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Homeless Man (Photo © Roman Bonnefoy)

Why poor people make bad decisions

People like to blame the poor for the situation they find themselves in. I come across this quite often, and this really shows how uninformed people still are and how simplistic they think. But fortunately a constantly growing number of people worldwide are starting to wake up to the fact that poor people alone can’t be blamed for being poor and making bad decisions; what’s more often responsible for poverty and widespread inequality is the seriously flawed system we live in that most of us, in our ignorance, still think is a good system to keep in place.

As I’ve mentioned numerous times already on this blog, the system we live in today is fundamentally hostile towards the individual. As author Albert J. Nock put it in his book “Our Enemy, The State”, this system is an “anti-social institution that is administered in the only way an anti-social institution can be administered, and by the kind of person who, in the nature of things, is best adapted to such service [a psychopath].”

This system was specifically designed so that a small elite (of psychopaths) could very easily be able to control, manipulate and enslave large masses of people. For example, inequality is fundamentally built into the system. People wonder why there’s so much inequality around the world today and fail to realize that this is because we live in a system that’s fundamentally designed around inequality. But we can’t expect people to easily realize this when we have an “education” system in place that is specifically designed to keep the masses passive, ignorant and obedient to authority, while not being able to critically think for themselves. 1 In addition, people are constantly kept in a survival mindset in an environment of artificial scarcity. If the population is kept struggling to survive every day, barely being able to provide for themselves, then they won’t have time to develop themselves intellectually and spiritually, and consequently will be powerless to rebel against the system that enslaves them. Indeed most people remain so intellectually poor that they don’t even realize that they are slaves, let alone think about getting rid of the system responsible for their enslavement.

In fact, a recent study published in the journal Science confirms the link between poverty and reduced cognitive capacity. The study shows that the poor spend so much mental energy on their financial problems and their daily struggle to satisfy their basic needs that they are left with less mental capacity to deal with other complex but important tasks. Especially their medium- and long-term thinking and planning capabilities are seriously impacted. From an article on The Guardian (PDF):

Poor people spend so much mental energy on the immediate problems of paying bills and cutting costs that they are left with less capacity to deal with other complex but important tasks, including education, training or managing their time, suggests research published on Thursday.

The cognitive deficit of being preoccupied with money problems was equivalent to a loss of 13 IQ points, losing an entire night’s sleep or being a chronic alcoholic, according to the study. The authors say this could explain why poorer people are more likely to make mistakes or bad decisions that exacerbate their financial difficulties.

Anandi Mani, a research fellow at the Centre for Competitive Advantage in the Global Economy at the University of Warwick, one of the four authors of the study, said the findings also suggest how small interventions or “nudges” at appropriate moments to help poor people access services and resources could help them break out of the poverty trap. Writing in the journal Science, Mani said previous research has found that poor people use less preventive health care, do not stick to drug regimens, are tardier and less likely to keep appointments, are less productive workers, less attentive parents, and worse managers of their finances. “The question we therefore wanted to address is, is that a cause of poverty or a consequence of poverty?”

She said the team of researchers, which included economists and psychologists in the UK and the US, wanted to test a hypothesis: “The state of worrying where your next meal is going to come from – you have uncertain income or you have more expenses than you can manage and you have to juggle all these things and constantly being pre-occupied about putting out these fires – takes up so much of your mental bandwidth, that you have less in terms of cognitive capacity to deal with things which may not be as urgent as your immediate emergency, but which are, nevertheless, important for your benefit in the medium or longer term.”

But poorer people performed much worse on the “hard” scenario – their average IQ was 13 points lower when they were thinking about serious financial troubles.

“That’s the difference in IQ between a person who is a normal adult versus a chronic alcoholic,” said Mani. “In terms of age, it’s like an average 45-year old as opposed to an average 60-year-old. In terms of sleep loss, [the immediate impact of the mall study] is like losing a full night of sleep.”

