Is poverty self-perpetuating?

The article is mainly about the psychological reasons why people in poverty act the way they do. I'll add my 2 cents: The fact is people's brains are wired to not keep doing something when it seems hopeless. Although from an outside perspective it seems illogical to work less when you have less money, from the perspective of the person living in poverty they know that no matter how hard they work, at minimum wage they're never going to have an easy life, and that's a very powerful psychological force. For instance, as a student, I borrow money at the beginning of the semester, and I have some big expenses. I work part time, but my fixed expenses exceed the income I make from working. So I go to work knowing that no matter how hard I work, or how much I try to save, it's physically, mathematically impossible for me to ever come out ahead. By working hard, all I can do is sink into debt more slowly. At least I have solace in the fact that I will soon be graduating. What if I didn't have that hope? What if that were all there were to life? I see people every day, in rural Oklahoma, who live like that, without hope. They go through cycles where they work for a while, realize they aren't getting ahead for all their work, and give up. Wouldn't you?

IMO, it is fair that the book was ignored.<p>The guy completely ignores the time and risk factors, namely being short-term-payoff-oriented and long-term-payoff-oriented. This is a subject of microeconomics (not 101, of course - it's a lot of maths, integrals and derivative functions).<p>Poor people do not save extra money exactly because of being short-term oriented. Drugs, entertainment and having early sex also deal with short-term payoff. Short-term payoff orientation also makes a person more risk-tolerant, which is a common attribute of criminals.<p>All the given examples are easily explainable with a utility function that takes into account risk perception and time discounting (long- or short-term orientation) and current posessions.<p>Committing a crime or not is a choice between risky and not risky opportunities. This deals with risk perception. Few posessions make the low-risk choice even less valuable. Fixing or not fixing dents on a car fit into choice between long-term and short-term payoff.<p>Writing this I suspected that the author hasn't worked with advanced microeconomics' maths. Indeed, Karelis is a philosopher. I haven't seen the book, but by his words ("Econ 101 is to blame") suspect that he doesn't know any more complicated economics. That's the reason he finds it wrong.

Does anyone here know about the economics of gambling? It seems like the argument Karelis is making would have strong similarities there. I'd be interested to see if this suggestion is at all valid.<p>To explain, in gambling (think lottery tickets, not poker) you trade $1 for something that actually has less than $1 worth of economic value. There is obviously another component at work (behavioral, not economic), call it hope. If economists have found a way to quantify hope in this context it seems that they could try the same thing with poverty, the results would certainly be interesting.

It's interesting that this article is at the top of the front page -- unexpected topic to fit the category of hacker news.<p>My theory: problem solving and unconventional solutions are of interest to hackers and this article presents poverty as a puzzle and hints at an intriguing fix.

"In challenging decades of poverty research, Karelis draws on some economic data and some sociological research. But, more than that, he makes his case as a philosopher, arguing by analogy and induction."<p>This, for me, is the biggest problem with the article.

I agree with this article. The current thinking on poverty is from the rich man's POV. And consequently, the solutions provided from that POV will do nothing to eradicate poverty.<p>One such solution is the "One Laptop Per Child" program. And this article explains why the OLPC will never work in the impoverished countries. The child is not hungry for education. The child is hungry for parental care from her indifferent parents who have given up on getting their bee stings looked at...

I can always tell who's actually been poor for any extended period of time, versus who hasn't, by the way they talk about the poor.<p>I've been in and out of poverty a few times. There is some truth to all of what everybody says, and yet none of what anybody says is the whole truth to it.<p>There are individual factors: if you're uneducated, or have a lower than average intelligence, or lack self discipline, or would just tend to prefer not to work, then you're more likely to be poor. But, not all poor people fit any of those categories.<p>If you're used to receiving hand-outs without having to work much for them, then you're more likely to keep accepting hand-outs. But, not everybody fits that, either.<p>There are a bunch of people that made one or two bad decisions at some point. They don't have to be stupid decisions, they could just be points where the person took a risk and the risk cost them dearly. Those people can then find themselves in one of the most challenging downward spirals that we have in Western society.<p>The poorer you are, the more effort it takes to become less poor. Think about that for a minute. For example, if you're living in an area with good public transportation -- so that you don't need your own car -- then your rents are likely higher than they would be in more rural areas, where you'd need a car. So, if you're poor enough that you can't afford to maintain a car, and you can't afford high rent, then what do you do? You have to spend even more resources just staying afloat, making it back and forth to work every day.<p>Inevitably, people who are trying to work their way out of poverty will begin to skim from one of two precious resources: their food, or their sleep. Either they'll take on extra jobs, and work 60 hours a week (or more), or they'll try to save money on their groceries.<p>It's possible to save money on groceries and still eat well, but that requires more time and attention. Those working their way out of poverty don't tend to have lots of time and attention to spread around.<p>As you continue to trim down your food budget, and/or cut back on sleep, you'll develop higher and higher levels of stress and exhaustion, which make it harder to deal with new problems as they arise. One of the things the article does get right is the mindset of some of those in poverty: each new thing is a problem, not an opportunity. Each thing that comes along is something that has to be dealt with, allocated resources to, worked around.<p>So, you end up in this vicious cycle, where you start falling behind because you're too overwhelmed and exhausted to deal with new problems as they arise.<p>Make no mistake about it, these people are fraught with problems. They can't afford a good, reliable car, so they have to deal with cars that break down, that require maintenance, or -- in California's case -- can't make it through the hairy mess of smog legislation.<p>There's no magic, easy solution for a person in that situation. They have to work their ass off, and it's pretty even odds that the average person in the same situation doesn't have the fortitude to do it.<p>In a society where over half of the population lives in poverty, the problem of poverty can reach this incredible runaway condition, where there aren't enough people left that can help others out of poverty, by providing well-paid jobs, training, and education.

