Just got back from Washington, D.C. where I took part in various activities related to a certain book (since we're still in soft launch mode, I shall withhold my barrage of obnoxious self promotion ... for now).
Anyhow, thanks to Barry Klein for passing along this article about an organization that helps the poor by (gulp) putting them in cars:
- Advocates say Ways to Work, which has underwritten $36 million in loans to 24,000 families since it began as a small program in Minnesota in 1984, is part of a new model for social service programs, one that delivers human services aimed at economic self-sufficiency. Borrowers in the program, which is in place at about 50 human services organizations in 25 states, are low-wage workers who have poor credit or no credit. The program is targeted at getting them not just cars, but also decent credit scores and bank accounts.
The nonprofit, which has grown swiftly and hopes to quadruple the number of loans it makes over the next five to six years, has a repayment rate of 90 percent. The program grew nationally with early funding from the McKnight Foundation and loan capital from Bank of America Corp.
Most of the loans are two-year loans for up to $4,000, with interest rates capped at 8 percent and monthly payments capped at $182.
A recently released study Ways to Work commissioned found its borrowers reported take-home pay increases averaging 41 percent, with their average annual income growing to $15,312 from $11,904. More than half the recipients said they were able to get better jobs because of their cars. Nearly four out of five parents with young children said they were able to put them into a more satisfactory day care arrangement.
Some results from participants in San Mateo County, California:
- the amount of work they miss after getting a car is down 92 percent. Their transit time to work is cut by 91 percent, and more than one-quarter say they have been able to attend job-related education they couldn't have reached without a car.
Sure helping the poor become self-sufficient is all well and good, but aren't cars, um, bad?