The Cost of Poverty

Amy Hulst:
Hi, this is Amy Hulst, and you’re listening to From Poverty to Prosperity, where we ask what keeps people in poverty in America and what it takes to break free.

Today we’ll explore the real cost of poverty in America and what we get for the money we spend.

…causes suffering for everyone I know. It’s a constant weight on my chest as well as those around me. Sierra.

Jason Janz:
Andrea says poverty touches every part of your life: your peace of mind, your relationships, your health, and even your sense of worth.

Amy Hulst:
Poverty is a lack of relational, spiritual, and financial wealth. Livy.

Jason Janz:
Roxy says poverty is not just about income. It’s also about lack of education and opportunity, limited access to services, and sometimes social exclusion.

Amy Hulst:
Andrea tells us poverty feels like being stuck, wanting more, knowing you’re capable of more, but not knowing how to break out of the cycle.

Jason Janz:
Michelle says, “I remember the weight of poverty not just in my bank account, but in my body. It lived in the tightness in my chest when the rent was due and I didn’t have enough.”

Amy Hulst:
I had begun to neglect my mental and physical health and became so severely sick that I had to be hospitalized from sepsis and nearly died. Andrea.

Jason Janz:
Mercedes says, “It definitely affected my confidence, being embarrassed about the clothes I wore or where I lived. I often missed school to watch my younger brother. I started working because needing money to survive was more important than getting an education.”

Amy Hulst:
Christy shares, “I grew up in poverty, sometimes not knowing where my next meal would come from, or breaking into the neighbor’s house just to take a shower. Growing up, I just remember all of the tears and sounds in my stomach.”

Jason Janz:
Michelle says poverty feels like carrying the world on your shoulders and smiling through the pain because you don’t want your children to see your fear.

Amy, these are all examples of the cost of poverty. And I think we’re going to get into some numbers here, but I want to start by just thinking about the true cost of poverty as to what it does to human beings, this toxic stress it puts on their lives. And the reason we’re so adamant about trying to solve this is we want to see human suffering go away.

Amy Hulst:
I think something we also don’t think about in this conversation, not just numbers, and we’ll get into that, the economics of the situation, but also the emotional, spiritual toll that poverty takes on people. We view poverty as holistic, so it’s not just how much is in your bank account or how much isn’t. So we’ll get into that in this conversation as well.

Jason, why don’t you tell us a little bit about what poverty is costing America and Americans?

Jason Janz:
When you look at it purely from federal spending, since the War on Poverty began, we’ve spent about $30 trillion since President Johnson declared the War on Poverty. But we spend about $1.7 trillion a year across federal, state, and local safety net programs, which is double what we spend on national defense. So people complain about how much we perhaps spend on national defense, but what we spend on poverty is far greater.

Amy Hulst:
Why do you think that number is as high as it is? Because that’s a large number. And you and I talk about how sometimes we gloss over large numbers like that, like $1.75 trillion. How much is America’s whole budget? How much do we spend in a year? How much of that is going towards poverty?

Jason Janz:
Yeah, we’re a $6 to $7 trillion national budget. So if you take $1.75 trillion, it’s a significant portion. And, you know, why is it so big? If you actually look at the numbers, healthcare is really taking up the lion’s share of that. Most people think it’s food stamps or Temporary Assistance for Needy Families, which is cash welfare. That’s actually a very small part of the overall net. Healthcare spending has just gone through the roof and shows no signs of receding.

It’s actually causing crisis in state budgets across the country, and especially here in Colorado.

Amy Hulst:
So before, we’ve said what is poverty. We’ve defined the line. In other conversations, we’ll talk about the social safety net, which will help us map the spending. Where’s all that going? This conversation is also about what are we getting for spending $1.75 trillion a year? It’s managing the problem. It’s not getting them all the way up and out, just managing where they’re at. What are we getting for the cost? Where do you think that money is going?

And do we think that’s effective?

Jason Janz:
Yeah, I think the money is going to a lot of really good things. I take great comfort in the fact that somebody who can’t afford health care in this country can get health care. That people who don’t have money for food can get some food stamps. I think any good society should take a portion of their proceeds and their tax dollars and help people who need help. The question is always around the amount of help, but I’m glad I live in a society where we help people who are down on their luck.

