The High Cost of Poverty

“Anyone who has struggled with poverty knows how extremely expensive it is to be poor.”

-James Baldwin

Living in poverty not only takes a toll on a person’s emotional and physical health but also on the meager financial resources they may have.  This article from the Washington Post takes a look at some of the ways that the poor end up paying more for basic goods/services than many middle or upper income folks, just because of their lack of money and the (most likely) poor neighborhood they live in.  Being forced to pay significant chunks of your small paychecks to check-cashing companies or having to buy food at the convenience store on the corner may not seem like big issues to those of us who have comfortable incomes but for someone who is living on a shoe-string budget these costs pile up week after week and month after month.  These costs make it even more difficult for someone to get out of poverty.

With our Poverty Challenge we hope that people will be able to see some of these hidden costs of being poor.  Choosing to drive a car will automatically put you over budget,  so if you need to get somewhere you will have to take the bus or start going into debt.  This means you will probably have to walk to your bus stop (which can be a long walk in some neighborhoods) and hope that the bus is on time.  If you miss the bus, that means waiting for at least another 20 minutes for another one.  Being late to work can mean instant firing for workers in many low-wage jobs, which would be a huge set-back because at a poverty level budget, odds are you haven’t been able to save much money in the last couple months.

The difficulty of finding steady transportation is just one hidden cost of being poor that people with higher incomes (who can usually afford a decent car) may not necessarily see.  Reading this article and taking part in the Poverty Challenge is one way that those of us who do not live at the poverty level can begin to get some understanding of the unique difficulties facing those of us living in poverty.

Poor? Pay Up.
Having Little Money Often Means No Car, No Washing Machine, No Checking Account And No Break From Fees and High Prices

By DeNeen L. Brown
Washington Post Staff Writer
Monday, May 18, 2009

You have to be rich to be poor.

That’s what some people who have never lived below the poverty line don’t understand.

Put it another way: The poorer you are, the more things cost. More in money, time, hassle, exhaustion, menace. This is a fact of life that reality television and magazines don’t often explain.

So we’ll explain it here. Consider this a primer on the economics of poverty.

“The poor pay more for a gallon of milk; they pay more on a capital basis for inferior housing,” says Rep. Earl Blumenauer (D-Ore.). “The poor and 100 million who are struggling for the middle class actually end up paying more for transportation, for housing, for health care, for mortgages. They get steered to subprime lending. . . . The poor pay more for things middle-class America takes for granted.”

Poverty 101: We’ll start with the basics.

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2009 Buffalo Poverty Challenge

Our second annual Buffalo Poverty Challenge is coming up June 1st-3rd.  This year we have  a new website at:

www.povertychallenge.com

You can go there to take the Challenge online or there is a link to download the Poverty Challenge Guide so that you can print it out and take it offline.

We have fliers available for you to download at the HAWNY website (www.wnyhomeless.org) that you can print out and post up at your workplace and wherever you think people may be interested.

We also have a Facebook page for the event, just search “Buffalo Poverty Challenge”, become a fan of our page, and suggest the page to all your friends!

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The Foreclosure Crisis, Renters, and Communities of Color

The narrative surrounding the foreclosure crisis of the past year has tended to focus primarily on the foreclosure of homes that were owned by the people who lived in the them.  This article shifts the focus to the rental properties that have been foreclosed upon.  Many of the tenants of these rental properties do not have very high incomes (which is one reason they have to rent instead of own a home) and after the foreclosure they are usually left without a home and do not have very much to fall back on.  People like Yolanda James will burn through the resources they have left until they eventually become homeless.

The article also highlights how rental property foreclosure disproportionately affects communities of color which already have been devastated by economic and racial inequalities for decades.  It also calls for a rethinking of the “ownership society” ideal which the federal government tends to put the majority of its funding into.  Affordable and secure rental housing is crucial for low income families and individuals who do not have the ability to put up the money to own a home yet.  Any effort to end poverty and homelessness must incorporate this type of housing into its plan.

Foreclosure Crisis Hits Poor Renters Hard: Evicted Families Have to Fight to Live Together

By Michelle Chen, ColorLines. Posted May 26, 2009.

Last fall, Yolanda James and her three children were lost in their own city. After foreclosure had forced them from their South Los Angeles apartment, they ran into closed doors at every turn. Aid agencies offered referrals to other offices, but no relief, and neither the shelter system nor the city’s high-priced housing market had room for them. James burned through her welfare money to pay for motel rooms and later resorted to sleeping with her children in their car.

“I was, like, two or three different people at one time,” she recalled. “I had to get on the grind, to hustle, to make sure my kids–when they get out of school, I could feed them, or I could take them somewhere to shower and bathe for the next day.”

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Bloomberg Charging Rent at Homeless Shelters

Unfortunately New York, a city that is home to some very progressive Housing First programs (like Pathways to Housing), is also home to some very backward ideas about how to end homelessness.  This article is about Mayor Bloomberg’s recent decision to enforce a 1997 state law that requires residents who are staying in one the city’s publicly run shelters “to pay a certain portion of their income”.  People like Dacosta who are working a minimum wage job and trying to pick themselves up by the boot-straps are now going to have to pay hundreds of dollars to stay in the shelters.  This is money that could be saved up for a security deposit or to pay off debts or loans.  People like Dacosta will never be able to get ahead if they cannot save up money to make the transition out of a shelter.

