web of social issues—crime, health, education, and housing—all intertwined. It’s a tight knot of material scarcity, chronic pain, incarceration, depression, and addiction. And its persistence means millions are denied safety, security, and dignity in one of the wealthiest nations in history.

Poverty in America: A Vicious Cycle of Injustice and Instability

In the past fifty years, humanity has celebrated remarkable achievements such as mapping the human genome, eradicating smallpox, and the invention of the Internet and smartphones. However, despite these advancements, poverty in the U.S. remains stubbornly persistent. As the poverty rate has oscillated slightly but remained largely unchanged, it's clear that material progress has not translated to poverty reduction.

Technological advances have turned luxuries into necessities, yet this hasn't alleviated poverty. While consumer goods like cell phones are more accessible, essential costs like healthcare and rent have skyrocketed. Michael Harrington's observation from sixty years ago still rings true: it’s easier to be decently dressed than decently housed or fed.

Despite significant increases in government spending on anti-poverty programs, much of the intended aid never reaches the poor. Welfare reforms, like those under President Clinton, have allowed states to divert funds to unrelated activities. This misallocation is exemplified by the misuse of Temporary Assistance for Needy Families funds in states like Oklahoma and Mississippi on projects ranging from marriage initiatives to football tickets and even payments to celebrities for services never rendered.

The inefficiency extends to programs like Social Security Disability Insurance, where applicants often need legal representation to secure benefits. This legal necessity siphons off millions of dollars yearly that could otherwise support the needy directly. 

Immigration is another scapegoat often blamed for persistent poverty, yet research shows that immigrants generally contribute more in taxes than they receive in benefits and are not the cause of stagnant wages. Instead, economic mobility among immigrants, especially their children, often leads to prosperity rather than increased poverty.

Family structure is also scrutinized. While single-parent households in the U.S. are more likely to be poor, this is not the case in other wealthy countries with robust social safety nets. Programs like Milwaukee’s New Hope have shown that economic stability encourages marriage and reduces poverty among single parents, highlighting the need for broader social investments.

Mass incarceration has had a devastating impact on poor families, particularly among Black and Hispanic communities. Policies that remove parents from their families and hinder their reintegration into society are profoundly anti-family, contributing significantly to the cycle of poverty.

Even with increased spending and various programs, poverty persists due to systemic inefficiencies and misdirected efforts. The core issue is that poverty is an injury inflicted by societal structures and choices, rather than an inevitable consequence of personal failings or demographic changes.

From Genomes to Gadgets: America's Persistent Poverty Puzzle

Poverty is often discussed as an unfortunate by-product of broken systems or economic shifts, like deindustrialization. But what if poverty exists because some benefit from it? As the late composer Stephen Sondheim noted, history is about who gets to eat and who gets eaten. For instance, landlords profit from renting substandard housing to the poor, a practice documented in a study titled "Exploiting the Inner City" at Harvard's Kennedy School. 

The exploitation of the vulnerable is stark in the labor market too. Undocumented workers often earn below minimum wage and lack protections, while prisoners are charged exorbitant fees for phone calls. This isn't just a systemic issue; it's about individual decisions made out of self-interest.

Consider Julio Payes, a Guatemalan immigrant working 80-hour weeks at two minimum-wage jobs to support his family. His brother once asked to buy an hour of his time, a poignant moment that underscores the human cost of poverty wages. Economists like George Stigler argued against raising the minimum wage, fearing unemployment. But real-world experiments, like New Jersey's wage hike studied by David Card and Alan Krueger, showed negligible job losses, debunking long-held economic theories.

Today, many jobs are outsourced to independent contractors, stripping workers of benefits and promotions. Companies use tactics like noncompete clauses and no-poaching agreements to suppress wages and limit worker mobility. The rise of gig jobs further erodes worker protections, creating a precarious labor market.

Corporate lobbying has reinforced these trends, with organizations like the U.S. Chamber of Commerce spending millions to oppose wage increases and worker protections. This corporate influence extends to our daily lives, where we benefit from low wages through cheaper goods and services, often without questioning the human cost.

Yet change is possible. In Emeryville, California, the city council raised the minimum wage, significantly improving workers' lives. Julio, now earning a higher wage, sleeps more, spends time with his family, and feels safer. Studies show that higher wages reduce child neglect, teen births, and smoking rates, while improving overall health.

Ultimately, the denial of living wages is a denial of happiness, health, and life itself. The question remains: Is this the capitalism we want?

Is Poverty Profitable in Today's Capitalist System?

Exploitation takes many forms—labor and consumer exploitation being the most obvious. When we're underpaid for our work or overcharged for purchases, our economic freedom is curtailed. This is particularly evident in the rental housing market, where history shows landlords have profited from subdividing properties and charging exorbitant rents.

