United Way

During United Way of Central Indiana event, author of “Evicted” says we’re doing a terrible job of connecting impoverished people with available resources

Growing up, Matthew Desmond’s family didn’t have a lot of money. His family’s gas got shut off all the time. The bank took their house. Seeing how his family was stressed by poverty drove Desmond to understand its dynamics and consequences. He has spent much of his life reporting and researching it.

“But even after all that, I felt I didn’t have this answer for: Why? Why is there so much poverty in America?” Desmond told a crowd of nearly 500 people during a recent event presented by the United Way of Central Indiana, alongside Glick Philanthropies, Indianapolis Neighborhood Housing Partnership and The Mind Trust.

“(Poverty’s) persistence in American life means that millions of families are denied safety and security and dignity in one of the richest nations in the history of the world. Why?” Desmond asked during his talk at the Indiana State Museum.

Desmond, the Pulitzer Prize-winning author of “Evicted,” said he sought to answer that question, which became the topic of his latest book released in March 2023, “Poverty, by America.”

United Way seeks to serve those living in or near poverty in the region. According to a new report released by United Way in April, more than 36 percent of Central Indiana households were either in poverty in 2021 or considered ALICE, an acronym for Asset Limited, Income Constrained, Employed, ALICE households earn above the Federal Poverty Level but not enough to afford a basic household budget.

That’s more than 244,400 households — more than one of three Central Indiana households. The number of households in this category has increased 11 percent since 2018, according to United Way data.

During his speech, Desmond, who also is a sociology professor at Princeton University and the principal investigator of The Eviction Lab, painted a picture of the landscape of American poverty: A third of U.S. households make $55,000 or less. More than 38 million Americans can’t afford basic necessities. If America’s poor founded a country, it would have a bigger population than Australia, he said.

While some have suggested there’s nothing to be done, that government programs don’t work, Desmond said that’s not true. Evidence shows programs such as housing assistance and food stamps are essential and effective — and anti-poverty spending has grown over the last several decades, he said. This makes America’s “stalled progress” on poverty even more baffling, as poverty has persisted despite an increase in federal relief.

Desmond offered several explanations for why poverty endures.

First, a “fair amount” of government aid earmarked for the poor never gets to them. Desmond said roughly 7 million people who could receive the Earned Income Tax Credit don’t, passing on $17 billion a year, for example.

“This is a picture of us doing a terrible job of connecting families to programs that they need and deserve,” he said.

The poor are exploited in the labor, housing and financial markets, Desmond said. Wages are falling and unions are weak in today’s labor market. Since 1985, rent prices have exceeded incomes by 325 percent, and every year poor Americans pay billions of dollars in overdraft fees, check cashing fees, and fees from payday loans. A hard pill to swallow, he said: Not only corporations but consumers, those invested directly or indirectly in the stock market, many homeowners and even those with free checking accounts all benefit from the exploitation of the poor.

Desmond argued the United States does more to subsidize affluence in American than to fight poverty. When considering all government spending from tax benefits to programs, he said, data shows that households in the bottom 20 percent — the poorest families — get about $26,000 a year from the government. By comparison, the richest ones — the top 20 percent — receive about $35,000 from the government.

“We give the most to those who have plenty already and then we have the audacity … to fabricate stories about poor people’s dependency on the government and shoot down proposals to reduce hardship because they would cost too much,” Desmond said.

“… There’s so much poverty here, not in spite of our wealth, but because of it.”
Affluent Americans also create poverty by building walls around prosperous communities, using municipal zoning ordinances to keep affordable housing out of their backyards, he said. It creates concentrated poverty.

Different anti-poverty investments are needed to fix the problem, not just deeper ones, Desmond said. He argued we need to create public policies that disrupt poverty and address exploitation by empowering the poor.

He suggested addressing labor exploitation, for example, by promoting worker empowerment and supporting the unionization of entire sectors as a way to level the playing field.

As for housing, Desmond said more can be done to expand the public housing infrastructure, to provide a path to homeownership for low-income families and to invest in community land trusts so tenants can build permanent, affordable housing.

He said we can end segregation of the poor by replacing exclusionary zoning policies with inclusionary ones — removing walls.

Desmond said the philanthropic sector has a role to play, too: Nonprofits can shift the conversation about poverty and advocate for more robust policy action.

Ending poverty requires all of us to become “poverty abolitionists,” he said.

“… The best hope we have of ending poverty is to bind ourselves together and demand this of our country. A mass movement for economic justice is necessary and a mass movement stirs,” Desmond said. “… The end of poverty is something to stand for.”