When Albuquerque, NM, mayor Richard Barry saw a homeless man with a sign reading, “Want a job. Anything helps,” Barry was inspired to work with local nonprofits to hire the homeless to pick up trash and do some light yard work for $9 an hour and a sack lunch. Talking to these people, he realized that the homeless would rather have the dignity of a job than have to panhandle. This is something of a departure from the upswing in cities that outlaw panhandling and have even criminalized feeding the poor in some cases, but hiring homeless people works because city workers and nonprofits can connect the homeless workers with services that they might not have been aware existed.
Those who manage the There's A Better Way program will tell you that the homeless aren't necessarily lazy. They simply lack access to the same opportunities that the rest of us do. Many of them lack photo ID cards and Social Security cards, which are required to do anything from get a job to open a bank account. A lot of them have just about given up because nobody will give them a chance.
From 1964 to 2014, the government spent $16 trillion on the war on poverty and the poverty rate hasn't changed much.
Albuquerque is a rare beacon among American cities that often prefer to sweep their homelessness problem under the rug and pretend it doesn't exist. New technologies like the Internet and distributed ledgers might be able to do a better job of giving the homeless a way out of poverty if combined with free market principles that have been decoupled from government regulation.
The War On Poverty Has Failed
When President Lyndon Johnson announced an “unconditional war on poverty” in 1964, many people saw this as a good thing. The government could bring its formidable resources to bear on the problem. However, from 1964 to 2014, the government spent $16 trillion on the war on poverty and the poverty rate hasn't changed very much. What happened?
The government is very good at spending money on bureaucracy but not so good at making sure that the money is being used for the purpose that it was intended for. When the money does get into the hands of the poor, it can alleviate some of the symptoms of poverty such as hunger and homelessness. However, like an opioid painkiller, the money spent on the war on poverty can mask the symptoms but does not cure the underlying cause of the pain – and it is easy for the recipient to get hooked if measures aren't taken to prevent it.
On the plus side, more states plan to reinstate work rules for their food stamp programs if they haven't already. Recipients must prove that they work 20 hours a week, participate in a “workfare” program, or train for a job in order to receive benefits. Maine has already had some luck by enforcing similar rules that encourage welfare recipients to find work, volunteer, or pursue vocational training. Those who refuse to follow these rules even though they are physically and mentally capable of working are simply eliminated from the program.
It's not a handout when 97.1% of loans are repaid.
This is based on a federal law titled the Personal Responsibility and Work Opportunity Reconciliation Act, which passed Congress with bipartisan support and was signed into law by Bill Clinton in 1996. This met Bill Clinton's campaign promise to “end welfare as we know it” by creating incentives for welfare recipients to increase their job skills and get themselves back on their feet. This is actually a better way to get people out of poverty because they cannot get away with procrastinating when it comes to finding at least part-time work.
The Personal Responsibility and Work Opportunity Reconciliation Act is not immune to howls that its conditions are somehow unfair to the poor and will only have teeth if state and federal agencies are willing to enforce it. That means we shouldn't count on the government being consistent when it comes to pushing people out of poverty. What other options are there?
Private Free Markets To The Rescue
Peer-to-peer lending platforms like Kiva work on the theory that microloans can be used by the less fortunate to start or expand small businesses, get a college degree, and become more self-sufficient. It's not a handout when 97.1% of loans are paid back and the same $25 can give a hand up to numerous people when it is loaned out multiple times. You only need to see the smiling faces and success stories on Kiva to understand how a hand up can be more valuable than a hand out when it comes to helping the less fortunate.
OneWeb aims to launch microsatellites capable of providing cheap Internet access to unconnected communities.
This is a private free market solution in which lenders can put their money behind their values when deciding who to give loans to and borrowers can take their lives to the next level in ways that wouldn't be possible if the government got in the middle of the transaction.
I will admit to being partial to the Education category, especially when I see that a woman in Jordan is pursuing a life sciences degree and just needs a loan to cover tuition. When that woman has the courage to empower herself through education, she deserves the financial boost and that's something that I can back without asking the government to do it for me.
