Why is there still poverty in America?

The Economist

1 Oct 201910:07

Summary

TLDRThis video highlights the paradox of poverty in America, particularly in affluent areas like Lake County, Illinois, where families rely on charity for essentials like diapers. Despite being one of the richest countries, America faces high poverty rates, with 40 million people struggling to survive on less than $26,000 a year. The video explores the shift of poverty to the suburbs, the limitations of government safety nets, and how the lack of support disproportionately affects children. It calls for political action, showing that solutions to reduce poverty are achievable.

Takeaways

📉 Poverty in the United States is complex and doesn't always look like what people expect, even in wealthy areas.
🧷 In affluent counties like Lake County, Illinois, people rely on charities for essentials, including diapers.
💸 There is no government support for diapers in the U.S., making it difficult for low-income families to afford them.
📊 Almost 40 million Americans live in poverty, which is nearly one-eighth of the population.
🏘️ Poverty has shifted from cities to the suburbs, but suburban counties spend much less on social support than urban areas.
👶 One in six American children lives in poverty, often affecting their education and exposure to crime.
📉 U.S. safety-net programs have reduced elder poverty but do less for working-age adults and children compared to other developed countries.
🇺🇸 The U.S. has a relatively high child-poverty rate among wealthy nations, partly due to insufficient safety-net programs.
💵 Proposals for cash benefits, like those in Canada, have been shown to reduce poverty, but political support in the U.S. is low.
🔗 Poverty in America is not inevitable; other wealthy nations have successfully reduced it with political will and resources.

Q & A

What is the main issue highlighted at the beginning of the video?
-The video highlights poverty in America, focusing on how people in affluent areas are struggling to afford basic necessities like diapers.
Why do many American families struggle to afford diapers?
-There is no government support in the United States to help pay for diapers, and many poor families cannot afford the $70-80 monthly cost per child.
How has the nature of poverty in America changed over recent years?
-Poverty has shifted from being an inner-city phenomenon to the suburbs, where poverty is growing faster, yet there are fewer support resources available compared to urban areas.
Why is suburban poverty particularly challenging?
-Suburban counties spend significantly less on supporting poor residents than urban counties, making it difficult for suburban poor to access necessary resources.
Who is Ann Marie Mathis, and what did she do to address poverty in her community?
-Ann Marie Mathis is a local mother in Lake County, Illinois, who started a charity distributing second-hand children’s clothes and later focused on providing diapers due to overwhelming demand.
What impact has Ann Marie Mathis's charity had on the community?
-Since its founding, the charity has distributed over 1.2 million diapers, providing critical support to struggling families in the community.
Why do safety-net programs in the United States struggle to reduce child poverty effectively?
-American safety-net programs tend to benefit the elderly more than working-age adults and children, leaving many families without sufficient support.
How does child poverty in America compare to other wealthy countries like Finland?
-While both America and Finland have similar child-poverty rates before taxes and transfers, Finland's safety net reduces its child-poverty rate to about 3%, whereas America's remains high.
What are some of the limitations of the current safety-net programs in the United States?
-American safety-net programs are often restrictive, with behavioral conditions and bureaucratic requirements that limit eligibility and access, creating obstacles for people trying to escape poverty.
What potential solution for reducing child poverty in America is mentioned in the video?
-The video mentions the proposal by Michael Bennet, a Colorado senator, to provide monthly cash transfers of $300 per American child, similar to a program in Canada that reduced child poverty by a third.

Outlines

00:00

🍼 Struggles of Diaper Poverty in America

In affluent counties like Lake County, Illinois, families are queuing for basic necessities like diapers, a product not covered by government support. Parents resort to extreme measures like reusing diapers due to financial hardships. The U.S., despite its wealth and low unemployment rate, has nearly 40 million people living in poverty, with many struggling to afford basic needs, especially as poverty has shifted from cities to suburbs. Charities, such as one started by Ann Marie Mathis, help provide essentials like diapers to families in need.

05:02

🏦 How Safety Nets Help and Fall Short

While America has some safety-net programs like Social Security and food stamps, they disproportionately benefit the elderly, leaving working-age adults and children more vulnerable. Countries like Finland effectively reduce child poverty through broader benefits, while in the U.S., the restrictions and bureaucracy surrounding support programs make it difficult for many to qualify. Diapers, for example, aren't covered by existing programs, forcing families to rely on charities.

