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Why do the poor make poor decisions?

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Re: Why do the poor make poor decisions?

#41
post #30

"Granted, it would take a big program to eradicate poverty in the U.S. According to economist Matt Bruenig’s calculations, it would cost $175 billion." Is that a correct figure? It's hardly that large and there's no excuse for us not spending it to end poverty if it is.

Agreed, except that it would have to be spent by Congress. That makes me... let's say somewhat less optimistic about it being doable.

Could Congress allocate $175 billion? Sure. Could they sell it to the public that it was worth it? Maybe. Could they do it in a way that actually eradicated poverty, rather than throwing big chunks of it down the sewer? I'm not optimistic.

If they could actually do it instead of larding it down with pork, though, I'm all for it.

Re: Why do the poor make poor decisions?

#42
post #39

This article tries to shift perception from "poor people make bad decisions because they're intrinsically dumb" to "poor people make bad decisions because poverty makes them dumb." But this is also wrong; the decisions poor people make are, for the most part, sensible decisions given the circumstances they're in. Here's a list from the article: > "The poor borrow more, save less, smoke more, exercise less, drink more…

> because healthy food costs more than unhealthy food. Gah, I hate this line of thinking. Buying healthy food and preparing it at your home is enormously cheaper than eating KFC 3 meals a day.

If you're digging ditches in the sun all day, you have zero energy to shop for hierloom tomatoes, pick some basil from your herb garden, and whip up a nice little caprese.

You're in "screw it, but I have to eat something now" mode. Your win for the evening was not telling your boss to stuff it as you were leaving the job site. KFC isn't that big of a deal by comparison.

Re: Why do the poor make poor decisions?

#43

This article tries to shift perception from "poor people make bad decisions because they're intrinsically dumb" to "poor people make bad decisions because poverty makes them dumb." But this is also wrong; the decisions poor people make are, for the most part, sensible decisions given the circumstances they're in. Here's a list from the article: > "The poor borrow more, save less, smoke more, exercise less, drink more…

I grew up with the kind of income that would qualify me as poor. However, my parents' financial discipline were off the charts for someone in their position. Both of them had a decent education for their time and knew what matters vs what doesn't. We never got anything fancy - two pairs of uniforms, one nice set of clothes, one pair of shoes and pretty ugly looking backpack for the whole school year - nothing more. Absolutely no pocket money. No movies, not even extra-curricular activities - basically anything that costed money.

What we got was good healthy food, a great education - things that ended up making a difference in the long term. There were people like us all around us who we could clearly see not appreciating the value of some of the things we valued.

I would go so far to say, it's not the money. People need education. People need discipline and self-control if they are really going to pull their weight. They need help along the way but it's not always money they need.

Re: Why do the poor make poor decisions?

#44
In my city, the poor school children in 8th grade are at a 3rd grade reading level. They also frequently go without food, have parents addicted to drugs, and are in or have friends who are in gangs. There are also no jobs in their neighborhoods and no transportation to areas that have jobs, that they can't get anyway, because they're in 8th grade at a 3rd grade reading level. And miraculously passing their exams every year.

Poor people do dumb things because they live in shitty situations and are trying to survive, not thrive.

You don't mainline heroin because it's a great idea. You do it because your drug addiction has progressed to the point where this is the only thing you can do. You are addicted to drugs because it's the only thing you can do to escape endless depression from how shitty your life is. And you were born into this life, so "pulling yourself up by your bootstraps" seems less likely than winning the lottery (hence why poor people play the lottery).

Re: Why do the poor make poor decisions?

#46

Earlier quoted context omitted.

> Eat less healthfully: because healthy food costs more than unhealthy food. I hate this myth. It glosses over some of the most difficult choices that people in poverty have to make on a regular basis. "Quantity has a quality all it's own." - various sources This is anecdotal, and entirely based on my own experiences as I grew up in poverty (by Canadian standards, which is substantially better than most of the world)…

That sounds like a slightly more nuanced way of saying the same thing? I agree that a lot of the cost differential between healthy and unhealthy eating is caused by shelf-life issues rather than a difference in sticker price, but it works out the same. Eg if eating a diet with fresh foods requires making shopping trips twice as frequently as a diet with frozen foods, then that's the same as if the fuel/time/car-wear…

Again, all anecdotal, but here goes...

Yes, it's nuanced, because poverty and decision making is a complex issue :)

It's opportunity cost - you have the choice between eating fresh food, with the risk that it will spoil, or the choice of eating lower cost and frequently processed foods that have a longer shelf life.

There are also alot of factors to this - in a given week of budget the price difference between a processed product and fresh product might be radically different, but fresh food is almost always available throughout much of the developed world. There is another hidden cost here - when I see something I haven't tried before I will buy it and learn how to prepare it, but when I was poor, I didn't - it wasn't worth the risk that I would ruin the food, or that I wouldn't like it, and throwing away even a small amount of food was an intolerable waste. Less of a risk these days when even most people living at or below the poverty line have the ability to access the internet to learn, but in the late 90s, I was loathe to take those chances. There may be nutritionally rich, low cost options, but if people are too poor to have had regular exposure, or come from a culture unfamiliar with the foods available at reasonable prices locally, then poor eating choices will continue to be propagated.

