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Poverty-Fighting Startups (fastcompany.com)
170 points by rmason 11 months ago | hide | past | web | favorite | 133 comments

Fighting poverty is a social and political problem. It is simply a question of will. We have enough wealth on earth to provide food, clothing, and housing to every single human being. Why don't we do it? That's a political question. The technology is trivial.

>“One of my ambitions is to help our users put more food on the table,” says Jimmy Chen, the founder of Propel. His company makes a mobile app called FreshEBT that helps people among the U.S.’s 43 million recipients of the electronic benefit transfer (EBT) service to stretch their food-stamp benefits as far as possible.

I read "we're here to somehow insert fees between you and your food stamp money". The self delusion of these people is incredible.

>Fighting poverty is a social and political problem. It is simply a question of will. We have enough wealth on earth to provide food, clothing, and housing to every single human being. Why don't we do it? That's a political question. The technology is trivial.

Because there is a huge and complex domain of human motivation, appreciation for hard-earned things vs. taking them for granted and so on. USSR tried doing exactly that with the planned economy and trying to distribute the wealth more or less evenly and failed miserably. Mostly because people lost motivation for achievement and started blatantly faking numbers and statistics since the connection between the results of their work and their life quality was completely lost. As someone who survived that crash, I would really hope that SV can learn from others' mistakes rather than repeating them.

> USSR tried doing exactly that with the planned economy and trying to distribute the wealth more or less evenly and failed miserably.

Actually if you look at where they started and where they got, they did a pretty good job in raising the very poorest our of poverty, electrifying the country, and really eliminating a lot of the abject poverty that was most of the country at the time of the revolution. Changes that the former (imperial) regime seemed uninterested in making.

Even into the 1950s and even 1960s quite a lot of people, including a surprisingly large amount of US government officials, thought that there was a chance the USSR could surpass the USA. I think such people were delusional, since the signs were pretty clear at the time (I was a child at that time, but I did study the USSR in the 1980s when it was very obviously not a threat to the west).

Don't get me wrong: the USSR was founded by a bunch of bloodthirsty assholes (Lenin, Stalin, Trotsky et al) and, for various reasons developed into a, yes, evil system. I don't blame it entirely on the people involved -- I think anyone who tries to follow that model, even with good intensions (and it's not clear the Bolsheviks had good intentions) is going to end up with a shitty result.

But dispassionately one thing they did accomplish was the thing you said they failed miserably at. And it's unlikely the Menshevik republicans would have pulled that off.

>Actually if you look at where they started and where they got, they did a pretty good job in raising the very poorest our of poverty, electrifying the country, and really eliminating a lot of the abject poverty that was most of the country at the time of the revolution.

That's the funny part about it. USSR was basically an engineered society with eliminated "overhead" of debating, negotiating, marketing, private risk-taking, etc. It worked extremely well while the goals to achieve were basic and everyone agreed on them. If you're living in a glorified mud hut in the 20th century, it's a no-brainer that the goal #1 is to build industry, powerlines, etc.

Except once the common needs were satisfied, the system ran into stagnation. How this would be resolved in the West is a risk-taking individual starting a company, organically growing it into a bigger business, eventually creating workplaces, and in some cases - entire industries. Planned economy can't have that - the only way to create something new would be through getting state funding, i.e. being in good terms with the inner party circle. It's the same reason why big corporations often can't quickly adapt to changes lose to lean startups despite unimaginable resources available to them. Except when your entire country is one inefficient corporation, you're really fucked.

IMO, Russia is still greatly suffering from the lack of the "overhead" removed by the USSR. The majority of people expect someone else to plan and decide for them, they don't get the concept of watching for your own interests, they alienate and despise hustling and blame others for their misfortune. I really hope that's not the way U.S. is heading, because I'm not sure there is an easy way out of this kind of a trap.

> Except once the common needs were satisfied, the system ran into stagnation.

You are vastly understating the magnitude of the USSR's problems.

https://en.m.wikipedia.org/wiki/Russian_famine_of_1921–22 https://en.m.wikipedia.org/wiki/Soviet_famine_of_1932–33 https://en.m.wikipedia.org/wiki/Holodomor https://en.m.wikipedia.org/wiki/Soviet_famine_of_1946–47

If you make the argument the USSR removed that overhead, it might be good to keep in mind, the tsars and the kosacks where busy removing it long before.


Tsar Russia was a very centralised society. A large portion of the population were not allowed to make any decisions for themselves, because they were slaves.

Another large portion were peasants, but they reported to a master.

And the Tsar himself was bogged down in decision making about minutiae to the degree that he had little time for strategic thinking.

I don't understand why you say "it's unlikely the Menshevik republicans would have pulled that off". It's what "Menshevik republicans" i.e. social democrats were doing in much of Western Europe (together with other democratic parties), and look at the results and compare them to what USSR ended up by 1991.

Of course, starting from 1917, it was not that hard to achieve progress, because the starting point was so low. NEP (the New Economic Policy of 1920's) was very efficient - but it was unorthodox in Stalin's theories, so a lot of people ended up dead or in the camps.

It puzzles me why socialists all over the world last year celebrated the October revolution (start of a new tyranny) but not the February revolution (end of old tyranny). I suppose it is because of romantic sentiments, and not knowing what actually happened.

They were successful by the late 30s (after lots of misery), but the Russian economy had been growing for a long time. I'm not sure the imperials or republicans couldn't have pulled it off, Russia had lots of natural advantages, especially after winning WW2.


    Country 	1890 	1900 	1913 	1925 	1938
    Russia/USSR 21 180 	32 000 	52 420 	32 600 	75 964
    Germany 	26 454 	35 800 	49 760 	45 002 	77 178
    Britain 	29 441 	36 273 	44 074 	43 700 	56 103
    France 	19 758 	23 500 	27 401 	36 262 	39 284
They went from the second smallest economy in 1890 to the biggest in 1913 (imperials). The economy crashed after the revolution and bad economic experiments and then rebounded. Russia was late to the industrial revolution so a lot of that growth was just it kicking in, along with the Soviets removing anyone that got in the way. Hard to say how much can be attributed to either.

