Thursday, January 05, 2006

From Poverty to Wealth; effort IS required...

The reason I've linked to this article is because it really spoke to me, about poverty, who is in it, for how long, and how they get out.

No one in my family had gone to college before. I dropped out of college. As a result, I worked for over 25 YEARS in grunt jobs that people looked down their noses at. But I did what had to be done. I did without, I saved, I invested in property. Now I'm in my 40s, and I am enjoying a level of prosperity I have EARNED, even without a college education. I find that I am now actually envied by people who did NOTHING to improve their own situation in life. I worked hard, they hardly worked. They may see what I have and think it's unfair, but I wasn't "lucky", I was diligent.

This article points out the reality of economics, and why the amount of people who STAY in poverty is much smaller than the media reports, and the actual reasons why they stay there.

The poverty hype
by Walter E. Williams

Despite claims that the rich get richer and the poor get poorer, poverty is nowhere near the problem it was yesteryear -- at least for those who want to work. Talk about the poor getting poorer tugs at the hearts of decent people and squares nicely with the agenda of big government advocates, but it doesn't square with the facts.

Dr. Michael Cox, economic adviser to the Federal Reserve Bank of Dallas, and Richard Alm, a business reporter for the Dallas Morning News, co-authored a 1999 book, "Myths of Rich and Poor: Why We're Better Off Than We Think," that demonstrates the pure nonsense about the claim that the poor get poorer.

The authors analyzed University of Michigan Panel Study of Income Dynamics data that tracked more than 50,000 individual families since 1968. Cox and Alms found: Only five percent of families in the bottom income quintile (lowest 20 percent) in 1975 were still there in 1991. Three-quarters of these families had moved into the three highest income quintiles. During the same period, 70 percent of those in the second lowest income quintile moved to a higher quintile, with 25 percent of them moving to the top income quintile. When the Bureau of Census reports, for example, that the poverty rate in 1980 was 15 percent and a decade later still 15 percent, for the most part they are referring to different people...

The Federal Reserve Bank of Dallas report listed a few no-brainer behaviors consistent with upward income mobility. Households in the top income bracket have 2.1 workers; those in the bottom have 0.6 workers. In the lowest income bracket, 84 percent worked part time; in the highest income bracket, 80 percent worked full time. That translates into: Get a full-time job. Only seven percent of top income earners live in a "nonfamily" household compared to 37 percent of the bottom income category. Translation: Get married. At the time of the study, the unemployment rate in McAllen, Texas, was 17.5 percent, while in Austin, Texas, it was 3.5 percent. Translation: If you can't find a job in one locality, move to where there are jobs...

You can read the complete article HERE.

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