About whats happening in peoples Financial Lives in the us . We have a ton of data and yet somehow this and managed to give a different kind of insight so the funders really wanted to do that work here. But i think they knew and jonathan knew there could be a local partner so ive always described myself as the local color on the project. But that was my original role. Tell us a little bit about how you were the local color. I work at a place called the centerfire Financial Services innovations and we work on dental health, trying to improve the Financial Health of americans but at the time, we were spending, we were focused on theissue of being under banked. And we were founded out of this idea to get more people dental access and we did a lot of research, we did the First National study of to understand what it meant to be under banked, the public study about that sowhen i joined , my first job was one of the things my bossfirst asked me to do , jennifer toucher who founded it said you figure out what our next leadership is and i said its like rummaging around and she and i had both written the financial diaries on a trip to south africa years before that. So we were inspired by the diaries and it caused me to reach out to jonathan and general collins who had done the book in south africa. And so it made sense that we were, ive been asking questions about this project and trying to figure out if this was the kind of research we might want to do it was a natural phase in some ways. Jonathan, it is so fascinating that you really came to the us after studying bangladesh and a lot of people say poverty in america really isnt real. Are the american core way of life, the middle class, anywhere else in the world and i want to come back to that notion several times during our conversation but i remember when you were a critic i think for my book with luke shafer two dollars a day, someone in that book of course is in extreme poverty in the United States, someone asked you this question. Can you compare us poverty to poverty in thedeveloping world and you said yes. Would you still say that and tell us more. Yes, absolutely. And its a real privilege to come to the us after having spent a lot of time thinking about poverty in a very different situation. When you are doing work in any event, in other cultures, one of the things which is so immediate to see is how much instability there is and also how much illiquidity, its Financial Markets and people are just struggling to put together the resources at the right time so coming in with that mindset made it much easier to come some places where we are working, cincinnati, new york. And see who the same kind of things but that might have been missed by others. You had already in your mind the idea of patching together a living given what youve seen in india and bangladesh. We knew that was the experience of poverty. And i do find the lives of the poor, id read some of your earlier work and i had a sense from your work and other works that that was very much a part of the lives of some families, some communities in the us. But i had just read your work, i think i had a sense of why it played out and how extensive but i came primed to be open to seeing this kind of action, this kind of communities pulling together, people working hard to create Financial Lives despite the odds. But in many ways its the greatest thing and i thank all these great guides, but the way that things are coming in with an open mind and not coming with a lot of knowledge. And this allamerican frame. Because i didnt know very much , a guy i was asking the dumb questions but looking for some of these experiences, how do you do it . The work in bangladesh had been about how do people live on a dollar a day . And here we are asking how do you live on 25 a yearor 30,000 a year or 40,000 a year with kids. That was the start of a fascinating journey with a group of families who let us into their lives back in 1972, the university of michigan originated the survey called town study of interdynamics and expressly to capture what youre describing and the sense of the survey of Income Participation program. What was the gap that you were trying to fill . And maybe it was much more organic than that, i dont want to put too much structure on what sounds like an organic process. Did they say hey jonathan, theres this thing. It wasnt totally addressed. I did manage to get a phd along the way in economics so the ps id and the other surveys were familiar but ive got to say, we went in with our eyes open, without a lot of preconceived notions and we wanted to listen to families and stay with them and track everything they get over the year. Everything they earn and spend. And the other author of the study had interviewed families without much regularity. Week after week. A whole year. So you dont have to recall more than just a few days. You kind of catch things in real time. It didnt always work out that way. That was the way it was the plan but it was afterwards where rachel and i would, you know how it is. You have all these amazing authorities and then you want to tell a broad story about what you saw and thats when i went back to the ps id and started trying to understand where the gaps were. What the biases were that came from collecting this data. And asking certain kind of questions. And asking certain kinds of questions so it was by accident that without during the identifying gap and that this is what were going to look for, we just wanted to understand. And i think that turned out to be a very powerful mistake. That might have been everything. Lisa, tell us about the nuts and bolts of this thing, not the sort of how many people you talk to for how long but what it was really like to have these conversations with these families in such an intense way over a years time. We had 10 researchers who were in four different locations. So first of all, just hiring the right people mattered. And i think right in that moment i had in my preconceptions questions because i had a certain image of what that person would look like, what