5 Reasons for Poverty in Memphis

To those familiar with Memphis, Tennessee, it’s obvious that the city has suffered on multiple fronts. In the early 1900s, we had Mayor “Boss” Crump, who manipulated everything he could for about four decades, and Roosevelt's New Deal offered many new laws that Crump used to his own advantage. By the 1980s the policies of the “Boss”, among other ills, began to take their toll on the city. Businesses vacated, leaving pockets of abandoned buildings and monumental towers, and entire neighborhoods fell into the grip of poverty. By the mid-90s, Memphis had firmly established its reputation as a poor city.

Twenty years later, poverty is still widespread across the city. What is holding people down? Here are five additional reasons why poverty is still an issue in Memphis today, and they all have simple solutions.

1. The War On Drugs

John Ehrlichman, a White House aid to President Nixon, has admitted why they started the war on drugs:

“We knew we couldn't make it illegal to be either against the war or black, but by getting the public to associate the hippies with marijuana and blacks with heroin, and then criminalizing both heavily, we could disrupt those communities. We could arrest their leaders, raid their homes, break up their meetings, and vilify them night after night on the evening news. Did we know we were lying about the drugs? Of course, we did.”

Even from the beginning, it was meant to suppress certain populations. By keeping them in poverty or in prison, it was easy to control them. Today we see the effects of this attitude. Millions of fathers in the U.S. can no longer participate in the workforce to provide for their families because they are either in prison or have a criminal record. Single mothers have a hard job as it is, and legal fees make life that much harder. This is one of the most obvious reasons for poverty in Memphis.


The first step in solving this issue is decriminalizing marijuana. If one recognizes that victimless crimes are not legitimate crimes, then it becomes self-evident that possessing a drug should not be a crime. Furthermore, scientific research is proving that it is far less harmful than alcohol. If drug addiction is a societal concern then it needs to be treated as a medical issue, not a crime.

2. Pilot Programs

The city of Memphis has a department called the Economic Development Growth Engine (EDGE). The name cleverly makes it sound like a good thing, and all its promotional material focuses on what good things it can do. But we must remember Frederick Bastiat's insight of “what is seen and what is not seen.” The EDGE programs are nothing more than crony capitalism (corporatism). They hand out massive tax incentives to businesses and rely on the citizens to pick up the slack through local taxes.

An example of this is the Crosstown Concourse project, for which the city has agreed to give $200 million in tax breaks over the next twenty years. Memphians will have to be taxed an additional $200 million to make up for that missing tax revenue. The money is taxed from everybody, and that includes Memphis’ poorest people—many of whom will never even have the chance to set foot inside the building.

The Beacon Center of Tennessee keeps a running total of the corporate handouts across the entire state. They recently released a documentary about another example in Memphis. This twenty-minute film details how the city bribed Ikea to build a store, and how it will negatively affect small businesses. You can watch the documentary below.



The answer to this one is easy: stop offering tax incentives. It's true that some may help corporations and bring in revenue, but there is always unseen effects. It hinders local entrepreneurs and employees. We must stop making Pilot Programs.

3. Civil Asset Forfeiture

Civil asset forfeiture began as an element of the War on Drugs. The idea was that if the police caught a drug kingpin with thousands of dollars, the police would seize the money. It also included taking vehicles and other possessions that were believed to be involved in the crime committed. But the law has expanded, and one does not even have to be convicted of a crime for the police to seize money and possessions. Now drug kingpins are not the only people being targeted for this. According to the Washington Post, there were 61,998 cash seizures without search warrants or indictments between 9/11 and 2014.

The trend has accelerated quickly in the past fifteen years, and 2014 reached a new record. In that year, more cash and property was seized by law enforcement than was taken in burglaries. In short, the police stole more from citizens than the criminals did. It has become an easy revenue stream to grow the pockets of the state, and it is nothing less than theft from the citizens.


This one also has a simple answer: abolish Civil Asset Forfeiture. In lieu of that, there is a compromise, already implemented by other states, that would improve things: change it from civil to criminal asset forfeiture such that a person has to be convicted of a crime before their money and possessions can be taken. It is still theft, but it is a step closer to where we need to be.

4. Mass Incarceration

In Tennessee, the average cost to house an inmate for a day is $76.82. If the inmate is incarcerated for a full year it is $28,039.30, and Tennessee has an average of around 20,000 inmates at any given moment. This brings the total cost up to almost $561 million dollars a year. And of course, this is funded by Tennessee taxpayers.

If they were all violent criminals, perhaps this would be okay. But we know that there are many things our government has turned into crimes that are not actually a crime. If there is no victim, then no genuine crime has been committed. Non-violent drug possession charges are not a crime by this standard. It is worth noting that 17% of all felons in Tennessee are in prison for drug charges.

Having mass incarceration hurts taxpayers in two ways. The obvious one is that we have to pay the bill. The second is that now the economy has that many fewer people in the workforce. A person or group becomes wealthy as a result of how much goods and services they produce that people want to buy. People have to be both producers and consumers for an economy to be healthy. But when you take that many producers out of the system and put them in cages they become consumers only. Even after they serve their time, a felon has a criminal record that makes it extremely hard to get a job afterward. They continue to be consumers and have difficulty becoming producers.


Many people are put in prison for reasons that I would not consider crimes. I would begin to look at what we call a “crime”. If a person has not harmed anybody or possessions or committed fraud, then was it really a crime? We can begin to lower mass incarceration by not making criminals out of innocent people.

5. Labor Laws

There are two types of labor laws: ones that are meant to help employees, and ones that are meant for consumer safety. Both of these harm people in many ways. This could be an entire article in itself if I talked about all of them, so I will speak specifically to one that has affected Memphis quite clearly, which is occupational licensing.

These are restrictions on people in certain industries that require them to file paperwork and pay a fee in order to do their job. The government cleverly says that it is for the safety of the consumers, but it is often more sinister. Larger businesses lobby for these types of regulations to help them overcome their competition. It is a way to prevent entrepreneurs from providing a cheaper or better product and secures the power among the larger businesses.

An example of this in Memphis is African hair braiding. Many women have opened up their own hair braiding businesses, but because of occupational licensing laws, these women are required to pay a fee and then take a hair styling course, which does not even teach African hair braiding! One of these entrepreneurs had already started her business and was trying to pay the bills when she was told to close her doors. She could not afford to pay for the license, and the business had to close. This is simply punishing people for trying to be productive members of society.


Any law that restricts competition should be questioned. Who will it benefit? If a law helps big businesses by harming the smaller competitors then it must be repealed.

In Conclusion, these five very simple solutions will help empower people and provide them a path out of poverty. The solutions can be done within state and local government. When more people are able to climb out of poverty it will help the economy as a whole and benefit everybody in some way.

ArticleJaron Weidner