How the pandemic has impacted the world’s most vulnerable populations in low- and middle-income economies

 Freetown, Sierra Leone
In Sierra Leone, 87% of rural households reported food insecurity, nearly double the median value.

  • Northwestern researchers asked 30,000 people on three continents how the pandemic affected them.
  • Households reported drops in income, as well as increases in food insecurity, and little support.
  • One of the most promising tactics for moving past the pandemic’s effects is mobile money transfers.
  • See more stories on Insider’s business page.

The COVID-19 crisis has been devastating for much of the global economy. Yet while the effects on established markets have been well-documented, less is known about the pandemic’s impacts on low- and middle-income countries, which account for the majority of the world’s population. This is partly because official statistics generally fail to capture the impact on informal markets, such as street-vendor sales, in which large sections of those economies participate.

So Kellogg finance professor Dean Karlan and Northwestern professor of economics Chris Udry, along with more than 20 collaborators, set out to measure the pandemic’s economic impact in low- and middle-income countries.

“These are the world’s most vulnerable people,” said Karlan, who along with Udry codirects Kellogg’s Global Poverty Research Lab. “The level of vulnerability is just fundamentally different in developing countries versus US and Europe, where even if someone is really low-income, they’re still better off than the poorest of the poor in developing countries, where the safety nets simply aren’t as strong.”

Read more: How to make sense of the COVID economic crisis, explained by a former US Treasury official

“We wanted to know the effect of the pandemic, and government policies to combat it, on individuals who rely on informal markets to sustain themselves and don’t have access to formal support mechanisms like social security or unemployment insurance,” Udry said.

Based on a phone survey of more than 30,000 people on three continents, the researchers found the pandemic’s impacts on developing regions to be deep, widespread, and negative: households across geographies and economic status reported significant drops in income and employment, as well as increases in food insecurity. And, crucially, few of these households reported receiving any kind of financial support.

As the authors write, for low- and middle-income countries, “the economic crisis precipitated by COVID-19 may become as much a public health and societal disaster as the pandemic itself.”

A global phone survey

While it’s not their normal method of data gathering, the researchers landed on a phone survey as the best method to use in a pandemic.

“It was like, ‘You want some data? This is the only way you can get it,'” Karlan said.

The method introduced a number of challenges for the researchers.

“We had to learn very quickly about how to conduct surveys by phone. You lose the trust and comfort that a face-to-face conversation engenders,” said Karlan.

To mitigate that loss, the researchers partnered with Innovations for Poverty Action to recruit local interviewers in each country, and took care to match languages, dialects, and accents between interviewers and respondents.

Another challenge: not everyone owns, or can easily borrow, a phone. “It meant we weren’t able to reach people without access to mobile phones,” Udry said. “That’s a whole set of vulnerable people we can’t get to until we’re able to go in person again.”

Due to this limitation, the study’s results likely represent a “best-case” scenario, as the interviews didn’t include those at the economic pyramid’s very bottom.

Ultimately the researchers conducted 16 surveys that were statistically representative of households in nine countries across Africa (Burkina Faso, Ghana, Kenya, Rwanda, Sierra Leone), Asia (Bangladesh, Nepal, Philippines), and Latin America (Colombia), starting in April 2020. Most of the surveys were coordinated by Innovations for Poverty Action.

In total, they surveyed 30,000 people living in both urban and rural areas, as well as in or near refugee camps. The researchers asked about changes in employment, income, food insecurity, access to markets (such as for purchasing groceries), receipt of government support, and domestic violence.

Bad news across the board

The study found that the negative impacts of the pandemic on developing regions are large and broad.

For example, income dropped for households in all settings during the pandemic. Across the 16 surveys, the median share of households that reported an income drop was a “staggering 70%,” the authors write, compared with a median of 7% reporting an income increase. The median share of households that experienced job loss was 30%.

In general, similar proportions of households across all socioeconomic levels reported drops in income and employment.