Mindmap

Keywords

💡Poverty

Poverty refers to the state of having insufficient financial resources to meet basic living needs such as food, housing, and clothing. In the video, poverty in America is highlighted through the struggles of families in affluent areas like Lake County, Illinois, where people rely on charity handouts for essentials such as diapers. The video contrasts this with how poverty has evolved over time, moving from inner cities to suburban areas.

💡Safety-net programs

Safety-net programs are government initiatives designed to provide financial assistance or essential services to vulnerable populations, such as the elderly, unemployed, or poor families. In the video, these programs are discussed in relation to Lyndon B. Johnson’s 'war on poverty,' which included Social Security and food stamps. However, it emphasizes that these programs are insufficient, especially for children and working-age adults.

💡Diaper need

Diaper need refers to the struggle faced by low-income families to afford enough diapers for their children. The video introduces this issue through Ann Marie Mathis’s charity, which supplies diapers to families in need. This essential but often overlooked expense can cost $70–80 per month per child, and many families have no government support for such basic necessities.

💡Suburban poverty

Suburban poverty refers to the rising number of poor people living in suburban areas, as opposed to inner cities. The video reveals how poverty has shifted geographically due to rising housing costs, with 3 million more poor people now living in the suburbs than in cities. Yet, suburban counties spend far less on supporting the poor than urban counties, which exacerbates the problem.

💡Child poverty

Child poverty describes the condition where children live in families with incomes below the poverty line. In the video, one in six American children is described as poor, which severely impacts their future opportunities, education, and well-being. The video contrasts this with countries like Finland, where child poverty is effectively reduced through strong safety nets and cash transfers.

💡Income inequality

Income inequality refers to the growing disparity in wealth and income between different socioeconomic groups. The video touches on this issue by mentioning that America is experiencing the worst income inequality in 100 years. This inequality is a key factor in why so many people are living in poverty, despite the country's wealth and low unemployment rate.

💡Cash transfers

Cash transfers are direct payments of money to individuals or families to support their basic needs. The video discusses how other countries, like Canada, use cash transfers to successfully reduce child poverty. It contrasts this with the U.S., where there is an ongoing debate about whether cash assistance would lead to dependency, despite evidence to the contrary.

💡Social Security

Social Security is a federal program in the U.S. that provides financial benefits to retirees, disabled individuals, and survivors. In the video, Social Security is highlighted as one of the more successful safety-net programs that has significantly reduced poverty among the elderly since its expansion during Lyndon B. Johnson’s 'war on poverty.' However, the video critiques its focus on the elderly, leaving other groups, like children, with less support.

💡Food stamps

Food stamps, now known as the Supplemental Nutrition Assistance Program (SNAP), provide low-income individuals and families with funds to purchase food. The video explains how food stamps are part of the safety-net programs introduced to fight poverty but notes their limitations, such as restrictions on what they can be used for, which leaves many other needs unmet, like diapers.

💡Political will

Political will refers to the commitment and action of policymakers to address specific issues. In the video, the lack of political will is mentioned as a reason for why poverty persists in America. Poor people are less likely to vote, and poverty issues are not vote-winners, which leads to limited political appetite for making substantial changes, such as expanding safety-net programs or implementing cash transfers for children.

Highlights

People in affluent areas of America are struggling with poverty, queuing for basic necessities like diapers.

Some families are reusing diapers due to the lack of financial resources.

There is no government support in America to help pay for diapers, causing a significant struggle for many families.

Almost 40 million people in America are living in poverty, which is nearly one-eighth of the population.

Poverty is shifting from inner cities to suburbs, with 3 million more poor people in suburbs than in cities.

Suburban counties spend significantly less on supporting their poor residents compared to urban counties.

Ann Marie Mathis started a charity in her basement to distribute second-hand children’s clothes and diapers.

The cost of diapers is a significant burden for families, with expenses ranging from $70-80 per child per month.

Poverty is becoming more concentrated, affecting children's education and exposure to crime.

One child in every six in America is living in poverty.

President Lyndon B. Johnson launched a war on poverty in the 1960s, introducing various social programs.

Safety-net programs have been successful in reducing poverty, especially among the elderly.

Compared to other wealthy countries, America's safety-net programs are less effective for working-age adults and children.

Safety-net programs in America do not cover diapers, leading to a reliance on charity for many families.

The debate in America about whether giving poor people cash leads to dependency is contrasted with evidence from other countries.

Canada's child benefit program has significantly reduced child poverty.

Senator Michael Bennet has proposed monthly cash transfers for each American child to help combat poverty.

The political will to reduce poverty in America is low, as poor people are less likely to vote or be heard.

The film's director, Anna, suggests that with resources and a strong economy, reducing poverty is a political choice.