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How Millions in America Get Entrenched in Poverty

An inside look at the system that's producing America's growing underclass.

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Having burned through her savings, her retirement accounts, and her unemployment benefits, and having fallen far behind on her mortgage, Luann realized that unless she started using the food pantry she and her two teenage children would literally go without meals. Then, adjusting her expectations ever downward, she took an accounting job at the center that housed the pantry. She was bringing in about $20,000 per year, whereas a few years earlier she had earned $60,000—not enough to live well, but too much to qualify for many government benefits.

Now, I shop in thrift stores. I live paycheck to paycheck. I make sure my children have necessities before I buy for myself. Fortunately, I don’t have a car payment, but my car is on its last lap. I’m barely holding onto the house. I’m on assistance for electricity—a state program, which allows me to keep my lights on. I don’t know how I’m going to make it through the winter with heating. I saved up money for oil, but it’s a fraction of what I’m going to need to get through the winter. I don’t get food stamps. I’m strictly on my own. Last year it was really, really rough—coming up with the money to heat the house. I had to defer my mortgage for three months; they added the interest I would have paid onto my new payments.

When she ran out of food, Luann improvised. “Chicken bouillon plus rice tastes like chicken rice soup,” she said, and shrugged. “Of course, there’s no chicken in it.”

And then there were the pantry denizens escaping domestic violence who had run up against draconian cuts to the shelter system. One client, Wallace recalled, was a woman in her late forties, about to enter a shelter. “We got a request to provide her food because she has to bring her own food to the shelter. The programs that assist the working poor and the poor are in dire straits.”


Variations on the stories from Appalachian Pennsylvania could be encountered in cities and regions across America. After all, an economic free-fall of the kind that the United States underwent after the housing market collapse and then the broader financial meltdown leaves carnage in its wake. For those born into poverty, the hardship is magnified. For millions of others who thought of themselves as upwardly mobile, with middle-class aspirations and middle-class spending patterns, the crisis flung them down the economic ladder, replacing a precarious fiscal stability with a continuous struggle to survive.

In the working-class, immigrant community of Pomona, a few miles east of downtown Los Angeles, in fall 2008 five eleventh-grade and ten twelfth-grade students in Village Academy teacher Michael Steinman’s English classes began compiling their stories of poverty for a video project. “I was aware of the economy, but I wasn’t personally affected too terribly,” Steinman explained. “But when I asked my students how things were going, in my AP class—we were studying The Great Gatsby at the time—every single student had been affected. I wanted them to give testimony to what they had witnessed and they were going through. The concept of the American Dream has either evaporated or gone away. Daily, I work with kids who are very much stressed. They hide it well; there’s a certain amount of shame that they carry about being poor or struggling. But I do know they’re going through circumstances that definitely impact their studies and their ability to think about the future and be positive.” The video footage that they created and put up on YouTube went viral in January 2009. Barack Obama’s presidential transition team was shown the video. A couple of months later when he visited Southern California, the newly inaugurated president held a rally in a lot adjacent to the buildings that housed the experimental school—whose student body is overwhelmingly made up of young people from ethnic minority backgrounds, and one ranked by U.S. News & World Report as one of California’s best educational establishments. Obama also invited Steinman and his students to the White House.

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