So it appears that being poor actually makes a person less intelligent — and this is apart from the fact that the current “education” system has already considerably dumbed them down to begin with.  1

The findings in the above mentioned study are consistent with what’s happening in the real world. Case in point is an article written by Linda Tirado, which was published on The Guardian (PDF) and which I highly recommend reading in its entirety to get a good understanding of what the poor have to deal with daily. In her article, Tirado discusses her experiences while living in poverty, providing a very different perspective on what the true reasons are for why the poor remain poor, and what causes them to make disastrous long term decisions:

Rest is a luxury for the rich. I get up at 6am, go to school (I have a full course load, but I only have to go to two in-person classes), then work, then I get the kids, then pick up my husband, then have half an hour to change and go to Job 2. I get home from that at around 12.30am, then I have the rest of my classes and work to tend to. I’m in bed by 3am. This isn’t every day, I have two days off a week from each of my obligations. I use that time to clean the house and soothe Mr. Martini [her partner], see the kids for longer than an hour and catch up on schoolwork.

Those nights I’m in bed by midnight, but if I go to bed too early I won’t be able to stay up the other nights because I’ll fuck my pattern up, and I drive an hour home from Job 2 so I can’t afford to be sleepy. I never get a day off from work unless I am fairly sick. It doesn’t leave you much room to think about what you are doing, only to attend to the next thing and the next. Planning isn’t in the mix.

I make a lot of poor financial decisions. None of them matter, in the long term. I will never not be poor, so what does it matter if I don’t pay a thing and a half this week instead of just one thing? It’s not like the sacrifice will result in improved circumstances; the thing holding me back isn’t that I blow five bucks at Wendy’s. It’s that now that I have proven that I am a Poor Person that is all that I am or ever will be. It is not worth it to me to live a bleak life devoid of small pleasures so that one day I can make a single large purchase. I will never have large pleasures to hold on to.

There’s a certain pull to live what bits of life you can while there’s money in your pocket, because no matter how responsible you are you will be broke in three days anyway. When you never have enough money it ceases to have meaning. I imagine having a lot of it is the same thing.

Poverty is bleak and cuts off your long-term brain. It’s why you see people with four different baby daddies instead of one. You grab a bit of connection wherever you can to survive. You have no idea how strong the pull to feel worthwhile is. It’s more basic than food. You go to these people who make you feel lovely for an hour that one time, and that’s all you get. You’re probably not compatible with them for anything long term, but right this minute they can make you feel powerful and valuable. It does not matter what will happen in a month. Whatever happens in a month is probably going to be just about as indifferent as whatever happened today or last week. None of it matters. We don’t plan long term because if we do we’ll just get our hearts broken. It’s best not to hope. You just take what you can get as you spot it.

I am not asking for sympathy. I am just trying to explain, on a human level, how it is that people make what look from the outside like awful decisions.

As Tirado’s experiences clearly show, it’s very difficult to think long term and strategically when your very survival is being threatened on a daily basis and you’re essentially constantly living in fear. This is confirmed by the brilliant stem cell biologist Dr. Bruce Lipton, who convincingly argues in his book “The Biology of Belief” that an organism that is living in survival mode will automatically allocate most available resources to fight for survival (in the short term), but as a result will find it very difficult to grow (in the long term). 2 And isn’t this exactly what the above mentioned study on the influence of poverty on a person’s mental capacity showed? Poor people spend lots of mental energy on short-term survival which leaves very little mental energy for long-term planning.

We often see poor people with lots of children and wonder why they’re apparently so stupid to make so many children while they’re already unable to adequately provide for themselves. Indeed having more children to take care of only makes their situation more difficult. But Tirado provides a good explanation for why this happens. It all comes down to survival — as she states, “grabbing a bit of connection wherever you can in order to survive.” And similarly, we can also see in the very poor countries around the world that survival is one of the primary reasons for the high birthrates there. As author Peter Diamandis shows in his book “Abundance”, “there is a direct correlation between quality of life and population growth rates — as quality increases, birth rates decrease.” 3 So as the quality of life goes down and people struggle for survival, as the case is with poverty, the birth rate also increases.

