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The Cognitive Cost of Poverty
An anonymous reader writes "It's a common trope that most poor people are poor because they're lazy or just inherently bad with money. But a new study (abstract) makes a fascinating find: being poor actually reduces your cognitive capabilities when thinking about money. 'In a series of experiments run by researchers at Princeton, Harvard, and the University of Warwick, low-income people who were primed to think about financial problems performed poorly on a series of cognition tests, saddled with a mental load that was the equivalent of losing an entire night's sleep. Put another way, the condition of poverty imposed a mental burden akin to losing 13 IQ points, or comparable to the cognitive difference that's been observed between chronic alcoholics and normal adults.' This makes the difficulty in climbing out of poverty much easier to understand. The researchers also demonstrated causality by showing that thinking about a very small expense led to no impairment, while thinking about a very large expense did. They confirmed this by looking at a group of farmers in India who tend to receive most of their income at one time — immediately following their harvest. Shortly before that payment, when the farmers had very little money, their scores dropped as well."
I have worked with homeless people. Next to none of them were poor by choice. Many of them were poor and homeless due to being a couple of major causes:
1) Mental issues such as schizophrenia and kicked out of the institution they were receiving treatment from.
2) Addiction issues.
3) Some major bill came along that wiped out their money.
So if you want to claim that people are poor by choice you need to provide some evidence because all you have is an anecdote that doesn't match what I've ever seen.
30 years ago I worked with a former social worker of long experience who had just changed jobs seeking a steadier paycheck. She said that poverty produced a constant stress over not feeling safe that basic needs would be met. Her view was that that constant stress often resulted in serious mental disfunction.
"Poverty makes you crazy...or at least stupid" was her standard rejoinder whenever we ran across someone who did something stupid with what little money they had.
From the Hierarchy of Needs, to my co-worker, to this new study - has anything changed? Not really. But it seems the relevant points need to be made over and over again because they just aren't getting through.
They are unable to comprehend that by drinking water instead of three sodas a day, and putting the savings into a tax deferred education savings account, they can easily afford in-state tuition at a good university.
Or perhaps they comprehend it just fine, but they make a choice you disagree with: Like after working a 10 hour shift for $7.25 an hour, they would like to have at least a small creature comfort, so they buy a six pack of beer (or soda), instead of going home and enjoying tasteless and bland tap-water. The thing about being poor that everyone forgets is that everything that might relieve the boredom and stress of long hours for little reward costs something. It's easy to say "I'll save a few dollars a day" when you've got a fat paycheck -- but when you have nothing and you're looking to those couple of dollars leftover in your wallet, it's hard to say "You don't exist, go away". But psychology aside, there's still the troubling issue of your really, really bad math skills.
Let's analyze your example of "three sodas a day". For the 2012-2013 year, tuition costs for state residents at a community college averaged $8,655 across the country. We're going to ignore cost of living adjustments, peripheral expenses like books, lost wages, and everything else. We're going to take just that tuition number and that will be the cost of "easily afford" at a "good university".
The cost of a 'soda', which to give you the best case scenario, will be for one of the plastic 16 oz variety, which averages about $1.50 right now. So we're going to go with $4.50 per day being blown on soda. In 1,923 days -- about 5.25 years worth of not drinking soda per year of tuition.
Now, given the rate of inflation combined with the rate that tuition has been rising, it's safe to say that number will be higher. And when you consider that tuition is only perhaps 2/3rds of the fees you'll be paying... that number goes up even more.
Bottom line here is that your assertion that saving the equivalent of three sodas a day ($4.50) can buy someone a college education is possible, but absurd. You would spend half your working life waiting. In reality, you're going to have to save more to make it happen. Working a minimum wage job, you're only going to be pulling in about $36 a day (at best). Odds are good you'll be clearing even less.
You're asking someone for whom three sodas a day accounts for about 1/8th of their total personal income to save even more to make this do-able. You'd have to at least double, and probably triple, the savings rate, to get into college within a reasonable timeframe.
Frankly, when you take rent, utilities, and everything else into consideration... a minimum wage job simply cannot sustain that level of investment. Not unless you want to starve, rack up debt elsewhere (like late fees, bank overdraft fees, etc.) -- which will happen anyway when you're living paycheck by paycheck.
The bottom line here is that what these scientists is saying has nothing to do with the conclusions you and many others are reaching: Which is that you can "think" your way out of poverty, or that the problem can be resolved by simple mathematical ability. It is much bigger than that. All this study does is show that when financial resources become severely constrained, people are poor judges of how to best utilize those limited resources.
It provides no guidance on a viable strategy for emerging from that environment, and your flippant advice about simply not drinking soda is symptomatic of another, perhaps larger problem, that poor people face: Prejudice.
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