What if the problem of poverty is that it’s profitable to other people?

The trailer park owner in the article owns 131 units and "makes" (presumably grosses) $400K a year. Those units are about $250 per month, hardly the stuff of Viking-style pillaging, IMO. The other landlord has also built herself a business in real-estate and now can afford to take a vacation? Good for her, seriously. She's providing housing and her tenants/customers are providing her income. Building such a business (and I assume running a 131 unit mobile home park) is absolutely work, the value of which is evident by the paying tenants.

In Linz we have something called "housing cooperatives" (the German word is "Wohngenossenschaften"). These cooperatives build apartments, and to rent them you become a member of the cooperative. The goal of these cooperatives is not to make a profit, but to provide affordable housing.

And it's amazing how well that works! Rents are typically 50% lower than average, and the buildings are always well maintained. In general, they also have better amenities (playgrounds for children etc) compared to privately owned apartment buildings. The only problem is that there are very long waiting lists (more than 5 years in some cases).

It's amazing how cheap good housing can be when it's not necessary to make a profit for the owner.

Why is this?

Some of it is tax policy. Tax policy is very favorable to property owners. Not only can landlords deduct mortgage interest and depreciate over 27.5 years, when someone buys an old building, they can depreciate it all over again.

Antitrust law doesn't seem to be applied to rental property. In some smaller cities, there are only a few big landlords.[1]

Given the current low cost of borrowing, rental housing prices should have dropped. But they haven't.

[1] http://people.oregonstate.edu/~emersonp/rentcontrol/rc2.pdf

The author mentions a significant root cause in the first paragraph - de-industrialisation. Like so many other American cities, Milwaukee was relatively prosperous before the collapse of the manufacturing industry.

Improved regulation of the rental market would be a minor improvement at best. It's wishful thinking to imagine that poverty could be fixed quickly and at negligible cost to the taxpayer. The problems of poverty are systemic and so are the solutions - better welfare provision, better education, better support for job creation. If we wish to see an end to poverty, we must be willing to pay for it.

I bought these 15 houses after the crash in 2008 as I thought it was the best investment possible with fantastic returns. IN fact I would have been WAY better off buying ONE house in the bay area and renting it to one well off person. I would have made a whole lot more in net rent and in capital gain.

So I think the premise of this article is completely wrong in the majority of cases. Renting to poor people is extremely difficult and a very easy way to lose money. Many states in the US are very favorable to tenants and not favorable to landlords. You also have to pay taxes, insurance.

Seriously if it was that easy everyone would do it. I thought it was an easy way to make money and I was wrong. Not horribly wrong as I did buy the properties very cheap, but still, not an easy way to make money.

One sign of this is that unemployment did not even exist several centuries ago in any kind of manner - all those who were capable (except again, those on top expropriating wealth created during worker's surplus labor time) worked.

This is openly discussed in the business press, like this (http://www.businessweek.com/1999/99_44/b3653163.htm ) BusinessWeek article "When is the jobless rate too low?" It's not a secret that those who control production are working to create unemployment, poverty etc. It's a foundation of the current economic system.

That sounds about right to me... I doubt anyone would consider it worth the hassle leasing 131 trailers if the income was say 100k.

Take boots, for example. He earned thirty-eight dollars a month plus allowances. A really good pair of leather boots cost fifty dollars. But an affordable pair of boots, which were sort of OK for a season or two and then leaked like hell when the cardboard gave out, cost about ten dollars. Those were the kind of boots Vimes always bought, and wore until the soles were so thin that he could tell where he was in Ankh-Morpork on a foggy night by the feel of the cobbles.

But the thing was that good boots lasted for years and years. A man who could afford fifty dollars had a pair of boots that'd still be keeping his feet dry in ten years' time, while the poor man who could only afford cheap boots would have spent a hundred dollars on boots in the same time and would still have wet feet.

This was the Captain Samuel Vimes 'Boots' theory of socioeconomic unfairness.

At some point the governments in developed countries have stepped in to set some kind of limit on what's "reasonable".

IMHO, they're not doing enough in America right now, the enormous social divide is showing that to us clearly. Developed countries that have stronger laws have less people in severe poverty, because the government forces the wealthy to distribute their wealth.

If we define the poor as a group which relies on regular labour to survive, and the wealthy as a group who does not, then many income sources of the wealthy dry up if the poor cease to exist.

One fairly obvious example is renting. The existence of a rental market is not undesirable. People will always want to live in a place temporarily, as a trial, as a holiday, as a stepping stone. But I'd imagine a huge majority of the rental market exists solely because the tenants either cannot afford, or have too little financial security to risk a mortgage.

