Poor people may feel like they never get a break, but it’s worse than that, according to a study of low-income families in Washington. They are getting gouged.
The report prepared by the Statewide Poverty Action Network and VOICES of Spokane details how the poor pay more for goods and services than higher-income residents.
From a loaf of bread to a home mortgage, the poor pay higher prices, not just in terms of percent of income, but in real dollars, according to the report, “The High Cost of Being Poor in Washington State.”
The findings were released Tuesday at a gathering of about 75 advocates for the poor at Salem Lutheran Church in the 3rd Legislative District, which has the lowest per capita income in the state, according to its representative, Tim Ormsby, who spoke at the gathering.
Ormsby tied poverty to an unremitting cycle of “anxiety, despair and violence.”
Also addressing the crowd was Cristy Guy, a single mother of two who is struggling to escape poverty.
“Instead of paying for more places to lock people up, we need to start paying to help them get them on their feet,” Guy said.
The state study, patterned after national research by the Brookings Institution, revealed price disparities in four key areas of daily life:
•Food, particularly fresh produce, is more expensive and of worse quality in poor neighborhoods than in wealthier ones.
•Transportation issues are often an obstacle to escaping poverty, and the poor pay more for vehicles and insurance premiums. Public transportation often is not an option, particularly for people working irregular hours.
•Housing not only costs the poor a higher percentage of their income, but home mortgage terms, including interest rates and fees, often are higher in lower-income neighborhoods.
•Financial services are fewer in low-income neighborhoods, and the poor often have to rely on payday loan institutions that trap them in cycles of high-cost debt.
The report makes several recommendations to alleviate the disproportionate cost burden for the poor, including:
•Granting tax incentives to grocery stores willing to open in poor neighborhoods.
•Community programs that promote competitive pricing and reasonable financing for automobiles.
•Elimination of predatory home-mortgage lending through community negotiations with lenders.
•Expansion of community-based credit unions and consumer protection laws that cap interest rates charged by payday lenders.
In a discussion following presentation of the report, a nurse who visits low-income families in their homes said often the cycle of poverty is more about ZIP codes than personal choices.
“Where you live matters,” Kathy Bernier said. “A person who lives in a million-dollar home has planned to live there, but a person on (Temporary Assistance to Needy Families) does not get to choose where he lives.”