They were holding their own late into WWI and actually had an agreement to obtain Istanbul, which the Bolsheviks revoked (hard to fault them) along with all that they gave up in the separate treaty with the Germans. Imagine them sticking it out to 1918 with gains from being on the allies and the revolution averted. They would have been as well positioned as anyone in Europe.

> Russia had lots of natural advantages, especially after winning WW2

What? How is having all your industrial infrastructure destroyed and 20 million of young, able-bodied males killed an advantage?

I believe GP is referring to natural resources (oil, gas, etc...) rather than the human cost of war.

> They went from the second smallest economy in 1890 to the biggest in 1913 (imperials).

What does it matter, if 90% of the population lived in near complete destitution?

  The economy crashed after the revolution 
The loss of the war with Japan didn't help, either.


I can’t find any evidence that there was any economic significance to that war aside from loss of the fleet and human life. Bruised imperial egos for sure and likely contributing to an image of a week government, but I’m hard pressed to see how it could have had any impact on the industrial output of the country.

You could surely say that the war with Japan didn't help.

Well-known events like the Potemkin mutiny may be dismissed as not impacting industrial output, but there was a large-scale general strike which actually lead to "1905 revolution" [0]. The loss to Japan was of course only a partial factor, with bigger contributor being the overall economic downturn of early 1900's.

There were some direct impacts from this revolution. There was large-scale unrest in Kingdom of Poland (the Russian-held part of partitioned Poland). Finland (then a Grand Duchy in the Russian empire) abolished Diet of Finland in favour of a new Parliament of Finland, with universal suffrage for both men and women. And in mainland Russia, the absolute monarchy was abolished in favour of a parliamentary monarchy.

However, this was too late for the Russian empire to recover.

[0] https://en.wikipedia.org/wiki/1905_Russian_Revolution

Sergei witte basically saved Russia’s ass in the peace negotiations. He was one of at least two very good ministers fired by the tsar in a time when Russia really needed one.

> Actually if you look at where they started and where they got, they did a pretty good job in raising the very poorest our of poverty

Depends on in what column you put the ~10% of the population they murdered.

I would think of them as "not raised out of poverty".

I believe America had it's own similar human liquidation program leading up to industrialization as well.

I presume you're referring to the ab original inhabitants? Sadly, quite effective.

That was pre-industrialization, though, and mostly due to things like smallpox for which indigenous population had no resistance, even before actual immigration from Europe.


90% of the pre-Columbian population was already wiped out long before Jeffery Amhurst may or may not have tried doing that. Regurgitating trite myths and legends is not particularly helpful in increasing knowledge.

Is SouthPark considered a citable source?


Citation needed. The estimate of pre-Columbian population itself is highly debated, I fail to see how you can so confidently state a number that must be derived from that estimate.

In any case - whether the pre-Columbian population in North America was 2 M or 20 M - the proportion of indigenous population killed by "America", (meaning United States of America) is certainly at most a few percent. Most of indigenous peoples of America lived in Central and South America, and most of the perished cultures of North America (e.g. Mississippian mound cultures) were gone long before founding of United States, and before major English immigration.

The cultures weren't gone. There were still mound building cultures active in the South when Spaniards arrived. Disease most likely played a large factor but to a certain extent it is a mystery. The American policies ensured that there cultures were nearly wiped from the planet. There was no chance for a rebound of population because of the constant disruption due to displacement and forced migration. This is without the warfare which wasn't the primary source of devastation although it was quite brutal at times. There were a large number of promises of land that were never honored. Look at the Wyandotte's removal from Ohio, they were promised 175,000 acres of land in the West but received nothing of the sort once they gave up their last remaining homestead. They had to find a spot to stay with a fellow tribe. This is all documented and the removal of the American Indian was and remains a real injustice and the impacts are still being felt.

It's a well established fact that 80-90% of the pre-Columbian population died from European infectious diseases, often before seeing a single European, since the diseases travelled faster than the people.

This was centuries before the germ theory of disease became mainstream in the late 1800s, and no one on either side had a clear understanding of what was going on.

Divine intervention was probably the most common theory.

Like I said, citation needed. There are still countries in the Americas with either majority or very significant indigenous populations. Were they immune somehow?

No, they had a much larger population to begin with. Life was very hard in North America before arrival of European technology and crops, and populations were small.

These are basic historical facts you can easily look up yourself.

The 90% dieouts happened several centuries ago. That's plenty of time to repopulate.

I fail to see what the ugly part of the American past has to do with the current thread. Your comment feels a lot like Whataboutism[0] to me.

0: https://en.wikipedia.org/wiki/Whataboutism

Can someone explain to me the downvotes?

I can only derive from them that someone thinks that what I wrote is wrong. Maybe I am missing something and I just do not know.

It appears a number of people use downvote to mean "I disagree". I suppose they think HN is Facebook.

Also of course some people use it correctly, which confounds the data.

its own

  they did a pretty good job in raising the very poorest our of poverty
Those who weren't outright killed during or in the wake of the revolution and pogroms, anyway. But many who DID survive did so only because of famine relief from the USA and Europe as farm collectivization went sideways.


Pogroms were definitely not a Soviet phenomenon. Many of the party leaders were Jewish. In that article, it shows that since 1947 no famines. I think the original post is making the argument that they started making progress later. 1950-1970 they really did make progress in almost every concretely measurable thing. USSR went tits up in the way that maybe a chilled out company (albeit with a weird corporate culture) would not compete well against a sweatshop with a culture of work hard, make money. The latter would just have more output, innovate quicker and maybe make a better product. But maybe also be better at cutting corners, or marketing or growing for the sake of growth like a cancer. I’m all over the place bc it’s a huge topic, but there is a reason why a lot of people miss the Soviet Union - and it’s not only because it was their youth.