I think my belief would be I’d like for benefits to be sometimes a crutch for a bad ankle, you know, versus a permanent condition where you’re always having to depend on others. And if you can be self-sufficient, we want to move people in that direction. So Section 8 housing, I think it can be a good thing, and it can be an abused thing as well.

What are we getting for it? I think you are onto it, what you’re saying there. It is designed to maintain. There are some pieces inside the safety net that are trying to help people get out, but it’s maybe one dollar per hundred being used for those purposes. I think we’re out of cash the way we’re budgeting things to be able to do that. So if we were to get new investments, perhaps we could do more preventative care. And obviously, if we allocate some of the budget for that, perhaps you could change the other side of the equation.

Amy Hulst:
Do you think most Americans believe what we’re spending, that $1.75 trillion on the social safety net, which would be Medicaid, TANF, and other things that would fall into the social safety net, which we’ll get into in other episodes? But do you think most Americans think that we are funding a ladder when we’re actually just funding a floor?

Jason Janz:
I like the illustration of a trapeze. When we talk about the safety net, what is that? That’s either when you’re jumping off of a building, right, or you’re on a trapeze. And if you’ve been to the circus, right, they have this safety net there, so if they fall off the trapeze, they won’t hit the concrete. They’ll land in the safety net.

And we have a ton of conversations around this net. The blue team thinks the net’s too small. The red team thinks the net’s too big. Everybody sees there’s holes in the net. We dialogue about how long people should be in the net.

I don’t know many people, though, that want to live on a net. Like trapeze artists, they want to climb that ladder and fly, right? That’s the heart of the work we do. That’s the dream people have in this country, to fly. So I would love to see more resources put into the ladder, but I think most people believe we have a net, it’s got holes in it, and they all have some thoughts about how it’s helping and some thoughts about how it’s not.

Amy Hulst:
How do we see the families and the folks that are coming through our doors at CrossPurpose? Where are they at in this whole cost equation?

Jason Janz:
Well, most of them are on some form of public benefit. The food stamp program in this country is our largest as far as headcount goes. It’s a significant amount of people that are experiencing help. Now, most people think that they’re living large off of that, but it’s a couple hundred bucks a month for the average family.

So Ronald Reagan talked about the welfare queen, and we still live with that stereotype, but that actually hurt the whole thing, because everybody started thinking people are living large off the safety net. You’d be hard pressed to find how you can actually have a very fulfilling life just living on the safety net in this country.

Amy Hulst:
You and I have mentioned before that society already accepts larger amounts for human investment. So K-12, talk about how much that costs. Your bachelor’s, that’s an exorbitant amount these days. Sixty days in rehab is about $50,000, depending. Average per person in incarceration for one year.

So talk about how much we are already spending on what would be considered human investment in these other, more socially acceptable segments, and why that isn’t accepted as much for families that we could point out this window right now and say they’re accepting food stamps or they’re accepting government…

Jason Janz:
First of all, I think we can actually get this $1.75 trillion number down to a more understandable number. Based on our projections in the book that we wrote, Together We Climb, we think it’s roughly around $32,000 a household that we’re spending on poverty in this country. So just think of that, right? That’s like giving a $16-an-hour job to somebody for a year, where you take all the costs associated with poverty.

And the work we do, and a lot of other service providers, if you’re really going to help people, not just help people in poverty become happier people in poverty, but help them get out of poverty, right, you’re going to have to invest. And so workforce development organizations, affordable housing organizations, they’re investing sometimes between $20,000 and $40,000 per person for a year of care. And we face this all the time with philanthropy, even with government. It’s like, “My gosh, that cost is super high.”

Well, yeah, but you know, as you said, incarceration is $60,000 a year. K-12 is an average of $17,000 per year per student. Over twelve years, we’re putting a quarter million dollars into educating a kid in this country. Homelessness can be as low as $35,000, but even some estimates here in Denver, when you take public and private funding into the homeless situation, you’ll have $80,000 to $120,000 per year per unhoused person just to maintain homelessness.

So we’ve got to think about it differently. I think we’re not going to solve poverty with a safety net. We’re not going to solve it with $200 of food stamps. It’s going to take an investment, but similar to the investments we’re making in K-12 or higher ed.

Amy Hulst:
People believe a full-time job is supposed to be enough to stay out of poverty. I think that’s a perspective older generations have: if you have a good job and it’s full-time, it should be enough to keep you from falling into poverty. You should be able to pay your bills. You should be able to pay housing, childcare, all those things. We know that today, in 2026, that’s actually not possible. We see that all the time. A person with a full-time paying job, it’s not enough to keep them out.

