Skip to comments.America Won't Get Rich by Relying on the Permanent Poor
Posted on 04/18/2012 5:09:06 AM PDT by Kaslin
America is a land of class mobility. That's what makes America a magnet destination for people all over the world: Come to America and make something of yourself. If you want great welfare benefits, try to bust into Europe; if you want to work for a living and get rich, come to the United States.
But for some Americans, there is no class mobility. There is a permanent economic underclass, and those who inhabit it have no ability to rise above their fiscal fate.
There is a reason for that: They make bad decisions.
Take, for example, prom night. A recent study from Visa shows that the average family spends a whopping $1,078 on their teenager's prom night. But what's more interesting is that there is an income breakdown. If you make more than $75,000 per year, you will spend somewhere between $700 and $1,000. If you are one of the unfortunates who earn between $20,000 and $29,999 per year, you will spend ... $2,600. In other words, if you earn three times less, you'll spend three times more.
This is not a recipe for financial success.
And yet President Obama believes it is. In fact, he thinks that if we distribute income to the lowest economic rung, we'll somehow build our nation's wealth. Thus spoke Obama last week: "In this country, prosperity has never trickled down from the wealthy few. Prosperity has always come from the bottom up, from a strong and growing middle class."
Nothing could be further from the truth. Prosperity has never trickled from the bottom up. It has always come from the top down, in terms of investment. That's because people at the top have money. Even in Obama's vision of the universe -- the vision where wealthy people subsidize poor people -- the wealth is flowing top down. It's just being forced to flow by the government.
True wealth comes from generating goods and services people want to buy at a price they want to pay. The only way such goods and services are generated is if somebody is willing to front the cash to do it. Henry Ford needed investors to get his Model-T up and running. It didn't magically appear. And when enough rich people are competing to create the next great product, you get capitalism's greatest achievement: thriving markets with choices for consumers.
And yet, the left does not want to see this. They proclaim that poor people spending money produce goods. This is insipid. It leaves the left in the unenviable position of having to argue that unemployment benefits help the economy because after all, people who are poor are spending more money.
If poverty generated wealth, Sudan would be a paradise.
Wealth generates wealth. It takes money to make money. Nobody has ever been hired long term by a member of the permanent poor. Nobody has ever developed a product while being funded by a member of the permanent poor.
The left insists that such talk is racist. It isn't. Charles Murray's new book, "Coming Apart: The State of White America" deals solely with American whites and makes the same point. The permanent underclass is a permanent underclass because it is filled with folks who make rotten decisions. That doesn't mean we can't help them. It doesn't mean we can't lend them a hand. It does mean that building our economic strategy on their ability to stimulate growth is a fool's errand.
If you work hard and do the right thing in America, you will benefit financially. If you don't, you won't. If we redistribute cash from the hard workers and good decision makers to their less responsible counterparts, we penalize hard work and good decisions in favor of frivolity. We don't want the parents who spend 10 percent of their earning power on prom night defining our economy. We've already done that once. It led to subprime mortgage meltdowns and stock market collapses. Why not try responsibility?
Yet more evidence that the values of Social Conservatism are really the values of Fiscal Conservatism. If you want a strong economy, promote traditional social values: hard-work, stable families, real education, moral behavior.
That prom night figure amazes me. Maybe it’s because I don’t have daughters, but I don’t understand. What on Earth do you spend over $2K for, on a prom??
There is poverty because kids aren’t finishing school, live in one parent households, and in the case of blacks, a hatred of whites. LBJ’s war on poverty was a non-winner from the start. Money doesn’t help them.
America will get rich by returning to an America similar to the one our founders built. Minimal government where any man could find his groove and get by or make his fortune as he saw fit.
My rented tux back in 1967 cost $30.
No. In fact, he doesn't. That's just boob bait for the bubbleheads.
He knows damn well what he's doing. He's intentionally trying to get as many people addicted to government as possible so-as to enslave and control them.
Let’s not forget thrift.
My prom nights cost about $30.00 for a corsage and a little gasoline. We wore whatever suit we already had. Some girls did buy new dresses so I guess the cost for girls was higher.
These days guys rent tuxedos and sometimes limos, plus many check into a hotel for the night, also. And the girls really go all out on the dresses, shoes and accessories. There's probably more.
That has me puzzled, too. My first thought is that it's a poor family's best opportunity to get their daughter married off...??
I’d imagine prom tickets, restaurant meals, limos (yuck!), hotel rooms, tuxes, etc., for the guys; dresses and accessories, beauty parlor/spa visits, etc., for the girls, but still that is amazing.
I guess the more working class you are the bigger the deal high school graduation is. Still, this is rank stupidity.
Let’s see....$100 for a dress and $1900 for legal fees and fines when the kid has a wreck while drunk.
A pathetic search for identity in the wilderness of bad taste.
In addition, there are lotto ticket purchases, eating out at family restaurants frequently, online and TV shopping purchases etc. I'm not being judgmental, but what was said in this article about making bad choices is definitely true.
$200 Hair & nails
$200 costume jewelry
$200 dinner at fancy restaurant
$200 after prom party
$200 champagne & drinks
$10 Pepto & aspirin
(potential $500 to bail bondsman)
Just looking at these numbers, it is easy to imagine they could double or triple.
I think a study of the chronically poor of America would reveal many families with parents or parent who spend a lot of their money on frivolous items. How many smoke, drink, rent movies, buy unnecessary things? I would bet a large amount. My parents weren’t frivolous, but they were both heavy smokers. They argued about money but did’t consider the money they spent on cigarettes as frivolous. We didn’t starve, and my father was a hard worker who eventually made more money. But I have no doubt many poor families never consider the ways they spend/waste money.
The poor put it on high interest credit cards, paying then, 3 times more..(until they default and taxpayers bail it out)
My grandson, for the second year, is wearing my 25 year old tux,shirt,tie.cummerbund,studs, and cufflinks to his prom and to his girlfriend’s.
Our daughter borrowed a dress. Because she went in spite of the fact that she was on deep double down grounded/probation, she got no money from us at all. Our sons I think we gave each of them a couple hundred for a tux and mad money and the loan of a car although the younger one wanted to drive his 18 year old Dodge van with the clear plastic roof. Can’t imagine why.
He was stopped at 2:00 a.m. for a right turn on red without stopping and even though he was in this old van and had hair to the middle of his back, that’s all they charged him for. In other words, he was clean and sober and had just dropped off his girl friend. The other one borrowed my Miata and his date almost fell out of her topless dress getting into it. LOL. Memories.
-—My grandson, for the second year, is wearing my 25 year old tux,shirt,tie.cummerbund,studs, and cufflinks to his prom and to his girlfriends.-—
He wouldn’t want to wear the one I wore in 1979. LOL