the Poor pay more

...Our social philosophy now recognizes that the consciences of the upper four-fifths of the nation cannot be salved by good intentions...

...In all stores in low-income areas there was a lack of orderliness and cleanliness, with prices not marked as clearly, and with meats and produce not as fresh as in the middle-class neighborhoods...

...Perhaps, as I suggested on July 7 before the NAACP convention in Los Angeles, the Federal government could provide below-market interest rate terms on loans to stimulate construction of food markets in low-income neighborhoods, just as it is doing to spur private housing in slum areas...

...Injunctive procedure would halt the practice—a step far more important than other types of court action which permit the shady business to be conducted profitably by new operators...

...But to start these programs requires local initiative, and it requires that the people who are interested in helping others be more than do-gooders...

...If the poor, with little cash to spend, are to achieve a net increase in purchasing power, much more than a net increase in income is required...

...Frequently the buyer does not even know how many payments are due, and when he falls behind he may find his wages garnisheed and in some cases—if the employer is irritated enough by this procedure—lose his job...

...For example, prices on staple items such as bread, milk, eggs, and sugar differed significantly, not so much between chain store branches in low-income and higher-income areas, but between chain stores and smaller independent stores...

...As one manager said: "They want the store they shop in not to remind them of the circumstances in which they're living...

...Thus, one of the first consumer questions the Committee was asked to examine was if it is true that the low-income consumer is penalized in the modern marketplace...

...Added to the higher prices are often even more exorbitant credit charges...

...Here, too, is another significant development that will help to chase out the racketeers —provided that all the fraud bureaus operate under laws that meet present-day needs...

...A recent shopping tour made by low-income consumers in Boston and Providence revealed that the cash price for one type of television set varied from $99 to $189—with the higher prices charged by merchants dealing almost exclusively with welfare recipients...

...A BLS special report last June 12 revealed that food did cost more in low-income neighborhoods of the six major cities surveyed—New York City, Los Angeles, Chicago, Washington, Atlanta, and Houston...

...By stressing immediate, short-term goals, the program hopes to achieve long-range success...

...The store is more than just a store, for it also provides a small park-like area and green space to help beautify the neighborhood...

...Interest rates which are, at times, disguised to exceed the legal maximum, may not be divulged to the buyer...

...These stores, incidentally, have only minor pilferage problems...

...I hope that the insurance companies can find the will and resources to provide adequate • coverage...

...A couple who signed a paper to buy a "custom made" orthopedic mattress and box spring for $22 each did not know, until too late, that taxes, carrying charges, delivery charges, and other fees brought the total cost to $247...

...At present, the poor are often the prey of door-to-door peddlers and sharpster merchants who sell over-priced merchandise on exorbitant credit terms, misrepresenting the product or sale conditions...

...The formation of cooperatives—for both buying and selling—also can be of great help...

...because of lack of education, skill, and bargain stores in low income neighborhoods," the panel said, "the poor are apt to pay more for comparable merchandise than people in middle income areas...

...But new laws and better law enforcement are only one part of the answer to correcting the abuses...

...A Chicago family agency offered free sewing and millinery lessons to newcomers from the rural South...

...No poverty program can succeed unless an educational program is an integral part...

...In New York City, two new stores in Spanish-speaking neighborhoods stress clean, orderly surroundings...

...In searching for further information, the President's Committee then asked the National Commission on Food Marketing for more authoritative figures...

...It agreed to our request and contracted with the Bureau of Labor Statistics, the fact-finding arm of the Department of Labor, for a study...

...We must, as President Johnson said when he established the Committee on Consumer Interests, "develop as promptly as possible effective ways and means of reaching more homes and more families—particularly low-income families —with information to help them to get the most for their money...

...To be sure, there are many factors which militate against building supermarkets in high-density areas...

...We established a panel of experts from the government, business, universities, and social agencies, who reported in June of last year that the poor do pay more...

...To find out about sewing and materials, the class took trips to the stores, where they also were advised on other related problems...

...The panel also asserted that food prices are a grievance in poor, big-city neighborhoods, for residents of low-income neighborhoods often believe they pay more, whether in fact they do or not...

...Legislative and judicial means can be used to insure that the poor are treated equitably when they use credit...

...Their purpose is not to change values, nor to provide a panacea for poverty, but simply to help the poor become better consumers within the restricting limits of the poverty income...

...To help the lower fifth is a primary task of our national domestic policy and individual morality...

...high (and sometimes unobtainable) insurance rates...

...One of the immediate needs of the poor is to obtain credit at a reasonable rate...

...These activities show good promise of success for they stress not book problems, but the daily task of eliminating wasteful expenditures and inefficient and costly ways of doing things...

...There must be sources available in addition to the small loan agency or the store where low income families buy their goods...

...The poor also tend to buy in small, uneconomical quantities...

...The major fault, rather, lies in the type of food distribution system which serves many low-income neighborhoods...

...State consumer fraud bureaus now exist in nineteen states—and their number is on the increase...