In the late 18th and early 19th centuries, as cities grew and land values soared, landlords subdivided properties into cramped, high-rent tenements. The Panic of 1837 worsened this trend. By the mid-1800s, rents in New York City’s tenements were 30% higher than in better apartments uptown, even in the poorest slums. 

Racism exacerbated this during the Great Migration (1915-1970), as Black families moving north were confined to ghettos. Landlords exploited their lack of options, charging Black tenants double for the worst housing. This pattern continued into the 1960s and beyond, with Black families often paying higher rents than white families for inferior housing.

Fast forward to today, and the problem persists. Rent has skyrocketed across the U.S., outpacing income growth. From 2000 to 2021, median rent more than doubled. Experts cite supply and demand issues, government regulations, and zoning restrictions, but these don’t fully explain the steep increases. In cities with plenty of vacant units, rents have still risen sharply.

Research using U.S. Census Bureau data has revealed that landlords in poor neighborhoods earn significantly higher profits than those in affluent areas. Even after accounting for maintenance costs and vacancies, landlords in poor neighborhoods come out ahead. This is because their expenses are lower, but their rents are only slightly lower than in middle-class areas.

Now, one might question: Why don’t poor families move to better neighborhoods with slightly higher rents? The answer is simple. Often, moves are forced by eviction or unsafe conditions, not by choice. Poor renters also face barriers like bad credit, eviction records, and racial discrimination, making it difficult to secure housing in better areas.

Historically, banks have excluded poor and Black communities, a practice known as redlining. Though official redlining has ended, banks still avoid low-income neighborhoods because they can make more elsewhere. As a result, poor families often pay high rents on homes they could otherwise afford to buy. 

Financial exploitation extends beyond housing. Deregulation in the 1980s led banks to raise fees, making it costly for the poor to maintain accounts. Overdraft fees, check cashing fees, and payday loans drain billions from low-income Americans annually. Payday loans, with interest rates often exceeding 400%, trap borrowers in cycles of debt.

The dual banking system—one for the poor and one for the rest—reflects broader economic divisions. Poor people are often forced to accept exploitative financial deals, not because they want to, but because they have no better options. This exploitation keeps them in poverty, despite efforts to raise incomes through policies like minimum wage increases. Landlords often absorb these gains by raising rents.

In Tommy Orange’s novel *There There*, a character likens the situation on Native American reservations to kids jumping out of burning buildings. The poverty debate similarly misses the point by focusing on the poor's behaviors rather than the systemic exploitation they face. The key question should be: "Who benefits from this?" Understanding who profits from poverty is crucial to addressing the root causes and creating effective policies.

From Tenements to Today: Unmasking the Profiteers of Economic Inequality

When COVID-19 hit the U.S., the economy plummeted. Businesses closed, jobs were lost, and unemployment skyrocketed to levels not seen since the Great Depression. The government responded with unprecedented relief efforts, including enhanced unemployment benefits, stimulus checks, and rental assistance. Surprisingly, instead of increasing, poverty levels declined, with millions fewer Americans in poverty by 2021 compared to 2018, particularly benefiting children.

But not everyone saw this as a victory. Critics argued that generous benefits discouraged work, blaming them for a sluggish economic recovery. However, data from states that cut benefits showed no significant job growth, debunking the theory that aid was keeping people home. The real reasons for slow returns to work included health concerns, poor job conditions, and lack of childcare.

Historically, society has stigmatized the poor as lazy, a narrative dating back to early capitalism where hunger was seen as a motivator for labor. This mindset persists, with many Americans believing welfare creates dependency, despite evidence to the contrary. Research shows most welfare recipients use aid temporarily, often as a safety net during hard times.

In contrast, wealthier Americans benefit significantly from less visible government aid like tax breaks and subsidies, which often go unnoticed or unacknowledged. This contributes to a skewed welfare state where the rich receive more in government benefits than the poor. Despite this, many well-off citizens harbor strong anti-government sentiments and oppose welfare programs for the poor.

The narrative that government aid is harmful persists, yet most Americans have benefited from some form of public assistance. This inconsistency highlights a deeper issue: a reluctance to acknowledge the role of government in our lives and a preference to maintain the status quo, even at the expense of the poor.

Ultimately, the U.S. welfare system is lopsided, favoring the affluent. This reality calls for a reevaluation of our social contract and a more honest conversation about how we support all Americans, especially the most vulnerable.

Did COVID-19 Relief Efforts Really Reduce Poverty in the U.S. While Exposing a Lopsided Welfare System?

In the early 2000s, before the financial crisis, the media was buzzing about America's Second Gilded Age. By 2020, Americans were spending billions on powerboats, pets, and leisure travel, yet the mood among the middle and upper classes remained anxious and fretful. Despite unprecedented wealth, many Americans felt deprived, and this anxiety masked our role in perpetuating inequality.

