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We don't need more big data studies to figure out what is causing poverty or how to fix it. Poverty in America is caused by: - real wages decreasing since 1980

• mtgx 9y ago
  Exactly my thoughts. I don't understand what this kind of study would achieve. Inequality at a society-level is not caused by "individual behavior" which is the only thing the Facebook study will be able to research. It's caused by politics, in general, and it could be fixed through politics. I don't think that by studying Facebook profiles, you'll be able to understand why politicians take corporate money and try to help only the rich to get richer, or other stuff like that.
• murph-almighty 9y ago
  Can you explain your last bullet point?
  • mistermann 9y ago
    I wondered the same.
• htormey 9y ago
  Good list. I would add a decade of low interest rates dramatically increasing the cost of college tuition and rent in major cities.
  • sokoloff 9y ago
    What's the mechanism whereby low interest rates cause high rents?
    • pteredactyl 9y ago
      Maybe cheap money has caused increased wealth to those closer to the 'watering hole' ( capital flows ), thereby inflating rents in metropolitan areas close to said 'watering holes'. If you're 'in' you can afford it. There are of course other major, possibly greater, factors like, NIMBY housing policies ( incl. rent-seeking boomers ).
      • pnutjam 9y ago
        In my experience, you have more people renting homes that are 100% leveraged, so your paying their crappy mortgage, with some "upkeep" costs on top. If interest is higher, more people are renting houses with more equity tied up in the house, so their costs are lower and they rent cheaper.
    • htormey 9y ago
      Here is a good article on the subject : https://www.investopedia.com/articles/mortgages-real-estate/08/interest-rates-affect-property-values.asp https://www.investopedia.com/articles/mortgages-real-estate/...
      • deleted 9y ago
        [deleted]
    • aaavl2821 9y ago
      Would imagine low interest rates increase housing prices as more people can afford a mortgage, higher housing prices increases rents
      • sokoloff 9y ago
        The more people who can afford a mortgage, the fewer people that need to rent in a given market. It seems obvious that low interest rates would drive up property prices. It's less clear whether that would drive up or down rents. It would tend to drive up rents by: requiring landlords to tie up more capital in new purchases of buildings (decreasing their marginal propensity/ability to put new buildings online for tenants), decreasing the number of people buying [increasing the number renting] due to fear of bubbly real estate market or inability to save down payment. It would tend to drive down rents by: lower returns in other passive investments might drive investment towards rental real estate chasing income (increasing supply), steadily increasing property values might encourage marginal buyers to buy, reducing demand on rental units in an area, foreign buyers might be more inclined to "park money" in USD real estate, some of which could be rented to offset the cash flow.
• gfodor 9y ago
  It's interesting how you list a bunch of hypotheses about the source of inequality, with no evidence, and yet also claim no data driven research is needed to validate them. Perhaps your comment needs citations and you should focus on why the existing evidence for your claims is so overwhelming that they are beyond being disproven by further understanding. Edit: I should note that I think performing social science on Facebook data is creepy and weird and potentially unethical.
  • YCode 9y ago
    Precisely so. The essence of the scientific method is taking what you think is true and proving it with a higher degree of accuracy. This is why studies are repeated by other people, to see if the results match up.
  • mistermann 9y ago
    I personally believe there is a lot more truth to this list than a "well researched" study backed by statistics that you can make say whatever you want (as an alert person may notice when reading the news). I'd even go so far as arguing that in-depth studies with their typical bias (to use a nice term) is what has made so many young, highly educated "evidence based" thinkers genuinely believe straightforward & consistent-with-observable-reality explanations like this are literally incorrect.
  • o_____________o 9y ago
    All of these claims are well-trod and have mountains of evidence. It's not necessary to cite references every time you say something on the internet, and it's not a meaningful rebuttal to point out the lack thereof.
    • gfodor 9y ago
      I was not asking him to justify the claims about inequality, but to justify the primary claim that no further investigation is needed. When responding to an article about using data to draw conclusions about inequality, and claiming no further research is needed, then obviously any constructive comment should explain why no further research is needed.
• ikeyany 9y ago
  Also, wealth hoarding/tax evasion.
  • raguuu 9y ago
    Irish Dutch sandwich.
• chrisseaton 9y ago
  These seem likely to me as well, but isn't the point of the study to actually check that's the case rather than assuming it? It'd be terrible if later on we figured out there's another underlying cause which we could have been tackling instead. Your bullet points these may well be immediate causes, but if you say something like 'real wages decreasing' well then you need to ask, what's the cause of that? And what's the cause of whatever caused that?