we thought we were hiring. The researchers were diverse, people who were interested in the job were a very diverse group. But there was age, background, education, their level of connection to the community that they weregoing to be in researching with , it varied. And that was fascinating right from the beginning. So in each of those researchers were sent out to recruit families and that was the first job. And that was hard. That was longer than we expected and we were asking people to do something onerous, really onerous, they wouldnt meet with us and share everything about your Financial Life so of course we lost. They would say yes so there was a really important motivation issue. We of course new people would say yes, was it about a little bit of money or, i think ultimately people said yes because they wanted to have impact and they wanted to be heard and that was really powerful. Just to be able to have people feel that we were going to be there megaphone. One family that stands out inyour memory , that families individual got to know, then make a bigger impression on me, its so true. That is something powerful right in the beginning and this was one of the ideas we were conscious of as you did the work. We think as humans we can make decisions based on facts and a number of analytics but the stories are incredibly powerful. Weve got personal experiences sitting in somebodys living room changes your mindset in a much different way. So there was these one women that didnt make it into the book but we wrote a profile about who had that place in my mind of a latino woman who had spent her life in social services and really is the american story of upward mobility but had access to great Financial Services over her life, made lucky decisions and when i went to visit her, we had this visual image ofwhat her house was like in her living room. And she had a can of jam she had made, its that kind of sense that changes your mindset. Thats a good story. You know, i reading this book was amazing and i found id like to get your reaction. And reading these things i sort of paused and said oh my goodness. This is terrific. So im going to begin and here, this is a little subtle, its built so stay with me. You begin by actually describing a study using this Income Program participation, your reporting on this study. You say a team of researchers studying Family Welfare assembled data across a 25 year span. Overall, monthtomonth income volatility for families and children was relatively stable in that time but two groups saw substantial changes. Volatility increased for the poorest 10 percent of household and it fell for the richest 10 percent. Thats over the past generation, the gap in income volatility between the poorest and richest grew by 400 percent. Reinforcing divides based on income and wealth and you move on in page 159 so stay with me to make the following statement, 81 percent of those judged poor by annual income had months when they were not poor so thats the second clue to why i think this book is really big. Third, the other america is a little over 50 years old, one of the most important poverty probably ever written, he writes really impressively, popular deceptions of the permanence of poverty and health care are spread, we speak of the poor as ifthey were and ever present and unchanging group. Indeed, the way we can contextualize the poverty problem, the underclass problem or the welfare problem seems to presume the permanent existence of welldefined groups within american society. So i had a conversation with a Foundation President about a year ago and he was asking me to come speak to the board and of course i wrote this book on the rise of extreme poverty that you describe in the developing world and but i dont want you to talk about that book today because our foundation is only interested in studying the working poor. Were not interested in the generational port. So i paused and i want to be respectful but i said oh, then i will be talking about two dollars a day because the extreme poor are in and out of the housing market, 70 percent of children falling into two dollars a day poverty have worked at some point so thats a small piece of this big story thatyou guys are telling. And im thinking and im wondering if you agree that it turns our conceptions of poverty on their head area most, Many Americans are poor for many a year, Many Americans are not poor. And you then find yes, that 86 percent of the volatility and income can be laid at the feet of jobs. Just jobs. So if this seems like a fundamental reconceptualization of poverty in america, and its fundamentally seems that its also, its also a fundamental reconceptualization of whatit means to work. Yes. I think rachel and i really struck by how the families started fitting into the concepts and categories that we are used to or thought we would be trying to fit them into and then as we wrote the book we spent a lot of time going back and reading Michael Harrington and trying to understand where the language came from and where thedisconnects were. We could see a new language which was the health sectors. Much of harrington books is really still an amazing book. I made my students read it last year. Its great, hes a great writer and youre angry at the end and youre ready to act. Its a powerful piece of weather but he does something which is intrinsically at odds with the world that i think rachel and i saw and i think that comes through in your work two dollars a day. And harrington, her book there are the four and we often use this idea of something being invisible. You have to go into the most inner part of the inner cities, the hollows of kentucky. The places which historically and still are places of disadvantage. But thats poverty to him and it reinforced the notion of the poor and the nonpoor. Exactly, despite both. And its striking and the frustration that a lot of people felt disruptively was how that moment in the 1960s could we tolerate so much poverty despite growing wealth in america and i think rachel and i saw is a parallel to that or a