People look at the poor and their incapacity to improve their situation and are quick to blame them entirely for the situation they find themselves in, not realizing that it’s the system we live in that put them there in the first place, and that keeps them there too. In fact, Tirado mentions a few examples of how the system actually benefits from keeping people poor so that they can very easily be exploited:

One factory I lived near used to hire a revolving number of temp workers whom they laid off after 90 days – the point at which a temp worker is supposed to get permanent job status. Then after three weeks of unemployment, the plant hired them again. That factory isn’t in town any more. It had gotten a break from the local government, making its first years there tax free. And wouldn’t you know it, after the tax break expired, the company decided that the plant wasn’t profitable enough and closed it. A temporary factory that hired temporary workers. Who says capitalism isn’t cruel?

At one chain I was required to sign a contract stating that I was an at-will employee, that I would be part-time with no benefits, and that if I took another job without permission I would be subject to termination because the company expected me to be able to come in whenever they found it necessary. And yes, this is legal. So let’s break this down: you’re poor, so you desperately need whatever crappy job you can find, and the nature of that crappy job is that you can be fired at any time. Meanwhile, your hours can be cut with no notice, and there’s no obligation on the part of your employer to provide severance regardless of why, how or when they let you go. And we wonder why the poor get poorer?

I’ve discussed numerous times in other blog posts how this system is fundamentally designed to (often forcefully) transfer wealth from the poor and the middle class to the rich. It would be quite easy for the rich to offer people like Tirado a long-term job with a good salary and benefits if they wanted to. But what matters more to these people is their bottom lines. Maximizing profits is what counts — even if they have to do it at the expense of poor people like Tirado. The money that was denied to the poor — who got paid slave wages and no benefits — eventually ends up in the bank accounts of the rich where, in the words of billionaire Nick Hanauer, “it does nothing.”

The poor are also accused of being lazy and not wanting to work, but people don’t realize that it’s hard to be motivated to work when you know or sense that you’re being exploited, aren’t being valued or have very little hope that your life will improve in any significant way because you earn so little money that you’re constantly broke no matter how hard you work. As Tirado explains:

The result of all of this? I just give up caring about work. I lose the energy, the bounce, the willingness. I’ll perform as directed but no more than that. I’ve rarely had a boss who gave me any indication that he valued me more highly than my uniform – we were that interchangeable – so I don’t go out of my way for my bosses either. The problem I have isn’t just being undervalued – it’s that it feels as though people go out of their way to make sure you know how useless you are.

Another thing that’s important to take note of in Tirado’s article is that the poor are more likely to be addicted to smoking, alcohol and drugs, because it provides them with an easy way to — at least temporarily — escape their depressing circumstances:

I smoke. It’s expensive. It’s also the best option. You see, I am always, always exhausted. It’s a stimulant. When I am too tired to walk one more step, I can smoke and go for another hour. When I am enraged and beaten down and incapable of accomplishing one more thing, I can smoke and I feel a little better, just for a minute. It is the only relaxation I am allowed. It is not a good decision, but it is the only one that I have access to. It is the only thing I have found that keeps me from collapsing or exploding.

We smoke because it’s a fast, quick hit of dopamine. We eat junk because it’s cheap and it lights up the pleasure centres of our brain. And we do drugs because it’s an effective way to feel good or escape something.

And I mention this because most people, again in their ignorance, often blame things like smoking, alcohol and drug abuse for people becoming poor, when in fact it’s the other way around. People who find themselves in difficult and depressing situations, such as poverty, often look for a temporary way out by smoking, drinking alcohol or doing drugs. The solution, therefore, is not to make smoking, alcohol and drugs illegal, but to actually take care of the root problems — that is, fixing the causes of the difficult and depressing situations people find themselves in that lead them to seek an escape in smoking, alcohol and drugs. In most cases this will require fixing the seriously flawed system we live in, and most people simply don’t have the courage or insight to want to do this, so they end up fighting the symptoms instead (for example introducing legislation limiting drug use etc.).

Taking all of the above into account, it becomes clear that simply blaming the poor for being poor and for making bad decisions is wrong and completely missing the point. The truth is that there’s a much bigger underlying root problem that we have to face right now, and that is the anti-social system that we currently live in. All of us are responsible for keeping this system in place. This system was never designed with humanity’s best interests in mind and this fact is becoming increasingly more obvious as time goes by.

