Overview
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ASSIGNMENT: Please respond to the classmate’s discussion post that pertains to the question and reading material below:
Sociologist David Caplovitz wrote a book called The Poor Pay More which is a sociological study of what could be called the "poverty penalty" - a concept that poor people pay more for the same goods and services as people with more money do. View the following videos on predatory lending to the poor. Why do you suppose there is not adequate political response to enact policies to end this poverty penalty?
The surprising logic behind the use of check cashers and payday loans https://www.youtube.com/watch?v=Y7OUdPE9UdA
Predatory Lending: Last Week Tonight with John Oliver (HBO) https://www.youtube.com/watch?v=PDylgzybWAw
Life in the cash economy for "underbanked" Americans https://www.youtube.com/watch?v=bOdfmb7obog
Dollar Stores: Last Week Tonight with John Oliver (HBO) - YouTube.
Audrey Friedman’s Discussion Post:
After watching the videos, it’s pretty clear that the “poverty penalty” isn’t just about bad decisions, it’s about the system people are forced to navigate. What stood out to me is that people using payday loans or check-cashing services are often making rational choices based on limited options, not being irresponsible. I think one big reason there hasn’t been a strong political response is because the people most affected don’t have much power. They’re focused on getting by day-to-day, so they don’t always have the time or resources to push for policy change. At the same time, the industries that benefit from this, like payday lenders, make a lot of money and have more influence over politics. Another reason is how society views poverty. A lot of people still think it’s about personal responsibility instead of structural issues. But the videos show that the system itself pushes people into these expensive options. If policymakers don’t see it as a systemic problem, they’re less likely to fix it. Overall, it seems like a mix of unequal power, misunderstanding, and profit is what keeps the poverty penalty going, even though it’s been a known issue for a long time.