The wealth gap was glaring. While some owned multiple properties and oversized homes, others struggled with poverty wages and relentless work conditions. Rising housing costs were often blamed on external factors like Russian oligarchs, yet it was our own wealth driving up prices.

America's stark inequality led to "private opulence and public squalor," a term popularized by economist John Kenneth Galbraith. As private fortunes grew, public investment dwindled, leading to deteriorating public services. This trend has historical roots dating back to the Roman Empire and was notably accelerated by Reagan's tax cuts in the 1980s, which gutted public services and reinforced economic disparities.

Public squalor wasn't evenly distributed. Wealthy communities enjoyed well-maintained parks and schools, while poorer areas suffered. Attempts to integrate low-income families into affluent neighborhoods often failed due to resistance from residents. Exclusionary zoning laws, stemming from the Great Migration, further entrenched segregation, making it illegal to build affordable housing in many areas.

The drive for private opulence has led to the commodification of opportunity. Access to good schools, safe neighborhoods, and public services increasingly depends on personal wealth. Despite a general desire for more public housing, most Americans resist having it in their own neighborhoods, revealing a deeper resistance to true economic integration.

The promise of shared prosperity often rings hollow. As sociologist Tressie McMillan Cottom notes, those who can hoard resources do, benefiting their communities while leaving others in squalor. True equality would require the affluent to take less so that others might share in the nation's wealth.

America's Second Gilded Age: The Illusion of Wealth Amidst Growing Inequality

Leo Tolstoy, famed author of "War and Peace" and "Anna Karenina," moved to Moscow in 1881 and was immediately struck by the city's stark poverty. Unlike the countryside poverty he knew, Moscow's urban destitution was baffling and distressing. Tolstoy's efforts to understand and address the issue led him to a profound realization: the problem wasn't the poor themselves, who worked tirelessly, but the affluent, including himself, who lived off their labor without truly helping.

He wrote, "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." This sentiment echoes today, highlighting how poverty persists not despite wealth but because of it. Tolstoy's insights remain relevant, revealing how systemic exploitation in labor, housing, and finance keeps the poor impoverished while benefiting the affluent.

In America, the poor are systematically exploited in various markets, driving down wages and inflating costs for housing and credit. This exploitation benefits not just corporations but also consumers and investors who enjoy cheap goods and services. Additionally, the government prioritizes subsidies for the wealthy, creating a welfare state that favors the rich while stigmatizing aid for the poor.

Efforts to alleviate poverty often fail due to complex and inaccessible aid systems. However, simple interventions, like providing clear information and assistance, have shown remarkable success in increasing enrollment in aid programs. For instance, a program that offered sign-up help tripled elderly enrollment in food stamps.

Ending poverty in America is financially feasible. The poverty gap in 2020 was $177 billion—less than 1% of the GDP. This sum could vastly improve housing, reduce hunger, and provide better opportunities for children. Funding could come from cracking down on tax evasion by wealthy individuals and corporations, potentially recovering over $1 trillion annually.

To truly address poverty, we must embrace policies that foster unity and economic opportunity, rebalancing the safety net and insisting on tax fairness. During the pandemic, bold policies like the Emergency Rental Assistance program significantly reduced evictions, demonstrating the impact of well-designed aid.

Can We End Poverty by Following Tolstoy's Timeless Insights?

In America, many poor individuals struggle to secure a fair deal in life. To combat this, we need to empower them with choices about where to work, live, and bank, and when to start a family.

Consider the plight of workers earning below the federal minimum wage of $7.25 an hour, a rate unchanged for over a decade. Service workers, often paid a subminimum wage of $2.13 an hour, rely on tips to survive. This system has roots in post-slavery exploitation, where formerly enslaved Black workers were forced to depend on customer charity. Raising the minimum wage and regularly reviewing it could provide fair pay and dignity to millions.

Unions are key to promoting worker empowerment. However, traditional labor laws have excluded sectors predominantly staffed by women and people of color. Modern labor laws should be inclusive, making unionizing easier and supporting sectoral bargaining, where workers across an industry can negotiate collectively. This approach has improved workers' lives in Europe and could do the same in the U.S.

Housing is another critical issue. Poor families often rent from private landlords, spending half their income on rent. Expanding housing options through public housing, homeownership programs, and tenant-owned cooperatives can provide affordable, stable homes. Initiatives like the 502 Direct Loan Program in rural America could be extended to urban areas, helping more families buy homes.

Access to fair banking and credit is essential. Banks should end exorbitant overdraft fees and payday lenders should be regulated to prevent exploitation. Providing low-interest small-dollar loans through the Postal Service or incentivizing commercial banks to help could offer better financial choices to low-income Americans.