Pogrom, meaning specifically persecution of Jewish communities, was not a Soviet phenomenon. Otherwise, there were a number of ethnic persecution campaigns in the USSR, with the Holodomor being the largest, but there were also many others. There were lots of people killed.

eh, You can have a very strong welfare state that provides minimal food, shelter, medical care and clothing to everyone who needs it without having a planned economy. They really are different issues.

there's a big difference between a welfare state and full out socialism; the difference is largely about power... Socialisim is about giving the workers control over the means of production. The welfare state is merely about seeing to it that people don't starve.

We're rich enough, in America, at least, that with tax increases, we could provide the minimum for everyone, and pay for it out of the sorts of taxes we pay now (only, of couse, somewhat more)

There was a lot of effort in that direction here and in the UK in the '70s; there was a lot of criticism that the public housing, for instance, wasn't very nice, but what really ended it was the rise of the political movement that backed Thatcher (in the UK) and Reagan (in the US)

I like your reasoning, and I agree that we need more effort toward social programs that provide basic needs for the population.

One argument against such programs is that they could allow people to have a lifestyle where they choose to never work, yet live a comfortable life and have lots of children. It seems like this could cause extreme population growth, but in a very bad way. Am I missing something, or is there a solution to address that problem?

Your logic assumes that most people are so shallow that they would stop working/trying to improve their conditions after they are able to live “comfortably”. There are several wealthy countries that provide this kind of welfare without much population growth or lazy workforce. On the other hand there are counties like Bangladesh that saw rapid growth in population in the 80s even though most people were very very poor - in fact the country’s pouplation growth has demolished now that more people can live comfortably due to increased wealth and access to education.

1) Higher income is already associated with lower fertility. Only people who are already pretty rich decide that they’re not rich enough to procreate.

2) If the market honestly has nothing for someone to do (or it’s of such low value that it falls below minimum wage), is it really a tragedy if they don’t work?

It is if they fill their time with making babies and this results in catastrophic population growth.

As you must be aware, population growth comes from high family size which in turn comes from the need to ensure one's support at old age.

In extremely poor societies, where there are no pensions or social security for the old, the best way to make sure you have food and shelter when you're too old to work is to have many children.

And maybe in a society where everything is provided for you, the easiest way to find fulfillment is through having lots of kids to raise?

If you actually want to do a good job raising those kids, it certainly isn't the easiest way to find fulfillment...

But of course, in societies where you (can choose to have) everything (basic) provided for you, there are indeed some who have many kids but don't bother to actually raise them. This is how underclass is created.

There's a huge gap between the current situation and a system where people on welfare who choose not to work are able to live "comfortably" in perpetuity.

Somewhere within that gap is a decent system where poor people don't starve but are still incentivized to improve their situation.

I also don't really see how having children relates to any of this.

On the other hand, automation will probably force us into a welfare state one way or another.

>One argument against such programs is that they could allow people to have a lifestyle where they choose to never work, yet live a comfortable life and have lots of children. It seems like this could cause extreme population growth, but in a very bad way. Am I missing something, or is there a solution to address that problem?

So, I'm talking largely about rich nations like the USA. Here? it has been a long time since the population was restricted by food, so we can neatly sidestep that problem without resorting to Swift.

I do think it's important to design welfare programs to aid people who are leaving poverty. I personally don't think this should be done by cutting off the support if they don't work... But I do think programs like the Earned Income Tax Credit which help smooth the transition from being dependent on welfare to supporting yourself are super important...

(And I think the Earned Income Tax Credit is generally considered a good model of this; the idea is that instead of cutting out benefits as soon as a person gets a job, the government continues to supplement the income until they are doing well.

a basic income that everyone gets addresses a similar problem, and a basic income + a strongly progressive income tax could probably do something similar.

Our current social welfare programs actively discourage people from saving money to get out of poverty. If you have more than 2,000$ in your bank account you are disqualified from reviving EBT in many states. So people either have to save and hide or lie about their money or get cut off the second their able to build their own safety net. Predatory lending and an inability to plan beyond their immediate survival also incentives what could be considered bad financial decisions. While start ups might in theory help buffer some of the negatives what objectively is needed is opportunities and examples of alternative means of livelihoods. People don't generally sit around and have babies because they don't have anything better to do, although I'm sure sex out of boredom does result in some unplanned pregnancies.

In 2016, 4.9 percent of U.S. households (6.1 million households) had very low food security, essentially unchanged from 5.0 percent in 2015. In this more severe range of food insecurity, the food intake of some household members was reduced and normal eating patterns were disrupted at times during the year due to limited resources. [1]

[1] https://www.ers.usda.gov/webdocs/publications/84973/err-237....

millions of teenagers get part time jobs despite not needing it to live.

The corollary to "if X has what they need to live they won't work" is "the only reason X works is to not die".

While on a high level it can feel that way, especially at the lower rungs of society (where people get the worst kind of jobs). But ultimately humans have a lot of motivations for doing things.

Unfortunately many people cannot act on these motivations because they are too busy trying not to starve/get evicted/die from illness. A world where no one has to worry about these is something we could all work towards.

I suspect the real argument anti-welfare people want to make, but are too cowardly to state explicitely, is: "if the poor weren't forced to accept shitty jobs to survive, we would have to pay them fair wages and/or improve working conditions, which would reduce the wealth going into our pockets."

Your assumption is that population growth is a bad thing. But why?

