In his compelling book, Poverty by America, Matthew Desmond not only interrogates why poverty persists in such an affluent society but also exposes the uncomfortable truth—the perpetuation of poverty is intricately linked to the privileges of the wealthy.
The United States of America, often celebrated as the land of opportunity, harbors a striking paradox: it is the wealthiest nation on Earth, yet it sustains levels of poverty that rival those of less affluent countries.
Desmond’s exploration goes beyond surface-level analyses to identify systemic exploitation and deliberate policies as primary engines of deprivation. This article seeks to delve into the nuanced themes of the book, offering an intellectual reflection on its insights while using statistical evidence and philosophical inquiry to illuminate the underlying causes of American poverty.
Poverty in America or American poverty is not a failure of resources; it is a reflection of a societal structure that benefits the affluent at the expense of the underprivileged. As Desmond writes, “Ending poverty will require each of us to become poverty abolitionists,” underscoring the urgent need for both collective action and individual accountability.
This article aims to unpack these themes while providing a comprehensive understanding of Desmond’s critical insights into one of the most pressing issues of our time.
Background
“Why is there so much poverty in America?” This was the question that drove Matthew Desmond’s decade-spanning research, documented in Poverty, by America. Poverty in America is not merely a byproduct of economic inequality or global competition; rather, it is deeply entrenched within systems that prioritize profit over people.
Despite producing $5.3 trillion more annually in goods and services than China, the U.S. maintains the highest poverty rate among advanced democracies, with over 38 million Americans—one in nine—unable to afford basic necessities.
Nevertheless, my finding suggests that 811 million people still go to bed hungry each night across the globe.
The roots of this disparity lie in historical and policy-driven inequities. Desmond’s narrative highlights how America’s welfare system, labor practices, and housing markets exacerbate inequality.
For example, federal spending on means-tested programs grew from $1,015 per capita in 1980 to $3,419 by 2018, yet poverty rates have remained stubbornly stagnant. This dissonance, as Desmond reveals, arises from systemic inefficiencies and maldistribution of resources. Programs like Temporary Assistance for Needy Families (TANF) allocate only 22 cents of every dollar directly to impoverished families, with the remainder often diverted to unrelated projects.
Desmond’s personal anecdotes, such as his observations of families living in Milwaukee’s poorest neighborhoods, lend a human face to the statistics. He details how systemic barriers, such as lack of access to affordable housing or healthcare, trap individuals in cycles of poverty.
By highlighting these stories, Desmond urges readers to see poverty not as a distant issue affecting “others” but as a moral and systemic failure that implicates everyone.
Poverty as a Structural and Moral Crisis
Desmond’s thesis challenges readers to rethink the nature of poverty by shifting the focus from the poor to the privileged. He writes in Poverty by America, “Books about poverty tend to be books about the poor. … But to understand the causes of poverty, we must look beyond the poor”. This statement encapsulates the central argument of Poverty, by America: that American poverty is not an inevitable consequence of economic disparity but a deliberate outcome of policy choices and societal complicity.
Consider the United States’ welfare state.
Contrary to popular narratives of its retrenchment, federal spending on means-tested programs grew substantially—from $1,015 per capita in 1980 to $3,419 by 2018. Yet, poverty rates have remained stagnant. How? Desmond argues that much of this spending does not directly reach the impoverished.
For instance, only 22 cents of every dollar budgeted for TANF goes directly to poor families. Meanwhile, states divert welfare funds to unrelated initiatives; for example, Mississippi allocated millions of TANF dollars to projects like college sports facilities and personal gains for influential individuals, leaving many poor families without assistance.
Furthermore, the societal and political narrative often places the burden of poverty on the shoulders of those experiencing it, portraying them as responsible for their misfortune.
Desmond dismantles this narrative by exposing the systemic forces that sustain poverty. For example, the top 1% of earners in the U.S. benefit from tax loopholes and subsidies totaling hundreds of billions of dollars annually, while simultaneously lobbying for policies that undercut social welfare programs. Wealthy individuals and corporations exploit low-wage labor, benefiting from suppressed wages that fail to cover basic living expenses for millions of workers.
In 2021, nearly 40% of U.S. households earning less than $25,000 paid more than 30% of their income on rent, a stark indicator of the structural inequality that prioritizes profit over human dignity.
The persistence of poverty also reflects broader systemic inequalities. Racial disparities exacerbate these issues, with Black and Hispanic families twice as likely to experience poverty compared to white families.
Structural discrimination in housing and employment markets compounds this reality, perpetuating cycles of disadvantage. For instance, studies reveal that Black job applicants are 50% less likely to receive callbacks than white applicants with identical qualifications. These inequities are not incidental but are reinforced by policies and practices designed to maintain existing power structures.
Desmond’s analysis calls for a radical rethinking of societal priorities. He challenges readers to confront the uncomfortable reality that the privileges enjoyed by some are often built on the deprivation of others. This perspective underscores the moral and structural crisis at the heart of American poverty: it is not merely a failure of policy but a reflection of deliberate choices that sustain inequality for the benefit of the few.