Trying to fix problems arising out of this system from within this system, is a futile undertaking. Like Albert Einstein said, we cannot solve our problems with the same thinking we used when we created them; in other words, to really solve the issues we’re experiencing because of this system, we’ll have to first get rid of this system entirely. It’s high time that we start to look at alternatives and one of the best I’ve seen so far is by social engineer and futurist Jacque Fresco as detailed in his books titled “The Best that Money Can’t Buy” and “Designing the Future.” As Fresco explains, when we manage to create a world where our basic human needs are unconditionally guaranteed for every single individual on this planet, then people will get out of their survival mindset and redirect most of their energy towards growth, allowing them to pursue higher goals and reach greater achievements in life.


  1. From the book “The Most Dangerous Superstition” by Larken Rose, which I highly recommend reading:

    The purported purpose of schools is to teach reading, writing, mathematics, and other academic fields of thought. But the message that institutions of “education” actually teach, far more effectively than any useful knowledge or skills, is the idea that subservience and blind obedience to “authority” are virtues.

    The “grades” the student receives, the way he is treated, the signals he is sent – written, verbal, and otherwise – all depend upon one factor: his ability and willingness to unquestioningly subvert his own desires, judgment and decisions to those of “authority.” If he does that, he is deemed “good.” If he does not, he is deemed “bad.” This method of indoctrination was not accidental. Schooling in the United States, and in fact in much of the world, was deliberately modeled after the Prussian system of “education,” which was designed with the express purpose of training people to be obedient tools of the ruling class, easy to manage and quick to unthinkingly obey, especially for military purposes. As it was explained by Johann Fichte, one of the designers of the Prussian system, the goal of this method was to “fashion” the student in such a way that he “simply cannot will otherwise” than what those in “authority” want him to will. At the time, the system was openly admitted to be a means of psychologically enslaving the general populace to the will of the ruling class. And it continues to accomplish exactly that, all over the world, including in the United States.

    And I think nobody said it better than Muammar al Qaddafi in his book “The Green Book”:

    Education, or learning, is not necessarily that routinized curriculum and those classified subjects in textbooks which youths are forced to learn during specified hours while sitting in rows of desks. This type of education now prevailing all over the world is directed against human freedom. State-controlled education, which governments boast of whenever they are able to force it on their youths, is a method of suppressing freedom. It is a compulsory obliteration of a human being’s talent, as well as a coercive directing of a human being’s choices. It is an act of dictatorship destructive of freedom because it deprives people of their free choice, creativity and brilliance. To force a human being to learn according to a set curriculum is a dictatorial act. To impose certain subjects upon people is also a dictatorial act.

    State-controlled and standardized education is, in fact, a forced stultification of the masses. All governments which set courses of education in terms of formal curricula and force people to learn those courses coerce their citizens. All methods of education prevailing in the world should be destroyed through a universal cultural revolution that frees the human mind from curricula of fanaticism which dictate a process of deliberate distortion of man’s tastes, conceptual ability and mentality.

    The video below has more details on the Prussian system of “education” mentioned above by Larken Rose. I recommend watching it.


  2. The brilliant stem cell biologist Dr. Bruce Lipton describes in chapter 6 of his book “The Biology of Belief” why an organism cannot simultaneously be in a state of growth and protection:

    By now you won’t be surprised to learn that I first became aware of how important growth and protection behaviors are in the laboratory where my observations of single cells have so often led me to insights about the multicellular human body. When I was cloning human endothelial cells, they retreated from toxins that I introduced into the culture dish, just as humans retreat from mountain lions and muggers in dark alleys. They also gravitated to nutrients, just as humans gravitate to breakfast, lunch, dinner and love. These opposing movements define the two basic cellular responses to environmental stimuli. Gravitating to a life-sustaining signal, such as nutrients, characterizes a growth response; moving away from threatening signals, such as toxins, characterizes a protection response. It must also be noted that some environmental stimuli are neutral; they provoke neither a growth nor a protection response.