...In Milwaukee, store-front ministers asked a speaker at a church conference to give them a course in financial management...

...Garnishment laws, all too harsh in many states, need amending and liberalizing...

...In the South, cooperatives are now being formed to make and market handcrafts and to operate service industries...

...The Office of Economic Opportunity has been encouraging the development of credit unions in low-income areas, and this is a welcome step forward...

...Another need of the poor is to buy insurance at a rate they can afford...

...Not only do they need sources of credit badly—for obviously their financial reserves are far thinner than those of the middle class—but they need more flexible credit, perhaps a plan which will provide relief for the sudden emergencies and costs of illness, or loss of income...

...As one housewife in a low-income family told me, "If I did have the money and I bought a week's worth of food it would be eaten in a day—and what would we do the rest of the week...

...They offer unadvertised specials and other advantages to customers...

...The New York Times reported later in the summer that the low-income consumer in Harlem paid a significantly higher price for certain items: up to eighty-nine cents for a dozen eggs, which could have been purchased elsewhere for sixty-nine cents...

...Laws may provide scaffolding for corrective measures, but they cannot replace the need for a national commitment from all segments of society—from businesses, labor unions, voluntary organizations, and private individuals, as well as the Federal, state, and local governments —to assist in protecting the consumer...

...Their success can help Southern Negroes break a pattern which has kept them dominated...

...and higher pilferage rates, are among the obstacles...

...In most instances, the higher cost is not the result of deliberate and discriminatory practice...

...Hidden finance charges are common...

...At present, not only are automobile and liability rates extremely high in the inner-city poverty areas, but some casualty companies, fearing future losses, have resorted to large-scale cancellation of policies—whether or not an individual has a good risk record...

...So she left the cupboard as bare as possible, buying only that which would be immediately eaten...

...This penalty is paid because many of the poor never learned the basic shopping skill of value comparison, and hence would rather buy from a man they know than to venture into a different and sometimes alien world...

...An upgrading of laws in the states relating to frauds can also be of inestimable help...

...The Commission was making a detailed study of the nation's food distribution system, including reasons for the increasing cost of food to all consumers, without a corresponding increase in return to the farmer...

...To help them, the OEO, under its nation-wide Community Action Programs, had approved 139 consumer education projects by August 10...

...A few states have now adopted injunctive protection, which can be granted when there is a likelihood that a seller "is about to engage in" an illegal practice...

...The dearth of large-scale shopping outlets, coupled with the fact that the poor prefer the "friendly," neighborly smiles of the door-to-door peddler or the personal service of the high-rate credit store, brings a definite price penalty...

...I hope that the private sector assumes its responsibilities...

...These informal sessions later became the nucleus of two consumer conferences which attracted more than 1,000 low-income people...

...the latter did tend to charge more...

...In discussing this problem with a leading supermarket executive recently, to my gratification I heard him say, "If the will to find the answer is strong enough, the answers will be found...

...High land costs and often the unavailability of land...

...But prices are only part of the story...

...She went on to explain that they noticed that the middle-class supermarkets not only seemed to have better values, but were cleaner, and the food was fresher...

...One community leader in Baltimore found that his discussions on "family life" were turning to questions on consumer problems...

...Credit is, perhaps, the worst problem...

...The ultimate result was a credit union for low-paid factory workers...

...Since the BLS study, corroborating evidence has arrived from other sources...

...Just as there is a lack of supermarkets in low-income areas, so too, for items other than food, there is a lack of stores which offer the buyer a wide variety of choice, price, and quality...

...We must, for example, rebuild our inner city marketplace as we are rebuilding our cities, for only an improved food distribution and retail system can lead the attack on the basic causes for the fact that the poor pay more for their food...

...as high as $1.05 for a pound of butter, or seventeen cents above the city average at the time...

...I do not think that the supermarket executive was referring wholly to Federal aid, for lately such large scale food markets have been profitably opened by private operators in at least two major cities...

...In one case, a janitor who was persuaded by a glib salesman to buy two pairs of eyeglasses for $118 and could not maintain his payments, found that part of his meager $22.50 weekly paycheck was garnisheed...

...And answers can be found...

...They may also need a more personalized type of service, one which includes financial counseling together with legal services...

...In Washington, D.C., a large chain opened a store on August 10 which now is busy serving an area where previously there had been no large market...

...The perpetrators of such schemes frequently continue their activities for a considerable time after charges have been preferred, because court dockets are crowded and the delaying tactics many...

...The speaker represented a small group of Negro domestic workers who had unexpectedly come to my office shortly after I had been appointed chairman of the Committee on Consumer Interests by President Johnson...

...Among its services to consumers is a home economist, available on the premises, to advise customers...

...The experience of social workers bears out the fact that all such programs must focus on counseling—legal, financial, health, nutritional—and that the needs are so many that cooperative action is necessary by business and private organizations as well as local, state, and Federal governments...

...The projects center around homemaker services, credit unions, cooperatives, legal services, consumer counseling, and consumer information...