Keeping poor people in their place
September 13, 2006 - Cushing, Oklahoma
It is a fact of economic life in the Hobbesian world of capitalism that as the number of people mired in poverty increases so do the scum that prey upon them. Both those in poverty and their predators have skyrocketed in the Bush years.
Census statistics recently released paint a gloomy portrait of the American working class. After saying that poverty leveled off in 2005, the first time since 1999, we find there is little reason to cheer. The leveling off actually means that more people are working more jobs for lower pay.
Median household income rose to $46,326, which means that half of all households made less than that. Anyone raising a family will attest that $46,326 barely keeps them above water.
USA Today reported in a story that 37 million Americans live in poverty "defined as an annual income of $19,971 or less for a family of four." Who "defines" this? One person can't live on $19,971, much less four. Using these woefully out-of-date figures, it's easy to see that poverty is actually much higher.
In my state, Indiana, poverty increased in 2005 by 13 percent meaning 740,000 more Hoosiers are trapped in an economic dead end, according to an Associated Press story.
"The poverty guidelines are very outdated and unrealistic," said Lisa Travis of the Indiana Institute for Working Families. "A person needs to earn nearly 200 percent of the poverty level just to make ends meet in Indiana." And, of course, suffer the children: 260,000 live in poverty in Indiana and at least a third of the national statistic.
Conservatives offer a host of reasons for people living in poverty. "Things happen to people that they don't anticipate," said Mark Pauls of Washington University in St. Louis. "You lose a job, a family splits up, you get sick -- all these things can happen and throw people into poverty."
Let's look at the reasons behind the reasons: You lose a job because a company's profits are more important than a worker's livelihood, a family splits up because of economic tension and when you get sick you find your insurance, if you're lucky enough to have it, is inadequate because companies have cut their contributions to the bone. If you don't have insurance you'll be charged higher by the health industry, which is also eager to increase its profits. The predators are everywhere.
When poverty increases in communities you begin to see a rise in pawn shops glad to give you a couple of bucks for a priceless family heirloom or just a few CDs so you can buy bread and milk. Find yourself running low on cash well before your next payday? Payday loan businesses are now as omnipresent as gas stations.
According to Tom Lehman , a writer for the Indiana Policy Review Foundation, there were 30 payday loan locations a decade ago in Indiana. Today there are 606.
According to the Associated Press, these loan sharks have grown up around military bases to prey on the low salaries of soldiers and sailors. One sailor walked into one of these businesses and signed over his next paycheck for $300 and left with $255, what the AP called "an annual interest rate of a staggering 459 percent."
Lehman calls it the market at work and decries the sort of regulations the military is calling for, which would put a cap on these crooks.
Competition, the market, will keep these interest rates in check, Lehman contends. The mushrooming of these businesses might indicate competition, but no one is lowering interest rates to grab customers. The rates will stay high because the sharks, pardon me, entrepreneurs, know there are enough people in poverty to keep all the payday loan jackals raking in the cash.
What kind of a country do we live in where the poor are so powerless that they have to accept the demands of vultures just to get by? Market purists, who should've a long time ago been discredited, will write off all poor people as unable to compete in the marketplace.
But economics must serve people, not the other way around. As long as we accept that business writes its own rules nothing will change.
Cushing Daily Citizen, Stephen Dick, (Writer, The Herald Bulletin)
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