question which is how can we tolerate so much insecurity and instability in america despite so many of us having increasingly disparate lives, there is a divide. And as you call it, the new inequality. Yes, and that is really foundational. And its this number, 86 percent of ups and downs during the year being attached to a single job, thats from the morgan Chase Institute and they did something amazing. They took data from all of their customers and boiled it down so the big data exercise , they found things which were very similar and thats, i gave rachel and me the confidence to write about our 235 which as an economist is a small number and they were even specifically representative but then we could connect it to j. P. Morgan chase, its very striking. One of the pieces of data that really surprised me is the effects of income and Program Participation for governments, they said between 2009 and 2011, it was a bit of an unusual. After the recession but during that period, 10 million americans report during other months of that face but 90 million americans at some point report during that period that a third of america experienced poverty at some moment in that period, often for a shorttime but that means we have to rethink whats going on. And the fifth story that had been done before the recession, there are similar kinds of numbers but it wasnt just recession issues, its a moment of whats going on today. It seems from reading your book that something happened in 1980. We know that in the late 70s were when working mens, those without a College Degree and so on and they been declining ever since but it seems like you know, the recession in a way blinded us to almost fundamental changes in the economy that are going to stay with us and thats going to, i think its undeniably driving these new cycles of despair that are bubbling up in our community so tell me about whats happened. I think you are absolutely right. It is the case that the room that preceded the recession and the recession would have deeper structural changes that had taken place. And what you see when you then peel away those layers is that you were referencing the work has really changed for many people and it is the fact thathaving a fulltime job no longer means that you have a steady income. Say that again. Network does not guarantee steady pay. So one more quote from your book , many, this is page 35. Many households could not count on their jobs to provide a steady income from one month. This is, thats a strong statement. It really is and were used to that for tip workers or people who work on commission so we have that model already in our economy but the fact is its a much bigger phenomenon that people who are selfemployed depend on tips and what you see now is if you work in retail , productivity enhancements means that your boss knows exactly how many people they need on the floor and send people home when they dont need them. My daughter got a job at a little mexico restaurants and poppies restaurant in College Point and she came home and said mom, they told me i was first cut. She thought this was something good. She was the first one sent home because she was the newest employee. Exactly and some of the variation in some jobs are unique. I in college you needed to get saturday night some of the time but you didnt need, you needed also did distribute saturday night among the waitstaff. Exactly. So it was like the best scheduled got friday and sunday but it was, the variations of some of that, you need to run a business and some of that employees need or workers need in order to share in the good days and bad days but what we think has happened is that the extent to which workers are now sharing in the ups and downs with their employers has just magnified and so you no longer are putting it. Its no longer you are buffered by this larger institution and that Expert Institution experiences the ups and downs but you get a steady wage. In some ways you are moving so the financial risk for the employer rather than the other way around. Right, and we are going to it in our book but we are also assuming that risk for the shareholders so it is a really big difference in how work is structured and i think its important to remember that it doesnt have to be that way. It has happened that way but its not inherently the case that manufacturing jobs go to the steadiest and nonmanufacturing jobs dont deliver steady income. Say more about that. Some of it is the course, manufacturing jobs deliver stability and mobility for a few generations of workers because we made policy choices that enable them to do so and because unions had real power when manufacturing first entered our economy it was a disastrous for free jobs, working. I remember. You remember norma rae. And even before that, you learned in grade school about the terrible working conditions and so its a choice, it was achoice to make manufacturing jobs. We could choose to make service jobs good jobs , it would require variation. It would require workers having a different kind of power than they have today but its not inherent to the nature of the job. I want to go a little deeper there. I think thats important. Simply, we sort of assume that employers are asking in economically rational ways. If you talk to employers, their operating by rules of some and they eventually, the market may win out but theres a lot of noise. I remember when Betsy Stevenson was on the council of economic advisers in the Obama Administration she was finding studies that many of these more onerous practices that employees were experiencing were actually costly to the employer. Where does that expression stand out . To what extent is there no going back because theres really an economic, theres an economicrationale . Thats sort of the whole system is just based on this new workplace and to what extent is it really a matter of making choices . Thats a good question. Im trying to pull it apart in different ways. But to take one part and connected to Betsy Stevenson, what some of the most important work that ive seen about whats going