Poverty industry: Difference between revisions

The terms '''poverty industry''' or '''poverty business''' refer to a wide range of money-making activities that attract a large portion of their business from the [[poverty|poor]]. Businesses in the poverty industry often include [[payday loan]] centers, [[pawnbroker|pawnshops]], [[rent-to-own]] centers, casinos, liquor stores, lotteries, tobacco stores, credit card companies, and bail-bond services.<ref>{{cite web |date=May 7, 2018 |title=Google bans ads for bail bonds services |work=Inside AdWords |url=https://adwords.googleblog.com/2018/05/google-bans-ads-for-bail-bonds-services.html |quote=Studies show that for-profit bail bond providers make most of their revenue from communities of color and low income neighborhoods...}}</ref><ref>{{cite journal |last=Rivlin |first=Gary |date=9 June 2010 |title=Fat Times for the Poverty Industry |journal=The Atlantic |quote=The pawnbroker, the subprime auto lender, and the rent-to-own operator might say the same. These and other merchants, part of what might be called the poverty business... |url=https://www.theatlantic.com/national/archive/2010/06/fat-times-for-the-poverty-industry/57906/ |access-date=22 July 2013|author-link=Gary Rivlin}}</ref><ref>{{cite web |title=EXPOSÉ on THE JOURNAL: The Business of Poverty |publisher=Bill Moyers Journal |url=https://www.pbs.org/moyers/journal/08082008/profile.html |access-date=4 June 2010}}</ref><ref>{{cite magazine |last=Grow |first=Brian |title=The Poverty Business |magazine=Business Week |url=http://www.businessweek.com/magazine/content/07_21/b4035001.htm?chan=search |archive-url=https://web.archive.org/web/20071102152241/http://www.businessweek.com/magazine/content/07_21/b4035001.htm?chan=search |url-status=dead |archive-date=November 2, 2007 |access-date=4 June 2010}}</ref> Illegal ventures such as [[loansharking]] might also be included. The poverty industry makes roughly US$33 billion a year in the United States.<ref>{{cite book |last=Rivlin |first=Gary |date=June 2010 |title=Broke, USA: From Pawnshops to Poverty, Inc.—How the Working Poor Became Big Business |publisher=HarperBusiness |isbn=978-0061733215 |url=http://www.harpercollins.com/books/Broke-USA-Gary-Rivlin?isbn=9780061733208&HCHP=TB_Broke,+USA |access-date=22 July 2013}}</ref>{{page needed|date=July 2013}} In 2010, elected American federal officials received more than $1.5 million in campaign contributions from poverty-industry donors.<ref>{{cite news |last=McNay |first=Don |author-link=Don McNay |date=29 July 2011 |title=Legalized Loan Sharks |work=The Huffington Post |url=http://www.huffingtonpost.com/don-mcnay/legalized-loan-sharks_b_912870.html |access-date=22 July 2013 |quote=The poverty industry has given huge contributions to lawmakers. According to the Citizens for Responsibility and Ethics in Washington, payday lenders donated more than $1.5 million to federal office holders during the 2010 election cycle.}}</ref>

In poorer countries, the poverty industry exploits the [[bottom of the pyramid]] and its extent can at times be used as a litmus test to assess the effectiveness of poverty-alleviation initiatives.<ref>{{cite journal |last1=Arp |first1=Frithjof |last2=Ardisa |first2=Alvin |last3=Ardisa |first3=Alviani |date=2017 |title=Microfinance for poverty alleviation: Do transnational initiatives overlook fundamental questions of competition and intermediation? |url=https://www.researchgate.net/publication/320100413 |journal=Transnational Corporations |publisher=United Nations Conference on Trade and Development |doi=10.18356/10695889-en |id=UNCTAD/DIAE/IA/2017D4A8 |volume=24 |issue=3 |pages=103–117|s2cid=73558727 }}</ref> In some cases, the poverty industry directly takes advantage of poverty-alleviation initiatives (e.g. formal, government-supported [[microfinance]]). For example, some moneylenders misrepresent themselves as formal microfinance initiatives or obtain loans from formal microfinance initiatives through deception. They on-lend these loans to micro-entrepreneurs (informal [[intermediation]]).<ref>{{cite journal |last=Arp |first=Frithjof |date=12 January 2018 |title=The 34 billion dollar question: Is microfinance the answer to poverty? |journal=Global Agenda |publisher=World Economic Forum |url=https://www.weforum.org/agenda/2018/01/the-34-billion-dollar-question-is-microfinance-the-answer-to-poverty}}</ref>