“The Real Reason the Poor Go Without Bank Accounts”: relationships

A public policy professor worked four months at a check cashing business and found check cashing services offer several features that banks do not:

At commercial banks, the account itself often maintains the relationship between the customer and the institution. I might not be satisfied with my bank, but it’s an enormous inconvenience to switch everything over to a new one, and there is no guarantee any other bank will be more efficient or better…
The glue at RiteCheck is the customer/teller relationship. I interviewed 50 RiteCheck customers after my stint as a teller and, when I asked them why they brought their business to RiteCheck instead of the major well-known bank three blocks away, they often told me stories about the things the RiteCheck tellers did for them. Nina, who has lived most of her life in Mott Haven, told us that her mother had been very ill and that the RiteCheck staff had called to ask about her. “So we can be family,” Nina said. “We know all of them.”

Being a regular at the check casher also brings more tangible benefits. Marta, another regular, came to my window one afternoon with a government issued disability check to cash. When I input the number from her RiteCheck keytag into my computer, the screen indicated she owed RiteCheck $20 from every check she cashed. I didn’t know what to do, so I turned to Cristina for advice. I learned that Marta had cashed a bad check awhile back, and that RiteCheck had worked out an arrangement in which she could pay RiteCheck back in installments…

Many factors—cost, transparency, convenience—go into the choice consumers make between a bank and a check casher.  Atmosphere and the attitudes of the staff are only one component, but this piece of the puzzle may be more important than we thought. Like the famous TV song goes, “You want to go where everyone knows your name.” If policy efforts to move the unbanked to banks are to be successful in the long run, banks need to remember they are a service industry involved in one of society’s most important and basic relationships.

It sounds like the check cashers serve as a kind of community institution that customers can count on for social support as well as ongoing relationships. It isn’t just about the ability to access money; it also includes the flexibility to have give and take, whether that means helping someone get by when money is tight or celebrating big moments (like births) together. Many large corporations don’t offer this kind of personalization, even as they might offer cheaper prices or certain goods. And what incentive do banks have to lend money with people with lower incomes? That is not where the big money is to be made.

At the same time, it would be interesting to see an attempt to quantify just how much this customer service is worth. Does this apply to other industries as well? For example, there has been a lot of talk recently about the surge of dollar stores who offer goods cheaper than Walmart. Why might relationships matter more with financial institutions than dollar stores or fast food restaurants?

Sociologists looking at the “seamy underside” of cities

A number of media reviews of sociologist Sudhir Venkatesh’s latest book highlight his look at the “seamy underside” of New York City:

A finishing school for young minority hookers. A Harlem drug dealer determined to crack the rich white downtown market. A socialite turned madam. A tortured academic struggling to navigate vicious subcultures.

All in all, this might have made a pretty good novel. Instead it’s “Floating City,” the latest nonfiction look at the urban underbelly by self-described “rogue sociologist” Sudhir Venkatesh…

Much of what the author finds out about the seamy underside of urban life has already been discovered by predecessors as various as Emile Zola, Nathan Heard and Tom Wolfe (to say nothing of the producers of “The Wire”).

This reminded me that this is not a new approach for urban sociologists. The classic 1920s text The City from Robert Park and others in the Chicago School looks at some of the seamier sides of Chicago including boarding houses and slums. Numerous other sociologists have explored similar topics including looks at bars, drug use, and criminal activity in cities. This sort of approach works to challenge more cultured American society who can’t understand what motivates urban dwellers involved in these activities, satisfy curiosity.

While this research might help expose the plight of some urban residents, it might have another effect: limit the number of sociologists looking at elites. I remember hearing sociologist Michael Lindsay speak about this a few years ago after carrying out his research with elites. Who is closely studying elites who have both influence and resources?

More low-income students in suburban Chicago school districts

A number of suburban school districts in the Chicago area have experienced increases in the number of low-income students:

An analysis of Illinois State Report Card data for 83 school districts in the Daily Herald’s circulation area shows poverty rates rose an average of 18 percentage points from 2000 to 2012…In 2000, only East Aurora Unit District 131 and Round Lake Unit District 116 identified at least one-third of students as low-income. None of the 83 districts’ poverty rates were above 50 percent.

By last year, 23 school districts reported their low-income student populations exceeded one-third. And of those, 11 had poverty rates that topped 50 percent.The most drastic increase over that period came in West Chicago Elementary District 33, where the low-income population jumped to 76 percent from 23 percent. Superintendent Kathy Wolfe didn’t respond to requests for comment…

Eight of the top 10 districts in poverty growth are in DuPage County, where the Hispanic population rose 50 percent from 2000 to 2010, according to a 2011 report by the county’s Department of Economic Development and Planning. Over the same period, the number of county residents living in poverty doubled, U.S. Census data shows.

This is not surprising given the increase in poverty in the suburbs in recent years. Yet, it highlights two other issues:

1. Some suburban communities and organizations just don’t perceive themselves as communities where lower-income people live. Traditionally, American suburbs were places for the middle- and upper-class. And, it would be interesting to see how many wealthier Chicago suburb residents would be willing to move to suburbs that have a reputation for being more working- or lower-class. My prediction: few, particularly when articles like this highlight the challenges for suburban schools, a common selling point for suburbs.

2. These same communities and organizations haven’t always allocated or shifted resources to facing the issues that accompany poverty and lower incomes. Providing more resources for schools may be unpopular with many, both because it could mean increased taxes but also because it may mean less money for other local services.

Both of these are hurdles to overcome.

