Once I flunked out of college and went to work at a minimum-wage job ($4.75 an hour back then) I was poor, by definition. I came from an upper-middle-class family (which was one generation removed from poverty) and I witnessed there how the middle-class and upper-middle-class squander huge amounts of money chasing status. And later in life, when I became wealthier, I would make those same mistakes. The rich don't take our money away from us, we willingly give it to them.
"a construction worker who stopped by RightCheck frequently to have his checks cashed, handed over a check for $5,000 for cashing, which required a 1.95 percent fee—$97.50. Servon questions why Carlos would willingly pay such a large fee—plus the $10 tip he leaves Servon"
The other argument made in the article, with regard to payday loans, was that these "borrowers" could use a lower-interest rate credit card they had (with 20% being lower than a payday loan!) but made the wise choice not to as they knew that a default on a payday loan would not be reported on their credit.
This is an odd and ridiculous argument on a number of levels. First of all, borrowing money is never the answer to money problems - it just makes you poorer. And the higher the interest rate you take out, the poorer you get. And payday loans are a one-way trip to oblivion, or at least bankruptcy.
Second, intentionally taking out a loan knowing you will end up delinquent on it makes no sense at all. This is simply a poor choice that makes you poor.
But getting back to elitism, the author really doesn't address why these poor people (cashing $5000 checks!) are so poor. And again, it is not because they are starving to death. They are not getting a payday loan to buy bread for starving babies. They are borrowing money in many cases for status.
You see, on the same corner as the check cashing stores and whatnot, is the rent to own bling rim shop and the rent to own furniture store and the buy-here-pay-here used car dealer. Don't forget the tattoo parlor and piercing shop! And no, they don't "need" a clapped-out monster SUV to "commute to work in" - they are merely making bad choices to obtain status among their peers. They could choose to make different choices. But they choose not to.
For me, after living a decade or so in marginal living quarters, just "getting by" on my income (but having a hobby car, nevertheless, and spending a lot on weed, beer, and junk!) I decided I wanted more. I went back to school, sometimes working three jobs at the same time, and eventually moved away to a better place with better opportunities (not to mention lower taxes). I made different choices and pulled myself out of poverty. Others stay down. But it is a choice, in most circumstances.
This does not mean it is an easy choice. And as usual, there is a Science Fiction story which helps one to understand how people can get trapped in situations like this.
Robert A. Heinlein's Logic of Empire illustrates the problems facing the very poor. In the story, two wealthy Earthmen argue as to whether laborers on Venus are indeed slave-laborers. One argues that their condition is akin to slavery - they have no choice in the matter and cannot buy their way out of their onerous contracts. The other argues that harsh contract terms are necessary to prevent them from quitting on a moment's notice.
They get drunk and place a bet, that they can go to Venus and find out for themselves what the deal is. They sign on as contract laborers, and.... well, find out that in theory you can work your way out of poverty, but in reality, it is damn difficult to do. The fact they all get addicted to narcotics within a week of landing there is part of the problem.
And that story reflects the reality of poverty in the United States. Yes we all have choices in these matters, but actually making these choices is damn hard to do. Having the wherewithal to give up on smoking pot and drinking beer - and walking away from friends and family members who did - was not an easy task. For many, this emotional decision is hard to make. When you are immersed in a culture where poverty is the norm, it is hard to visualize a situation so unlike your own. So you assume that people who are rich are "nothing like you" and somehow lucked out by inheriting money or whatever.
Read that story (the link is to a free online copy of it). It sort of illustrates the problems involved.
And the author of the Atlantic piece is partially right - we should offer better deals to the poor, so they are not exploited. The problem with that argument is, who pays for these deals? Banks did not walk away from serving the poor out of racism, spite, or fear. They walked away because they lost money on poor customers - lots of money.
The upshot, however, is this - pining for a change in society's rules is fine and all, but not likely to happen overnight - if it happens at all. If we paint ourselves as helpless victims, nothing ever changes. If enough people stopped patronizing check cashing stores and payday loans, they would go away.
On an individual basis, you have to decide what your choices are in life. It isn't easy, but walking that extra block to a real bank, and then managing your funds down to the penny will result in a far better outcome in your life.
It ain't easy, but rewards are there for people willing to do hard things. And do we want to reward those who don't?