Of course the earth only has finite resources, but with our level of technology it is entirely feasible to sustain billions more people. The growth and progress of humanity is dependent on ever increasing available intellect to solve the worlds problems. If we ever want build massive civilizations spanning the solar system, it’s going to take trillions of humans. I’d rather believe in that kind of future than a stagnant “garden of eden” earth where we self limit our own progress.

The leap you're making, that I don't understand, is that if people didn't have to work, they'd start having huge families en masse.

Why do you think that would happen? Is there any basis for having that concern?

Sex is fun, it’s free, and procreation is a biologically driven part of being human.

The argument is that if we give people a basic sustainable way to live and the least motivated to improve their condition will likely fall back to the basics.

Children are annoying, though. I doubt most people would start having huge families if they can easily prevent it while still having sex.

Socialism is state (in some sense the public if it is also a democracy) owning the means of production. Capitalism is private ownership of the means of production. Workers owning the means of production is syndicalism.

I think I agree that you are more correct, especially as I specifically said 'workers' and not 'people' - syndicalism, as I understand it, is mostly about the workers in a particular industry (or factory) controlling said industry (or factory) however, it doesn't really change my point;

Either way, socialism is about control of the means of production, and my point is that you can have a welfare state without changing the control of the means of production, as long as you have a means of significant taxation, which we have in place in the US already.

Wikipedia page on socialism: "Social ownership may refer to forms of public, collective or cooperative ownership, or to citizen ownership of equity."

An additional problem is one of economic calculation. Mises argued one hundred years ago that a planned economy where the state owns the means of production and arbitrarily sets prices without an open market to determine prices by supply and demand would result in economic waste and shortages. He was largely proven right by the disastrous Soviet experience.


In a capitalist system, a zero sum game in which titans buy ads to pull marketshare back and forth between each other creates value, yet feeding a starving person does not.

That's a ridiculous statement, of course, but it demonstrates that the economic notion of value can diverge wildly from most other reasonable notions of value. The seemingly inoffensive "economic value = value" approximation is actually a trojan horse used by libertarians to sneak the more objectionable aspects of their theories past casual observers and put a tautological halo over markets and their preferences.

It's a point worth keeping in mind when considering complaints that X system doesn't optimize economic value.

While he might have been right one hundred years ago, the economic calculation problem might not be a problem anymore. We're starting to get to the point where we have enough computing power to simulate the world economy. Everyone also now has a way to communicate their needs instantly to a computer. Compared to what could be achieved with todays technology, the price mechanism is inaccurate and slow.

> "Everyone also now has a way to communicate their needs instantly to a computer. Compared to what could be achieved with todays technology, the price mechanism is inaccurate and slow."

The price mechanism means that people have to make trade offs, and for anyone living outside of poverty, that's often a good thing.

To use a simple example, if you're a gamer you may want both a PS4 and an Xbox One, but if you only have the money to buy one, you have to choose which one you'd rather have. If you remove the price mechanism you've absolved the individual from making that choice, and you'll get greater demands for material goods as a result.

Of course you'd have to somehow set limits on consumption in any system where resources are limited. The price mechanism isn't the only way to do that. You could for example have only one game system to begin with so there's no reason to own two. Or you could have public "libraries" for things like gaming systems where you could borrow anything you need, reducing the need to own things.

Resources should be allocated where they are needed the most. The price mechanism doesn't do that. If you don't have any money, a system based on the price mechanism doesn't know you exist no matter how great your need.

> "Of course you'd have to somehow set limits on consumption in any system where resources are limited. The price mechanism isn't the only way to do that. You could for example have only one game system to begin with so there's no reason to own two. Or you could have public "libraries" for things like gaming systems where you could borrow anything you need, reducing the need to own things."

Okay, but putting aside shared ownership and artificially limiting choice, how do you set limits on consumption?

Let's use a different example. Someone owns a car that they maintain themselves. Their car breaks down, but instead of requesting a new part to fix it they request a new car. How does the government choose which is the appropriate action to take? Before you answer, consider that this is just one decision out of millions that a government would have to make within the space of a month.

If we know exactly how much resources we have, how much resources we usually spend on things and we ask people what's most important to them now and in the near future, we can calculate the allocation of resources that does the best job of satisfying peoples needs.

If a lot of people think new cars are important, then a computer can allocate a lot of resources into making new cars. This would of course mean we'd have less resources for everything else and peoples needs start changing as a result. If you can easily get a new car but notice that the quality of healthcare is decreasing, the next time the system asks your opinion on resource allocation you vote for more healthcare.

So in your example I guess there would be a democratically decided amount of resources dedicated to making new cars. If that amount is high, the computer would probably give him a new car as soon as one was available. If it's low, society would be fixing and sharing cars and using the freed resources on more important things.

So in other words, you've replaced money with votes. Will everyone have an equal number of votes? Do parents get more votes as they have children to support? Do the votes of locals have greater weight than the votes of people from outside a region where a proposed change is due to take place? How do people stay informed about all the votes they should be participating in? If someone wants to opt out of your proposed society, can they do so and still retain material resources?

I didn't mean people would buy things with votes. People could just keep a list of things they need in order of importance and the system would only use those lists to calculate the optimal allocation of resources, for example.

We'd need to test what works best. I don't have the details of such a system because it doesn't exist. All I'm trying to say is that we could come up with other ways to allocate resources than the price mechanism with our current level of technology. What I just came up with is just one way you might go about doing it, I'm sure we could figure out a working system. Of course such a system would have it's own faults, but I believe we could come up with something better than the current system, where the "needs" of a billionaire are more important than the needs of a million people in poverty.

I'm sure your heart is in the right place, and I admire your optimism, but I just don't think what you're suggesting will be a society I'd want to live in.

The thing is, I used to think along similar limes to you. When I was in my 20s I saw the Zeitgeist films and found the ideas behind the resource-based economy to be compelling. A way to meet everyone's needs without relying on money. However, as time went on and I thought more about what living in such a society would be like, I saw that it wasn't the answer I was looking for.