on in the workplace is being done by Susan Lambert and his collaborators in chicago, we were just talking to them comparing notes and the real work is even, shes documenting it week by week on the schedule and one of the insights she had is that it doesnt have to be that way on a process perspective. Whats happened is the floor managers are also making choices that are not optimal actually from the high level. This is really important. Yes, and once you see it. Its amazing. Businesses dont have to do it. Her work is sort of the first work to document these scheduling practices. Its extremely powerful. And so part of it is that. Businesses understood they could create better algorithms and they would better themselves but its really striking. Another part of it and this is a conversation rachel and i have had is that treating workers better, they work harder and there are more loyal and its also better for the employer. But at some level, thats not enough. There is a shift thats increasingly toward what economists call monopsony which is not monopoly but monotony which means you are the singleemployer and you have a lot of control and the workers increasingly are disadvantaged with less Bargaining Power give us an example. Monotony, its simply like we tell stories of men in germany in the introduction. A mechanic who works on this truck. He works at a local truckstop and its the only thing around and a lot of other jobs are in the way who doesnt have options to work in factories like the previous generation did, and hes lost a dm factory and other factories that supply gm, wheres he going . He doesnt have a lot of choice because it Bargaining Power has little away and he ends up having to take whatever the employer offers and what the employer is offering them was a late shift with a lot of volatility and we saw. Like never getting the saturday night. We see it in fact for him winter and summer are really high paycheck time because the cost for breaking down, he was busy and working on commission but when fall came around and the weather was too nice so its always this ironic situation. We need good weather, exactly. But interestingly, this created options. He ended up quitting that job because he wasnt working which was undermining the family and he ends up taking a job 45 minutes away at another place but they gave him guaranteed hours, guaranteed paycheck. But at a lower wage. It paid less but that was more important to him. Right, and that for us showed how costly and important these issues are to the family. And you know, how did you have to drive so far to get a better deal . Thats why the late market isnt working effectively and fluidly. So this raises the obvious question rachel, how do people cope . Tell me some stories about helping and then im really interested in how this plays out over time. If, were now being forced tocope with the way that we havent before like Many Americans , whats going to happen for example . How do people cope . Thats a good question. Ill continue using jeremy as the example, we renamed jeremy as truck mechanics wife and shes really responsiblefor managing their weekly finances. So what she does to manage the volatility is interesting. She says saving in cash, she understands the seasonality. She knows whats going to be happening but what she does is when they have the high months to stockpile. And so she would turn to coupons and she finds great deals and her pantry is pat. And she says this works for me and we saw lots of work around like that, people who say. Becky is not that good. Not that great. But i cant think of Something Else to do with the money. Exactly so even this joyce is real because there isnt a lot of pushing there, theres not a ton of excess tax to work so shes just exercising real discipline and a lot of what we saw were ways that people introduced discipline with the right level of structure, right level of flexibility but for her saving and cash in a bank account is too much flexibility and we withdraw it when i want to go to the movies, too tempting. And we heard that from lots of people. But at the same time if you put the money away in Something Like a retirement fund, then you really cant get access so its shifted. You write, this is one of the many fascinating little tidbits in the book actually that when youre trying to getpeople to save , weaker commitments are more effective thanstronger ones. Right and in the international work. You need stability because youre living from paycheck to paycheck, you need the ability to get the money out. Exactly so people want discipline but they dontwant , both too much or too little trouble so we see people putting their savings and an account thats now driving away and cutting up the atm cards or cutting up their checkbooks so they can access pay. They need checks in order to throttle for a payday loan. Those kinds of signs are really interesting because they suggest things you can do on a broader scale and they suggest a real selfawareness, people know what works for them and if you Pay Attention to what works, you can think of ways to help lots of people. We will return to this because you really i think capitalized in the book on this willingly. Taking what people are doing and thinking about ways of changing Financial Services to really mimic some of those strategies that are so effective in the field so to speak. So jonathan, i wanted to talk about something that was more of a box of, maybe it would kind of poking its head through in the narrative. And i wanted to give you an opportunity to talk more about it. So if we sort of its the 1980s is the time that things begin to shift in the 1990s. We had this economic boom that perhaps was again a bit of a masking. This is one of the best times we had in our history and 2000 hit and 2000 is sort of the Great Depression for the poor but so along with the story of whats happening in the economy is whats going on in the safety net. So we have you know, 1994, we have the dramatic expansion of a very key program to support the working poor. Of the earned income tax credit. Not