4 ms·

NYT: How Expensive It Is to Be Poor

29 points by Nowyouknow 12y ago

drzaiusapelord 12y ago
>According to the study, in 2015 the poorest fifth of Americans will pay on average 10.9 percent of their income in state and local taxes This is purposely misleading. Yes, the poor do get hit with state/local taxes (this may or may not include sales tax, gas tax, etc) but often will not pay federal tax. That's on top of various aid programs like food stamps, section 8 rent assistance, etc. These articles are really disingenuous statistics, often used to push an agenda. A less politicized article here on who does and doesn't pay taxes: http://www.washingtonpost.com/blogs/wonkblog/wp/2012/09/18/who-doesnt-pay-taxes-in-charts/ http://www.washingtonpost.com/blogs/wonkblog/wp/2012/09/18/w...
- deleted 12y ago
  [deleted]
- chc 12y ago
  While I agree that this article is frustratingly light on information, I don't think that one is any better, and it's certainly no less political. The article you linked isn't even attempting to quantify how much of their income people pay in taxes. Its primary goal is just to show that some comments by a particular politician reflected real statistics, not to analyze the actual lot of the poor in society. The only part that even goes near the issue just seems to be summing tax rates, not considering how much of their money they actually have to pay (e.g. I keep more of my income than summing tax rates would lead you to believe because I have a 401k plan).
  - tehwebguy 12y ago
    The WP article is really just a response to the uproar over Romney's comment in the 2012 election at a fundraiser about how ~"47% of the country doesn't pay tax", probably why they are focusing on "who pays" and not "how much"
aianus 12y ago
What exactly is preventing poor people from getting basic checking accounts? They give those out to 12-year-olds with no assets and no credit history.
- briantakita 12y ago
  Bank fees, like overdraft fees, sting when money is scarce.
  - LordKano 12y ago
    The banking reforms that took effect in 2010 have made it more difficult for banks to screw people with overdraft fees. As an anecdote, less than two weeks before those protections went into effect, I overdraw my account. It was my fault, I lost track of my account balance and overdrew my account. I legitimately owed one overdraft fee. My bank, re-ordered the transactions for that day so that instead of merely overdrawing my account for one transaction, I overdrew it for five. I got a printout of my account activity and compared it to my purchases and figured out what they did. I called in and complained, they agreed to waive two of the five overdraft fees. I still ended up paying $90 for what should have been a $30 overdraft. I stopped doing business with that bank immediately. I have since switched to a credit union and have never looked back. Community banks and credit unions are useful for the poor to get a foothold on financial stability. I have a friend who, while not truly poor, is financially irresponsible and he has come to plan on paying overdraft fees every payday because he can't control himself for one month and not overdraw his account. I'm sure that his bank loved him, he was paying at least $60 per month in overdraft fees. He was actually upset that banks wouldn't default to offering him the "service" of allowing his overdrafts.
    - briantakita 12y ago
      > The banking reforms that took effect in 2010 have made it more difficult for banks to screw people with overdraft fees. The rules have changed but the game is still the same. > I have a friend who, while not truly poor, is financially irresponsible and he has come to plan on paying overdraft fees every payday because he can't control himself for one month and not overdraw his account. Sounds like he may be better off not having a banking account. It's easy to call someone irresponsible with this externally imposed money game, however there's much more important things in life than money. We should be focusing more on those things, make those things priority, & give those things more value.
rayiner 12y ago
The referenced Pew study is even more interesting: http://www.people-press.org/2015/01/08/the-politics-of-financial-insecurity-a-democratic-tilt-undercut-by-low-participation http://www.people-press.org/2015/01/08/the-politics-of-finan.... Some correlations I haven't seen before. The most secure voters were 3x as likely to vote as the least secure. Preference for democrats was about the same for every category of security, but preference for republicans was 3x higher among the most secure (with the difference coming at the expense of other/not sure).

29 points by Nowyouknow 12y ago

>According to the study, in 2015 the poorest fifth of Americans will pay on average 10.9 percent of their income in state and local taxes This is purposely misleading. Yes, the poor do get hit with state/local taxes (this may or may not include sales tax, gas tax, etc) but often will not pay federal tax. That's on top of various aid programs like food stamps, section 8 rent assistance, etc. These articles are really disingenuous statistics, often used to push an agenda. A less politicized article here on who does and doesn't pay taxes: http://www.washingtonpost.com/blogs/wonkblog/wp/2012/09/18/who-doesnt-pay-taxes-in-charts/ http://www.washingtonpost.com/blogs/wonkblog/wp/2012/09/18/w...

deleted 12y ago
[deleted]
chc 12y ago
While I agree that this article is frustratingly light on information, I don't think that one is any better, and it's certainly no less political. The article you linked isn't even attempting to quantify how much of their income people pay in taxes. Its primary goal is just to show that some comments by a particular politician reflected real statistics, not to analyze the actual lot of the poor in society. The only part that even goes near the issue just seems to be summing tax rates, not considering how much of their money they actually have to pay (e.g. I keep more of my income than summing tax rates would lead you to believe because I have a 401k plan).
- tehwebguy 12y ago
  The WP article is really just a response to the uproar over Romney's comment in the 2012 election at a fundraiser about how ~"47% of the country doesn't pay tax", probably why they are focusing on "who pays" and not "how much"

aianus 12y ago

What exactly is preventing poor people from getting basic checking accounts? They give those out to 12-year-olds with no assets and no credit history.

briantakita 12y ago
Bank fees, like overdraft fees, sting when money is scarce.
- LordKano 12y ago
  The banking reforms that took effect in 2010 have made it more difficult for banks to screw people with overdraft fees. As an anecdote, less than two weeks before those protections went into effect, I overdraw my account. It was my fault, I lost track of my account balance and overdrew my account. I legitimately owed one overdraft fee. My bank, re-ordered the transactions for that day so that instead of merely overdrawing my account for one transaction, I overdrew it for five. I got a printout of my account activity and compared it to my purchases and figured out what they did. I called in and complained, they agreed to waive two of the five overdraft fees. I still ended up paying $90 for what should have been a $30 overdraft. I stopped doing business with that bank immediately. I have since switched to a credit union and have never looked back. Community banks and credit unions are useful for the poor to get a foothold on financial stability. I have a friend who, while not truly poor, is financially irresponsible and he has come to plan on paying overdraft fees every payday because he can't control himself for one month and not overdraw his account. I'm sure that his bank loved him, he was paying at least $60 per month in overdraft fees. He was actually upset that banks wouldn't default to offering him the "service" of allowing his overdrafts.
  - briantakita 12y ago
    > The banking reforms that took effect in 2010 have made it more difficult for banks to screw people with overdraft fees. The rules have changed but the game is still the same. > I have a friend who, while not truly poor, is financially irresponsible and he has come to plan on paying overdraft fees every payday because he can't control himself for one month and not overdraw his account. Sounds like he may be better off not having a banking account. It's easy to call someone irresponsible with this externally imposed money game, however there's much more important things in life than money. We should be focusing more on those things, make those things priority, & give those things more value.

rayiner 12y ago

The referenced Pew study is even more interesting: http://www.people-press.org/2015/01/08/the-politics-of-financial-insecurity-a-democratic-tilt-undercut-by-low-participation http://www.people-press.org/2015/01/08/the-politics-of-finan.... Some correlations I haven't seen before. The most secure voters were 3x as likely to vote as the least secure. Preference for democrats was about the same for every category of security, but preference for republicans was 3x higher among the most secure (with the difference coming at the expense of other/not sure).