To give you some idea of what changed my mind, I'd suggest we look at variety. As the phrase goes, variety is the spice of life. Centrally planned economies, whether resource-based or otherwise, would see variety as inefficient and attempt to cut down on variety. You gave an example of it earlier when I asked about the PS4 and Xbox One. Whilst it's true we don't "need" variety, it is something we collectively want.

For all its flaws, money gives people the chance to make choices based on what's best for them, with far fewer restrictions on what's possible. These days, I'd much rather see something along the lines of universal basic income than a resource-based economy, though I recognise UBI has its flaws too.

Variety in life can come in many forms. The difference between different brands of products isn't that great. You get more spice for life from trying completely different things instead of different variations of the same thing. The PS4 and Xbox One have basically zero difference, the only difference they have is the artificial difference of exclusive games. How much better could the PS4 be if the resources used for the creation of the Xbox were instead used to improve PS4?

Sometimes too much choice can even be a bad thing. https://www.theguardian.com/lifeandstyle/2015/oct/21/choice-...

I believe people would quickly get used to less variety. But if variety isn't just a product of a system based on competition and people really desire it, there are no rules against it in a planned economy based on direct democracy. People could suggest and vote for different types of the same thing if they feel there's a need for such a thing.

money gives people the chance to make choices based on what's best for them, with far fewer restrictions on what's possible.

Most people have quite large restrictions on what they can choose due to the amount of money they have. Sure if you're wealthy enough you probably have more choice in the current system, but for the majority of people I believe a planned economy would increase the amount options they have in their lives.

> "would result in economic waste and shortages"

Capitalism frequently also results in economic waste and artificial shortages, it's not like communism has the monopoly on that.

> people lost motivation for achievement (...) since the connection between the results of their work and their life quality was completely lost.

But this is the case for lots of people with a fixed salary.

And you think American capitalism provides "gratification" in being a corporate drone in middle management ticking checkboxes for your next paycheck? I'd gain much more happiness in seeing equality of all people around me, knowing my hard work benefits all, than feeding dividend-sucking corporate greed.

> Why don't we do it?

Define "we". World-wide, "we" are doing an absolutely amazing job of eliminating poverty.



Also, most industrialized economies don't really have absolute poverty: anyone who is poor has the right to social benefits to alleviate it, to provide the basics of food, clothing and housing (as well as other basics such as education).

So for example, in Germany, we talk about poverty being on the increase. But that is relative poverty, meaning a certain percentage of the average. So we can "increase" poverty by simply improving GDP w/o raising the bottom as much as the increase in GDP.

> I read "we're here to somehow insert fees between you and your food stamp money". The self delusion of these people is incredible.

There’s already an enormous number of fees. Check out midway through [1] where it lists out the various fees JP Morgan got in their 2014 EBT management contract with New York State (it was the first example I came across, there may be a newer contract publicly available).

The federal portion alone (there’s a state-level component as well) of the cost to administer EBT services in 2017 were $4.2 billion [2], so there’s plenty of fees between recipients and food stamp money already.

That said, iirc it’s illegal for a third party to insert a fee related to EBT services. In fact, most of the fees that are charged aren’t directly visible to the recipient, but are rather charged on the backend as part of the administration costs.

Looking at the screenshots for the FreshEBT app, there’s a coupon section and the ability to find stores that accept SNAP benefits. It’s more likely that they’ll monetize via retailers and manufacturer promotions rather than via recipients themselves. Plus the marketing analytics components of being able to track EBT spending habits and tie it into all the other type of data you can collect by having an app installed on people’s phones. Not that there isn’t potential qualms about that monetization strategy, but that type of data is already available to the largest retailers and isn’t a new level of monitoring. And it shows the company’s incentive isn’t actively detrimental or predatory to the users like inserting fees, as you suggested.

[1] http://prospect.org/article/how-big-banks-are-cashing-food-s...

[2] https://fns-prod.azureedge.net/sites/default/files/pd/SNAPsu...

Having worked in nonprofits for years, I have truly learned the hard lesson about how hard it is to raise funds for altruistic endeavors! It's so much easier to raise funds from someone who expects a return to their life in one form or another.

We have the wealth on earth, yes, but fundamentally people are selfish. I think this behavior is largely driven by fear of losing everything, even for those most privileged.

> "We have the wealth on earth, yes, but fundamentally people are selfish. I think this behavior is largely driven by fear of losing everything, even for those most privileged."

I think it's a little more complex than that. Something that still doesn't seem to be well understood in the non-profit field is that of dependency.

The idea "give a man a fish and you feed him for a day; teach a man to fish and you feed him for a lifetime" should be the guiding principal of pretty much all non-profits (with the only exception, in my opinion, being for disaster relief). The idea being that the end goal is self-sufficiency.

I'm not a millionaire, nor am I likely to become one in my lifetime, but I recognise my own patterns of donating to charity, and I can see the charity/non-profits that I'm most likely to donate to are either involved with disaster relief, or are doing something that makes a lasting change. When I've donated to charities outside these groups, I've resented the expected "thank you for your donation, can you donate any more please". At that point, the charity has become, in a small way, dependent on my generosity, with no end in sight. I'd imagine there's similar resentment for millionaires and billionaires also.

Fundamentally, I do think that focusing on the technology end of the problem, making solving the problem cheaper, is a totally valid way to try to help, especially if you are better at technology than politics.

But I toatally agree that for-profit companies have incentives that can become problematic when their customer base doesn't have anywhere else to turn.

> I read "we're here to somehow insert fees between you and your food stamp money"

You need to read the article more carefully, it says "But FreshEBT isn't a typical Silicon Valley product."

