Why are people living in poverty? Or is it a budgeting problem?

Every week when we switch on the news we see yet another story about some struggling family.  There will be some family in Western Sydney or South Auckland who can't heat their homes and who can't give their kids new shoes.  We hear about families who can't put food on the table and we hear about parents who can't heat their house.  Then we hear about those who can't buy a home.  In this piece I won't be talking about the latter because home ownership is something which should be earned and not necessarily a given or taken for granted.

The first group however is considerably high.  If you believe the statistics that are released every few months with great reactions then you'd believe that 14% of people in Australia are living in poverty.  Poverty is defined as being half of the median income, or $400 a week in Australia for a single person, and $841 a week for a family of four

If you were a single person living in Sydney then $400 a week would be tight but you would get the following:
Rent $200 for a cheap boarding house in a terrible suburb with power included.
Transport $50 assuming you have a job or studies to travel to.
Phone $15
Food $70
That would still leave $65 to put into savings for a rainy day or for clothing.  One could argue that we have a distorted view on what poverty is in Australia because our wages and living standards are so high.

Now suppose you're a family of four living in Sydney, the poverty line is $841, so what could you get for that amount of money?
Rent $350 - $400 for a house with three bedrooms in Western Sydney.
Transport $100
Food $150
Power $50
Phone $40
That leaves $60 to put away for a rainy day or savings for the doctor although the doctor is free.  In other words, if you budget carefully then you can survive if you live below the official poverty line.  Yes things would be tight and you would have to watch the pennies but you could still save.

This actually brings me to my next point, do we have a poverty problem or do we have a budgeting problem?  If you are bringing in $800 a week as a family and you still can't make ends meet then you have a budgeting problem, you also have an employment problem.  if you have just relocated to a new area then it makes sense that your income would be low as you would need to find a job, however if that's not the case then you need to ask yourself the question of why your income is so low and what you can do to increase it.  Do you have skills that employers want?  Are you educated enough?  Do you have motivation?  Do you want to improve your situation in life?  Those who are proactive and want a better life will do everything in their power to get ahead and will not be on the low income for long (think less than two years) while those who are on that long term have other issues that need addressing.

Given Australia, depending on where you live, is a land of opportunity people should have no issues finding jobs and increasing their income.  It is the same situation for the young.  We hear about youth unemployment day after day and how it's awful but instead of asking why, the mainstream media just says it's happening.  I don't support activism journalism, though one could argue that is what I do in my independent blog, however surely it's the mainstream media's job to look at what is actually causing long term unemployment.

Nobody is saying it is easy to solve long term unemployment or the cycle of poverty however imagine this, if you only grow up surrounded by poor people with low education you don't know anything else, just as the well off don't know what poverty is.  Is it time that schools in well off areas had a quota of say 10% for those out of zone from the poorer areas?  And with private schools is it time we looked at increasing the number of scholarships offered?  It seems that the current system is failing people and handouts and benefits are not the answer.  Not everyone can reach the top and nor should they, but it seems like some parents, teachers and kids themselves are ensuring they never improve their lot in life.

Parents play a big part in their kids' future and education.  Without good parents investing in your education you won't have opportunities and may end up stuck in poverty, so the question is, why are parents having kids that they don't want to help achieve?  And the bigger question, how can parents live with themselves if they don't give their kids opportunities?  Are they dumb?  Or do they just not care?

Rather than just giving endless handouts, what can be done to truly help those living in poverty get out of it?  Why didn't they get the qualifications and skills when they were younger?