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

Growing up in school, we are told that we can achieve anything with hard work and determination. We are told that the magic combination of those two traits will guarantee success in life. With them, we will make good money, buy a house and a car, and live a good life. 

This mentality subtly teaches us that those who live in poverty got there because they were lazy, made bad choices, and are therefore less valuable as human beings. However, when you take a deep-dive into poverty, you will quickly realize that this is entirely wrong. People are trapped in the cycle of poverty because it is profitable to others, and therefore beneficial to keep them there. (1)


Who Profits From Poverty?

Intertwined in poverty is racism, sexism, classism, and essentially all types of discrimination possible. Anyone who does not fall under the category of impoverished benefits from poverty in some way. (1)


Those who profit from poverty are typically the wealthy, the privileged, and the greedy. They are corporations, business owners, landlords, governments, and chances are, to some degree, you.


In fact, keeping people in poverty is so profitable that it has even been given a name: The Poverty Industry. (1)


The Poverty Industry

In his book The Poverty Industry, lawyer and law professor Daniel Hatcher defines this term as:


“the private sector partnering with the state and local governments to use the vulnerable as a resource for extracting funds … strip-mining billions in federal aid and other funds from impoverished families abused and neglected children, the disabled and elderly poor.” (1)

What he means is that a vast amount of the money that is supposed to go towards helping those who need it most never gets to them. Instead, through “illusory budget shell games,” the money ends up in the pockets of the already wealthy, making them richer and leaving the poor, well, still poor. (1)


There are countless systems in place that make it impossible for the nation’s most vulnerable people to clear their debts and make a better life for themselves and their families. (1) These people include (1, 2):

  • People of color
  • Single moms, especially single moms of color
  • Foster children
  • Those with mental and/or physical disabilities
  • Those suffering from mental illness and addiction
  • The elderly

These people are saddled with impossible debt, face eviction from their homes, and only qualify for the highest-interest loans. When they inevitably have to go to court because of their debts or evictions, they can’t pay the fees and fines, pushing them further into debt. (1)


It becomes harder and harder for them to find a stable income and a place to live. If they have children, this disrupts the children’s lives, schooling, and opportunity, continuing the cycle for generations. (2)


Housing Inequalities

One of the biggest problems facing the nation’s poorest is the constant threat of eviction. In his book Evicted, Matthew Desmond takes a deep-dive into the lives of some of Milwaukee, Wisconsin’s poorest. (2)

He outlines how low-income families are gouged to live in poverty and how landlords find a reason to evict them when there is an opportunity to make more off someone else. (2)

Landlords evict tenants for many more reasons than just not being able to make rent. For example, if the police show up at their door, maybe because their child got in a fight at school, the landlord might say they are “high risk” and evict them. For this reason, many women in abusive situations don’t call the police out of fear that they will lose their home. (2)

The most vulnerable to evictions are single moms of color.

“If incarceration had come to define the lives of men from impoverished black neighborhoods, eviction was shaping the lives of women. Poor black men were locked up. Poor black women were locked out.” he writes. (2)

Even low-income white people benefit from those of color because, in many cases, landlords are more likely to rent to them than a person of color. (2)

The Cost of Eviction

When a family is evicted, they have to start over completely. They often lose many of their possessions and the ability to save the small amount of money they need to make their situation more stable. Once you have an eviction on your record, this makes getting your next home even more challenging. (2)

For children, this instability and stress affect their school performance, which decreases their chances of ever breaking out of the cycle as an adult. Often families lose their welfare checks in the chaos of eviction because they are sent to the wrong address. (2)

In his book, Desmond shows how communities suffer from evictions. With tenants constantly changing, residents don’t form the social connections and bonds that make neighborhoods safer, better places to live. (2)

How Do You End Poverty?

This is a highly complex question. In Evicted, Desmond points to a universal housing voucher system that provides housing access to a country’s most vulnerable. (2) However, the reality is that to stop the cycle of poverty, systemic racism, gender wage gaps, and other forms of segregation must be addressed. (3)

We must stop businesses from profiting off of the poor. Moreover, middle and upper-class citizens must make certain sacrifices for true equality to be reached. (3)

In his article reviewing Evicted on Current Affairs, David Adler writes:

“to solve the problem of urban inequality on our doorstep, we need a whole new set of solutions…We must think instead about what we are willing to give up on behalf of inclusion. We might start with tolerating the noisy construction next door, which will build the new units that are necessary to house our cities’ low-income residents. Or we might raise our property taxes, funding new housing developments with the balance. Or we might send our children to the local public school, finally following through on our constitutional promise of integration. But it will be hard, and it will be painful. There can be no true social reform, after all, without sacrifice.” (3)

To help solve poverty, we are all going to have to get a little – or a lot – more uncomfortable.

Keep Reading: There Is Nothing Natural About the Way We Work


  1. US law professor exposes system that makes a profit from poverty.” The Guardian. Mary O’Hara. June 28, 2016.
  2. Evicted by Matthew Desmond review – what if the problem of poverty is that it’s profitable to other people?The Guardian. Katha Pollitt. April 7, 2016.
  3. WHO PROFITS FROM POVERTY?Current Affairs. David Adler. June 20, 2017.
Julie Hambleton
Freelance Writer
Julie Hambleton has a BSc in Food and Nutrition from the Western University, Canada, is a former certified personal trainer and a competitive runner. Julie loves food, culture, and health, and enjoys sharing her knowledge to help others make positive changes and live healthier lives.