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No Money, No Time

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Re: No Money, No Time

#21

Post by VLM »

smileysteve wrote: post #16
hnal943 wrote: post #15

Earlier quoted context omitted.

If that were true, welfare would work.

Not necessarily - one issue facing poor USA is the Financial Cliff of coming off of welfare. In some tax and unemployment environments, working that 2nd job actually nets less cash, because at a magic number ~27k, unemployment benefits kick out , and a little bit higher and income tax burdens raise ( there was one deduction in particular the last few years) So, to make working a second job "worth the jump" it needed…

The actual numbers are far worse with children, between $20K and $60K there's a no (wo)mans land for single moms where they'll make more money off .gov at $20K than off .com at $60K. Its pretty sick.

Re: No Money, No Time

#22

Post by JASchilz »

judk wrote: post #13
fit2rule wrote: post #9

There's a saying, it goes like this: "its expensive being poor", and its really the truth. If you don't have enough money to buy in bulk, you end up paying way more for the smaller amount of product. If you can't afford to spend time on something because you have a limited number of calories before you become unproductive, and therefore have to work on aquiring more calories, then you're stuck in a feedback loop of n…

Not really true. Buying in bulk is a minor savings that offsets the cost if a big car or big house or whatever. The core issue is that life has transaction costs on that the wealthier folks don't need to worry about, but a poor person faces catastrophic collapse by going over budget with no way to borrow against the future.

Could you give a few examples of these transaction costs?

Re: No Money, No Time

#23

Post by nilkn »

nilkn wrote: post #4
yummyfajitas wrote: post #2

Strange that little correlation data is provided. Microdata is available from the BLS on what people spend time on, sliced by income and poverty. Checking whether poverty or low income are correlated with having little time should be a fairly straightforward python/pandas job. It seems unlikely that the money-poor are also time-poor (given that the main cause of money-poverty is not working), but it's straightforward…

> given that the main cause of money-poverty is not working Is that really true? I'm not sure if my girlfriend's family qualifies as truly poor, but they certainly don't have much money. Her dad has two jobs--line cook and hotel janitor--and her mom is also a line cook. They frequently have to go to check cashing places, they have only one car so her mom relies on taking the bus to work (which takes over an hour each…

I wanted this to be an edit to the original post, but it looks like that post is locked into stone for now.

I wanted to expand on the robbery incident and illustrate how something like that is potentially even worse than you'd expect.

The reason he was walking through the neighborhood is because he doesn't have (and can't afford) a car, and he was walking back from work.

They made the "mistake" of calling 911 to report the incident. He was mildly beaten up, and they were worried about potential injuries, so they sent an ambulance. It turns out he was completely okay, and they put on a few bandages and that was it. Then he was hit with a $3k bill.

Her brother works part time at a minimum wage job while going to school. A random $3k bill out of the blue is really not affordable to him, so now he's on a payment plan paying off that debt.

This is on top of the items that were actually stolen from him, like his phone, which he had to replace, and the general trauma of having been robbed.

Re: No Money, No Time

#24

Post by Meekro »

beat wrote: post #11

The thing that frustrates me the most about this situation is the waste of human capital this represents for society. Now, I'm a firm believer that society is advanced mostly by a small minority of highly talented individuals - the intelligent, creative, charismatic, and hardworking few change the game for everyone else. Now, what happens when those rare talents are born into the cycle of poverty? What lessons do the…

The fact that people like you can escape is very encouraging: it means we still have class mobility -- if you've got the skills and work ethic, you can be born into the lower class and quickly rise above that.

Re: No Money, No Time

#25

Post by digikata »

smileysteve wrote: post #16
hnal943 wrote: post #15

Earlier quoted context omitted.

If that were true, welfare would work.

Not necessarily - one issue facing poor USA is the Financial Cliff of coming off of welfare. In some tax and unemployment environments, working that 2nd job actually nets less cash, because at a magic number ~27k, unemployment benefits kick out , and a little bit higher and income tax burdens raise ( there was one deduction in particular the last few years) So, to make working a second job "worth the jump" it needed…

It's not only the cliff itself, but threat of the cliff and qualification hysteresis. For some benefits, if it's determined that your categorization changes, then getting accepted into the former level of benefit can take a long time. E.g. if you're told that more than X dollars in your checking account will result in a reduction of benefits, and getting your old status back might take a year, then it's logical to be risk averse and stay well clear of any jobs that could take you over the limit even for a day.

