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Comment by fuzz4lyfe | Hacker News Reader

"The average American can't come up with $500"

>The lowest-income households in the U.S. on average spend $412 annually on lottery tickets[1]

>In the U.S., people living below the poverty level and people having lower levels of educational attainment have higher rates of cigarette smoking than the general population[2]

>Among smoking households, the mean quarterly expenditure on cigarettes in constant 2015 dollars was US$458[3]

[1]https://www.bloomberg.com/news/articles/2018-09-12/the-poore...

[2]https://www.cdc.gov/tobacco/disparities/low-ses/index.htm

[3]https://www.ncbi.nlm.nih.gov/pmc/articles/PMC6009464/

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Being able to come up with a dollar a day isn't the same as being able to come up with a year's worth of lump sum at once.

Being poor changes how you think about money. Every time you save a few dollars, something happens - an unexpectedly high electricity bill, an unexpected doctor visit, losing your phone - and that minute bit of savings goes out the door. It's easy to get into the thought pattern that you might as well spend on something fun while you've got it.

As for cigarettes, being as addictive than heroin will do that to ya.

Does not saving prevent those events from happening? How are those events handled without savings? How would giving them more money resolve this problem?

> Does not saving prevent those events from happening?

That's not the point. Of course it doesn't - but that unexpected $35 copay for the urgent care visit would've wiped you out, whether you'd bought the $1 lottery ticket or not. At least you had a little burst of "man, if I won, I'd..."

We know from studies that poverty dramatically changes short-term vs. long-term decision making.

https://www.ncbi.nlm.nih.gov/pmc/articles/PMC5641572/

> How are those events handled without savings?

Be hungry the week after, pawn a possession, payday loan.

> How would giving them more money resolve this problem?

How would having money solve money problems? That's really the question?

>How would having money solve money problems? That's really the question?

I have shown that they do have $500 to cover an emergency but they have chosen to spend it on lottery tickets and tobacco products. You claim that this is due to being poor and how they have poor impulse control and that makes them unable to save the money and instead the immediately spend it. If I give them another $500 why wouldn't they just spent that on more lottery tickets and tobacco products?

> I have shown that they do have $500 to cover an emergency

You have not. You've shown that after a year of not buying lottery tickets they might have that $500, with the caveat of the fact that we know that's not really how that works - any savings gets wiped out by the next unexpected bill long before that.

> If I give them another $500 why wouldn't they just spent that too?

Where was that suggested? That's a silly approach to the problem.

Far more comprehensive solutions are necessary. Better housing policy, living wage, national healthcare, better regulation (or banning) of payday loans, guaranteed access to banking services, etc.

>You have not. You've shown that after a year of not buying lottery tickets they might have that $500, with the caveat of the fact that we know that's not really how that works - any savings gets wiped out by the next unexpected bill long before that.

I don't see how this math works. Lets say my total annual income is $5000 to keep the math easy. My spending looks like this:

get $5000 paycheck (for the sake of ease of math)

spend $3000 on rent

spend $500 on lottery tickets

spend $1000 on food

spend $500 on tobacco

Now I have a $500 bill that I don't have the money for.

Conversely I could:

get $5000 paycheck

spend $3000 on rent

spend $1000 on food

Now I have a $500 bill that I can cover because I did not buy all those lottery tickets.

You continue to pretend poverty doesn't have one key fact: There are always more bills to pay.

Your car breaks down. You get a parking ticket. Your kid gets sick. You get evicted and some of your stuff gets ruined by the rainstorm because the landlord put it on the lawn.

Exactly. Car-job-house, lose one and the other two quickly fall. You're one bill away from homelessness. As a Markov chain, ultimately everyone in poverty crashes at some point or another.

>There are always more bills to pay.

If saving money causes more bills to appear as you suggest the solutions seems to be to give the poor less money so they will have less bills.

> If saving money causes more bills to appear

Sigh. I'm not sure if this is a comprehension issue or if you're deliberately misrepresenting what I'm saying.

Saving doesn't cause bills to appear. The bills are already there. They've likely been piling up for years, and continue to do so.

If you're $20k in debt, and it keeps growing, and every time you've tried to save up a few dollars to pay it down you've had to spend the couple bucks you managed to accrue on yet another critical bill you can't put off any longer, it starts to feel pointless to save.

> you suggest the solutions seems to be to give the poor less money

What?

I laid out specific, systemic interventions that are necessary, none of which require giving the poor less money.

>The bills are already there. They've likely been piling up for years, and continue to do so.

>If you're $20k in debt, and it keeps growing, and every time you've tried to save up a few dollars to pay it down you've had to spend the couple bucks you managed to accrue on yet another critical bill you can't put off any longer, it starts to feel pointless to save.

If they have so much debt buying so many lottery tickets? Seems like a bad idea. What if they never bought lottery tickets to begin with? Who keeps extending them credit when they clearly never pay any bills?

Do you extend this same logic to firms like Amazon? Amazon spends virtually every dollar they make, does that mean they are poor? Should the government step in a give them money because of how poor they are?

I don't see why, "You have to stop buying lottery tickets" is a non-starter when talking about Americas poor. First stop buying lottery tickets, then we can talk about money problems you may have.

> Who keeps extending them credit when they clearly never pay any bills?

Predatory lenders, utilities and hospitals that may not be legally permitted to deny service but can still attempt to collect, etc. They're certainly not getting a 2% cash-back credit line from Chase.

They're also not never paying bills. They're juggling them, so the latest and most critical get paid. Squeaky wheel gets the grease - you'll probably pay to get your car out of impound before you'll pay your kid's school lunch debt.

> Do you extend this same logic to firms like Amazon? Amazon spends virtually every dollar they make, does that mean they are poor?

My "I'm being argued with in bad faith" senses are beginning to tingle.

> I don't see why, "You have to stop buying lottery tickets" is a non-starter when talking about Americas poor.

Again, systemic solutions are required here.

Add "get rid of lotteries" to my systemic fixes list, if you like.

I think the meaning here is that the average American finds themselves unable to execute on the fact that they have the means to save an emergency fund and are instead too focused on the short-term dopamine hits that they can get immediately.

Couldn't come up with that amount of money all at once. Lottery tickets and smoking add up to $2.38 per day.

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