a lot of people know about this program but its one of the early to largest antipoverty programs we have and basically ensures that if you work fulltime for low wages, emphasis on fulltime for a year, you wont need to work so we have this big i think now we are at about spending on tax credits is about 90 billion, Something Like that so theres this huge shift in the safety net to helping the working poor. Its kind of based on the assumption that your work is gettable and it was. At the same time we begin to see this collapse of the needbased safety net, namely afdc which had a name change during welfare reform to temporary assistance need for families and that program goes to serving 5 million adults to now, 750 in all 50 states so theres no floor. The only floor we really have is food stamps which we now call snap so you know, i think what happened during that period is we redefined what it meant to be deserving. You had to work, back in the day in the 80s and 70s and 60s, good mothers didnt work. And that was seen as a trade up but we changed the narrative so talk to me about how this instability marries with this narrative of the dramatic shift in the safety net and the disappearance of an entitlement to cash in when its really needed. To give you an illustration, the number of people, families selling food stamps, they have zero income at any given month as increasingly in the United States from a small number in the early 90s, say 1. 3 million today. Yes, were at a point where we really need to look back and rethink whats going on with the safety net because it isnt there. Theres somany families , we need it and who could use it in a way that its designed to be. A safety net, which it will help you when youre down but allow you to get back on your feet and go out and be productive and chase the American Dream. That floor is there in the same way. So really through part of it, one is families that really need financial support. And youre working two dollars a day, but that kind of support for the extreme core that used to be there. That isnt there at all, to the extent that people dont even know that Something Like that even existed before. That was a striking point for me. The other part is , the safety net also isnt built well for people who are basically doing okay but are sometimes poor. And thats key. Just like all the workarounds that people are doing with theirbank accounts , there are a lot of workarounds with these safety nets so you have that solution becomes a key program for lots of families because it is one of the ones that is flexible that you can get on. A lot of people dont understand that the increase in that program as really a been the cause bush to wanted more working poor families and made it a little more generous but also because he was actively talking about people dipping in during tough times. This is a great example again, wiki coming to small center homes. They earn 43,000 a year on average so there above the poverty line and basically doing fine, they have a nice home and all that but because of the ups and downs, there are six months of the year when their income below the poverty line and at those moments, because they didnt have the savings, they did take into snap and they did take advantage of state Health Insurance and felt terrible about it. They did. They said i didnt want the taxpayers have to pay for that and those people were worse off than her and she felt bad but she shouldnt have needed to feel so ashamed. There are lots of people who do need that help and our programs are really good for it. You have limits on how much people can save for example if your argument from access. Exactly and thats really undermining what i believe to get off. Think about thomas called this a economy track. Are we, all this volatility suggests we dont have a positive track in the United States, yet these, man, the book is depressing. Its the sense that nobody is really secure anymore. I think probably our basis and originally rich and i are careful because we studied foresight and we got to know these families extremely well but in our sample we are not the poorest people in our community or the richest so we missed people who you might think might be trapped in some way in poverty so we cant really it but we can say is that theres a big population that are poor some of the time and doesnt get any help. Either in the private sector or public sector. And theres the income tax credits. Which i love but it doesnt solve that problem. It doesnt, its very powerful. Were big fans of the itc and families are even bigger fans. And they withhold to even ramp up. Another great example of that, we recently had 700,000 because they over withheld and that was part of by their financial strategy. It was a different time with money. In our work on the e atc, we saw this cohort of 100 families over 600 times who were recipients of this program. And you know, the tax climate is incredible. Its a one woman since february, she had a whole food written cause thats where you go and you get your taxes done and you come home with this check that you feel you earned we found definitely this was savings or the kids so the music for the longerterm goals, get a car so you can get a better job for example and that money is important because thats mobility money. But theres always this sense ofgetting by. As an economist its kind of like i talked to like aboutmoving in these goals about household. But were kind of assuming that basically every month you are spending the same on your mortgage check for your rent check or your utilities are the same. Do you want to have a more same possible spending month after month but when you saw, the itc is a great example, thats something important, that households often need big chunks of money to go smoothly and spike and despite spending spikes the mobility money or thats the next the roof money or the get the better car money thats important to achieving some of the goals in life. So im thinking about, i just want to know one little fun little tidbit of the book, its super depressing