Moreover, the median share of households that reported food insecurity was 45%, with wide variability within and between countries. In Sierra Leone, for example, 87% of rural households reported food insecurity, nearly double the median value.

The crisis may have also contributed to increased domestic violence. In Kenya, for example, violence against women and children rose 4% and 13%, respectively, during the early months of the pandemic.

And, for the most part, people were on their own to weather the storm. Overall, the median share of households receiving government or NGO crisis support was only 11%.

The authors note that the scale of disruption seems to eclipse those of other global crises like the 2008 Great Recession and the 2014 Ebola outbreak. “The biggest take-home for me is the spread of the effect,” Udry said. “I expected the effects to be serious but didn’t realize it was going to reach almost everyone.”

“What we found makes clear the kind of calamity low-income households in developing countries are facing,” Karlan agreed.

To make matters worse, if other historical events are any guide, COVID’s impact will be long-reaching. For example, children in the US born soon after the 1918 influenza pandemic experienced lifelong declines in education and earnings compared with baseline expectations.

“One of the main messages of modern economics is that even relatively short-run shocks can have long-term effects,” Udry said. “Long after the pandemic is gone, there are likely consequences for the growth of kids’ knowledge and declines in the asset holdings of the poor.”

The impact, unfortunately, is likely to be felt for generations.

The best way forward

The research also points to policies that could help address the pandemic’s dire economic impacts – and mitigate the effects of future crises.

One of the most promising tactics is mobile money transfers from the government or NGOs, which are fast and require no risky face-to-face transaction. “We can reach a lot of people quickly with these innovative payment mechanisms,” Udry said.

Indeed, Karlan and Udry worked on this type of transfer with the government of Togo during the pandemic.

“We’ve helped them rapid-fire implement a targeted program of cash transfers to low-income households that were in the informal market,” Karlan said. “Now we’re helping the government use cell-phone data to refine and improve targeting methods, to help find low-income households and transfer them cash.” They’re exploring expansion of the strategy to Nigeria and Bangladesh.

Furthermore, the researchers say, governments and NGOs must build robust social support systems – with short-term components like Togo’s cash-transfer system and longer-term ones like skills training programs – to anticipate the next pandemic or economic crisis.

Granted, this wouldn’t be easy for the already cash-strapped governments of the countries studied here. But richer countries have an important role to play, partly for humanitarian reasons, but also because “disease transmission does not respect national borders,” as the authors write.

“We need some multinational players, like the World Bank, to help establish the methods, procedures, and technical knowledge for doing this,” Karlan said.

In general, the researchers agree that a more proactive, preventive approach is the right way forward.

“This crisis has been disastrous and widespread, with long-term effects,” Udry said. “We do have mechanisms that can help a lot of people, but we need to strengthen social security systems to provide greater resilience and support in the future. That’s the lesson to learn here.”

Karlan agrees. “We want our work to serve as a call to arms to groups,” Karlan said, “to do things like what Togo has done, to prepare for the next crisis.”

Read the original article on Business Insider

Survivors of domestic violence call on the IRS to recognize financial abuse and help them combat it

domestic violence
  • Lawmakers and domestic violence survivors told Insider the IRS isn’t doing enough to support victims of financial abuse.
  • About 99% of domestic violence survivors experience financial abuse, according to experts.
  • Over the course of the pandemic, abusers pocketed stimulus checks and might direct much-needed child tax credits to their own accounts.
  • See more stories on Insider’s business page.

For almost a year, Democratic and Republican lawmakers have been calling on the IRS to make it easier for domestic violence survivors to collect stimulus checks and tax returns.

Experts say almost all domestic violence survivors experience some form of financial or economic abuse, and lawmakers and IRS representatives continue to hold conversations about ways to prevent it.

But the two parties seem to be at odds. So far, the IRS has not sufficiently delivered on pleas to streamline filing processes, lawmakers and survivors of domestic violence said in interviews and emails with Insider.

