What Really Keeps Poor People Poor
jonbischke.com
What Really Keeps Poor People Poor
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Re: What Really Keeps Poor People Poor
#2There are a few reasons that poor people remain poor.
Math: The fact is that it's much more difficult to make $10,000 from nothing than it is to make $1M when you have $1B to use.
Experience: When you're poor, the odds are very good that you don't know anyone who is successful(let alone "rich") so there isn't the chance to find out what it takes to be successful. Plus, when you have no experience you need to work your way up from nothing. If you come from a rich family, odds are you know people who are willing to take a chance on you based on the references you have.
Mindset: I came from a very poor family. I always assumed that I would start work at some horrible entry level job, and work my way up. That's what everyone in my family had done. It never occurred to me that there was another way until my mid 20's. Now I'm approaching 30 and I feel like I'm finally on my way to working for myself.
Re: What Really Keeps Poor People Poor
#3at the top places, two-thirds of the students come from the top quartile and only 5 percent come from the bottom quartile
Whenever I see a statistic like that, the first question I want answered is: what is the trend over time? Maybe this is actually a big change with only 1% coming from the bottom quartile 10 years ago, indicating the future situation, etc.
Re: What Really Keeps Poor People Poor
#4There are a few reasons that poor people remain poor. Math: The fact is that it's much more difficult to make $10,000 from nothing than it is to make $1M when you have $1B to use. Experience: When you're poor, the odds are very good that you don't know anyone who is successful(let alone "rich") so there isn't the chance to find out what it takes to be successful. Plus, when you have no experience you need to work you…
I'm with you. I'm now 30 and in debt from trying to "do things they way they're done," which is what I was taught. I actually think that's probably the larger reason (though certainly raw resources like money don't hurt.)
Re: What Really Keeps Poor People Poor
#5Many factors in poor staying poor.
The High Cost of Poverty: Why the Poor Pay More: http://www.washingtonpost.com/wp-dyn/content/article/2009/05...
Poor people spend 9% of income on lottery tickets; here's why: http://www.walletpop.com/blog/2010/05/31/poor-people-spend-9...
Missing poverty's new reality: There's a lot less of it: http://www.washingtonpost.com/wp-dyn/content/article/2011/01...
Re: What Really Keeps Poor People Poor
#6He stretches the point a bit far. When he's talking about "isolation" broadly, I can maybe see the point -- lack of role models, mentors, references, people to help get your foot in the door at your first job. (I have no idea if this is "what really keeps poor people poor.")
Then he uses "network" to mean what you get at Harvard or Yale, and suggests that this is a gating factor, that masses of people have everything they need to rise out of the bottom quartile, if only we could give them a letter of admission to Harvard. This seems odd.
Re: What Really Keeps Poor People Poor
#7This whole line of arguments is very strange to me.
I think it would be nice to have high expectations for our highest colleges to admit a large amount from the lowest quartile of society, but this is not the natural next step in the process of solving poverty. The next step is how do we get more of those individuals to graduate from high school, go to vocational schools, etc. This is just another example of the intellectual elite trying to overlay their standards on problems, resulting in impractical policies and priorities, that do nothing to solve underlying problems.
Re: What Really Keeps Poor People Poor
#8He stretches the point a bit far. When he's talking about "isolation" broadly, I can maybe see the point -- lack of role models, mentors, references, people to help get your foot in the door at your first job. (I have no idea if this is "what really keeps poor people poor.") Then he uses "network" to mean what you get at Harvard or Yale, and suggests that this is a gating factor, that masses of people have everything…
I don't think it's that much of a stretch. When you're poor and you're around other poor people there is no one there to recognize your potential and bring you into the fold (job, connections, inform you of opportunities available). You're just a clever person other poor people know.
There's a big difference between knowing small business owners in the neighborhood and knowing friends of wealthy and or well connected people. When you're poor you are isolated. You have to do everything from scratch and it takes a LONG time to figure out by yourself, what generations of people have already figured out.
The Harvard example could easily be a proxy for other institutions frequented by the elite.
Re: What Really Keeps Poor People Poor
#9This article has me reminiscing about the recent Linked-In IPO; I remember reading that the IPO was offered to favorable clients of the brokerage underwriting the IPO.
I don't know how many "favorable" offerings are presented each year or what their performances are, but if the IPO is purposelessly undervalued to make their clients richer, how does one compete with that? I doubt a $100 or 10k account would draw enough interest to gain access to these "Favorable" offerings.
Re: What Really Keeps Poor People Poor
#10There are a few reasons that poor people remain poor. Math: The fact is that it's much more difficult to make $10,000 from nothing than it is to make $1M when you have $1B to use. Experience: When you're poor, the odds are very good that you don't know anyone who is successful(let alone "rich") so there isn't the chance to find out what it takes to be successful. Plus, when you have no experience you need to work you…
Poor people need to work for tomorrow. No failure accepted.
Rich people invest in their future. Failure is ok.