but the book is totally worth reading. Its a pace trigger. So i want audiences to know that as well but spouses incomes used to sort of be moving and you report research that shows that rather than compensate, compensating for a spouses income loss, that the two are now correlated. So in part because we are increasingly likely to marry people from the same educational background. Whereas the boss might marry the secretary in the madmen age. So you dont really, kinda happening to both spouses at once but the question i wanted to ask you was about hope so theres this powerful narrative going on now across the United States about the despair of the rural white poor and i think some of the urban black poor are saying hey, what about me . Ive been experiencing this for generations but there is this very strong narrative as we are trying to figure out whats responsible for the Opioid Crisis that in these conversations you had with families, had they given up on the American Dream . Were they despairing or hopeful . Thats a really good question and you know, i felt like what i heard was fundamentally mostly still optimistic. And i thought about one family in particular who, and they kind of had this financial household from our perspective, a woman we named sarah and she had a lot of potential hardship during the time we got to know her before and after and yet she was working her way through college. This is a woman who graduated from college at 40 and was planning on starting a masters degree. A lot of work was going into that upward mobility and at the same time. Was she the woman who was intent on keeping her credit score high . That was a Woman Working on getting her masters but there are a little bit length in my mind, they are both people who were experiencingtrouble with credit. One had declared bankruptcy and the other end up by the time thinking that she was probably an option for her future. But they were both nonetheless working towards a better life and sarah in particular said life is not only about the money. Like, my life is going well. My kids are good, my husband is good. We are embedded in our community. Much about our life is fulfilling and working well. We never look at these numbers and think about that. And that was one of the pieces that was really powerful and important to me. You said in somebodys living room, you get the holistic terms of your life and this is somebody who financially is unstable. But she said you know, thats only part of what her life is about. Were talking about the tradeoff of what it would take for her budget and budget effectively and the so on top of her money that she wouldnt have money worries and that tradeoff versus just living her life wasnt worth it for her. Shewanted to just live her life. She was optimistic about what life would bring her going forward. Myself, even in studying this to dollar a day poor, we always ask people because we follow people for months and years and knew everything about their life and what it was like to be part of the study so to a person, the narrative went Something Like this. If my story can help even one person, then all my struggle will be worth it. Its really powerful. There is this optimism and in peoples lives. Some folks say g, the poor really dont want to work they dont move anymore, they dont use opportunity. What opportunity are we talking about . For that live in san francisco, they are lashing meaningful lives where they are in churches and synagogues and with their neighbors and friends. I think its not clear that you would have been able to move from one part of our sample to the other part, we were in mississippi, ohio, kentucky. Its not like if any of the people in the samples had picked up and moved, to one of the other locations it would have been better exactly. They were the same ones running out of gas. I think a lot of people areconfused. Their lives dont look like their parents which is the main model onehas. And theyre working hard but the pieces are coming together and they have expectations that are being met and theyre hopeful that the pieces will somehow fit together and thats part of the story thats gone back to school and shes looking for a better job and graduating from high school, the teachers are being together but sometimes consequences can be devastating for them. And im just imagining whats going to transpire when this whole generation has lived with this instability at retirement age. Yes. A lot of them are asking that same question. Feels like a zoo nominee is going to, a lot of them i think are planning to retire on Government Social security. Its in that that program continue to be stable because so many people are counting on it. Are people going to work longer, its going to be a problem. Im going to tell you a story. And you talk about the paradox in the book. So ive been following the families from two dollars a day now for, i think i met her, miss ray mccormick. Shes been in and out of extremepoverty since she was 12. Shes been in and out of the labor market at the same time, shes a worker and i hear from her on facebook almost every day and when the study and because we continue to communicate with me on facebook and so the striking thing about that is that she has a cell phone. Right . Yes. And an internet connection. She also has medicaid and her house, one of the things that two dollars a day does is it degrades your help. Hes about to have surgery. Shes had many surgeries. Shes had so many medications. And yet shes trying to work at the quickie mart. So following all these things of course, i know she has health care and she has this luxury item but i also know that she had to leave the center. And i also know that her daughter had a birthday, a sixth birthday before christmas and she had no money for presentsfor her kids. So my coauthor luke heroically convinced the local Grocery Store to make up birthday cupcakes and take a credit card over the phone but no presents for christmas for her birthday. And over the year i think she had your utilities disconnected at least three times that iknow