Reproductive choice also plays a crucial role in economic empowerment. Programs like Delaware CAN have shown that providing access to effective contraception reduces unintended pregnancies and allows women to pursue education and career opportunities. Ensuring access to contraception and abortion can help prevent poverty and improve economic outcomes for women.

Ultimately, the rich and powerful bear significant responsibility for America's poverty. However, everyday decisions by individuals also contribute to the problem. By making conscious choices about where to shop, work, and invest, and by supporting fair labor practices and ethical companies, we can collectively push for change. This moral reckoning requires effort and may come with costs, but it's necessary for a fairer and more just society.

Empowering America's Poor: A Call for Fair Wages, Housing, and Reproductive Rights

We've revised textbooks, renamed holidays, and removed statues to confront the harms of colonization and slavery. Yet, we act as modern-day segregationists when we block affordable housing or reserve opportunities for our children while denying others a fair shot. 

Integration blunts poverty’s sting. Moving poor families to high-opportunity neighborhoods improves their lives, even if their incomes don’t increase. Their children flourish in safer, more prosperous environments, and studies show long-term economic benefits.

Anti-poverty proposals often ignore segregation, creating a nation that’s separate but slightly less unequal. When affluent and poor families live disparate lives, institutions relied on by the poor become vulnerable. Integration ensures all families are invested in schools, parks, and streets, fostering empathy and solidarity.

Opposing segregation is vital to abolishing poverty. Poor neighborhoods offer community and culture, but we need more neighborhood choices to ensure a child’s birthplace doesn’t predetermine their future. Affordable housing in affluent areas is in high demand, as seen when 9,309 people applied for 29 affordable apartments in Cherry Hill, NJ.

Research supports integration. After the Brown v. Board of Education ruling, Black children in integrated schools performed better and were less likely to experience poverty as adults. White children’s academic and well-being remained unaffected. Montgomery County, Maryland, showed that poor students fared better in low-poverty schools, even when poor schools received more resources.

We know a child’s environment matters, yet our children’s schools are less economically diverse today. To end segregation, we must replace exclusionary zoning with inclusionary ordinances, allowing affordable housing in high-opportunity neighborhoods. New Jersey’s mandate requiring municipalities to provide their fair share of affordable housing is a successful model.

Affordable housing doesn’t lower property values if well-managed. Federal incentives could encourage communities to invest in affordable housing, while penalties could be imposed on those refusing to end exclusionary zoning. This idea, proposed by George Romney in 1970, was smothered due to backlash, but the fight continues.

Voices advocating for integration must be louder than those defending the status quo. Families planning to move into affordable housing developments and students eager to welcome new peers need to speak up. 

A 1953 Minnesota brochure on racial integration highlighted that many whites objected to Black neighbors due to insecurity about their social position. Scarcity mindset exacerbates this, making people less willing to support equal opportunity. Yet, ending poverty would lead to enormous improvements in American life, benefiting everyone.

Imagine an America without poverty: safer communities, higher civic participation, and a sense of shared purpose. Ending poverty wouldn’t lead to social collapse but to a more vibrant, forward-moving country. We’d unlock the potential of millions, empowering artists, scientists, and leaders.

Can America Truly Overcome Segregation and Abolish Poverty?

Poverty is far more than just a lack of money. It is a relentless accumulation of problems, from health issues and unstable housing to job insecurity and systemic racism. Poverty manifests in physical pain, emotional instability, and pervasive fear and shame. 

Despite technological advancements and increased government spending on anti-poverty programs, the poverty rate remains largely unchanged due to systemic inefficiencies and misallocated funds.

Economic exploitation is a significant factor, with poor families often paying more for substandard housing and facing predatory financial practices. This exploitation benefits not just corporations but also consumers and investors. The narrative that government aid fosters dependency persists, despite evidence showing it provides crucial support during hard times.

The wealth gap and economic inequality are perpetuated by policies and societal structures that favor the affluent, leading to "private opulence and public squalor." Efforts to integrate low-income families into affluent neighborhoods often fail due to resistance and exclusionary zoning laws. Integration, however, has proven to improve the lives and futures of poor children.

Ending poverty requires systemic change and collective effort. Policies should focus on empowering workers, expanding affordable housing, ensuring fair banking practices, and supporting reproductive choice. Integration is key to fostering empathy, solidarity, and investment in public institutions. 

By addressing these issues, we can create a society where everyone has the opportunity to thrive, ultimately transforming our nation into a more just and humane place.

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Poverty, by America

Matthew Desmond

Ever wondered why, despite remarkable technological advancements and increased government spending, poverty in the U.S. remains persistent?

How does systemic exploitation in labor, housing, and finance keep the poor impoverished while benefiting the affluent?

What role does segregation play in perpetuating poverty and how can integration disrupt this trend?

Dive into this compelling narrative to find answers and understand the complex web of social issues that enshroud poverty in America.

Key Ideas

#1