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> But it’s a few thousand dollars if that (as low as under $1,000) which is reachable to all but destitute families. It seems that more than half the families

> But it’s a few thousand dollars if that (as low as under $1,000) which is reachable to all but destitute families. It seems that more than half the families in the US are "destitute" then (https://www.foxbusiness.com/money/most-americans-cant-afford-unexpected-expenses https://www.foxbusiness.com/money/most-americans-cant-afford...) and it's been bad for years (https://abcnews.go.com/US/10-americans-struggle-cover-400-emergency-expense-federal/story?id=63253846 https://abcnews.go.com/US/10-americans-struggle-cover-400-em...)

rayiner 5y ago
That addresses sudden expenses that people can cover without resorting to credit, not planned expenses. Two very different things—a lot of folks who couldn’t make a $1,000 unexpected payment for cash flow reasons wouldn’t blink about $1,000 extra in a 5-year car loan where they can plan around the extra expense. Americans are chronically cash poor because their expenses rise to meet their income. Poor immigrant families in New York where the parents work in Chinese restaurants can afford $995 for test prep because they plan for it in advance.
- temp8964 5y ago
  Exactly, it's all about life choices. Many Chinese immigrants never go to bars / night clubs, and almost never eat outside, and almost never travels. They save all the money for their kids' education. Some other ethnic groups, even low-income families frequently spend money on those things. Yes. It's your right to spend the money the way you like. But you don't get to cry for no money for education when you spend money on other unnecessary things. Essentially, it's culture. In modern multiculturalism, cultural differences are important for the narrative, but totally unimportant for life outcomes. Why is that?
  - SyzygistSix 5y ago
    Because some cultural differences are different than others. And the ones that are especially detrimental won't change unless people of that demographic are exposed to and learn from successful people who engage in beneficial habits that solve the issue.
    - temp8964 5y ago
      I don't think most people would change their behaviors even after they are exposed to other cultures. There is an opposite force to prevent you from engaging in "beneficial habits". In Blacks kids, there is a commonly known term called "acting White". Kids can actually be laughed at for studying hard.
      - SyzygistSix 5y ago
        Do you think normalizing the successful behaviors will increase the backlash? I would think it would do the opposite. And I would disagree with anyone that said that becoming highly educated, at least in the modern sense, necessitates giving up one's culture.
        temp8964 5y ago
        When even the first African American President didn’t want to do that, there’s no other person can do that without being called a racist. Sometimes what matters is not being correct, but being politically correct.
bhupy 5y ago
That's a myth perpetuated by a (possibly willful) misinterpretation of the survey results[1][2]. If you click on the report in your own link, the survey summary even says as much: "If faced with an unexpected expense of $400, 61 percent of adults say they would cover it with cash, savings, or a credit card paid off at the next statement—a modest improvement from the prior year. Similar to the prior year, 27 percent would borrow or sell something to pay for the expense, and 12 percent would not be able to cover the expense at all." In the study, the Fed asks respondents whether they are able to pay all of their bills in full. Only 17% say they can’t pay some bills. The Fed also asks respondents how a $400 emergency expense that they had to pay would affect their ability to pay their other bills. 85% percent report that they would still be able to pay all their bills. Only 14% say that the emergency expense would result in their not being able to pay some bills. The situation is bad for that 14%, but that figure is much closer to what you would expect in a normal distribution, unlike the sensationalist 40% figure that makes the rounds. Also, these kinds of surveys capture a point in time, and don't reflect changing affluence of an individual over the course of their life. One study[3] of historic income tax returns found that 40% of working Americans spend at least 2 years in the top 10%. A full 62% spend at least 2 years in the top 20%, and over 54% spend at least 3 years there[4]. If this comes as a surprise, one can sanity check this by comparing the median household income (after taxes, transfers, and benefits) in the US with those of other countries; the US is #1[5]. And NB: even for those that are destitute, the US has a huge safety net, where the poorest fifth of American working age households are better off than those in Canada, Denmark, Britain, and Germany because their market income is higher and their taxes are lower, after accounting for all monetary benefits[6]. That's not to say that there isn't room for improvement (people still slip through the cracks), but it's by no means as dire as many make it out to be. Given all this, it takes a lot of motivated reasoning to be able to argue that "more than half of the families in the US are destitute". [1] https://www.bloomberg.com/opinion/articles/2019-06-04/the-400-emergency-expense-story-is-wrong https://www.bloomberg.com/opinion/articles/2019-06-04/the-40... [2] https://www.cato.org/blog/it-true-40-americans-cant-handle-400-emergency-expense-0 https://www.cato.org/blog/it-true-40-americans-cant-handle-4... [3] https://journals.plos.org/plosone/article?id=10.1371%2Fjournal.pone.0116370 https://journals.plos.org/plosone/article?id=10.1371%2Fjourn... [4] https://journals.plos.org/plosone/article/figure?id=10.1371%2Fjournal.pone.0116370.t002 https://journals.plos.org/plosone/article/figure?id=10.1371%... [5] https://en.wikipedia.org/wiki/Disposable_household_and_per_capita_income#Median https://en.wikipedia.org/wiki/Disposable_household_and_per_c... [6] https://twitter.com/CPopeHC/status/1489702016561602568 https://twitter.com/CPopeHC/status/1489702016561602568

