One of my biggest "why"s is "Why are there poor?" What do you think? Why are there poor here in the United States? I don't pretend to know. It's something I ask myself fairly frequently. Let's think about it some. We'll call our example person Bob. There are really only two sides to the equation for Bob, the income and the outgo. If Bob doesn't have any money coming in, he's poor. If Bob has more money going out than coming in, he's also poor. So for Bob to turn things around He would either need to get the income up or the outgo down and he is currently poor because one or both of those sides is out of balance.
The next question is "why?". Let's assume that the outgo is ok, why is the income down? Is Bob working? Hey, it's a valid question, there are people that just don't work for varied reasons from drug and alcohol abuse to plain laziness. Let's assume that isn't Bob, he'd work if he could. Great, then why isn't he working? Maybe he can't find a job. That can be really discouraging, but why can't he? If I was Bob, I'd probably say, "Because there aren't any jobs out there!" Do you think that's true? Really Bob, there aren't any jobs out there? Here are the things that could be going on:
1. Bob's right, here in town, there aren't any jobs. But the world is bigger than this town, county, state, or country. Maybe Bob needs to cast a wider net (and move).
2. Bob's right, nobody is hiring for the exact job Bob wants to do, but there are other jobs that Bob could take if he were more flexible. I really respect people that do what it takes to take care of their family. They're working crazy hours with multiple part-time jobs to make ends meet. That shouldn't be a way of life and doesn't have to be a way of life, but sometimes, for the short term, you gotta do what you gotta do. People that do that are awesome in my book.
3. Bob's right, there aren't any jobs Bob wants for people with Bob's skill-set. He isn't educated or experienced enough to get one of the jobs available. I have to ask the question here, why, because this is one of the reasons I worked my tail off in school. Our state provides a basic education and there are ways to work your way through upper education (I did it). But even now it's not too late for Bob, if he can read there is much self-education available. If he mixed #2 with a little education on the side he could work his way up to a better job.
4. Bob's right, of the three places he's looked, none of them were hiring. As a teenager my wife applied for many summer jobs that she was qualified for but was turned down again and again. She was different from Bob in that she kept looking and eventually found a job.
5. (very unlikely) Bob's right, our economy and country are in complete and utter collapse and there is no more "means of production". Armageddon is knocking on our door.
Even if we wanted to concede to Bob that he can't get a job, there is still another way. What would be wrong with Bob going into business for himself? Being an entrepenur is scary to some people but there is a lot to be said for being your own boss. Starting a business doesn't require mountains of capital (money) or a group of investors. In fact, most busisnesses in the United States are small, a handful of people providing a good or service. How did they get started? It looks like they're making a go of it. Find someone in a neighboring town that is doing what you'd like to do and ask how they got started.
Going back to Bob, let's assume that he's still poor but he has a job. Why is he still poor? Well, maybe the income still isn't high enough. He would probably benefit from some of the things we mentioned before, another part-time to cover the gaps and education on the side so that he doesn't have to do that forever.
But what if Bob really does have a pretty good job, then the problem is the outgo. What does Bob need to do? He needs to make a budget and live on it (lots of people do it). He needs to make his money behave. If he does indeed have a good job, he needs to squeeze the excess out of his life. Why? Because he can't afford it. I think that as a society we don't like to say "No". We don't want to say no to ourselves (I know it's hard). We don't want to say no to others. But the reality is, if you can't afford it, you shouldn't buy it. Part of Bob's problem might be that he has prior obligations that he can't meet. Bob is in debt. Because he didn't say no to himself, the outgo is bigger than the income.
Huge aside: You know, I was thinking about debt and it's really the most expensive way to buy something. You see something you want. You don't have the money but they'll sell it to you if you pay them even more than what they're selling it for but they'll collect the money in payements over time. If the sticker had the actual price on it including the interest and fees you'll pay with payments, would you still buy the item? We do this with bonds and public projects. "We'll not only pay top dollar for this public works project but we'll even pay more for it in interest", and then your state is short cash and wondering where they'll get it. You can work this the other way. You see something you want. You don't have the money so you start saving while accumulating interest. In the end the actually amount you pay for the item is less than sticker because you received the interest instead of paying it.
This is part of the problem with cash advance places. The interest is ridiculous and the people that use such places are already in a tight spot. Places like this keep the poor, poor. Now I'm not arguing that they should be shut down, I'm arguing that they shouldn't be patronized.