  • kevmo 9y ago
    Many studies have already checked and confirmed these things. There is a wealth of research on poverty and inequality, which is why I say we don't need more studies to figure it out -- we already know. Now is the time for action in response to the findings.
    • ng-user 9y ago
      Please provide some sources for these 'many studies'.
      • Frondo 9y ago
        Dude, go find your own studies. The OP content is now at the level of "Sun is bright and hot" level of having been studied. At some point, it stops becoming on us to link to studies for well-documented stuff, and on you to show the intellectual curiosity to find it on your own (and intellectual honesty to accept it).
        • briandear 9y ago
          Regarding the claim that “real wages have decreased” — yet I have studied that show such claims ignore the dramatically lower prices for consumer goods and the dramatic increase in non-wage benefits. I am not arguing that wages are up or down, but there is enough reasonable doubt that such statements aren’t in the realm of “the sun is hot.” Science should be continually challenging assumptions — especially social science where there is huge opportunity for bias and inconsistently.
• bogomipz 9y ago
  >"- ever-decreasing investment in infrastructure" I understand lack of infrastructure investment is a problem but how exactly does that cause poverty?
  • 20180201 9y ago
    infrastructure projects have traditionally been a reliable form of mass non-minimum-wage employment.
    • ams6110 9y ago
      Also a reliable form of siphoning public money into well-connected private pockets. Not saying that the employment benefits aren't real, but the other problem needs to be solved to get the best benefit.
    • samastur 9y ago
      + bad infrastructure is not evenly distributed and its effects are more likely to impact poorer parts.
    • kevmo 9y ago
      And not just that - transportation and communication are pillars of any economy. When you stop investing in them, you are kneecapping growth in general.
  • neves 9y ago
    I generates high quality blue collar jobs. It spreads the gov money for all the society with clean water, good roads and better transport.
  • Broken_Hippo 9y ago
    I remember working at a phone company around 1999-2001. Some folks were just getting landlines. I'm pretty sure the same folks are slow to get decent quality internet and decent cell service. Even then, finding a job without telephone service was difficult. Similar situations occur without proper communication now. Similar problems exist when folks lack sanitary conditions or mass transit proves to be completely inadequate or doesn't exist. At best, the sanitation easily means folks become sick more easily - which can push folks into poverty because the health care infrastructure and care isn't where it should be. Now, I don't have facts to back these up, but they aren't exactly insane ideas either.
• pteredactyl 9y ago
  Thank you for the mostly common sense. To me, the root cause is: - Central planners in government who think they're able to positively control and shape society ( because they know better than 'we' do )
  • cribbles 9y ago
    This directly contradicts the parent post, which suggested that the root cause was neoliberal economic reforms and divestment from the public sector.
    • MadSudaca 9y ago
      I think parent comment was being ironic.
    • AnthonyMouse 9y ago
      It's so interesting how two people can see the same list and read it so differently. This was the list: > real wages decreasing since 1980 This is the problematic outcome itself, not one of the specific causes. > the commoditizing of labor (e.g. janitorial companies, the "sharing economy") Caused by labor laws that make hiring full time employees more expensive (e.g. employer-provided healthcare mandates, see below), pushing businesses to hire temporary contractors from contracting companies that take a cut of the wages rather than forming stable long-term employment relationships directly with specific individuals. > ever-decreasing investment in infrastructure This is obviously a call for more government spending on infrastructure, which I would agree with personally, but there is actually a "this is still the government's fault" Libertarian position on this -- the government provides crumbling-but-free infrastructure which destroys the private market for providing the same things. If they didn't provide it at all then the market would invest more in it, so the theory goes. > tying wealth to real estate prices Unambiguous case of government regulations (zoning laws, loan interest subsidies) screwing things up. > an educational system that leaves many young people mired in debt Federal loan interest subsidies again. > tying healthcare to employment and the price of healthcare in general. More bad regulations: Tax subsidies and regulatory requirements for employer-provided healthcare, laws that encourage "health insurance" that covers everyday medicine rather than actual insurance against atypically large costs, which inhibits consumers from being price sensitive and thereby inflates healthcare costs. > mass incarceration destroying families and individuals Obvious case of "repeal the laws" as the solution. > regulatory capture allowing big businesses to beat down all the small ones Large companies control the regulatory bodies for their industry and purposely have rules enacted that favor large scale entities. Remove the rules, restore competition. > a monoculture that tremendously decreases resiliency Outcome of bad regulations again -- regulatory capture producing monopolies/oligopolies, regulations mandating specific solutions instead of facilitating multiple alternative solutions, high regulatory compliance costs destroying small businesses, monoculture of federal programs themselves that displace diverse programs operated by localities or private industry, etc. There is a completely valid position that eliminating regulations could solve all of these.
