Poverty Premiums: Cost of Being Poor

Abstract

Definition "Life is more expensive than we can tolerate" Linda Tirado (2014) Poverty within a developed country is typically considered within "relative" terms. This means that people experience poverty relative to those within their society. This acknowledges that a certain standard of living is expected within developed countries, yet, simultaneously admitting that poverty persists. Moreover, within developed countries such as the UK, Australia, and New Zealand, or across North America, etc., not all experiences of poverty are shared. What is more common is the fact that being poor in a rich country is hard work; collectively and politically, society places certain expectations upon households, indicative of expected living standards. Unfortunately, however, this burden of expectation is insidious within discourses of poverty, as they normally are met through paying a premium rate for the same services than would be paid by wealthier households. Operating as a financial penalty, the poverty premium ultimately produces a form of chronic poverty, pushing poorer households further toward deprivation as they struggle to meet these expectations. More specifically, low-income households suffer extended poverty due to a systemic lack of trust and, therefore, become exploited by providers of expected services. A poverty premium recognizes, therefore, the burden of having additional costs applied to accessing services simply because you already live in poverty. Although on the surface this may seem perverse, to be in poverty in a wealthy country can be expensive.