Bloomberg’s decision to enforce this law is a great example of social welfare policies that support a person only enough to just get by.  With these kinds of policies all it takes is one emergency and the person is locked into a spiral of debt that they may never be able to get out of.  Social welfare policies should help a person establish a firm base from which they can make real progress to get out of poverty.  Guaranteeing that a person will have a home, regardless of income, is an important way to establish a firm base.   Bloomberg’s policy will only hamper the efforts of anyone attempting to get out of poverty.

New York Charges Rent for Working Homeless

Robert Stolarik for The New York Times

May 9, 2009

New York Charges Rent for Working Homeless

By JULIE BOSMAN and ANDY NEWMAN

The Bloomberg administration has quietly begun charging rent to homeless families who live in publicly run shelters but have income from jobs.

The new policy is based on a 1997 state law that was not enforced until last week, when shelter operators across the city began requiring residents to pay a certain portion of their income. The amount varies based on factors that include family size and what shelter is being used, but should not exceed 50 percent of a family’s income, a state official said.

Vanessa Dacosta, who earns $8.40 an hour as a cashier at Sbarro, received a notice under her door several weeks ago informing her that she had to give $336 of her approximately $800 per month in wages to the Clinton Family Inn, a shelter in Hell’s Kitchen where she has lived since March.

“It’s not right,” said Ms. Dacosta, a single mother of a 2-year-old who said she spends nearly $100 a week on child care. “I pay my baby sitter, I buy diapers, and I’m trying to save money so I can get out of here. I don’t want to be in the shelter forever.”

City officials said the new rent requirement had been in the works since a 2007 state audit that forced them to pay back $2.4 million in state housing aid that should have been covered by homeless families with income. They argued that homeless people with income should be expected to pay for a portion of their shelter costs, a model that echoes the federal Section 8 housing voucher program.

“I think it’s hard to argue that families that can contribute to their shelter cost shouldn’t,” Robert V. Hess, the city’s commissioner of homeless services, said in a telephone interview Friday. “I don’t see this playing out in an adverse way. Our objective is not for families to remain in shelter. Our objective is to move families back into their own homes and into the community.”

It is unclear why the state law has not been enforced until now. New York’s situation is unusual, with far more working homeless families than elsewhere in the state, and higher housing costs than virtually anywhere in the country.

Anthony Farmer, a spokesman for the State Office of Temporary and Disability Assistance, said the new policy will eventually affect about 2,000 of the more than 9,000 families in New York City shelters. More than 500 families have been informed that they were expected to begin paying rent on May 1.

City officials said they started with families who are new to shelters, and would phase in the new approach over the next several months, including for people who are on welfare and are also working. They could not yet estimate how much it would raise.

A flier posted in one shelter last week warned residents in bold, underlined type, “Failure to make the required contributions could result in the loss of your family’s temporary housing.”

But advocates for the homeless said the new policy was punitive and counterproductive, and some shelter residents, in protest, have already refused to sign the documents acknowledging receipt of the rent notifications.

“Families have been told to pay up or get out,” said Steven Banks, the attorney in chief for the Legal Aid Society. “The policy is poorly conceived, but even more alarmingly, it’s being poorly executed. What is happening is that we have seen cases of families being unilaterally told, without any notice of how the rent was calculated, that they must pay certain amounts of rent or leave the shelter. We’ve already had a case of a survivor of domestic violence who was actually locked out of her room.”

Mr. Hess acknowledged that if a family does not pay the required rent, it could be told to leave the shelter, but he noted that residents can contest the rent required through a state hearing.

Ms. Dacosta, for one, said she had spoken with her caseworker and demanded a hearing. Martha Gonzalez, who is 49 and lives with her 19-year-old son in a rundown shelter in Fort Greene, Brooklyn, said she was informed last week that she owes $1,099 in monthly rent on a $1,700 monthly income as a security guard in Midtown. She said she planned to contest the rent demand in court.

City officials did not immediately respond to Ms. Gonzalez’s assertion that her rent would exceed half of her income.

Patrick Markee, the senior policy analyst of the Coalition for the Homeless, called the policy “impractical,” arguing that most working people who live in homeless shelters earn low wages and would be better off saving for a place of their own. “It’s going to make families stay in shelter longer because they’ll have fewer financial resources,” he said.

“They are taking money from them that could otherwise be used to help themselves get out of the shelter system,” agreed Arnold S. Cohen, the president and chief executive of the Partnership for the Homeless. “We’re dealing with the poorest people, the people who are the most in need, and we’re asking them to pay for a shelter of last resort. As a city and a state that has a history of social and economic justice, I think we can do better than that.”

http://www.nytimes.com/2009/05/09/nyregion/09shelters.html?hp

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The New Homeless

Here is a very well written article about the “new” homeless population.  The important thing to remember is that the “new” homeless people, who have received a lot of attention in the last few months, are really not qualitatively different than the “old” homeless population that has been around since the late 1970′s.  These “new” homeless are the result of an economy in a deep recession, where there are fewer jobs and existing jobs are being paid less and having benefits cuts.  Increases in costs of living  as well as major cuts to social services and benefits over the past few decades have also contributed heavily to the increasing number of poor and homeless people.  As inequality and poverty increases, homelessness will increase.  That is important to remember as you read this and other articles about the “new” homeless.