Desmond’s thesis Poverty by America challenges readers to rethink the nature of poverty by shifting the focus from the poor to the privileged. He writes, “Books about poverty tend to be books about the poor. … But to understand the causes of poverty, we must look beyond the poor”. This statement captures the central argument of Poverty, by America: that poverty is not an inevitable consequence of economic disparity but a deliberate outcome of policy choices and societal complicity.
Furthermore, the societal and political narrative often places the burden of poverty on the shoulders of those experiencing it, portraying them as responsible for their misfortune.
Desmond dismantles this narrative by exposing the systemic forces that sustain poverty. Wealthy individuals and corporations exploit low-wage labor, benefit from tax loopholes, and support policies that marginalize the poor. The result is a self-perpetuating cycle in which poverty persists, not because of individual failings, but because of deliberate decisions to prioritize profit over human dignity.
The High Costs of Being Poor
Poverty, as Desmond illustrates in Poverty, by America, is not merely a lack of income but a relentless cycle of deprivation that amplifies suffering.
For example, poor families spend over 70% of their income on rent, yet federal housing assistance reaches only one in four eligible families. This housing insecurity contributes to chronic instability, forcing families to endure frequent relocations, disrupted education, and diminished health outcomes.
Moreover, poverty exacts a physical toll.
Desmond cites that one in four poor children suffers from untreated cavities, which can escalate into severe infections. Similarly, families living near petrochemical plants face disproportionate exposure to toxic pollutants, leading to higher rates of cancer and respiratory diseases.
Poverty by America provides harrowing examples of individuals who, despite working multiple jobs, are unable to afford basic healthcare or safe housing.
Beyond physical harm, poverty inflicts psychological trauma. Desmond describes it as “a bandwidth tax,” draining cognitive resources and trapping individuals in survival mode.
He writes, “Being poor reduces a person’s cognitive capacity more than going a full night without sleep”. This cognitive burden perpetuates a vicious cycle, leaving little mental energy for long-term planning or upward mobility.
The Exploitative Economy
The persistence of poverty is not merely a failure of policy but a reflection of systemic exploitation.
Desmond’s analysis in Poverty by America reveals that the wealthy benefit directly from the labor, housing, and consumption of the poor.
For instance, landlords in low-income housing markets routinely charge exorbitant rents for substandard accommodations, leaving tenants with few alternatives. In some cases, poor families end up paying over 50% more per square foot compared to middle-class renters in better neighborhoods.
The labor market similarly exploits the poor.
Statistics reveal that nearly 40% of the American workforce earns less than $15 an hour, leaving millions below the threshold for a decent living. This is especially true in industries like fast food, retail, and caregiving, where corporations report records profits while resisting wage increases. Desmond underscores the exploitation by highlighting the lack of benefits and job security in these sectors.
For example, a study shows that 73% of low-wage workers lack paid sick leave, exacerbating financial precarity when illness strikes.
Desmond’s critique extends to the prison-industrial complex, where the incarceration of millions—disproportionately poor and Black—serves as a tool of social control.
Nearly 2 million Americans are incarcerated daily, with many forced to perform labor for pennies on the dollar. This system generates billions in profit for private companies while excluding the incarcerated from poverty statistics, masking the true scale of deprivation. In one striking example, the average wage for incarcerated workers ranges from $0.14 to $1.41 per hour, depending on the state.
Even consumer markets exploit the poor through predatory practices. Payday loans, for instance, carry annual interest rates averaging 400%, trapping borrowers in cycles of debt.
Meanwhile, banking fees disproportionately affect low-income individuals, who often pay $300 or more annually in overdraft fees alone. These examples highlight how systems and industries systematically siphon resources from the poor to benefit the affluent.
This exploitation is not incidental but systemic, rooted in policies and practices designed to maximize profit while minimizing accountability. Desmond’s work calls attention to the urgent need for reforms that prioritize equity and dismantle the mechanisms of exploitation embedded in housing, labor, and criminal justice systems.
The persistence of poverty is not merely a failure of policy but a reflection of systemic exploitation.
Desmond’s analysis reveals that the wealthy benefit directly from the labor, housing, and consumption of the poor. In housing markets, landlords extract exorbitant rents from vulnerable tenants, often providing substandard living conditions. Similarly, low-wage workers in industries like fast food and retail are underpaid and overworked, enabling corporations to reap substantial profits.
Desmond’s critique extends to the prison-industrial complex, where the incarceration of millions—disproportionately poor and Black—serves as a tool of social control. The incarcerated are not included in poverty statistics, masking the true scale of deprivation. Moreover, they are often forced to work for meager wages, their labor further enriching private enterprises.
This exploitation is not incidental but systemic, rooted in policies and practices designed to maximize profit while minimizing accountability.
Statistics At a Glance
National Poverty Rate: Over 38 million Americans (one in nine) live in poverty.
Child Poverty: One in eight children in the U.S. is affected by poverty.