This requires reliable access to the Internet to work. More than 50% of the human population does not have access to high-speed Internet and that means the opportunities made possible by the Internet is not available to them. OneWeb aims to solve that problem by launching a constellation of microsatellites that will be capable of providing cheap or free Internet access to unconnected communities. These satellites can connect to cheap terminals that can be installed in libraries and community centers in poor communities.
Bitcoin for the Unbanked
Internet access and peer-to-peer lending are only two parts of the equation when it comes to lifting the less advantaged out of poverty. Sometimes the government gets in the way of the less privileged who would have a better chance if they could enter the marketplace on an even footing with everybody else. The Patriot Act, for instance, puts an enormous burden on banks to verify the identities of their customers. This tends to freeze out the homeless people who don't have photo ID cards because banks would rather err on the side of caution than be fined for giving checking accounts to people who can't verify their identities.
This has the ripple effect of not being able to confirm a Paypal account or do anything serious on freelancing platforms like Upwork or Freelancer. Carrying a large amount of cash around is never a good idea if you're homeless (or anybody else) because it could be stolen by a pickpocket or seized by cops on the mere suspicion that it's being used for financial crimes.
You can download a Bitcoin wallet without providing a photo ID right now.
However, if you're reading this, then you can download a Bitcoin wallet without providing a photo ID right now. You're not asking a bank to trust that you are who you say you are or getting hung up on having to confirm that you do have a bank account. As governments may have figured out by now when they try to regulate Bitcoin, cryptocurrencies like Bitcoin are slippery critters because they're decentralized.
Bitcoin has more than 10,000 nodes around the world. It would be hard to destroy without also causing significant damage to the entire Internet. As recent activity in the cryptocurrency niche shows, distributed ledgers, also known as blockchains, make Bitcoin's level of decentralization possible and entrepreneurs aim to use that to create censor-resistant platforms that could do a better job of putting the homeless and disadvantaged on the same playing field as the rest of us.
The trick, of course, is that you have to jump on them early to get the most benefit out of it. You probably wish that you had bought Bitcoin in 2009, but you can still jump on services like Blocklancer when they officially “open for business” as decentralized freelancing platforms.
Adopt early, establish your reputation fast by actually doing the work, promote it to friends and family who might have been interested in a side gig (and this goes double if there's an affiliate marketing option), and you can usually do well on a new freelancing platform. Blocklancer may or may not require a photo ID, depending on what the regulations say, but will definitely allow users to skip the step of confirming a Paypal account. That alone will be encouraging to anyone who has had difficulties establishing themselves on mainstream freelancing platforms.
The homeless don't always realize what services are available to help them.
The obvious problem in this scenario is that the homeless don't always realize what services are available to help them, so they may not know how they can establish themselves on a freelancing platform even when they don't have to confirm a Paypal account and add a picture of their face in order to use the platform. So it may be hoped that Blocklancer will use at least some of the money that it will earn through its upcoming token sale to implement an outreach program for the homeless population who may be interested in getting into freelancing but aren't sure how they can do it.
Blocklancer is one of several decentralized, free market options that could theoretically be used to help them, so they may not know how they can establish themselves on a freelancing platform even when they don't have to confirm a Paypal account and add a picture of their face in order to use the platform. So it may be hoped that Blocklancer will use at least some of the money that it will earn through its upcoming token sale to implement an outreach program for the homeless population who may be interested in getting into freelancing but aren't sure how they can do it.
Blocklancer is one of several decentralized, free market options that could theoretically be used to help the poor if they launch successfully. OpenBazaar is another one in which users can buy and sell goods and services. Like most free market options, they are only worth anything if their target audiences are willing and able to use them.
As Richard Barry and the There's A Better Way staff would tell you in a heartbeat, though many homeless people who might otherwise have trouble finding a job or holding steady work could take on the occasional “side gig” as part of the process of getting their lives back on track. They aren't lazy; they may simply have been unlucky and got kicked out of an apartment because they were always a few bucks short on the rent.
It's often difficult for people to get their lives back on track once they become homeless due to all the hurdles that society, government, and the mainstream financial system place in their way. However, with free market options like cryptocurrencies and decentralized freelancing platforms that don't require them to jump through impossible hoops, the homeless may have better luck lifting themselves out of poverty.