Instead, stimulus checks and tax returns designated for survivors have gone straight to their abusers. And now, following President Joe Biden’s announcement that child tax credits are slated for rollout beginning July 15, survivors taking care of children worry their abusers will pocket that money as well.

Rimsha, a 28-year-old survivor who requested her last name be withheld due to safety concerns, said she hasn’t received any of the three stimulus checks Congress approved to offset the financial difficulties brought on by the pandemic. Her abuser filed his tax return jointly without her consent and collected them all instead, she told Insider.

Biden’s child tax credit announcement “makes me more anxious,” Rimsha said. “I’m actually more frustrated. Okay, IRS, you’re going to send that to my husband as well?”

Domestic violence survivors like Rimsha often double as caregivers who, over the past year, have had to adapt to inconvenient circumstances like remote learning while trying to earn a living and support their children.

Adding to the stress of making ends meet, the pandemic has exacerbated the financial abuse nearly all domestic violence survivors endure. Since the start of the pandemic in March 2020, abusers have had more opportunities to pocket money that’s not theirs.

While missing out on supplemental income like stimulus checks or child tax credits, survivors also have to navigate tax season.

Even before the pandemic, abusers often tried to claim children on their tax returns to get more money back from the government, according to Teal Inzunza, program director for Economic Empowerment at the Urban Resource Institute, a nonprofit that provides services to domestic violence survivors. But as the country begins to reopen fully and slowly recovers from the economic recession, that extra financial support is more crucial than ever to survivors, experts say.

“Abusers will often fraudulently sign and claim the survivor on their tax return, therefore making it so that the survivor doesn’t have access to really necessary refunds or tax return information,” Inzunza said.

In attempts to get the stimulus checks she’s owed and ensure that all other funds like child tax credits are directed to her account, Rimsha has repeatedly engaged with IRS representatives.

So far, no one has been able to help her, she said.

IRS reps on the phone have used her husband’s joint tax filing as a justification for the issues Rimsha’s facing, she said, adding that she’s even provided the agency with copies of restraining orders against him to explain her case and separate her filings from his.

“It makes me upset,” she said. “Why are the abusers getting away with this?”

Because of the abuse she’s endured, Rimsha has been diagnosed with PTSD, she said.

A congressional push to derail abusers

In a June 2020 letter to the IRS, Democratic lawmakers outlined a series of changes the agency could implement to make it harder for abusers to gain access to accounts and private information that do not belong to them.

That letter, though nearly a year old, reflects many of the same struggles domestic violence survivors still deal with today.

Among the changes recommended was the implementation of a dedicated phone line that survivors could call to report address changes, and the creation of an individual PIN that would heighten security measures and prohibit abusers from accessing or changing their partner’s information. There’s also a suggestion to add information to aid survivors like Rimsha who filed a joint tax return but are no longer with their spouses.

These changes, several lawmakers told Insider, have not been adequately addressed or implemented. And as a result, there will be survivors at risk of losing child tax credits, among other financial support, the lawmakers behind that letter told Insider.

“Right now, these benefits are at risk of being stolen by their abuser unless the IRS takes additional concrete steps to support survivors of domestic violence,” the office of Sen. Sherrod Brown said to Insider in an email.

The changes outlined in the letter remain pertinent today, almost a year after it was sent off to the IRS, lawmakers argue. Sen. Chris Van Hollen of Maryland told Insider changes to the way the IRS collects taxpayer information are needed to ensure survivors have access to “crucial resources” that make it easier for them to keep their information secure and out of the hands of their abusers.

Van Hollen’s office said the senator plans to follow up with the IRS to urge the agency to better support survivors of domestic violence, especially when it comes to financial abuse, a topic less commonly known, but widely prevalent.

About 99% of domestic violence survivors experience financial abuse, according to Blair Dorosh-Walther, program manager of economic empowerment at Safe Horizon, a New York-based nonprofit dedicated to providing resources to survivors.

