5 ms·

Major takeaway: "evidence has accumulated that in many circumstances, cash improves the life of poor people more than equivalent spending on aid programs or go

Major takeaway: "evidence has accumulated that in many circumstances, cash improves the life of poor people more than equivalent spending on aid programs or goods."

ctdonath 5y ago
US "poverty line" is at 80th percentile of world incomes.
- kspacewalk2 5y ago
  Absolute numbers don't matter. Purchasing power matters.
  - rmah 5y ago
    Global PPP uses USD purchasing power in the US as the baseline.
  - retention456 5y ago
    Purchasing power parity (PPP) is accounting for both absolute exchange rates and differential purchasing power across different countries https://www.pewresearch.org/fact-tank/2015/07/09/how-americans-compare-with-the-global-middle-class/ https://www.pewresearch.org/fact-tank/2015/07/09/how-america...
  - ctdonath 5y ago
    That's accounting for PPP adjustments. Poverty line is a published official statement. Percentile of world incomes, PPP adjusted, are easily found. Find and compare them.
- Robotbeat 5y ago
  In part because we have used regulations to require you to be rich. In India the cheapest new street legal car is the Tato Nano, around $2500 (maybe small electric cars from China even less). But the cheapest new car in the US is the Chevy Spark at $13-14k. Building codes and zoning regulations mean there’s a minimum price you have to pay for housing in the US that’s around a factor of 10 higher than in much of the world (less than $100/month for a single bedroom apartment in a city in India vs around $1000/month in the US in a city… median is currently around $1200/month). And if you can’t afford that, and try to live in a tent even with the permission of a landowner, you can be arrested because sleeping in a tent is illegal and against code. It’s illegal to be poor. Luckily we at least have some social programs. But we make people jump through hoops to get access to them. A time tax and something that becomes a lot harder or next to impossible if you have literacy problems or aren’t good at forms.
  - nine_zeros 5y ago
    If you are going to bring China and India to the conversation, you have to talk about the amazing range of high quality smartphones for $150
  - BoiledCabbage 5y ago
    > In part because we have used regulations to require you to be rich. ... > Building codes and zoning regulations mean there’s a minimum price you have to pay for housing in the US that’s around a factor of 10 higher than in much of the world (less than $100/month for a single bedroom apartment in a city in India vs around $1000/month in the US in a city… median is currently around $1200/month). That's a pretty incredible take. Somehow so many people live in an ideological bubble, that no matter how varied the situation their explanation of the cause of the problem is exactly the same. In the US, where the minimum wage is 10x that of India, the real value is land likely more than 10x that of India the explanation for why housing is more expensive is because of building codes. The claim is that 90% of the cost of housing is due is building codes. I really wish people on got out of their ideological bubble more frequently. Some mantras get repeated so much people start believing they are true no matter how contradictory the evidence. It's not good for long term outcomes.
    - Robotbeat 5y ago
      But land is not where people live. Buildings are. Buildings which can be built higher. Building materials are global commodities. So why doesn’t the US just build more stories than India if the land is more expensive but the commodities to build buildings, relative to cost of land, are cheaper? Answer: zoning codes, “local control,” and regulations. (Also, the land density per person is actually MUCH higher in India than the US, over an order of magnitude higher, which OUGHT to bid up the price of land even more. https://en.wikipedia.org/wiki/List_of_countries_and_dependencies_by_population_density https://en.wikipedia.org/wiki/List_of_countries_and_dependen... ) The reality is we make it illegal to be poor, whether intentional or not. And then put meanstesting in social programs to target them, which has the perverse effect of making it harder for those who are poorest (ie least able to navigate bureaucracy) to get access to them. And as far as ideology, both the left and the right seem to conspire to make this happen. It’s worse in cities than rural area due to obvious reasons, but within a city itself, both the mainstream left and mainstream right seem to back the regulations that make it illegal to be poor.
- cturner 5y ago
  This would be a powerful point with a reference - can you cite it?
  - ctdonath 5y ago