I don't think that you can eradicate poverty (handouts don't count) because there simply isn't enough non-subsistence related work for 6 billion people.<p>for our purposes poverty = subsistence or close to it<p>once energy is cheap (distributed solar) humanity can turn to the problem of food distribution and education. Once we start getting more people educated more einstein's and other people who add disproportionate value to humanity should pop up and we'll get accelerating returns.<p>the point of all this is to solve the population problem before the population problem solves us, so to speak.

No.<p>Longer answer: My great-grandfather Reginald Braithwaite was one of nine children (that we know survived) growing up in a one-room shack in Barbados. His son Leonard was the first Black Member of Provincial Parliament in Ontario. His grand-daughter Gwen was the first woman AND the first person of colour to work in Systems analysis with Empire Life.<p>Sadly, the (possibly apocryphal) Chinese Proverb about returning to poverty in four generations may hold: her son is chiefly known for blogging.

The article makes a very good point. I like the dents-in-the-car metaphor. I don't, however, agree with how he interpreted it. If I have a car with, say, ten dents in it, and I get one more, no, I am not inclined to try to fix it. And let us follow his story, and say that someone comes along and fixes all but two of those dents for me.<p>The question is, does the fact that I have fewer dents in my car make me more likely to fix the others? If someone comes along and does almost all of my dishes for me, am I more likely to wash the last few myself?<p>I believe the answer to that is not, as Bennett suggests, "Yes."<p>If someone comes along and fixes most of my car for me, or cleans most of my dishes, when I had no inclination of doing it myself, why would I stop them? If someone is going to come and fix my problems for me, why do it myself? All you have to do is wait long enough, and, like <i>magic</i> it's done for you!<p>So while it is an interesting theory, the problem is, people become set in their habits fairly quickly. If I do not wash my dishes one day, I am not really more inclined to wash them the next. Indeed, why should I? There is suddenly an almost empty sink in which to store the dirty ones.

A negative income tax seems to me like a generally good, if naive, solution.<p>Of course the problem is that a straight forward negative income tax creates a resistance level where each additional dollar earned is worth less and less. The simple negative income tax leads to the situation in the 1970's study mentioned in the article (people are discouraged from working).<p>I think the solutions lies in creating support levels, or income targets. I.e. $15k or less is taxed at 0%, $15k - 20k at -5%. This would establish a support level at $15k.<p>I can even imagine a system where meeting an "income goal" (support level) one year triggers a higher one for the next year. I.e. if you make $16k in 2008 and are taxed at -5%, you must make $20k in 2009 to receive the -5% rate again, otherwise you'll be taxed at 0%.<p>Eventually, if the person keeps meeting income targets, they'll no longer be poor (by definition).

A response: <a href="http://wirkman.net/wordpress/?p=295" rel="nofollow">http://wirkman.net/wordpress/?p=295</a><p>"By the way, vice in any form is self-reinforcing, as he suggests. Ancient moralists realized it; modern “mental health” professionals do, too. The behavior of poor people is often that of simple vice. It is not new, nor are the traps involved.<p>Example? Think of becoming fat: the fatter you get, the harder it is to exercise, the less incentive you have to exercise; the less you exercise, the fatter you get. You get caught in a feedback loop that spirals into imbalance and self-destruction. Sloth and gluttony (the old terms for two major causes of being overweight) are not new nor are they hard to understand."<p>(Please note that I am not agreeing with or endorsing this opinion, merely providing a link)

It would be interesting to see what the path dependence of poverty is.

this article is much more accurate than the ones i've seen on HN about poverty in the past. still doesn't hit the nail on the head, but its a lot closer.

Poverty as it exists in America today is mostly a matter of breeding and culture. A thousand words on poverty and no mention of heritability? Drake either has his head up his ass or his PC blinders on too tight.

Offhand, it doesn't smell like hacker news to me. Here's why: it's already touched off a thread on politics. I'm not convinced that these things don't degrade with time. And I am certain that in any case, as hackers, our "comparative advantage" is not in discussing politics.

The whole article could have been shortened to this one paragraph:<p><i>In the early 1970s, a large-scale study gave poor people in four cities a so-called "negative income tax," a no-strings-attached payment based on how little money they made. The conclusion: the aid tended to discourage work.</i><p>Yeah, that's right. The obvious occurred, as usual. All such theories, and all such fawning articles, rely upon one unalterable precondition: Nobody involved has actually lived among the destitute, while destitute.