My car is 14 years old and has upwards of 150,000 miles on it. It's missing paint on the hood where I chipped away at ice that had frozen into a sheet after I didn't clean off the snow that had fallen days before. It was missing the fuel door for a couple of years (the black void was very prominent against the white, sort of, paint) until my husband replaced it for my birthday. It is not what we call, our "people" car: the one that we take on social occasions when we will be observed by people in proximity to the car. No, for that we take his car. It's only 13 years old and boasts all of its paint.
I love my car because it is free. I enhance it's free-ness by rarely driving it and eschewing any notion of preventative maintenance. This is where thrifty degenerates into cheap. I recognize that. One day I will be driving down the road on my bald, dry rotted tires and crash into something and incur cost that well exceed what new tires would have set me back. But that day is not today. When that day is today, I will, fortunately, have sufficient precautionary savings to cover the expense.
Our colleagues at the Half in Ten Campaign, in a report aptly titled "Penny Wise, Pound Foolish" written by Harry Holzer, assert that we should not treat poverty like my car. The report estimates that child poverty costs the economy around $500 billion a year in lost productivity, increased health expenditures, and other factors. When I don't fix my car, I will pay the cost. Poverty isn't isolated, though, to the households and communities where it exists; it's actually aggregated and the costs are distributed throughout the economy.
In an op-ed that Reid Cramer and I wrote that appeared today, we argue that policymakers
should not concede investments in policies that target child poverty to concerns over the deficit. Given the long-run costs of inaction, this is a false choice.
We also argue that policies that help low-income families save provide resources that serve as a buffer against financial shocks and build pathways to economic security over the long-run. Assets are part of a preventative maintenance strategy against poverty and an investment in a strong economy. That makes sense even to me.