Sunday, February 13, 2011

The Economics of Poverty

The Struggles of Parenting in Poverty
After a rather interesting week of finding a job and producing a theoretical budget for a single mother with two kids, I have gained an immense amount of respect for those that can actually make ends meet. For the sake of this week's class session, I will only update the why?, what is being done?, and what should be done?, as those are the three that apply to the topics discussed this week.

WHY?
Despite what I have said in previous posts about the various reasons people come to be impoverished, I would like to change my perspective once more. As I was studying for this week's class, I ran across  a chart that lists fifteen different reasons why a person(s) may be in poverty. For example: Immigration status, access to public benefits, and culture shock are just a few of the many plausible reasons. I think i made a huge mistake by taking on the responsibility of listing one-by-one the possible causes of poverty. From now on, whenever I am asked the question, "Why are people in poverty?" my response will be "there are too many reasons to list, furthermore each individuals situation is unique and their reason for being poor may be totally different compared to the next persons' reason." 

As stated earlier, a few of my classmates and I were assigned the task of finding a job for a single mother with two children. She was a high school graduate, but possessed no specific work skills. We eventually found an entry level position at a bank. Her salary was roughly $19,000 dollars after taxes. After we did research and made a budget for the woman, we realized that she would need to make double the amount of money to make ends meet. In the end, I believe there were two problems 1) the job chosen for the woman did not pay enough and 2) the budget we prepared for the woman was a bit too expensive. I believe if the task of the project was to make the budget work, we could have made some huge decreases in spending, but that wasn't the case. The point I am trying to make is that there may be individuals that are not taking the appropriate steps to reduce the amount of overhead that they are responsible for paying, as well as taking advantage of government programs aimed at alleviating poverty. In addition, the theoretical situation of the single mother with two kids fits perfectly with the Neoclassical Economic Theory which states, "individual traits, such as family background, education, human, social, and cultural capital effect economic well-being (Iceland, 2003)" Although we weren't given very much information about the woman's family background, she did lack in the education department as well as in the human capital department (knowledge, skills, training and education). 
I also I think some truth lies in the Structural Economic Theory of Poverty as well. This specific theory, "emphasizes the impact of economic, social, and political systems on poverty (Iceland,2003)."

WHAT IS BEING DONE?
As stated in previous updates, the government has a number of programs in place that aim to alleviate poverty. I forgot to mention President Obama's health care bill which aims to make health care universal by the year 2014. I think it's a great idea to spread the availability of doctors and nurses to those that are not able to afford health coverage. The only downside is I worry about how the quality of health care will change, which I'm sure it will. I guess the bill has a few positive and negative areas, but overall I think it's a step in the right direction. I try to take a moment to think about how I would feel about these sort of things if i were the impoverished individual.

WHAT SHOULD BE DONE?
After watching a poverty simulation video clip, I am now aware that a great deal of those working at government agencies are suffering through the same situations as those they are working to help. In one scene, a long line of unemployed individuals were waiting to be helped with paperwork. There were three available employees, but only one was actually assisting customers, the other two were talking to each other AS IF there wasn't a long line of people standing in front of them! I was even more chocked to find out that what happened in the poverty simulation is exactly what happens to those in real life. After analyzing the situation more, I realized a family friend of mine is in the same position; she works at the IRS, has two kids, and struggles each month to pay the bills. The shocking part is she's a college graduate, but she's still not making enough money to live comfortably. The point I am trying to make is how can the government expect people in need to get the help they deserve when employees are suffering just as much as those they are supposed to be helping?? That doesn't seem fair at all- to either party. The government needs to improve the benefits and salaries of it's workers before we can expect those in need to get the attention that they deserve.

RANDOM
Did anybody else have an "ah-ha" moment when the people participating in the poverty simulation raised their hands when asked if they'd engaged in illegal activities to pay their rent? 
--I'll be honest, for years I was under the impression that those in underprivileged communities were involved in crime just because they thought it was fun or there was nothing else to do. I now understand that there are some people selling drugs, stealing, and prostituting because that's the only way they can guarantee their lights won't be off or they won't be evicted. I completely understand now.



1 comment:

  1. Good point on the fact that there are TOO MANY reasons to list to question why are people poor. I have been trying to answer this question since starting this class and it seems that while there may be contributing factors, there is no one reason why people are poor. It is so easy to say 'this person is poor because of x,y or z' but in most cases there is not one reason why people are poor.

    Also I was interested in your comment on how often people selling drugs or stealing are doing it bc they have to. After this weeks lesson, my eyes were opened to the fat that some people HAVE to do these things to survive and not for fun or to be 'cool.' So sad, but that is the reality for so many people.

    POSTED BY SARAH FLACK

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