Re: No Money, No Time

#26

Post by _delirium »

incision wrote: post #20

I'm glad to see a few studies bearing out the sort of things I perceived growing up. 'To him, the obvious conclusion is to radically change our thinking. “Just like you wouldn’t charge them $1,000 to fill out a form, you shouldn’t charge them $1,000 in cognitive complexity,” he says. One study found that if you offer help with filling out the Fafsa form, pickup goes up significantly.' I believe this is exactly the ri…

As mostly an outside observer in both countries (fortunately), this is one of the big differences I see between the American and Danish welfare systems. The Danish one has a reputation for being much more generous, which is true to some extent, but is not as true in terms of throughput as it is in terms of latency. The Danish system does a lot of short-term "business": people get onto the system in a matter of days, use it for 6-12 months, then get off again. (By "the system" I mean a range of things: housing subsidy, retraining, cash welfare, mental-health treatment, etc.) Whereas the American one seems incapable of delivering anything with less than a 6-month waiting list, with an extremely bureaucratic and unfriendly process almost always serving as the gatekeeper.

Re: No Money, No Time

#27

Post by SilasX »

aturek wrote: post #14
fit2rule wrote: post #9

There's a saying, it goes like this: "its expensive being poor", and its really the truth. If you don't have enough money to buy in bulk, you end up paying way more for the smaller amount of product. If you can't afford to spend time on something because you have a limited number of calories before you become unproductive, and therefore have to work on aquiring more calories, then you're stuck in a feedback loop of n…

There's a great quote from a Terry Pratchett Discworld novel: "The reason that the rich were so rich, Vimes reasoned, was because they managed to spend less money. Take boots, for example. He earned thirty-eight dollars a month plus allowances. A really good pair of leather boots cost fifty dollars. But an affordable pair of boots, which were sort of OK for a season or two and then leaked like hell when the cardboard…

That quote always bothers me, because most long-term savings like that aren't nearly so clear in numerical terms.

Re: No Money, No Time

#28

Post by SilasX »

incision wrote: post #20

I'm glad to see a few studies bearing out the sort of things I perceived growing up. 'To him, the obvious conclusion is to radically change our thinking. “Just like you wouldn’t charge them $1,000 to fill out a form, you shouldn’t charge them $1,000 in cognitive complexity,” he says. One study found that if you offer help with filling out the Fafsa form, pickup goes up significantly.' I believe this is exactly the ri…

I think that ignores the fact that the forms and such are there in the first place precisely to contain the tide of applicants.

What do you think happens when organizations are under budget constraints and have to find creative ways to cut [edit: typo] costs?

Re: No Money, No Time

#29

Post by alexqgb »

Meekro wrote: post #24
beat wrote: post #11

The thing that frustrates me the most about this situation is the waste of human capital this represents for society. Now, I'm a firm believer that society is advanced mostly by a small minority of highly talented individuals - the intelligent, creative, charismatic, and hardworking few change the game for everyone else. Now, what happens when those rare talents are born into the cycle of poverty? What lessons do the…

The fact that people like you can escape is very encouraging: it means we still have class mobility -- if you've got the skills and work ethic, you can be born into the lower class and quickly rise above that.

Don't kid yourself. There's a wide gulf between a worldview based on a few anecdotal successes and the more realistic picture emerging from a flood of statistics, which not only show the rarity of mobility, but indicate that it's declining - esp. for those unfortunate enough to be born at the bottom.

Yes, people can win Olympic Gold (we're not competing against robots yet), but very few will and those who do will have to make extraordinary sacrifices. So yes, give them credit. But don't - whatever you do - look at people who haven't managed to keep their heads about water, and think "well, this one guy made it against all odds and you didn't, so you must be a lazy, stupid human."

That may be fair (if harsh) in a supportive world where it takes rare talent to fail. But it's a monstrous attitude in a world where the opposite is so clearly the case.

Re: No Money, No Time

#30

Post by OrwellianChild »

JASchilz wrote: post #22
judk wrote: post #13

Earlier quoted context omitted.

Not really true. Buying in bulk is a minor savings that offsets the cost if a big car or big house or whatever. The core issue is that life has transaction costs on that the wealthier folks don't need to worry about, but a poor person faces catastrophic collapse by going over budget with no way to borrow against the future.

Could you give a few examples of these transaction costs?

A simple example is the concept of living paycheck to paycheck... If you work on contract or hourly and payment is delayed (either because there weren't enough hours to work or your client is slow to pay), one of two things happens:

1) You are wealthy enough to have credit and perhaps a bit of cash savings, and you can pay your bills with that savings/credit card. When your paycheck comes, you pay down the short-term credit and you are as good as if it never happens.

2) You have no credit and no savings. You must directly choose between which bills you can and cannot pay. Some bills go into default or incur late fees. Other bills may cancel service because you cannot be relied upon to pay. In this scenario, when the paycheck comes, you pay your late bills, but you are left with the extra fees, lost services, and are at a net-loss going into the next period.

Compound scenario 2 for a few periods, and you start to incur heavily negative consequences that are very difficult to overcome.

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