This article in particular does a very good job highlighting the fact that people become homeless because of poverty.  Even if you are working, like the people in this article, your income may not be enough to cover rent or utilities and there’s is a good chance you will be forced onto the street when you can’t continue paying the bills.  These people are not lazy or irresponsible.  There just is not enough affordable housing in their community and their jobs do not pay enough for them to able to afford to live in the apartments that are available.  To end homelessness we must focus on the systematic inequalities (like high rents and low paying jobs) that put people on the streets.

HAWNY’s Buffalo Poverty Challenge is one way that we are going to try and get our community and community leaders to understand just what it’s like to live at the federal poverty level which is what it is like being payed minimum wage is.  We will take out rent and clothing costs (two basic necessities) for one person and give you a starting budget.  We will calculate how much everyday things like private transportation and pet supplies cost and you will have to decide, based on your starting budget of $7.87, what everyday things you can continue doing and still be able to have money for food.  Living on this budget should demonstrate how hard it is to “pull yourself up by your bootstraps” without any sort of assistance from family or friends.  And there are many people who’s family or friends who do not have enough money themselves to give more than moral support.

At the end of this exercise we hope that people will be able to understand why 1/3 of Buffalo lives in poverty and thousands of people are homeless every night.  We hope that as a community we will stop blaming people for being poor and begin to recognize the structural inequalities facing people with low incomes.  If Buffalo can begin to focus on efforts like creating living wage jobs and expanding access to affordable housing then we may be able to end homelessness here.  But if we continue ignoring these issues as most of the community and our leaders have, then the number of people living in poverty in Buffalo will surely keep increasing.

Sunday 03 May 2009

by: Elizabeth Leland  |  Visit article original @ The Charlotte Observer

Renee Hadley gets evicted from a tent city. (Photo: Getty Images)

Kenneth and Stacy Dowdy can’t afford a place to live in Charlotte. Neither can Charles DuPree. But if you passed them on the street, you might not recognize them for what they are: Homeless.

They are among a growing number of newly homeless who don’t fit old stereotypes. Many of them work regular jobs, or did until recently, nursing the sick, caring for other people’s children, vacuuming offices, driving cabs.

They lived in apartments or houses, surviving paycheck to paycheck. One thing went wrong in this bad economy, and they didn’t have far to fall before they ended up on the street.

Or in the cab of a pickup, where the Dowdys slept one night, treating it like a camping adventure for the sake of their young son.

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21st Century Shantytowns

This article illustrates a very tangible result of the current economic crisis.  As unemployment rates continue to rise and finding work becomes more and more difficult, people are losing their sources of income and are exhausting all their housing options.  When a person runs out of money and can’t afford an apartment or motel, they can choose between the streets, camps like these, and shelters which are oftentimes filled to capacity.  The stories of recently homeless individuals, like many of the people in these tent cities, are at odds with the un-substantiated claims that people make about homeless people being lazy or irresponsible. They give further evidence to the research-based claims that organizations like HAWNY make about homelessness being caused by poverty and the lack of affordable housing.  In fact our latest research found job-loss to be one of the most commonly cited reasons for homelessness.  It is our hope that articles like these will help highlight the fact that poverty is what is driving people out onto the streets.

It is also important to put these new tent-cities into context.  Inequality in income has risen dramatically since the early 1970′s, which coincides with the emergence of modern homelessness.  People have been living in tents for decades.  The tent-cities that have sprung up during the economic crisis are the result of an intense spike in economic inequality, which had already been high before.   Homelessness follows poverty and as the economic crisis worsens we agree with the National Coalition for the Homeless claim that homelessness is sure to increase dramatically as well.

One issue that tends to come up with articles like these is the definition of chronically homeless.  Here the chronically homeless “are indigent as a result of illiteracy, alcoholism, mental illness and drug abuse”.   While these conditions certainly contribute to homelessness and need to be taken into account in efforts to end homelessness, they do not necessarily lead to homelessness.  Poor and rich people alike struggle with mental health and substance abuse issues but do not end up in poverty and on the streets.  Dividing the homeless population into chronically homeless (such as those with substance abuse/ mental health issues) and non-chronically homeless (such as those people filling the tent cities) tends to distract public attention away from the root cause of homelessness: poverty.  Those with debilitating conditions certainly need specialized attention but it is important not to lose sight of the fact that the “chronically homeless” were poor before the onset of their conditions began which further deteriorated their income and forced them into more extreme poverty and homelessness.

See the National Coalition for the Homeless’ report Poverty vs. Pathology: What’s Chronic About Homelessness? for a more in depth exploration of the use of the term chronically homeless.

http://www.nytimes.com/2009/03/26/us/26tents.html?pagewanted=2&_r=1&sq=homeless&st=cse&scp=2

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