What Keeps Poor People Poor?

When Jamie Holmes says that poor people lack "willpower," he isn't disparaging their work ethic or blaming them for their situation. Rather, he's trying to explain the dynamics that keep poor people impoverished. As Holmes explains, individuals seem to have a finite capacity for exerting willpower, and every choice depletes it. In particular, poor people face a huge number of "tradeoff decisions" for every financial choice they make; to buy groceries or pay rent, to buy medicine or pay for utilities, etc. According to Holmes, this constant stream of difficult choices diminishes the capacity for willpower and self-control, and makes poverty that much more difficult. In his words:

[I]n addition to all the structural barriers that prevent even determined poor people from escaping poverty, there may be another, deeper, and considerably more disturbing barrier: Poverty may reduce free will, making it even harder for the poor to escape their circumstances. [...]

[W]e may need to grapple with a new possibility: that poverty doesn’t simply reduce freedom by constraining an individual’s choices, but that it may actually alter the nature of freedom by reducing an individual’s willpower.

This sounds like an argument for switching to direct cash transfers instead of our current service-based welfare system. In other words, if you simply give money to poor people, they can avoid constant tradeoffs decisions, and can "save" their willpower for better decisions in the long-term. Which makes sense; if you have the money to pay for rent, groceries, medicine and utilities, then you can direct your attention to other, more distant concerns.

As Holmes notes, and as Monica Potts described a few months ago, Mexico and Brazil have had success with programs to give money to poor people, and there's nothing about the United States which makes this idea untenable, other than political realities. Americans are strongly resistant to straightforward income redistribution and view "handouts" as something to avoid, which is unfortunate; most poor people are perfectly capable of addressing their needs if they have the money to do so. Instead of complicated schemes to target assistance, it makes a lot more sense to just give them money.

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