William Julius Wilson on what has changed in the 25 years since “The Truly Disadvantaged” was published

William Julius Wilson offers some thoughts on what has changed since his book The Truly Disadvantaged was published in 1987:

It doesn’t do any good to offer some people a job if their values don’t lead them to take it. That concerns Wilson, too. At the conference, he and other policy experts explored the importance of “neighborhood effects” that can undermine values and incentives to, for example, pack up and move to where jobs might be more available.

Wilson credited welfare reform and the robust economy of the 1990s with reducing underclass poverty, but noted that poverty has rebounded since 2000. The dip in the 1990s might prove to be only a “blip” in the long-term decline of concentrated poverty communities, he said.

Black prison incarceration also has increased, putting even more of a chill on black incomes, family life and marriageable men.

“Quite frankly I think that (President Barack) Obama’s programs have prevented poverty, including concentrated poverty, from rapidly rising, considering the terrible economy,” Wilson said. He included Obama’s stimulus package, the American Recovery and Reinvestment Act, which earmarked $80 billion for low-income Americans. It included such emergency benefits as an extension of unemployment benefits, a temporary increase in the earned income tax credit and additional funds for food stamps. It also offered $4 billion in job-training and workforce enhancement programs and $2 billion for neighborhood stabilization efforts, Wilson noted.

Based on what Clarence Page reports here, perhaps not a whole lot has changed? It doesn’t seem that poverty or inner-city neighborhoods have really been a major priority of any major political candidate

Kotkin: Obama coalition now about urban professionals, not blue collar workers

Joel Kotkin writes about the shift in the Democratic coalition under President Obama away from blue collar workers and toward urban professionals:

The gentrification of the Democratic Party has gone too far to be reversed in this election. After decades of fighting to win over white working- and middle-class families, Democrats under Obama have set them aside in favor of a new top-bottom coalition dominated by urban professionals—notably academics and members of the media—single women, and childless couples, along with ethnic minorities.

Rather than representing, as Chris Christie and others on the right suggest, the old, corrupt Chicago machine, Obama in fact epitomizes the city’s new political culture, as described by the University of Chicago’s Terry Nichols Clark, that greatly deemphasizes white, largely Catholic working-class voters, the self-employed, and people involved in blue-collar industries…

The traditional machine provided him with critical backing early in his political career, but Obama owes his success to new groups that have taken center stage in the increasingly liberal post-Clinton Democratic party: the urban “creative class” made up mostly of highly-educated professionals, academics, gays, single people, and childless couples. It’s a group Clark once called “the slimmer family.” Such people were barely acknowledged and even mistreated by the old machine; now they are primary players in the “the post-materialistic” party. The only holdovers from the old coalition are ethnic minorities and government workers…

Focused on the “upstairs” part of the new political culture, the administration—confident in minority support—has done very little materially to improve the long-term prospects of those “downstairs.” Minorities, in fact, have done far worse under this administration than virtually any in recent history, including that of the hapless George W. Bush. In 2012, African-American unemployment stands at the highest level in decades; 12 percent of the nation’s population, blacks account for 21 percent of the nation’s jobless. The picture is particularly dire Los Angeles and Las Vegas, where black unemployment is nearly 20%, and Detroit, where’s it’s over 25 percent.

Fascinating. If correct, this could be a boon for the powerful in big cities, people interested in big ideas and big projects and big returns, but not necessarily for those in the struggling neighborhoods. It’s too bad Kotkin doesn’t link this approach to specific policies Obama and the new Democrats have pursued – what exactly does this look like? Have the first four years provided concrete evidence that these Democrats are opposed to the suburbs, as conservatives suggest? On the other hand, we might look at the lack of policies directly aimed at the urban working and lower classes and draw conclusions from that.

I’ve suggested before that Chicago Mayor Rahm Emanuel is a pragmatic kind of Democrat in the mold of Bill Clinton, liberal but clearly pro-business and interested in things like public-private partnerships. If Obama is more interested in the “upstairs” of the Democratic Party, does he approve of Emanuel’s moves and kinds of actions?

How social class might affect a family’s view of its pet

Some sociologists have examined the relationship between people and their pets. Indeed, there is even an American Sociological Association section titled  “Animals and Society” (read their rationale here).  Here are the thoughts of two sociologists on this dynamic between pets and their owners:

Sociologist Elizabeth Terrien discovered in a study of dog owners that people from rural backgrounds view dogs more as guardians that should be kept outside. More affluent people tend to see their pets more as children and describe them in terms such as “child,” “companion” or “partner in crime.”

Terrien found that those with Latino backgrounds were more likely to use the term “protector” or “toy” to describe their pet’s role.

Carey also refers to sociologist David Blouin’s three main categories of pet owners:

Dominionists,” who view pets as useful but replaceable helpers. Many of the people in this category in Blouin’s study were immigrants from rural areas.

Humanists,” who pamper their pet much like a human child, let their pets sleep in their beds or leave money in their will.

Protectionists,” who have strong opinions about how animals should be treated and decide what they think is “best” for an animal (untying a dog tethered to a tree, for instance, or determining when a dog should be put down).

I wonder if we could map these ideas on top of Annette Lareau’s ideas about class and parenting styles in Unequal Childhoods. Lareau suggests that lower-class parents practice the accomplishment of natural growth, a more independent view of children and not encouraging children to challenge external authorities, where middle- and upper-class parents practice concerted cultivation where children are encouraged to speak up and parents give children the activities and cultural tools to get ahead. These categories seem to line up with the idea of these two sociologists: pets are more replaceable and functional for lower-class people (“dominionists”) while pets take are much closer to family members in more wealthy families (“humanists” and “protectionists”).

I also wonder if there is work comparing the treatment of children in families to treatment of pets. What might the impact of this be on children?

Additionally, it sounds like there could be some value judgment regarding which of the three approaches is most appropriate. How do “humanists” and “protectionists” view “dominionists”?