    Poverty line = $12,880/yr : https://aspe.hhs.gov/topics/poverty-economic-mobility/poverty-guidelines/prior-hhs-poverty-guidelines-federal-register-references/2021-poverty-guidelines#threshholds https://aspe.hhs.gov/topics/poverty-economic-mobility/povert... "A $12,880 income in the United States has enough buying power to put you in the 84th percentile globally for per-person income" : https://www.washingtonpost.com/graphics/2018/business/global-income-calculator/ https://www.washingtonpost.com/graphics/2018/business/global...
    - deleted 5y ago
      [deleted]
    - ctdonath 5y ago
      On a whim, I looked into poverty-level taxation by plugging $12,880 into various online tax [gu]estimate calculators. Results varied from -$114 to $1080 (FICA included). Short of running it thru a real tax program (which I will in due course), struck me how US income tax law presumes you will pay at least a 10% tax rate, even if below the poverty line. https://www.irs.gov/newsroom/irs-provides-tax-inflation-adjustments-for-tax-year-2020 https://www.irs.gov/newsroom/irs-provides-tax-inflation-adju... I assume a little finesse with a 1040EZ form should get it down to $0, but it's unsettling that legislators who unanimously agree "something should be done for the poor" actually legislate a 10% tax rate on the poor.
dls2016 5y ago
Why is it important to reflect on that?
- reidjs 5y ago
  I think it's important because it sounds incorrect, but in reality it works out like that. In my experience most people think that if you give a poor person money they are just going to spend it on things which make their life worse, like drugs. It's one way to justify not giving a few quarters or a dollar to a homeless person on the street when they ask.
  - hellojesus 5y ago
    Yes, but another way to justify it is that it's your money, and the utility you get from spending it on that random, asking person is less than you would get from the next best expenditure (opportunity cost). That's not to say I don't give charitably or believe in it. I just don't think that anyone has to justify not giving money to some random when asked. I don't believe it's the government's job to hand out money to people in need. I think private charities and churches do a lot better job of spending it than a bureaucratic government, and the auditability of where the money goes is way, way more transparent so long as you're not dealing with a shady organization (which you can easily vet).
    - shakna 5y ago
      > I don't believe it's the government's job to hand out money to people in need. I think private charities and churches do a lot better job of spending it than a bureaucratic government, and the auditability of where the money goes is way, way more transparent so long as you're not dealing with a shady organization (which you can easily vet). There are many "popular" charities for which auditing is as far from transparent as can be, where the majority of their spending never reaches the target audience. To the point where this is the _norm_. Government programs, on the other hand, are required to account for every dollar spent, and issue regular public reports. How would one go about vetting the Salvation Army's spending, for example? They say they have regular independent audits, for none of those are public. So when they say 82% of donations go to the intended target, you must simply trust them.
shakna 5y ago
> Anyway I suspect if we change the meaning of "poor people" from African centric to West centric results may be less clear. > In 2009, when Michael Faye co-founded the New York-based nonprofit GiveDirectly, whose mission is to alleviate poverty by providing unconditional cash transfers, skeptical development experts and philanthropists told him the sums would be misspent. But in the following decade, evidence has accumulated that in many circumstances, cash improves the life of poor people more than equivalent spending on aid programs or goods. Did you miss that the evidence from GiveDirectly's efforts isn't African-centric? They operate on a global scale, including programs that run within US borders. > GiveDirectly is the leading global NGO specialized in delivering digital cash transfers. We’ve worked in challenging contexts across 9 countries, from Houston after Harvey to the most remote parts of Uganda, and launched 15 experimental evaluations (RCTs) with independent researchers documenting the impacts on recipients and on the local economy.
- Chris2048 5y ago
  The comments don't make sense wrt to the OP: has this post been majorly re-edited?
  - shakna 5y ago
    The first line of my above comment was a direct quote that was removed from the above parent's post. Making my comment now somewhat pointless, yes.