    My research at Stanford showed that these growth/protection behaviors are also essential for the survival of multicellular organisms such as humans. But there is a catch to these opposing survival mechanisms that have evolved over billions of years. It turns out that the mechanisms that support growth and protection cannot operate optimally at the same time. In other words, cells cannot simultaneously move forward and backward. The human blood vessel cells I studied at Stanford exhibited one microscopic anatomy for providing nutrition and a completely different microscopic anatomy for providing a protection response. What they couldn’t do was exhibit both configurations at the same time. [Lipton, et al, 1991)

    In a response similar to that displayed by cells, humans unavoidably restrict their growth behaviors when they shift into a protective mode. If you’re running from a mountain lion, it’s not a good idea to expend energy on growth. In order to survive — that is, escape the lion — you summon all your energy for your fight or flight response. Redistributing energy reserves to fuel the protection response inevitably results in a curtailment of growth.

    In other words, living in a constant state of survival, as the case is with poverty, severely restricts a person’s capabilities to grow. ↩︎

  3. In his book “Abundance”, author Peter Diamandis discusses examples showing that a higher quality of life reduces the population growth rate:

    Our days of isolation are behind us. In today’s world, what happens “over there” impacts “over here.” Pandemics do not respect borders, terrorist organizations operate on a global scale, and overpopulation is everybody’s problem. What’s the best way to solve these issues? Raise global standards of living. Research shows that the wealthier, more educated, and healthier a nation, the less violence and civil unrest among its populace, and the less likely that unrest will spread across its borders. As such, stable governments are better prepared to stop an infectious disease outbreak before it becomes a global pandemic. And, as a bonus, there is a direct correlation between quality of life and population growth rates—as quality increases, birth rates decrease. The point is this: In today’s hyperlinked world, solving problems anywhere, solves problems everywhere.

    Homo sapiens has been on the planet for roughly 150,000 years, yet until 1900, there was only one country in the world with an infant mortality rate below 10 percent. Since children take care of their parents later in life, in places where a lot of children die, by having a large family, parents are ensuring themselves a more comfortable old age. The good news is the inverse is also true. As Microsoft cofounder Bill Gates pointed out in his recent talk on the subject: “The key thing you can do to reduce population growth is actually improve health. … [T]here is a perfect correlation, as you improve health, within half a generation, the population growth rate goes down.”

    And the reason Gates knows this is because he’s seen a plethora of population data that has been gathered over the last forty years. Morocco, for example, is now a young nation. Over half the population is under the age of twenty-five; almost one-third is under fifteen. Having this many kids around is a fairly recent historical development, but not for lack of trying. Back in 1971, when child mortality rates were high and average life-expectancy rates were low, Moroccan women had an average of 7.8 children. But after making great strides in improving water, sanitation, health care, and women’s rights, these days, Morocco’s baby boom is winding down. The average number of births per woman is now 2.7, while the population growth rate has dipped below 1.6 percent—and all because people are living longer, healthier, freer lives.

    John Oldfield, managing director of the WASH Advocacy Initiative, which is dedicated to solving global water challenges, explains it this way: “The best way to control population is through increasing child survival, educating girls, and making knowledge about and availability of birth control ubiquitous. By far the most important of these is increasing child survival. In communities where childhood death rates hover near one-third, most parents opt to significantly overshoot their desired family size. They will have replacement births, insurance births, lottery births—and the population soars. It’s counterintuitive, but eradicating smallpox and vaccine-preventable disease and stopping diarrheal diseases and malaria are the best family planning programs yet devised. More disease, especially affecting the poor, will raise infant and child mortality which, in turn, will raise the birth rate. With fewer childhood deaths, you get lower fertility rates—it’s really that straightforward.”

    This shows that poverty actually causes people to have more children for a number of reasons, all relating to a poor quality of life and attempts at increasing their chances for survival. ↩︎

Additional Notes


  1. Karel Donk's Blog » Statism: A System for your Enslavement (09/02/2015)
  2. Karel Donk's Blog » Statisme: Een Systeem voor jouw Slavernij (14/02/2016)
  3. Giving Apartments to Homeless People — Karel Donk (10/11/2019)


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