YOU GOTTA PAY A PRICE TO BE POOR

Poverty extracts a price from the impoverished. You don’t get to be poor on the cheap. It—poverty— attracts a wide assortment of individuals and businesses on the make to wring a buck out of the broke.

The thing about poverty is that it—poverty— shrinks the choices that the poor have on offer. When you’re poor, the choice of where to live, play, and shop is chopped down considerably.

And when you lack choices, as Matthew Desmond observes, you’re a sitting duck for exploited:

Poverty isn’t simply the condition of not having enough money. It’s the condition of not having enough money. It’s the condition of not having enough choice and being taken advantage of because of that.

As Desmond is well aware, this is precisely the point expressed by James Baldwin more than six decades ago:

Anyone who has ever struggled with poverty knows how extremely expensive it is to be poor; and if one is a member of a captive population, economically speaking, one’s feet have simply been placed on the treadmill forever.

CASE IN POINT: DOLLAR STORES

The Dollar Stores—Dollar General and Dollar Tree— perfectly illustrate the expense of being poor.

Before proceeding, though, it’s important to note a couple of important things as they relate to the Dollar Stores. First, there’s a bit more than 37,000 Dollar Stores operating in the United States. That number—37,000— easily exceeds the combined number of stores operated by Starbucks (15,873), Walmart (4,630), and McDonalds (13,520).

If we confine the comparison to the largest grocery stores, these Dollar Stores swamp the combined number of the ten largest grocery stores by a factor of 8—37,000 versus 4,585. When it comes to the Dollar Stores, ubiquity is the name of the game.

But—and here’s the second point— the business strategy of these Dollar Stores revolves around identifying and saturating poor and rural neighborhoods with stores. According to a recent study by the Center For Science In The Public Interest:

Dollar stores target communities of color, where grocery store chains underinvest. Predominately white communities have two to four times more large grocery stores than do communities of color.

In yet another study, the Institute for Local Self-Reliance arrives at a similar conclusion:

While dollar chains look for locations across the U.S. for places with large concentrations of low- and fixed-income residents, in urban areas, they also appear to specifically target Black and Brown neighborhoods. A growing number of studies, including ones by researchers at the University of Georgia and the University of Florida, show a clear correlation between race and dollar store location, even when controlling for income and other factors. DeKalb County, Ga., for example, has more than 70 dollar stores, but only three of them are in the two mostly white districts in the north part of the county.

All of this— the saturation of the market, the location of stores, the targeting of poor communities of color— combine to constrain the options open to the typical resident of these communities (particularly those without transportation). These stores generally have the hood in which they locate on serious lock down.

The impact of this lock-down and lack of viable alternatives makes its impact most forcibly known via the stiff price that’s imposed on the poor.

This can be seen by taking a quick peak at the price of milk.

THE DOLLAR STORE AND THE PRICE OF MILK

Let’s say that you’re a family of four, with a household income of $27,000 per year. That would put your household about three grand below the 2023 official poverty level for a family of your size. On a weekly basis, then, you’re pulling in about $520 per week, and that’s before taxes.

Now, despite what some folk think about the economically deprived, you’re not stupid. You’re perfectly capable of running some quick numbers through your head and knowing that at $520 per week there’s always a distinct possibility that there’ll be more month than money.

You also know that it’s generally cheaper to buy in bulk; that you typically come out better by purchasing in larger than smaller quantities.

You also know that 5 Benjamins a week severely constrain what you can do. Basically, you can’t easily buy in quantity, even if doing so means that you come out ahead of the game in the end.

You just don’t have the upfront money to participate in the game of quantity.

So,you make your ducats do what they do.

You get in where you fit in.

You “save” money by buying less rather than more.

What does this have to do with milk?

Actually, plenty.

More to the point, in Dollar Stores it’s not unusual to be able to buy milk in 16 ounce cartons, with that carton costing around $1.

That $1 price tag for a 16 ounce carton enables you to put a little milk on the table. But since it takes 128 ounces to equal a gallon, what you just did is equivalent to paying $8 for a gallon of milk (128/16=8).

What’s the typical or average price of a gallon of milk? I looked at the United States Department of Agriculture’s Retail Milk Prices Report, and here’s what I found: In July 2023, the average price for a gallon of conventional whole milk was $4.31 and $4.26 per gallon for reduced fat 2% milk.

That buck that you just dropped on that 16 ounce carton of milk is equivalent, then, to buying almost two gallons of conventional or reduced fat milk at your average grocery store.

IT’S NOT CHEAP BEING POOR

None of this supports what many of us think about the poor— that is, that they’re little more than a collection of financial ignoramuses.

The price of being poor is grounded in the lack of alternatives that accompany poverty.

It’s the lack of alternatives that so often result in the poor getting fleeced by payday loan joints charging outrageously high APR’s.

It’s the lack of money that prevents many of the poor from being able to purchase in-home washers and dryers and, as a result, having to lug dirty clothes down to a neighborhood laundromat and to purchase small packets of detergent that’s ends up being equivalent to purchase a big box of detergent.

They know that the price per load is much higher than it would be if they actually had their own shit.

And they know—they can figure out just as easily as the rest of us— that buying milk from Dollar Stores is a straight up fleece job.

They know what Baldwin knew decades ago:

You gotta pay a price to be poor.