The decision is not always a choice to eat the less healthy food over the more healthy food, it is a choice to marginally increase the level of food security you have by choosing less "healthy" options that have a longer shelf-life and offer a discount in bulk.

Re: Why do the poor make poor decisions?

#47

This article tries to shift perception from "poor people make bad decisions because they're intrinsically dumb" to "poor people make bad decisions because poverty makes them dumb." But this is also wrong; the decisions poor people make are, for the most part, sensible decisions given the circumstances they're in. Here's a list from the article: > "The poor borrow more, save less, smoke more, exercise less, drink more…

I don't think that's the real answer. Each of your bullet points has some truth to it, but is far from the whole story: > you only need to borrow if you don't have money. > you can only save if you have money. Certainly more income makes these easier. But consider the following impossible-to-conduct-in-reality-experiment: Set group A to be a set of 100 randomly selected poor folks who are only qualified to be cashier…

So my intuition about your thought experiment is that said high performing individual would probably waste away quite quickly by the onset of severe depression leading to high incidence of drink, drug abuse, and possibly suicide. I don't think their savings account would be very high priority.

Re: Why do the poor make poor decisions?

#48

Earlier quoted context omitted.

I don't think that's the real answer. Each of your bullet points has some truth to it, but is far from the whole story: > you only need to borrow if you don't have money. > you can only save if you have money. Certainly more income makes these easier. But consider the following impossible-to-conduct-in-reality-experiment: Set group A to be a set of 100 randomly selected poor folks who are only qualified to be cashier…

I may be wrong, but aren't you replying his quotes using a logic of a non poor human being? That's what I understood when reading your replies. The parent comment is meant to share the 'biases' that poor people have, their mindset, such as "Save less: because you can only save if you have money.".

I am. But I interpreted his comment differently from the way you did.

The article's thesis, with which I partially I agree, is that poverty is persisted, at least in part, by a poverty-induced inability to consider one's long-term welfare.

jimrandomh's comment seems (to me) to be saying that the poor are not making bad decisions, but instead behaving in an objectively logical/near-optimal way given how little money they have. See the beginning of his comment:

> This article tries to shift perception from "poor people make bad decisions because they're intrinsically dumb" to "poor people make bad decisions because poverty makes them dumb." But this is also wrong; the decisions poor people make are, for the most part, sensible decisions given the circumstances they're in.

Re: Why do the poor make poor decisions?

#49

Being poor is hard. There is no flexibility to be nimble around hardships or mistakes. Its easy to make money if you have money. But try to start a business with no backup funds.or credit line? The first time your vehicle breaks down can put your business in a death cycle.

Forget the breakdowns as an impediment to business. Most businesses have high startup costs just from taxes and fees alone. I'm trying to start a small hobby business and just getting the ball rolling I've forked over $500 in filing fees. I imagine it must be nigh on impossible if you are poor and want to start a small business. And I know people do it but they borrow heavily from friends and family.

Re: Why do the poor make poor decisions?

#50

Earlier quoted context omitted.

I may be wrong, but aren't you replying his quotes using a logic of a non poor human being? That's what I understood when reading your replies. The parent comment is meant to share the 'biases' that poor people have, their mindset, such as "Save less: because you can only save if you have money.".

I am. But I interpreted his comment differently from the way you did. The article's thesis, with which I partially I agree, is that poverty is persisted, at least in part, by a poverty-induced inability to consider one's long-term welfare. jimrandomh's comment seems (to me) to be saying that the poor are not making bad decisions, but instead behaving in an objectively logical/near-optimal way given how little money t…

Long-term anything is not something you think about when you are poor. Ask any poor person.

What is a "bad decision" ? It's a decision that ends poorly. But poor people are not intentionally deciding to make bad decisions. No poor person goes "Oh boy, I hope I fuck up today!" They are making risky or ill-advised decisions, which then don't pan out. They may have been aware of the consequences, or even willfully ignorant of them. But there was still a cause and effect which started with a basic need. For most of those decisions, they are acted upon by considering the most immediate solution to the need.

Long-term goals are inherently prioritized lower than short-term goals. People with less money have less resources to achieve long-term goals. General welfare is often a secondary priority to the most basic needs of paying bills and feeding and sheltering oneself or one's family. But having a drink, doing drugs, the high of gambling, getting laid, and more are all much higher in priority than even those other basic needs, because they can be achieved the quickest and easiest and provide an immediate positive emotional gain, something sorely lacking for most poor people.

So in terms of decision making, first you'll buy booze, then you'll debate between buying food for your family or paying the electric bill, then you'll think about finding a job. But to get the booze or pay the bill you might have to steal a radio. If there are no other apparent options, these are simply the only choices.

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