of. She cant afford any of her medications, she has no cash income. So shes just not taking the medications that dont get covered by medicaid. How do we think about this . On one side there are people saying well, we should give the poor because they consume more. And they are consuming more medicaid, for the moment. Thats the main way in which they consume more than they did 20 years ago. People are bringing in unheated checks, you cant even rent an apartment without a bathroom thats not up to code and legally read Something Like that out to someone. Just tell me how to think about the fact that economically struggling families have may have more luxury, tvs for example. Yes, its a tricky question. I mean, one that when we look at the numbers , the cost of the cell phone and tv, it does seem hard to square with the deprivations and also how even small amounts of money can be helpful. On the other hand, when you look at it, there nothing compared to the resources that are needed to protect oneself and move forward and everybody in our sample has tvs and all that. We work focused on the truly poor but what was striking to us was that the mccormick story is one you here and you thinkwell , mccormick has had a really rough life. She doesnt have a lot of resources we were seeing families earning 40,000, 50,000 but also not taking their medications and splitting their pills and not getting the health care they need because of these ups and downs in instability and sometimes they just werent sure if the money was going to be there in a steady enough way to start a medical procedure. Sometimes i wonder if people dont when the spikes, its easy to think that the spikes are going to last forever. We do it as a nation. And i know that some of your families know its going to get worse because theres seasonal employees for example but buying a tv seems to have a certain psychological value. Like im moving up or maybe theres hope for me. Theres another thing, i wonder im in san jose. I thought it was it was smart that the woman is talking to her husband whos a construction worker but he makes a little extra money fixing motorcycles on the side and all the money he gets from motorcycles is put into a funny money fund and then they spend it to live. And you might say thats crazy because they have had some debt issues but having that funny money allows them to be super strict on the other side i guess they can bear it. You cant live the kind of life that a robot would be expected to live because were not robots, where humans so in the end its counterproductive to try to minute many robots life and i thought thats worked out pretty well so the tv is when you got a little bit of money or the phone and you can do the things that allow you to recover in other ways. Ive often thought about it that way, the phone is really early to society and gosh, would she be better off if she spent the same money getting a heater . I dont know. Theres that awful house without power, it is an awful house, ive been there. Its kind of unbelievable. They should be better off and what is necessary for ecological survival in the worlds most advanced Capital Society but what does it take just to feel like you can keep going . I have a final question for you. Now, as you know, you are intimately involved in this. Policy solutions are just fantastic here. Really innovative. Very diverse, i would say. So the readers should go there and look at them and try them out in their communities. But theres always a sense and i struggled with this same thing, the problem is like this and then the solutions are like this in part because we want to be kept cautious and we want to make sure its sound, we want to have tests but you dont have to be under the weight of being an academic. [laughter] lets say your clean for the day and you can do whatever you want. What would you do . We did not ask it that way to ourselves as we were writing because its exactly what youre saying, you want to Say Something thats doable. And because the problem seems so big you want to give People Solutions that are achievable. Theres a feeling of moving forward and being able to do something. When i really think my wish list of what i think could actually happen, i think its fundamentally, it is building on the concepts we put in the book. Its about this idea of moving risk to the right shoulder. When you look at the question you are asking, buying a cell phone or not buying a cell phone, the risk of small decisions going badly is so much higher for people at the bottom. Wealthy people make spending decisions all the time. I can come up with some for me from the past year but for me, the consequence of that is really minimal, there isnt one but the consequence for people struggling is often really big so a lot of what we thought about was how do you ship risk away from individuals were struggling ontoinstitutions , back onto government or employers or Financial Institutions . To really execute effectively you have to think about why are they putting that risk down on others in the first place . Theres big structural things about how our economy is functioning that have to ship before larger institutions want to take the risk back. Maybe we need to hear from those institutions about their own risk. You see it play out in healthcare. The cost of, who is bearing the risk . Its a complicated set of questions. You think about whos going to advocate for more Public Health care, well, the Insurance Companies have a state. State governments have a stake in what the government would do. That plays out at this high level without thinking about risk enough. Thats really what you want to change. This is fundamental in how things have you all and i think really in the grand plan, its just played out that way and if i was going to wave a wand, one of the places i would focus is im an economist and markets to me are the key to a lot of things working well but that has to be a balance of power and that balance isunbalanced. Cspan where history unfolds daily. In 1979 cspan was created as a Public Service by americas cae