“The average survivor carries over $103,000 worth of debt throughout their lifetime due to the abuse,” Dorosh-Walther said. “This leaves taxpayers with an annual cost of $3.6 trillion due to domestic violence, which is higher than some countries’ GDP.”

Other lawmakers, like Sen. Cortes Masto of Nevada who led the June 2020 letter, said they also plan to continue advocating for survivors to minimize economic abuse. Her office is collaborating with the IRS on ways to revamp the agency’s systems so they benefit survivors over abusers.

“I have consistently called on the IRS to make sure their systems are working” to address economic abuse, Cortes Masto told Insider. “There are clear steps the IRS can take to make sure that survivors can receive the stimulus payments they are owed, and I’m going to keep pushing to make sure they do so.”

Other senators are taking different approaches. Sen. Bob Casey of Pennsylvania, for example, is working on moving a bill through the Senate that “would reauthorize and improve a federal funding program which lapsed six years ago,” his office said.

“Through grants to states, tribal governments, and territories, survivors would receive services such as emergency shelter, crisis counseling, safety planning, and assistance recovering from financial abuse and housing insecurity,” his office told Insider.

The IRS did not respond to a request for comment.

Financial abuse takes many different forms

Sara Gardner, 29, considers herself both a survivor and an ally to people who’ve experienced domestic violence and financial abuse.

As a kid, her stepdad made large purchases under the guise of supporting Gardner, her mom, and younger sister.

“Growing up, it would be like, why are we not getting groceries but we bought a car? Or a new truck for my stepdad?” Gardner told Insider.

Her mom was always the parent who took care of tax filings, while her stepdad refused to contribute his portion. Only when lawmakers passed the first stimulus relief fund offering Americans $1,200 checks did her stepdad decide to contribute his information and file taxes, Gardner said. That’s when her mom learned he owed over $15,000 in federal and state taxes, Gardner said.

The anxiety of having to deal with that debt got to her.

“I cannot pay over $15,000 back to the government,” Gardner said her mom told her. “I don’t have that.”

Late last year, Gardner’s mom called while her husband was away on business and told her she had to leave him before he returned. Her mom has Parkinson’s disease and is immunocompromised, meaning she had to find isolated shelter where she wouldn’t run the risk of getting sick with COVID-19.

Having that much debt made her mom feel isolated and drove her to consider pursuing suspicious tax services that promised to “stop IRS debt,” Gardner said. Her mom’s credit score had dropped over 100 points, Gardner said.

After she left her husband, Gardner’s mom continued to receive stimulus checks, but they were written out to both her and her abuser because the IRS had their joint tax information on file. That meant both of them had to sign the check in order for the money to be deposited. Gardner’s mom didn’t want to see her abuser, and the onus fell on her to find a way to deposit the check safely and without meeting up with him.

She called the IRS, Gardner said, but a representative was unhelpful, telling her the agency couldn’t do anything since the two parents filed together. Ultimately, Gardner’s mom ended up calling their local bank and asking whether she could come in to sign the check separately from her now-ex-husband. She had to deceive him and promise she’d be there to sign the check with him, Gardner said.

She was able to connect her mom to a shelter program that advocated for her and helped her find a place.

But the financial abuse has left lingering emotional scars, Gardner said.

Her mom, for example, is afraid to spend money on anything other than bills. Because of the fear of going into further debt and losing control of her finances once more, her mom avoids spending leisurely or on personal items whenever possible.

“I buy her a grocery store gift card or a meal or a massage” as gifts, Gardner said, because she knows she will usually try not to buy these things on her own.

Money and personal finances can easily tie into feelings of self-worth and self-validation, experts told Insider. And events like tax season and periods of time that come with financial uncertainty like this pandemic can be major trigger points for survivors of domestic violence who’ve experienced economic abuse.

“With taxes, with credit reports, and then with the stimulus check, it’s just this ongoing reminder of the abuse,” Dorosh-Walther of Safe Horizon told Insider.