Housing Costs: Poor families often spend over 70% of their income on rent.
Federal Spending on Welfare: Grew from $1,015 per capita in 1980 to $3,419 by 2018.
TANF Allocation: Only 22 cents of every dollar goes directly to poor families.
Healthcare Spending: Medicaid accounted for $521 billion in federal spending in 2021.
Untreated Health Issues: One in four poor children suffers from untreated cavities.
Housing Assistance: Only 1 in 4 eligible families receives federal housing support.
Prison System Impact: Almost 2 million incarcerated Americans are excluded from poverty statistics.
A Call to Abolish Poverty
Ending poverty in America, Desmond argues, requires more than policy reform; it demands a moral reckoning. “Ending poverty will require that each of us, in our own way, become poverty abolitionists,” he writes.
This involves reevaluating societal values and dismantling systems of privilege that perpetuate inequality.
Desmond’s call to action is rooted in evidence-based solutions. Expanding affordable housing, implementing universal healthcare, and raising the minimum wage are achievable goals that could significantly reduce poverty. However, such measures require collective will and a willingness to confront uncomfortable truths about privilege and exploitation.
He also emphasizes the role of grassroots movements and community organizing in driving change. From tenant unions to labor rights advocacy, these efforts demonstrate the power of collective action in challenging entrenched systems of inequality.
Desmond’s vision is one of solidarity, where individuals and communities work together to build a society that values human dignity over profit.
Hope for the Rich and Poor Countries: My Remark
Hope, in its most profound form, is a refusal to accept despair as the final answer. As I reflect on Matthew Desmond’s Poverty by America, I am struck by his unflinching examination of poverty in the land of dream—a condition as persistent as it is preventable. Desmond’s portrayal of American poverty as a systemic consequence of privilege reminds us that hope for both rich and poor nations rests in our willingness to confront the inequalities entrenched in our societies.
“Those of us living lives of privilege and plenty must examine ourselves,” Desmond writes, exposing the uncomfortable truth that wealth often depends on the deprivation of others (Prologue). Is he talking about Pareto Optimality?
The global economic structure enables the affluent—both individuals and nations—to thrive while marginalizing the less fortunate. Wealthy nations often exploit poorer countries through unfair trade practices, resource extraction, and political manipulation.
But hope for the rich lies in their capacity to redefine success. Imagine a world where prosperity is measured not by accumulation but by equitable distribution.
Historical precedents, such as the Marshall Plan, demonstrate how investment in the well-being of others can yield both moral and material returns. Similarly, individuals within rich countries must re-evaluate their participation in systems that perpetuate inequality—from their consumption habits to their voting choices.
Hope springs from action, and the rich have the tools and resources to lead transformative change.
On the other hand, Desmond’s narratives humanize poverty’s relentless toll: the physical pain, the psychological trauma, and the systemic barriers that crush opportunity. Yet within these stories, there is also remarkable resilience. Families survive eviction, endure hunger, and navigate unstable job markets with ingenuity and perseverance. “Poverty is pain,” Desmond observes in Poverty by America, “but it is also a relentless piling on of problems”.
For poor nations, resilience often manifests as innovation. Countries like Rwanda and Bangladesh have emerged as leaders in sustainable development and microfinance, respectively, despite their limited resources. Grassroots movements and local ingenuity offer hope, proving that even under oppressive conditions, communities can create pathways to a better future.
However, systemic barriers—both domestic and global—must be dismantled for resilience to translate into lasting progress.
“Poverty persists because some wish and will it to,” Desmond asserts, highlighting the interconnectedness of wealth and poverty. This interdependence suggests that solutions must also be shared.
Rich countries cannot insulate themselves from global poverty, as inequality fuels instability, migration crises, and environmental degradation that affect everyone.
Shared hope lies in solidarity. When rich and poor nations collaborate, as seen in the Paris Agreement on climate change, they acknowledge a shared destiny. Similarly, within countries, policies that empower the poor—such as universal healthcare, living wages, and affordable housing—benefit entire societies by fostering stability and economic growth.
Hope emerges when humanity recognizes its collective fate.
As an observer, I am reminded of the words of the poet Layli Long Soldier, whom Desmond cites: “The oil at the surface” is not the full story. Hope demands that we dig deeper, challenging not just economic systems but also our personal complicity in them. What can I do—what can we do—to ensure that hope is not a mere sentiment but a lived reality?
Desmond’s book urges us to become “poverty abolitionists,” unwinding ourselves from the systems that sustain inequality (Prologue). For me, this means conscious consumption, advocating for equitable policies, and amplifying the voices of those marginalized by the current order.
For nations, it means replacing exploitation with cooperation.
Conclusion
Poverty, by America, is a sobering reminder that poverty is neither natural nor necessary; it is a choice made and sustained by society.
Through meticulous research and poignant storytelling, Matthew Desmond challenges us to imagine a future where abundance is not hoarded but shared.
As citizens of the richest nation in history, the question we must ask ourselves is not whether we can afford to end poverty but whether we can afford not to.