rayiner 5y ago

That addresses sudden expenses that people can cover without resorting to credit, not planned expenses. Two very different things—a lot of folks who couldn’t make a $1,000 unexpected payment for cash flow reasons wouldn’t blink about $1,000 extra in a 5-year car loan where they can plan around the extra expense. Americans are chronically cash poor because their expenses rise to meet their income. Poor immigrant families in New York where the parents work in Chinese restaurants can afford $995 for test prep because they plan for it in advance.

temp8964 5y ago
Exactly, it's all about life choices. Many Chinese immigrants never go to bars / night clubs, and almost never eat outside, and almost never travels. They save all the money for their kids' education. Some other ethnic groups, even low-income families frequently spend money on those things. Yes. It's your right to spend the money the way you like. But you don't get to cry for no money for education when you spend money on other unnecessary things. Essentially, it's culture. In modern multiculturalism, cultural differences are important for the narrative, but totally unimportant for life outcomes. Why is that?
- SyzygistSix 5y ago
  Because some cultural differences are different than others. And the ones that are especially detrimental won't change unless people of that demographic are exposed to and learn from successful people who engage in beneficial habits that solve the issue.
  - temp8964 5y ago
    I don't think most people would change their behaviors even after they are exposed to other cultures. There is an opposite force to prevent you from engaging in "beneficial habits". In Blacks kids, there is a commonly known term called "acting White". Kids can actually be laughed at for studying hard.
    - SyzygistSix 5y ago
      Do you think normalizing the successful behaviors will increase the backlash? I would think it would do the opposite. And I would disagree with anyone that said that becoming highly educated, at least in the modern sense, necessitates giving up one's culture.
      - temp8964 5y ago
        When even the first African American President didn’t want to do that, there’s no other person can do that without being called a racist. Sometimes what matters is not being correct, but being politically correct.

bhupy 5y ago

That's a myth perpetuated by a (possibly willful) misinterpretation of the survey results[1][2]. If you click on the report in your own link, the survey summary even says as much: "If faced with an unexpected expense of $400, 61 percent of adults say they would cover it with cash, savings, or a credit card paid off at the next statement—a modest improvement from the prior year. Similar to the prior year, 27 percent would borrow or sell something to pay for the expense, and 12 percent would not be able to cover the expense at all." In the study, the Fed asks respondents whether they are able to pay all of their bills in full. Only 17% say they can’t pay some bills. The Fed also asks respondents how a $400 emergency expense that they had to pay would affect their ability to pay their other bills. 85% percent report that they would still be able to pay all their bills. Only 14% say that the emergency expense would result in their not being able to pay some bills. The situation is bad for that 14%, but that figure is much closer to what you would expect in a normal distribution, unlike the sensationalist 40% figure that makes the rounds. Also, these kinds of surveys capture a point in time, and don't reflect changing affluence of an individual over the course of their life. One study[3] of historic income tax returns found that 40% of working Americans spend at least 2 years in the top 10%. A full 62% spend at least 2 years in the top 20%, and over 54% spend at least 3 years there[4]. If this comes as a surprise, one can sanity check this by comparing the median household income (after taxes, transfers, and benefits) in the US with those of other countries; the US is #1[5]. And NB: even for those that are destitute, the US has a huge safety net, where the poorest fifth of American working age households are better off than those in Canada, Denmark, Britain, and Germany because their market income is higher and their taxes are lower, after accounting for all monetary benefits[6]. That's not to say that there isn't room for improvement (people still slip through the cracks), but it's by no means as dire as many make it out to be. Given all this, it takes a lot of motivated reasoning to be able to argue that "more than half of the families in the US are destitute". [1] https://www.bloomberg.com/opinion/articles/2019-06-04/the-400-emergency-expense-story-is-wrong https://www.bloomberg.com/opinion/articles/2019-06-04/the-40... [2] https://www.cato.org/blog/it-true-40-americans-cant-handle-400-emergency-expense-0 https://www.cato.org/blog/it-true-40-americans-cant-handle-4... [3] https://journals.plos.org/plosone/article?id=10.1371%2Fjournal.pone.0116370 https://journals.plos.org/plosone/article?id=10.1371%2Fjourn... [4] https://journals.plos.org/plosone/article/figure?id=10.1371%2Fjournal.pone.0116370.t002 https://journals.plos.org/plosone/article/figure?id=10.1371%... [5] https://en.wikipedia.org/wiki/Disposable_household_and_per_capita_income#Median https://en.wikipedia.org/wiki/Disposable_household_and_per_c... [6] https://twitter.com/CPopeHC/status/1489702016561602568 https://twitter.com/CPopeHC/status/1489702016561602568