Tuesday, August 28, 2007

The Conspiracy of the Poor

By: Julie Castro Abrams

Barbara Ehrenreich just came out with a terrific blog post about the crisis among the American poor today.

In classic Ehrenreich style, she takes the issues head on with a critical new look at the current market situation. Tongue in cheek, she suggests that perhaps there is a conspiracy among the poor who took out high risk mortgages, lived in houses they couldn’t afford, and stopped shopping at Walmart and Home Depot last month all in an effort to get back at the “man”.
Somewhere in the Hamptons a high-roller is cursing his cleaning lady and shaking his fists at the lawn guys. The American poor, who are usually tactful enough to remain invisible to the multi-millionaire class, suddenly leaped onto the scene and started smashing the global financial system. Incredibly enough, this may be the first case in history in which the downtrodden manage to bring down an unfair economic system without going to the trouble of a revolution.

First they stopped paying their mortgages, a move in which they were joined by many financially stretched middle class folks, though the poor definitely led the way. ... Then, in a diabolically clever move, the poor – a category which now roughly coincides with the working class – stopped shopping. Both Wal-Mart and Home Depot announced disappointing second quarter performances, plunging the market into another Arctic-style meltdown. H. Lee Scott, CEO of the low-wage Wal-Mart empire, admitted with admirable sensitivity, that “it’s no secret that many customers are running out of money at the end of the month.”
Banking for the poor has been heralded as a new revolution with Grameen Bank leading the way. We are hitting a wall in the U.S. because of over-extending credit and predatory practices with the poor. There are even fewer controls in place internationally.

We must take a hard look at the market problem of making money off of the backs of poor people; this includes paying wages that are unsustainable and the “throw-away” culture. There is a place at the table for everyone – there must be or our humanity is truly at risk.

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