Major takeaway: "evidence has accumulated that in many circumstances, cash improves the life of poor people more than equivalent spending on aid programs or goods."

ctdonath 5y ago

US "poverty line" is at 80th percentile of world incomes.

kspacewalk2 5y ago
Absolute numbers don't matter. Purchasing power matters.
- rmah 5y ago
  Global PPP uses USD purchasing power in the US as the baseline.
- retention456 5y ago
  Purchasing power parity (PPP) is accounting for both absolute exchange rates and differential purchasing power across different countries https://www.pewresearch.org/fact-tank/2015/07/09/how-americans-compare-with-the-global-middle-class/ https://www.pewresearch.org/fact-tank/2015/07/09/how-america...
- ctdonath 5y ago
  That's accounting for PPP adjustments. Poverty line is a published official statement. Percentile of world incomes, PPP adjusted, are easily found. Find and compare them.
Robotbeat 5y ago
In part because we have used regulations to require you to be rich. In India the cheapest new street legal car is the Tato Nano, around $2500 (maybe small electric cars from China even less). But the cheapest new car in the US is the Chevy Spark at $13-14k. Building codes and zoning regulations mean there’s a minimum price you have to pay for housing in the US that’s around a factor of 10 higher than in much of the world (less than $100/month for a single bedroom apartment in a city in India vs around $1000/month in the US in a city… median is currently around $1200/month). And if you can’t afford that, and try to live in a tent even with the permission of a landowner, you can be arrested because sleeping in a tent is illegal and against code. It’s illegal to be poor. Luckily we at least have some social programs. But we make people jump through hoops to get access to them. A time tax and something that becomes a lot harder or next to impossible if you have literacy problems or aren’t good at forms.
- nine_zeros 5y ago
  If you are going to bring China and India to the conversation, you have to talk about the amazing range of high quality smartphones for $150
- BoiledCabbage 5y ago
  > In part because we have used regulations to require you to be rich. ... > Building codes and zoning regulations mean there’s a minimum price you have to pay for housing in the US that’s around a factor of 10 higher than in much of the world (less than $100/month for a single bedroom apartment in a city in India vs around $1000/month in the US in a city… median is currently around $1200/month). That's a pretty incredible take. Somehow so many people live in an ideological bubble, that no matter how varied the situation their explanation of the cause of the problem is exactly the same. In the US, where the minimum wage is 10x that of India, the real value is land likely more than 10x that of India the explanation for why housing is more expensive is because of building codes. The claim is that 90% of the cost of housing is due is building codes. I really wish people on got out of their ideological bubble more frequently. Some mantras get repeated so much people start believing they are true no matter how contradictory the evidence. It's not good for long term outcomes.
  - Robotbeat 5y ago
    But land is not where people live. Buildings are. Buildings which can be built higher. Building materials are global commodities. So why doesn’t the US just build more stories than India if the land is more expensive but the commodities to build buildings, relative to cost of land, are cheaper? Answer: zoning codes, “local control,” and regulations. (Also, the land density per person is actually MUCH higher in India than the US, over an order of magnitude higher, which OUGHT to bid up the price of land even more. https://en.wikipedia.org/wiki/List_of_countries_and_dependencies_by_population_density https://en.wikipedia.org/wiki/List_of_countries_and_dependen... ) The reality is we make it illegal to be poor, whether intentional or not. And then put meanstesting in social programs to target them, which has the perverse effect of making it harder for those who are poorest (ie least able to navigate bureaucracy) to get access to them. And as far as ideology, both the left and the right seem to conspire to make this happen. It’s worse in cities than rural area due to obvious reasons, but within a city itself, both the mainstream left and mainstream right seem to back the regulations that make it illegal to be poor.
cturner 5y ago
This would be a powerful point with a reference - can you cite it?
- ctdonath 5y ago
  Poverty line = $12,880/yr : https://aspe.hhs.gov/topics/poverty-economic-mobility/poverty-guidelines/prior-hhs-poverty-guidelines-federal-register-references/2021-poverty-guidelines#threshholds https://aspe.hhs.gov/topics/poverty-economic-mobility/povert... "A $12,880 income in the United States has enough buying power to put you in the 84th percentile globally for per-person income" : https://www.washingtonpost.com/graphics/2018/business/global-income-calculator/ https://www.washingtonpost.com/graphics/2018/business/global...
  - deleted 5y ago
    [deleted]
  - ctdonath 5y ago
    On a whim, I looked into poverty-level taxation by plugging $12,880 into various online tax [gu]estimate calculators. Results varied from -$114 to $1080 (FICA included). Short of running it thru a real tax program (which I will in due course), struck me how US income tax law presumes you will pay at least a 10% tax rate, even if below the poverty line. https://www.irs.gov/newsroom/irs-provides-tax-inflation-adjustments-for-tax-year-2020 https://www.irs.gov/newsroom/irs-provides-tax-inflation-adju... I assume a little finesse with a 1040EZ form should get it down to $0, but it's unsettling that legislators who unanimously agree "something should be done for the poor" actually legislate a 10% tax rate on the poor.