I have several objections to your argument, many of which others have covered, including the actual lack of user fees. But even at the most basic level your argument doesn't make any sense. Technology enables more efficient service delivery, which means we can do more with the same budget. Budgets are constrained by politics, which as you say is probably morally wrong and an inadequate response. Yet we can change the technology more easily than the politics. Or, at least the people who choose to contribute with technology can do so more easily than they can completely transform the US political discourse. Plus, even if the politics change, more efficient services will continue to benefit society by reducing the total costs. Don't let the perfect be the enemy of the good.

> We have enough wealth on earth to provide food, clothing, and housing to every single human being.

That's like saying nobody should ever be without water because of rain. There's more wealth than what's needed to provide necessities but it isn't located everywhere its needed and getting it there is often virtually impossible.

Well it turns out that this political problem is extremely hard to solve.

Because of that, other people are working on technological problems.

The cheaper it is to feed people, from a technological standpoint, the easier it is to solve the political problem.

I would say that in principle we don't do it because at some level we probably do actually believe in the doctrine of self determination at the level of states. This is directly at odds with the notion that rich countries should be trying to provide infrastructure and food for the worlds poorest. Of course this argument doesn't hold up within a single country, so the question of why entrenched poverty remains an issue throughout the United States is indeed a political one where there is no excuse.

Why should rich countries be trying to provide infrastructure and food for the world's poorest? Far as I know, the original reason for doing so was to create strong and loyal trading partners. That doesn't seem to have happened though. Is that no longer the end goal?

At the state level it is still true in some cases. China is dumping loads of less-strings-attached (than the international development fund) cash into the developing world, and one argument is that they are developing new markets for their goods. A more sinister twist would be that they are laying the infrastructure for future all-Chinese enclaves in those countries.

On the other hand the US's failed state building exercises in the middle east is an example of the complete opposite. The US was/is literally burning money in an attempt to 'improve' another country. None of the nonsense about 'went for the oil' makes any sense when you look at the total cost, the destruction of a potential trading partner, etc. It is the 'oh no he is killing his own people/keeping his own people in poverty/pillaging his country for personal gain' type of mentality that enables the kind of self determination rejecting behavior that the US has been engaged in for a very long time. There are things that we can and should do to prevent atrocity, but we have consistently failed to strike a balance with helping states develop and have instead repeatedly opted to overthrow governments and destabilize regions, often in the name of improving the lives of their citizens. (Just look at the humanitarian disaster that has been the Arab Spring.)

It hasn't happened probably because most of the aid to us in developing countries go to treating the symptoms of our real problems. Also aid business is a huge business for Western NGOs and most of the money find their way back to the west anyway. The positive I can see is that aid buys a lot of influence in a much cheaper way than war.

Relative poverty is a social and political problem but reductions in absolute poverty such as having enough to eat have been to a large extent driven by science and technology.

will and education, you can teach people how to make electricity, how to make solar concentrator, how to isolate from cold, etc

basically how to unplug yourself from the economy to restore foundations to survive better when you're on the border of the system

Why do we do it? We need poor as an example to keep working and middle class motivated.

What's your plan for dealing with Orthodox Judaism or Quiverful or other ideological/religious sects that believe that having as many children possible as quickly as possible is God's will?

Exponentially increasing cost is a problem for the most technocratic plans you can imagine. And in a democratic society not only will groups that have tons of children grow rapidly, they will also increase their share of the voting power at the same rate.

What's the problem? As long as those kids grow up to be roughly as successful as the national average, they'll be paying back into the system and everything works as intended.

Also, Orthodox Jews have been around for a long, long time and are still a small minority almost everywhere. Small ideological sects with large families historically don't seem to take over the world.

>Small ideological sects with large families historically don't seem to take over the world.

It only seems that way because pre-1960, the world was entirely dominated by sects (e.g. religions) with large families. All the old religions are very traditionally pro-natalist for a reason. Go forth and multiply!

If the population didn't grow, it was only because there was just no more food to feed more mouths. So it was for all of human history until recently.

It's only now that there is a significant group of people who choose not to have large families, and who have the birth control technology to make it happen. As with past sects who followed this path, they will dwindle as a proportion of the population. We are in nothing like a steady state, and high-fertility groups absolutely will own the future, just as they owned the past.

Topical here is The Most Important Graph In The World:


Governments shouldn't take care of people. People should take care of people. (Over course, we should take care of ourselves first but that doesn't always work out.)

Strange, is the government somehow not made up of people?

This line of reasoning is so strange, like government is some sort of alien being, not an institution of the people, for the people.

Taxes are how you buy civilization. Voting is how you decide what sort of civilization you want.

I read "Civil Disobedience" by Henry David Thoreau[0] in my early twenties and have been miserable ever since.

"I heartily accept the motto, 'That government is best which governs least' ... But, to speak practically and as a citizen, unlike those who call themselves no-government men, I ask for, not at once no government, but at once a better government."

[0] http://xroads.virginia.edu/~hyper2/thoreau/civil.html

People taking care of people on an individual basis doesn't scale up very well.

Its important to know that you don't need millions of dollars to help people and do good. My salary was 145k with it I started a non profit that pays low-income earners minimum wage while they learn how to code. These people could really benefit from learning how to problem solve but they don't have the luxury to quit and join a bootcamp. With my salary, I was able to help 3 people at first but now (after getting a new job and selling my vested stocks) we are able to support 13 students.

When I visited CalWorks (local government assistance program) to see if they could help my project financially, they were really excited and agreed to refer students (who are on the poverty line) and also pay the students so I don't have to. Before we joined, the only kinds of job training they were able to offer were the likes of Amazon warehouse packaging and hotel cleaning. I hope to empower more low-income earners to have the ability to simplify complex problems and problem solve.

Just in case someone likes the vision and wants to donate, here's a donation link: https://secure.givelively.org/donate/garage-script

Are you accepting/looking for volunteers?