In the book Together We Climb, and in a lot of these conversations about the cost of poverty, it’s not just the economic costs that we are talking about. Those are the big numbers. Those are the headlines. However, here’s the underbelly side of the cost of poverty. Ten years of cumulative poverty means a 70% higher mortality rate. A child born into poverty has an over 40% higher chance of being poor as an adult. And children from low-income families have an estimated 30 million fewer words in their vocabulary by kindergarten.

That is some of the cost of poverty that we are seeing happen to children, seeing happen to our neighbors, seeing happen to our communities.

Jason Janz:
Yeah, I think when we think about the cost, in some of the research I was doing, we think about the domino effect of poverty. Like, 38% of people earning under $25,000 a year skipped medical care because of scarcity of resources. So you think about that. The reason you seek medical care is you’re suffering. And if you say, “Hey, I can’t go get alleviation for my suffering because I don’t have money,” this is the true cost of poverty. And I think that’s what drives what we do.

Amy Hulst:
So Jason, what do we do?

Jason Janz:
Yeah, I was thinking this week about a story that took place a couple of years ago. We helped men and women coming out of incarceration. And before you think that that’s a rare or a small percentage, 33% of Americans have a criminal record. So this is a big problem.

And when you get out of prison here in Colorado, they give you a one-way bus ticket to downtown, $100, and your personal belongings back. So I picked up Zach, and I said, “What do you need to do?” He says, “I need to go see my parole officer.”

So I drove him over there, and the parole officer sat down and started listing out the things that Zach needed to do. “You need to go to the upper north part of town and get an ankle bracelet. That’s going to be $46 a month. You need to go to anger management classes. That’s $30 a week. Every day you need to call a phone number, and if your color is announced on that phone call, you need to leave work and go do a drug test, a UA, right in the middle of the day.”

And I stopped the guy, and I said, “Hey, hey, hey. How’s a guy going to ever hold on to a job if he’s got to leave?” And he looked at me and said, “Hey, sir, that’s the system.”

And ever since then, I thought our job is, we have to change the system that keeps people in poverty. It shouldn’t be this hard. If you’ve done the crime and paid the time, we should have a better system of helping people succeed. Because I’ve had guys tell me it’s easier to go get three hots and a cot back inside than to deal with all this pressure out here. So we’ve disincentivized that through a broken system.

So that’s for policy people, I think, to fix. But I think for the average American, just go love somebody. Invest in their life, and also invest in programs that actually make catalytic change. And don’t get too worried about the $1.75 trillion, because none of us can probably affect that too much. But worry about the person on your block or the person that’s two cubicles down from you, and just help them in a substantive way, the way you’d even think about helping your own children. Take responsibility for somebody in your community that’s in pain and human suffering.

Amy Hulst:
We say a lot at CrossPurpose, one of the most scalable and most radical ideas that there is, is the one-to-one: one neighbor helping one neighbor, one person helping one person.

So we have talked a lot about the overall cost, the national cost. We’ve put numbers on it. We’ve even talked about stories of how that’s showing up in people’s lives. But I think the challenge that we want listeners, our communities, our cities, to grab hold of is the sacrifice, what it actually costs you to show up one-to-one for your neighbor. It’s the cost of, will you take your neighbor?

You even just gave us a stat. 33% have some sort of criminal background. That’s one in three. That’s probably a family member. That’s for sure your neighbor. That’s for sure your coworker. The people this is affecting, one in eight Coloradans are receiving food stamps. That’s so many people that you see every day. That’s so many people that you brush shoulders with. It is not as far removed as we like to think that it is.

And so I think our charge here in this conversation is saying, will you take the sacrifice? Will you let the cost of poverty, the cost of suffering around you, cost you something? Not just in your taxes, not just in your tithing, but actually cost you something, of going one-to-one with someone in your life, one-to-one with your neighbor, and walking them all the way out of their own suffering.

Jason Janz:
And when you do it, it’ll be the most joyous journey you could possibly go on.

Amy Hulst:
Thanks, Jason.

Thanks for joining us for today’s conversation. If you found this episode interesting, share it. And if you want to learn more about today’s topic, check out chapter three in Together We Climb.