In Gardner’s case, her mom is “optimistic” about her future.

“I think she’s really looking forward to filing alone, to having a much more simple return,” Gardner said.

Read the original article on Business Insider

Nine Capitol rioters were charged with sexual assault or had restraining orders for domestic violence: report

capitol siege riot ladder
Rioters clash with police using big ladder trying to enter Capitol building through the front doors.

  • Nine Capitol rioters have a history of violence against women, according to HuffPost.
  • Some men previously had restraining orders against them due to allegations of domestic violence.
  • At least three are military veterans, and some of the men were once charged with rape and battery. 
  • Visit the Business section of Insider for more stories.

At least nine men who participated in the Capitol riot on January 6 have a history of exhibiting violence against women, an investigation by the Huffington Post uncovered.

The Capitol riot on January 6 left at least five people, including one police officer, dead. Members of the Proud Boys, which is classified as a hate group by the Southern Poverty Law Center, were reportedly present.

Organizers were emboldened by President Donald Trump’s urges to protest the results of the 2020 election with him, despite Democrat Joe Biden’s election victory. While members of Congress were meeting inside the Capitol building day to certify the results, supporters organized an attempted coup and stormed the Capitol building.

Upon news that the riot breached the Capitol building, lawmakers began to shelter in place and many evacuated.

Nine men who were part of the storm were charged with acts of violence against women, HuffPost reported. Some had restraining orders taken out against them because of allegations of domestic violence.

Three of the nine men are veterans, HuffPost’s Alanna Vagianos reported. Men with militaristic pasts can create “dire consequences for women,” Vagianos reported, citing Dr. Miranda Christou, a senior fellow at the Centre for Analysis of the Radical Right.

“You have forms of masculinity that depend on militarized expressions: the uniforms, the guns, the paraphernalia, the whole idea of the military structure and discipline,” Christou told HuffPost. “When the institution of the military infiltrates social life and that sense of masculinity and what makes you a man depends on that ― depends on the gun on the side of your hip ― that becomes a problem for women.”

One man, Larry Rendall Brock Jr., stormed the building carrying zip-tie handcuffs and wearing full combat gear. Brock had sent several threatening messages to his ex-wife, HuffPost reported. He was described as a “terroristic threat of family/household” during one call to the police.

larry rendall brock rioter capitol surge
Retired Air Force officer Larry Rendall Brock, Jr., wearing a combat helmet, in the Senate chamber in the US Capitol, in Washington DC on January 6, 2021.


Another man, Guy Reffitt, was spotted and photographed carrying tactical gear during the attempted coup. Reffitt in 2018 pushed his wife onto a bed and began to choke her, according to a police report obtained by HuffPost.

Guy Reffitt seen at the Capitol siege.
Guy Reffitt seen at the Capitol siege.

Mathew Capsel of Marseille, Illinois, violated a protection order after his arrest in Washington. In 2012, he had been arrested for “battery, mob action and robbery,” HuffPost reported, having allegedly struck a woman “3-4 times in the head.”

Other men who attended the riot have records marked by similar charges.

Jacob Lewis, for example, had a restraining order for domestic violence taken out against him in California, according to HuffPost. Samuel Pinho Camargo had in 2016 “intentionally caused bodily harm” to his sister.

Dominic Pezzola is a member of the Proud Boys, HuffPost reported. Police removed a shotgun from his home in 2005 after a call concerning a domestic dispute. 

Andrew Ryan Bennett also wore a Proud Boys hat entering the Capitol building, according to HuffPost. He received an 18-month prison sentence after attacking a woman at a tattoo parlor in 2003.  

Edward Hemenway served five years in prison on charges related to rape, sexual battery, and criminal confinement, according to HuffPost. He handcuffed his wife in 2004 and put duct-tape over her mouth.

And Donovan Ray Crowl had been arrested in 2005 for domestic violence charges that have since been dropped, HuffPost reported.

Read the original article on Business Insider