Yes! Please send me an email (in my profile)

I'm not from Silicon Valley, so the only sampling I have of SV culture comes from this site[0]. From what I see, the article has a refrain that being anti-libertarian goes against the SV gain, but I see political opinions from across the political spectrum here, and my leftist opinions are often upvoted. So, while I can see investors being skeptical, would the tech community as a whole be anti-welfare? I don't necessarily think so.

Regardless, that's just a nitpick about the article. I'm happy that these businesses are doing what they are doing.

[0] FWIW, the article cited a comment from here, so this place must be important enough to cite as an example of SV attitudes

I think SV culture tends to be politically extremist, or to be more accurate fundamentalist, in whatever ideology it pursues. I see more hard-line libertarians, but also more hard-line socialists, than in other subcultures.

There's a long tradition of political extremism among engineers in cultures around the world; something to do with seeing society as a system simple enough that a single human being can understand the solutions to its problems. Hayek (who I disagree with on many points) even wrote a whole essay on it, with this very lovely point:

"It is this awareness of being part of a social process, and of the manner in which individual efforts interact, which the education solely in the sciences or in technology seems so lamentably to fail to convey. It is not surprising that many of the more active minds among those so trained sooner or later react violently against the deficiencies of their education and develop a passion for imposing on society the order which they are unable to detect by the means with which they are familiar."


Gambetta and Hertog tried to quantify this, and found that engineers were over-represented (drastically) in Islamist terrorist networks, and (less drastically) in Western right-wing extremism; and that Western left-wing extremists tended more towards a humanities education. I've read lots of newspaper write-ups of the book, but haven't gotten my hands on a copy, so I don't know their speculation on the causes of the left-right split they observed in studies.


They also have older scholarly write-ups, which I should probably take a look at, e.g. https://www.cambridge.org/core/journals/european-journal-of-...

EDIT: So, looked at that paper at last, and it seems the right-wing stereotype of SV people is likely true. They looked at Westerners to try to make comparisons, and while they found no overrepresentation in violent groups, they did look at surveys of political views of educated people by degree. The best data they could find was about faculty members from 1984, so keep the age and restricted subset in mind.

"The results are startling (Table 7). The proportion of engineers who declare themselves to be on the right of the political spectrum is greater than in any other disciplinary group: 57.6 % of them are either conservative or strongly conservative, as compared to 51.1 of economists, 42.5 of doctors and 33.5 % of scientists, 21.4 % of those in the humanities, and 18.6 % of the social scientists, the least right-wing of all disciplinary groups. Only 1.4 % of engineers are on the left, as opposed to 12.9 % in the social sciences and 16.7 % in law. Perhaps this is an uncanny coincidence, but the four fields at the top of the conservatism scale – engineering, economics, medicine, and science – are the same four secular fields we found at the top of our main jihadist sample."

They also cited a more recent Canadian study (1999) with similar results.

Anyway, there are many other interesting findings in that paper; highly recommended.

This is actually amazing. I always thought that this "seeing in systems" was also the cause of the lack of empathy that traditionally has been attributed to engineers (being this an unfair stereotype or not).

There are several computational paradigms that we attribute to minds (and people) that more often than not backfire, finite state machines being the most obvious one. Sometimes it works, and we discover a great mental model to live by. Sometimes it goes really wrong and it all goes the modernist way (Mies van der Rohe and co).

This leads to another nasty effect: being incapable to commiserate with the people around us. If the mind is a deterministic black box and I'm not an alcoholic because I refrain myself from drinking, how come there are alcoholics. The answer must be: they do not try hard enough. Same with poor people, obese people. If things have not happened to me, the fact that happen to other people must mean that they've brought it upon themselves.

> or to be more accurate fundamentalist

It's also noted that engineers are overrepresented among terrorists. [0]

I think it's because engineers believe that there really is such a thing as a coherent, all-encompassing political philosophy that will yield strictly best outcomes for a given set of constraints.

They're basically porting their mindset from a technical endeavour to a sociopolitical one.

[0] https://foreignpolicy.com/2013/07/11/theres-a-good-reason-wh...

>There's a long tradition of political extremism among engineers in cultures around the world

Funny you say that, as most of the major Islamist terrorist groups were founded by or led by men with engineering backgrounds.

Propel (and bunch of other ventures) have their genesis at the Blue Ridge Labs.

Blue Ridge Labs focuses on bringing together people who are interested in product, design and engineering to go out and apply tools of empathy and discovery to understand the problems faced by low-income and socially disadvantaged Americans.

For anyone who is at crossroads in their career, I would highly recommend reaching out to @BlueRidgeLabs. I vouch for and support the sincerity of their mission.

Have questions about Blue Ridge Labs? Reach out to @cromulus. Looking to find an engineering position in NYC reach out to @FreshEBT. I am @rksio

How are these startups planning to pay back the VC money? The poor don't exactly have a lot of money. Where are they going to get the money from? I am skeptical anytime a VC invests in "solving poverty".

Is it... a "startup"? Do they make money? Is Propel even a for-profit company?

Non-profits can be startups too, if they're attempting to build new business models.

I don't see why a company has to be profit-seeking to be considered a "startup". But Propel is indeed for-profit.

> Is it... a "startup"? Do they make money? Is Propel even a for-profit company?

A startup is a newly established business - that is to say, just starting up.

I'm a fan of PG's view: http://www.paulgraham.com/growth.html

I'll put forward that PG is using his own definition that aligns with his business. His definition differs from that of the dictionary's definition.

There's nothing wrong with that, as it helps him achieve day-to-day his goals. But, the definition is otherwise limited in that it is not correct or useful outside of direct investors who are looking for fast growing companies that want to be called startups in order to get startup funding.

For profit. FreshEBT raised a round from A16Z.

If a poverty fighting startup would work it would be a huge plus for capitalism, I think.

