Poverty versus squalor

In his interview on EconTalk, Paul Graham made a distinction between poverty and squalor. He says that most poor people live like rich people, but with cheap imitations. A rich person might have something made of gold and a poor person might have the same thing except made of plastic. But the creative poor, such as the proverbial starving artist, live differently. They live in poverty but not in squalor. They achieve a pleasant lifestyle by not trying to imitate the rich.

For example, the wealthy have large beautiful houses. The poor have small and usually not-so-beautiful houses. The rich have new expensive cars and the poor have old cheap cars. But the starving artist might not have a house or a car. He or she might live in a converted warehouse with a few nice furnishings and ride a bicycle.

The point of his discussion of poverty was to make an analogy for small software companies. It makes no sense for a tiny start-up to try to be a scaled-down version of Microsoft. They need to have an entirely different strategy. They can be poor without living in squalor.

I don’t know what I think of Graham’s assertion that the poor live cheap imitations of the lifestyles of the rich. There’s probably some truth to it, though I’m not sure how much. And I’m not sure how much truth there is in the romantic image of the bohemian starving artist. But I agree that it makes no sense for a small company to be a miniature version of a huge corporation.

Related posts:

Living within chosen limits
Selective use of technology
Organizational scar tissue
Parkinson’s law
How animals scale up and down

12 thoughts on “Poverty versus squalor

  1. I don’t know how it would apply to the software analogy, or how widespread it is, but I can verify that notion is sometimes true. Not a ‘bohemian artist’ but a ‘starving student’, I didn’t starve. I had no car until I was 25. I’ve never bought myself a TV. Etc. I had plenty materially when I was young, and though the materially lean years lasted a long time, I knew I could have plenty eventually. A woman I’m very close to now grew up poor. She has a large screen TV that she’s probably paying on credit for. She’s done the rental furniture thing. (Expensive!) She went on a cruise while poor. To me, her financial choices seem crazy. But I think she’d tell you they’re common.

    She says knowing me has changed her thinking. She has a baby, and now buys lots of his clothes at Thrift Town, which she never would have done before. I buy as much as I can secondhand for the Earth’s sake.

  2. His “poor” does not really map to the actual, really poor. Where you don’t have any car or any house at all, and where you’re not eating cheap food and going to bad schools, but having no food and not having money (or time, same thing) for any schooling whatsoever.

    If you have a car, a house and access to food and emergency medical care, you’re not poor in any absolute sense. Of course, that doesn’t mean you’re not deprived or disadvantaged, but I feel that poverty is a strong enough word that it should be reserved for those with an absolute lack or insufficiency of necessities. There should be a word for this next level above poverty, though I am not currently able to think of one.

  3. While 200 years ago living in a warehouse wasn’t always a step up from living in a house, ever since they’ve been “converted” it has been a position of wealth. The starving artists of the 1800s might not have been living in the mansions of their indulgent parents, they certainly lived better than anyone who had ever set foot in an “unconverted” warehouse — including foremen.

    It’s not like the rest of us prefer cramped rooms with low ceilings and enjoy long commutes to drudgerous jobs. It’s that we don’t have wealthy indulgent parents (or friends with wealthy indulgent parents to mooch off of) and the luxury of indolently wasting time wondering what to do with our boundless leisure (besides writing romantic memoirs about our sufferings in poverty which carefully exclude mention our generous stipends –squandered on riotous living– and assiduously omit the squalor.)

  4. Oh so well put Aaron!

    Being someone who has experienced both sides of the fence, as a highly qualified accountant who turned to the arts, there is a lot to be said about “starving artists” who are incredibly well supported by indulgent benefactors.

  5. Aaron, I moved to Brooklyn with $700 and a suitcase and lived in a loft with a bunch of other similar minded kids. I worked random carpentry and construction jobs and spent my free time pursuing my passion for music. Why did we live in a loft? Because it had plenty of space for our artistic endeavors and we could make noise at all hours of the day. I don’t think any one of us were getting money from our parents. I certainly was not.

    Listen, I have no problem with there being a world full of people who live in the suburbs and commute to cubicles for 50 years and then retire to Arizona. I like cell phones, Kleenex, and X-ray machines, so I’m happy that there are people out there making sure that they get manufactured and sold.

    But please, for heaven’s sake, don’t look at anyone who decides to ignore that path as a privileged debutante. If that’s really how you feel, please take all of your books, records, and paintings and set them alight in your backyard.

    All it takes is courage, not wealth, to lead the life that you wish.

  6. @John Interesting distinction between the two categories. Poverty supported by abundant materialism (which seems and odd combo) is definitely I see in my neighborhood.

    @Sue Have you read ‘The High Price of Materialism’. It examines some of the empirical research that has been done over the years related to this topic. One of the points mentioned is that poor or disadvantaged people are actually more likely to display these materialistic tendencies in their search for security and comfort (renting the big flat screen for instance).

    @Aaron I see your point and I definitely think there is a great deal of ‘fashionable poverty’ supported by rich parents. However, that does seem a little all encompassing. There are individuals, as John mentions, who chose to live more simply and are thus able to work less or on things which are more meaningful to them.

  7. > I don’t know what I think of Graham’s assertion that the poor live cheap imitations of the lifestyles of the rich.

    How about ghetto blacks? I understand that the whole hip-hop clothing-complex started as imitations of the rich.

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