Ok, going back to Bob. Let's say he's really doing well with is his money. He's living on a budget and making his money behave. But still he's having trouble. Bob may have a good job, but where he is living is too expensive. In some parts of the country the cost of living is so high that even with a good job things can be tight. What would you do in a place like that? Maybe Bob needs to look for an even better job. Or maybe he needs to look for a different place to live.
Let's say that Bob is making it, it's tight but he's pulling through. Then disaster strikes, an unexpected event in the $1000-10000 range. Part of balancing that income/outgo equation is planning for the unexpected, and a credit card isn't a plan. And that's not just a glib statement. If you didn't have the money and you were just getting by, how are you going to afford the credit card payment?
I think about this a lot, especially after I moved to California. I believe you can make it in America, and not just make it, excel! Why are there still people that don't? I don't pretend to know. Here are some of my guesses.
They don't believe themselves that they can make it. That may sound cliche but really, if you don't think you can improve your situation yourself, why try? There are lots of misconceptions about wealth and money floating around in our society and I think a lot of people believe them. For example, to become really wealthy you have to inherit it or win it in the lottery or debt is best way to build wealth. Another one, some evil entity (business/socioeconomic group/race) is keeping all the poor down so that they can exploit them; essentially, it isn't their fault, they're victims and they need to be rescued. Because they don't believe they can make it, they don't see the opportunities that are right in the way.
Let's take a look at the evil entity thing. Do you think it's true that some people are poor because some entity has is in for them? I'm not trying to straw-man either. Are there groups that have perceptions about the poor and because of those perceptions unconsciously design a system that locks the poor out? I've heard some people accuse one group or another of doing that. Do you think it's true? Honestly, I have a hard time believing it. When I was very young, my family went through really hard times. My dad had no work, a failed business, and small family to take care of. Christmas was a box of blocks cut from 2x4's. It took my parents a while to dig themselves back out again, but they did it. Maybe I'm blind to what other people are seeing, but it seems clear to me that hard work, determination, and sacrifice can take you anywhere you want to be. Another old cliche, "Where there is a will, there's a way."
I think some people really don't know where to start to improve their situation. They just never learned about how to interview well for a job. They never learned how to be a good employee. They don't know how to fix some of the problems their in even though it's within their power. They honestly are lacking knowledge that would make a difference. The hard part is they don't know they don't know. I think there are also some that know some things but don't know how to apply it in their life. They need an example of how to grab that bull by the horns.
For sake of argument, assume I have it right, those that are poor, stay poor because of a lack of knowledge and example. We'll leave out the people that have no gumption, the beautiful thing about this country is it's your life and if you want to be poor you can be. If knowledge and example are what stand between poverty and not poverty, then we don't need a larger and larger government. We need more friends, mentors, and teachers.
This is an idea that I've been thinking about for a while. I'm always reminded of it when I see pan-handlers. What does that pan-handler need? Yeah, a little food would probably be good. Uh, some money might be good too, maybe. What does he really need? Assuming he is in need, he needs someone to sit down with him and find out what is going on. Why is he on the street pan-handling? Why doesn't he have a job (remember Bob)? Is he lacking knowledge? Does he need an example to show him how to do it? I wonder what would Jesus do? Yeah he might take care of his immediate need but he'd do so much more. I think Jesus would help the man become self-sufficient. What would that require? Someone taking a genuine interesting and offering help on those levels they see need help. That might extend to offering a job and then teaching them how to be an employee. What if I started a business that hired people that needed a chance to learn how to work. Then I could offer what some of these people really need. I have no idea what the business would do, but this is idea I've been kicking around.
Maybe you noticed throughout this post that I tried to look at a lot of the possible reasons someone might be poor. The point is there are lots of different reasons (I'm sure I'm missing some). Because the reasons are so varied, so are the solutions. I believe that there is a lot we can do for ourselves without help or intervention. For those that need help, I believe other helps should come first, before monetary help. Because individual problems require individual solutions and sometimes the best help isn't money, I think large government programs intended to help the poor are some of the worst help. If we insisted on giving money, I think local charities and churches would do a better job. Even local cities would do better than federal programs. No, I don't have any data on any of this, it's just my gut. And, absolutely, you can call my gut wrong, that's fine, but when I think about helping people the best help is personal and helping them change the things that have put them in the situation their in. In some cases, money is the worst thing you could do, because it enables the continuation of bad behavior. If you really cared about the person, you'd all you could to help them change.