How to get poor people at least to an average income while making some money yourself.

I'm from Germany and at least here I have the feeling that the issue is mostly missing education opportunities for older people.

Sure, the "really" poor without any job have more time on their hands, but there are probably a huge bunch of people who could work as taxi diver or waiter, who can make 1000€ a month without the need of too much education.

While you probably can mingle with the "Arbeitsagentur" (part of the public service for unemployed people) to get the people without income paid by them while you re-educate them, the much bigger part are the people who work but simply don't make enough money to have an okay life.

Also, while you have to get the second part of the people like 1000€ a month so they can do their re-education fulltime, you also have to make money yourself.

All I found today were some models, where the re-educated had to pay like 10-20% of their first income as payment later. This doesn't sound too bad, since it forces the education-company to get them ready for jobs, but on the other hand it maybe prevents people from getting good jobs? I don't really know.

The other model could be more like Mozilla does it, getting big sponsors, but then you are working for the sponsors and not for your customers anymore :/

Love that this could start becoming a thing. There's a very similar incubator[1] in Chile with the same hypothesis, poor people also have problems that can be resolved through tech/startups and there are plenty of good business opportunities there.

[1]: http://www.socialab.com

There's no sacred cows in this case, just groupthink.

Incidentally, Silicon Valley isn't at even typically anti-government. That bit isn't even in the groupthink even if there's a particular anti-government dogma that isn't absent from the milieu.

(note: I'm not in SV or it's groupthink, I'm speaking as an observer of it)

Does anyone else find it odd to make a smartphone app for EBT users? If I were broke, one of my first moves would be to go to a cheaper phone, maybe a flip-phone style.

But maybe that's what the author meant by the trade of time and convenience for cost.... I really, truly believe that money skills lead to the accumulation of wealth, and that they are acquirable (teachable) skills.

The greed of the rich and well-connected, is beyond belief. Capitalism has failed for a segment of the population. Democracy has failed for them.

You need money to make money. You need education, skills, connections, and health to get and maintain a job.

Have you seen the pictures of Skid Row in Los Angeles?



This is the reality on the ground in Los Angeles. There are several blocks in downtown Los Angeles, where when you step into it, it feels like you stepped into a land that time forgot. The people are destitute. They have failed at one thing or another in life, and that has brought them to this point.

And what is the result of this? It has created a micro-3rd-world-country, right in the heart of one of the richest cities in the world. Where people drive by in expensive Mercedes, BMW, and Tesla cars.

The rich don't care about this, because they will never drive through the poor parts of town. But for everyone else, it makes life miserable for all.

At some point, you just have to cut your losses with these people. They are not going to get any corporate job. They pan-handle, beg, and harass people on the streets. Society, the city, the state, and the federal government, must step in to provide a baseline for these people.

Give them a damn fake job, give them money, give them food, give them shelter. Just get them off the streets.

If society cannot do this for them, then take the next step, and go extreme. Incarcerate them. Make it illegal to be homeless. Throw them into a prison. At least that way, they will get fed, have a jumpsuit for clothing, and a warm shelter.

This is a human rights issue. And for the United States to claim that they are the greatest at human rights, then all you have to do is to look at the homeless, the underbelly of society, and see the people that has failed in society. And here, you will see the hypocrisy of a society that has no desire or inclination to help them.

Poverty-fighting? They're quite literally poverty-exploiting.

The road out of poverty is through what is called "exploitation" in Marxist theory - particularly, international trade.

As British economist Joan Robinson put it :"The misery of being exploited by capitalists is nothing compared to the misery of not being exploited at all."

They save people money on their groceries. They save people time looking up their balance (previously it was a phone call).

How are either of those things exploitative?

Contrary to how it sounds, you can't eat a double-byte character. This does seem to feel slightly like rent seeking on behalf of these companies.

>“One of my ambitions is to help our users put more food on the table,” says Jimmy Chen, the founder of Propel.

This app has some short-term benefits, but it’s hard to see long-term benefits. What if every government aid program was super easy to sign-up for and instantly check whatever you need. What would change? Less taxes from all the gov workers we’d no longer need?

>This app has some short-term benefits, but it’s hard to see long-term benefits. What if every government aid program was super easy to sign-up for and instantly check whatever you need. What would change? Less taxes from all the gov workers we’d no longer need?

A lot of people who could receive aid but don't have the time / ability / don't know that they could receive aid would get help? How is that not a good result?

And yes, it'd also mean that there's less effort required to find people who need help and verify them, and thus the overhead is reduced.

To make the most simplistic possible point, having a society where everyone is adequately fed is a longterm benefit. Perhaps you'd be interested in the history of the American school lunch program.

> This app has some short-term benefits, but it’s hard to see long-term benefits. What if every government aid program was super easy to sign-up for and instantly check whatever you need. What would change?

More of the people who need those services would be able to get them?

Less taxes as you point out, and more time for aid recipients to spend improving their lives instead of dealing with bureaucracy.

At first blush it would seem that coordinating or collaborating with cooperative government agencies might be of benefit as many of these apps seem to streamline and make processes more effective for the ultimate beneficiary of the programs. Obviously this is a benefit for both the recipient and the government organization which wants to serve its pop as well as possible.

As someone mentioned in the thread, efficiency could lead to either better benefits to the recipients of the government benefits or they could result in contraction of the government workforce.

To that latter concern we must figure out whether people are employed by the government (or companies in general) to do a job or they're there also equally as a part of a social contract to keep the most people possible in gainful employment --which if the latter is true, SV startups are an anathema by design. People for the most part aren't building startups in order to require more people to keep things running --they tend to be in business to save their customers money.

Wait til you hear about the manufacturing industry using machinery!

Please don't post unsubstantive comments here.

It's hard to identify what 'unsubstantive' might mean when it apparently doesn't include the idea that businesses are not created in order to employ people.

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