• bmmayer1 9y ago
  Even if some or all of the items on this list are true, to present them as obvious and unquestionable, without any supporting evidence, belays a shocking amount of arrogance that I'm surprised and embarrassed the HN community has deemed worthy to merit with top comment status.
  • maxerickson 9y ago
    It's a conversation, not an essay. Why not smash one of the points with data if you think that is the way that everything should proceed?
  • chibg10 9y ago
    Especially when the article was mostly about social mobility, rather than poverty per se. This list isn't really anything different than your standard Democratic talking points and doesn't even directly relate to the article. Not sure what it's doing as a top comment here.
• pc86 9y ago
  How do janitorial companies cause poverty?
  • r00fus 9y ago
    It's not the janitorial companies, it's the laws and regulations that make it cheaper to hire a company to perform janitorial services than hiring a janitor. It's purely tax law with very broad implications.
  • zo1 9y ago
    To put it in a nutshell, with the way I understand it. Hiring, keeping an employee employed, dealing with labor-law issues, paying for harassment/dispute lawsuits, difficulty in firing misbehaving or under-performing employees are all costs. Costs that a company would not necessarily be able to burden. So what happens is that all that risk, red-tape, etc gets consolidated in the form of an employment intermediary (for lack of a better term). So they consolidate, optimize and package all that risk and cost into a single figure which is both cheaper (due to economies of scale and concentrated knowledge) and easier to deal with and monetarily quantify. Companies then save money by rather hiring the employment intermediary instead of the actual employee. I clearly see it immensely in South Africa. Even in the software-development industry, where software-development firms are called "body-shops" because all they do is re-sell developer-hours rather than working on projects. The client explicitly interviews, selects and has the developer sit in their offices under their management team with their hardware, etc. It's made worse in South Africa because there is no at-will employment, and the government has made it ridiculously difficult to dismiss/fire employees even for perfectly reasonable and straightforward reasons.
    • pc86 9y ago
      > So what happens is that all that risk, red-tape, etc gets consolidated in the form of an employment intermediary (for lack of a better term). So they consolidate, optimize and package all that risk and cost into a single figure which is both cheaper (due to economies of scale and concentrated knowledge) and easier to deal with and monetarily quantify. Companies then save money by rather hiring the employment intermediary instead of the actual employee. Which is good for everyone. It's good for the first company, because they're saving money and can either deliver more profit to shareholders or they have more money to reinvest into the company. It's good for the janitorial company because that entire company wouldn't have existed before. Everyone there not scrubbing floors has a job because that company exists. It's good for the janitors because more janitors can be employed (again through economies of scale).
• Helmet 9y ago
  While I do agree with you that these are all potential causes, I would appreciate any citations or sources. There is an interesting report from the Brookings Instituion that goes into this a little more deeply: https://www.brookings.edu/research/thirteen-facts-about-wage-growth/ https://www.brookings.edu/research/thirteen-facts-about-wage... I think it's worth a read regardless of where you stand on the ideological spectrum. I think there is room for both sides to find some headway in areas like healthcare, incarceration, and education...
• scramblerollo 9y ago
  You're inferring that poverty and inequality are the same. Though very connected on many layers they are distinct categories. For instance I am above the poverty line, yet can be far outranked in monetary scale by a reasonable 40% of society in my country. I could be seen as having income inequality for the value I contribute to society and yet not fall onto the scale of poverty or even lower income. Technically the arguement could be made that the difference between the top 5% and 0.5% of society have a far greater inequality between themselves than the rest of us. Poverty is absent in this context.
• stochastic_monk 9y ago
  I disagree with the comment below you claiming there's no evidence to support your claims. You don't have citations in your post, that's because it's a summary. There are huge amounts of evidence backing up your claim. A bigger issue than the uselessness of this initiative by facebook is the empty, bald-faced PR "Hey, look over here!" distraction that they're using to cover their callous complicity in disinformation campaigns. That bothers me more.