dls2016 5y ago

Why is it important to reflect on that?

reidjs 5y ago
I think it's important because it sounds incorrect, but in reality it works out like that. In my experience most people think that if you give a poor person money they are just going to spend it on things which make their life worse, like drugs. It's one way to justify not giving a few quarters or a dollar to a homeless person on the street when they ask.
- hellojesus 5y ago
  Yes, but another way to justify it is that it's your money, and the utility you get from spending it on that random, asking person is less than you would get from the next best expenditure (opportunity cost). That's not to say I don't give charitably or believe in it. I just don't think that anyone has to justify not giving money to some random when asked. I don't believe it's the government's job to hand out money to people in need. I think private charities and churches do a lot better job of spending it than a bureaucratic government, and the auditability of where the money goes is way, way more transparent so long as you're not dealing with a shady organization (which you can easily vet).
  - shakna 5y ago
    > I don't believe it's the government's job to hand out money to people in need. I think private charities and churches do a lot better job of spending it than a bureaucratic government, and the auditability of where the money goes is way, way more transparent so long as you're not dealing with a shady organization (which you can easily vet). There are many "popular" charities for which auditing is as far from transparent as can be, where the majority of their spending never reaches the target audience. To the point where this is the _norm_. Government programs, on the other hand, are required to account for every dollar spent, and issue regular public reports. How would one go about vetting the Salvation Army's spending, for example? They say they have regular independent audits, for none of those are public. So when they say 82% of donations go to the intended target, you must simply trust them.

shakna 5y ago

> Anyway I suspect if we change the meaning of "poor people" from African centric to West centric results may be less clear. > In 2009, when Michael Faye co-founded the New York-based nonprofit GiveDirectly, whose mission is to alleviate poverty by providing unconditional cash transfers, skeptical development experts and philanthropists told him the sums would be misspent. But in the following decade, evidence has accumulated that in many circumstances, cash improves the life of poor people more than equivalent spending on aid programs or goods. Did you miss that the evidence from GiveDirectly's efforts isn't African-centric? They operate on a global scale, including programs that run within US borders. > GiveDirectly is the leading global NGO specialized in delivering digital cash transfers. We’ve worked in challenging contexts across 9 countries, from Houston after Harvey to the most remote parts of Uganda, and launched 15 experimental evaluations (RCTs) with independent researchers documenting the impacts on recipients and on the local economy.

Chris2048 5y ago
The comments don't make sense wrt to the OP: has this post been majorly re-edited?
- shakna 5y ago
  The first line of my above comment was a direct quote that was removed from the above parent's post. Making my comment now somewhat pointless, yes.