More broadly, the cost of labour is reduced by the existence of poverty. The minimum wage is an attempt to alleviate this - in a world without poverty, a minimum wage would be unnecessary.

The question is whether we can do better. Axiomatically wealth inequality is good for those on top, at least in a direct sense.

Poverty has a lot of facettes. Here's one that wasn't even mentioned: Because you can recognize poor people by their dressing preferences, richer people give them less opportunity. And there are quite a few opportunities that come with being at the right party, having the right friend, having the right hobby (like playing Golf). Poor people aren't at that party. And they don't feel comfortable in a suit.

    > makes $400k a year renting out 131 trailers

At those margins (I don't know what the costs are, but with that little annual profit per trailer it really doesn't matter) there would be no reason to not want the poverty-stricken to have more money, other than perhaps an unwillingness to change business model. The profit margin is just _so_ much greater on more expensive properties.

The social safety net is pretty simple. Bob, A healthy worker is made unemployed, they can either take state assistance and find work 6 months later, leading to another 30 years of tax revenue, or let them default on mortgage, spiral into poverty and no tax. Now extend that so Bob needs six months rehab.

Housing built, owned and managed by the state (or so closely regulated it may as well be) has been a cornerstone of the social safety net. This article underlines that.

You cash your check for a good percentage of it. If they had a bank account they wouldn't need to spend that money. I don't know how it is in other states but the last time I opened a bank account in California it was a pain. The amount of information needed is certainly not possible for a huge chunk of people.

Nobody would work in the conditions needed for diamond extraction or sweatshop clothing making for example, if it wasn't for dire poverty.

Pass.

How dare these landlords take vacations… in Jamaica!

Walmart and other companies pays employees the bare minimum, forcing them to go on welfare and boycott their right to form unions and defend themselves.

Pharmaceutical companies do fake studies as well as tricks to extend patents and prevent people from benefiting from affordable drugs.

Healthcare disproportionally overcharges people. 500 dollars for a bag of water with salt.

Food industry adds sugar to all foods knowing sugar poses health risks, because sugar is addictive and keeps people coming back to their products. They also lobby to prevent proper labeling of sugar in food.

Companies sell garbage food to kids in schools like pizzas and hotdogs, knowing it's ruining generations of people.

You get the idea...

Additionally, when they say she makes $400k a year - is this her take home, or her business's gross profit? Are they considering the money she has to spend on mortgages, insurance, repairs, business administration, rent collection, legal fees, etc?

A holiday in Jamaica is something most middle class people can and often do afford, even lower middle class. You can get a trip to an all inclusive for a week with airfare for $1000, maybe even less.

-MLK, Where Do We Go From Here? 1967

In these types of economies (the US, Australia, etc), a Universal Basic Income would just make rents go up, just like easy 95% equity loans made house prices go up.

And the story isn't really complete unless it somehow connects to powerful people pulling the strings to keep the money rolling. A small time landlord is probably not friends with senator.

So who exactly is the villain here?

The title is also ridiculous. Yes, in a market driven economy, some people are going to make a profit off of poor people, but that's true for every economic level. As far as I'm concerned that's only a problem when it's exploitative.

The premise is that landlords are keeping them down through rent, but that is BS as well. There are many voucher programs, and those that receive them don't miraculously escape from poverty.

I'm not opposed to providing housing subsidies for those in poverty conditions, but it is not the cause of poverty.

This is a symptom. The main condition is that they have to bargain with their life (or physical suffering) on the balance for nearly everything including rent.

When the choice is pay rent you can't afford or live on the street (a severe risk to one's life) then you will pay whatever you are able.

The same goes for selling their time for less than it is worth for decades at a time. It is either that or die or be in pain. This is also very profitable for the parties on the other side of the equation.

This seems like the defining feature of poverty and why it is worth fighting. When people are not bargaining with their life on the line, they will make decisions to improve their lot rather than to merely lose less.

https://en.wikipedia.org/wiki/Vote_selling

Most https://en.wikipedia.org/wiki/Dominant_minority doesn't want you to prosper; They fear you'll dilute their HEGEMONY in the society;

If we dwell deep higher social class exhibits increased UNETHICAL behaviour

http://www.pnas.org/cgi/doi/10.1073/pnas.1118373109

Most laws and government policies that affect poverty have trade offs - subsidise education and someone has to pay for it and so on. And tennant's rights come into that - laws that favour renters at the expense of landlords will probably be lobbied against by landlords though that's a bit removed from the arguments in the article and affects wealthy renters as well as poor ones.

http://www.ericberne.com/games-people-play/

Its very entertaining and highly recommended. The first episode has a segment about people that rent appliances because they cannot afford them, and the companies that exploit them. Eye opening and infuriating.