  • Applejinx 9y ago
    Thank you: I too found the post a simple summary of obvious things. And I too am skeptical of Facebook's motives here: though part of it must surely be 'let's find causes for poverty that allow us to continue to be Facebook, and allow internet 'unicorns' to continue to be unregulated industry-devouring titans'. Basically, Facebook needs to find a solution to poverty that ends with them consuming and disseminating the data of billions of people who happen to not be desperately poor. In many ways their best case is all the better if their data is of solvent people.
    • stochastic_monk 9y ago
      You’re completely right. This belongs in the same class of disgusting PR moves to grow userbase as Zuckerberg offering for Xie to name his firstborn son.
  • TAForObvReasons 9y ago
    > cover their callous complicity in disinformation campaigns. They've been on the defensive for years now. Recall how vehemently they downplayed Russian attempts to influence via Facebook ad buys and troll accounts But to the general point, we've known how to fix the problems for decades but actually attacking issues of income and wealth disparity is asking for the people who are currently benefitting most from the system to give something back. And if history tells us anything, it may take violent revolution to see a real fix.
    • ttonkytonk 9y ago
• harlanji 9y ago
  Accurate breakdown. If you looked at my life as a 14 year old, you wouldn't have been able to picture me as a 28 year old. If you looked at me as a 28 year old, you wouldn't have been able to picture me as a 33 year old. In the last 5 years I found the top of my game where people didn't want a poor person there; got knocked down and it's been interesting adjusting to being chronically impoverished with issues increasingly piling up--relatives now comparing me to my cousins who can't hold down dish washing jobs. Meanwhile the tech giants are still trying to recruit me, and I know when I start work I'll be knocked out again because, like my last several high salary jobs in the BA, I've entered $1000s in debt with several years of poverty, causing rejection by coworkers (poor attire, untraveled). Crazy... miracle or relocation seem to be needed. I'm optimistic these last years will be a hilarious memory that toughened me up (in typical ign'nt American fashion, temporarily embarrassed millionaire).
  • antihero 9y ago
    What industry, may I ask?
  • kevmo 9y ago
    I recommend a capsule wardrobe. Buy a decent set of monochrome shirts/pants and mix them around --> many good outfits! https://en.m.wikipedia.org/wiki/Capsule_wardrobe https://en.m.wikipedia.org/wiki/Capsule_wardrobe
  • Applejinx 9y ago
    Yup. I'm an entrepreneur who ran a sole proprietorship software business since 2007 or so. I've been at the top of my game to the point where I now enjoy a reputation as a key DSP guy in my industry (pro audio, recording studios etc) but I watched the income of my business collapse over the years, and got knocked down by that. I observed that my troubles exactly tracked the Labor Share of wages as tracked by the Fed: I was impoverished to the exact proportion that the country (and the world: I did and do a lot of export) didn't itself have money. If labor boomed, so did I: if labor took a downturn, so did I. I retained such a high reputation that I was able to withstand a switch over to Patreon when my payment processor went out of business owing me months of payments: from my observation if you transition to a patron model it literally decimates your earnings, but they become steady and may grow. I am also typically American in that I figure if I double down and work ten times harder and don't die, it'll all work out, and I'm getting up to what would be minimum wage for a factory worker (this is 97th percentile of Patreon accounts, by the way: I'm in the top 3% of all Patreon and trying to get into ITS 'one percent') and doing things like releasing all my existing products for LinuxVST and methodically open-sourcing it all under the MIT license. I figure even as an open-sourcer I will not succeed unless I can be ruthlessly exploited for my work, and even as a patron-supported person I'm still subject to the power-law factor of 2018 life where unless I'm exploding in success, I'm failing. So my motivation can only be: exploit and crush the world, or out-give the most generous people AS IF I was already that millionaire, a Bill Gates just looking for ways to give it away again. So I'm doing the latter, and we'll see whether I literally live to do more of it. Any little financial thing crushes me and breaks my spirit for a while, costing me valuable work time. My only recourse is to charge off entreprenurially into new prospects and hope for the best. The funny thing is, that's the same recipe for if I was trying to prosper with new commercial products, and I do free everything now (increasingly including ideas). In an America with a saner Gini coefficient, I would probably still be close to broke, but I'd have a much huger cash flow and would probably be employing people. I know I can't do everything I envision, and I would absolutely be hiring if that was remotely possible.
• rubicon33 9y ago
  I think you forgot, on your list, a massively de-regulated banking system which since the 80s has been destabilizing the economy and at times even going as far as to profit from it's downfall. This has had the effect of removing real wealth from average people and consolidating it into the hands of a few.
• wuliwong 9y ago
  I appreciate that your first bullet point was about real wages decreasing. I wonder how many people know what that means.