The Finch Formerly Known As Gold

27 November 2006


Or, in other words, a poverty simulation, and not on screen either:

We were assigned an identity and given a summary of our current life situation. Stations were set up to represent the utility company, the mortgage company, a pawn shop, check cashing loan store, grocery store, and public assistance. During the simulation, I became a 19 year old, unemployed, high school dropout, single mother with a live-in boyfriend. Our bills totaled $555 per month including a mortgage on our mobile home, lot rent, utilities, food, and a car title loan that we had taken out. We also had to give transportation passes at every stop to account for the gas or the bus to get us there. Our monthly take home pay was $794.00 per month including $234 in TANF (Temporary Assistance for Needy Families) benefits and $120 in food stamps. That left us with $239 per month for everything else. Trust me $60 per week for a family of three for everything else (such as gasoline for the car, medicine, car repairs, diapers, toiletries, and other items) does not go far. Just to make it interesting we were also given several items of value to pawn if we got desperate.

This test subject, in real life, actually counsels on financial issues. And said counsel, she discovered, is offtimes easier said than done:

In a matter of minutes I transformed from the calm budgeting expert who had it all figured out to someone who was just living in survival mode. Much of my reason and logic went out the window. I could not pay the mortgage first as planned because we only took home $110 per week from my boyfriend’s job. It was 3 weeks before we had enough to pay the mortgage. In real life, I tell people to pay their mortgage first since we want them to avoid homelessness. In the simulation, we paid the mortgage next to last and had been evicted by the time we came up with enough money to pay it.

In real life I advise people to avoid paying high fees for services such as check cashing and to stay away from the pawn shop. Logic would tell you that it is much cheaper to open a checking account at the local bank or credit union than to pay fees for check cashing services. In the simulation, we did not have a bank account and could not obtain one. In order to cash my boyfriend’s check to get money to pay the bills, we had to pay a $10.00 fee for every check we cashed. When we got a cut off notice for the utilities, I found myself in line at the pawn shop to hock my stereo. I took the money from hocking the stereo to pay the gas bill just before they cut it off. I also had to stand in a long line at the public assistance office just to confirm my TANF benefits. I had to take my baby with me since I could not afford daycare. I stood in line for so long that the office closed and I had to come back the next day.

This isn't exactly the situation for which the term "vicious circle" was invented, but it's close enough.

If nothing else, this exercise demonstrates one Hard Fact: things look different on the other side of the desk.

(Seen at Satellite Sky.)

Posted at 1:52 PM to Common Cents

There are a couple of problems with this sim. It assumes that you start with $0 at the start of each month, it looks like it limits you to only pawn shops for selling things (as opposed to garage sales or free newspaper ads), and it appears that you can't get another job to generate more income.

I've lived hand to mouth and have NEVER sold to a pawn shop nor had to use a check cashing service. I havne't been completly flat broke, but I have been severely deflated.

Posted by: Dwayne "the canoe guy" at 5:55 PM on 27 November 2006

And maybe someone else got a different version of it. I don't know; I just reprinted what I saw. It is certainly true, though, that this is only one possible scenario, and it doesn't particularly resemble the one I lived through Way Back When.

Posted by: CGHill at 6:03 PM on 27 November 2006

Well, let's see. When I was a kid, we moved out of subsidized housing to rent a house that my folks claimed the landlord used more as a tax shelter than an income producer. We had one leased car repossessed from the street in front of our house, and there was a Chapter 13 filing somewhere along the line, probably not long after the repo.

The previous, subsidized housing was the extent, that I know of, of our taking any kind of direct or nearly-direct public assistance; both parents worked outside the home and between my brother and me we got a combined 21 years of private (Catholic) school education, part of which my brother and me worked off in high school.

Checking accounts were open and functioning all along, and I certainly don't remember anything getting pawned for quick cash. But we ate a lot of canned tuna.

Maybe I could start a consulting business telling people how we did it. Only trouble is, the market for my services consists of people who can't pay.

Posted by: McGehee at 9:21 PM on 27 November 2006

My mother washed my ordinary cloth diapers. People used to do that, and probably still should if they're poor.

Posted by: Purple Avenger at 12:24 AM on 28 November 2006


Thanks for the mention. Pretty amazing considering it is such a serious topic for your humorous blog.

There seems to be a complete disconnect and denial of the reality of the unjust exploitation of the those members of our society who are least capable of protecting their financial interests. Believe it or not, but there are members of our society who are not fully capable of helping themselves.

Dwayne: As for "just get another job," see one of my later articles for the costs that are being foisted upon the middle and lower classes. See also Barbara Ehrenreich's books Nickel and Dimed and Bait and Switch for the plight of low-wage workers and hopeful entrepreneurs trying to make ends meet.

The story is much bigger than you might realize.

Posted by: OkieLawyer at 8:56 AM on 28 November 2006

The poverty simulation scenario is not perfect but aspects of it do reflect pretty accurately many parts of the the "modern poverty" situation.If anything it at least puts people in the empathetic role of feeling the narrow confines of the prefabricated financial world that exists for folks in certain situatiions. Things have changed dramatically since we were children (I'm 48). Being in a small town my parents could cash their checks at the local grocery store or bank (we had a small savings account there) where they knew us and no extra fees were assessed (unlike today where check cashing fees are the way it is and it is difficult to open even a savings account at some banks if you've had ANY kind of credit problem in the past which most poor folks have) ... try cashing a check at a bank where you do not have an account nowadays. The utility companies cut you a LOT of slack back then unlike today where they might let you slide a little but the more you are late the quicker the cut of notices start to come and the added deposits (added right to your bill) put you deeper in the debt of the company store. Banks have hit the road out of poor neighborhoods and check cashing companies and pawn shops sprang up to fill the void with larger fees and dubious offers of credit (the payday loan and post dated check)along with the marketing to make it OK. People turn the best alternatives at hand and sometimes that includes these places and the pawn shop. I have a unique perspective having been poor as a child and later owning both pawn shops and check cashing places (what I call the dark side of my previous life :) ... and then working in the non-profit world counseling consumers and working on community beneficial projects. I've been in, worked in, and seen the "big picture" on this part of life. A lot of "if i was in that situation I would ..." goes out the window as Jennifer so aptly alludes in her blog. One of the most common refrains from folks at the pawn shop was "I've never done this before" and "I need to get money for medicine or the doctor bill". Most of these folks were the working poor ... uneducated or more likely undereducated, in minimum wage jobs for long periods of time, and parents to 2 or more children. Most were NOT on any kind of public assistance. Some folks are lucky enough to be born into families, albeit poor, with smart parents and deep connections to community and family ... when tough times come they have a good lifeline. I know I was. Many others come into the world in the company of parents who have never saved, planned, or anything but there they are and there they must come into their own understanding of how to cope with "the system" and find their place within it to survive at the level of their comfort or ability. Couple that with the lousy job prospects of these folks and the "cycle" starts or continues in most cases. Some make it ... many don't. I know I'm belaboring the obvious here but I'm passionate about this. :)

Posted by: Ron at 9:19 AM on 28 November 2006


Ron! Paragraph breaks!

You'll thank me later.

Posted by: McGehee at 9:13 PM on 28 November 2006

Point well taken ... It's just that whole stream of consciousness thing :)

Posted by: Ron at 8:14 AM on 29 November 2006


Posted by: McGehee at 10:27 AM on 29 November 2006