1) The Right can't recognize there's a problem with contemporary elites ("They Deserved it"). Poverty is all about the government.

2) The Left can't recognize the government plays a role on this . Inequality is all about greedy rich people.

Ever since I first saw Henry George's ideas, I can't stop seeing it everywhere; there's a very real difference between the return to rent than for other capital or labor.

Let me rephrase these biased questions with the opposite bias (well actually I think my version is fair...):

"What if the leftist discourse on poverty is just wrong? What if the problem isn't greedy capitalist profiteers tricking the downtrodden out of their hard earned money? What if the problem was a self-perpetuating cycle where short term lack of resources lead to the inability to make long term plans, or take advantage of opportunities? What if changes in the technology and the economy meant that skills and education are required that large sections of the population do not have?"

Nearly everyone in the US is just a different degree of rich - trailer park residents included.

The problem is complex and takes no sides. The poor are unskilled with money because of their environment, upbringing, relationships, and situation; and also because of inherent features. The rich are rich because of their luck, circumstances, upbringing, and situation; and also because of inherent features. The combinations of all of those factors and the interaction between them defines the problem, not any one aspect. This you must understand first.

So yes, absolutely, one of the problems of poverty is that it's profitable to other people; because the poor are powerless to stop it, and the rich are powerful and easily take advantage to the extent they can under their laws and morals. That is the reality, and arguing otherwise reveals our collective immaturity in terms of understanding systems and complexity—the true root cause of our unfair and unbalanced society. Instead of seeing reality, we are often limited by our human capacity and biases that don't help us understand the world—much less respond to in a constructive way.

So let's talk about the systems that influence us all—the article is about one of those systemic problems, and it's fascinating and evidential. It's a good discussion, and it's the right one to have, and I'm always sad that discussions of poverty or inequality devolve into talk of individuals and what they should or should not do. Let's keep our eye on the ball and talk about the whole, and the productive construction of a society that works better.

This won't work. Now don't get me wrong : that doesn't mean you can't make it work through investment for a while, potentially even a long while. But you can't make it work over long periods of time.

The only way to solve poverty is to find something for huge numbers of unskilled labour to do that's economically positive (ie. makes a profit for whoever is the boss). That can last. And yes, we'll have to do it again, and again, and again.

Now should we use the government to bridge people over between jobs ? To help them out in periods where their economic utility is low ? In my opinion absolutely. But we should NOT make the mistake to assume that this can be anything but a very temporary measure.

https://www.youtube.com/watch?v=xkYEXS16dZA

Latin America has been waking up to the realities of Populism. This, to a large extent, due to Gloria quite literally risking her life to speak-up and educate the populous about such topics.

In the above lined speech she delivers a line that is right on point (translated):

"Populism loves the poor so much it multiplies them".

That, right there, is the root of much of the evil keeping the poor down.

In another passage she reads a definition of Populism penned by another activist:

"The shortcut through which politicians play with the passions, dreams and ideals of people by promising what is impossible, taking advantage of their misery while leaving out logic and reason. It plays with their needs to impose dictatorships."

You see, in the US, Democrats need poor disenfranchised blacks and hispanics. Guaranteed votes. And Republicans need poor disenfranchised bible-thumpers and low education folks. Again, guaranteed votes.

Writing that was disgusting. Yet, it is the truth.

And so, both sides, through Populism, have every incentive to NEVER fix the problems of the poor. If the poor are elevated it is likely that both sides would lose votes. Politicians don't want to work hard for votes. They'd rather promise the impossible and play to your needs and fears and just get you to vote. Once elected, they drop you on your head.

Want to point a finger at evil? Populism.

All four of the top contenders for the Presidency of the US today are populists: Clinton, Sanders, Cruz and Trump. They are all playing people like a finely tuned violin. All of them. Nothing good will come out of electing any of them. Regrettably, there doesn't seem to be a way out of this one. Not voting will only play into the hands of whoever promises more free shit and gets more people to support them.

Poverty isn't hard to fix. First you have to fix the fact that poor people are far more valuable politically while they stay down and remain poor. Imagine a political system where politicians are actually rewarded for fixing problems like poverty. Not sure what that looks like. You'd have to take Populism out of the equation.