Licensing panhandlers

A few days ago, I found myself in an interesting conversation about panhandlers and the fact that some cities require panhandlers to be licensed.

Obviously, this is a controversial issue for many reasons.

A panhandling license is just what it sounds like – a license to sit/stand in a particular area and ask for money. Why are these necessary? Unfortunately, it has been discovered that there are a number of panhandlers who pull down $30,000-$40,000 a year. They own or rent nice houses, and they frequently drive themselves to and from their panhandling position.

I have mixed feelings about this. Does having a roof over your head or owning a car mean that you’re not poor? Absolutely not. Does it mean that you can hold down a job? Not necessarily. And if a person in that position gives up panhandling, they will likely lose their house and their job and end up homeless and on the streets or in a shelter. Which will probably lead them back to panhandling in the first place. But are there people who could have a minimum wage job and earn a living without begging for money? You bet.

I think that if I gave money to a panhandler and later learned that they could hold down a job and were just asking for money because they “earned” more that way, I would feel misled. Sure, I know that if I’m giving money to a person on the street, I have no right to say how they should spend that money. They can buy food, they can buy alcohol, whatever makes them happy. It’s a gift. But at the same time, the assumption is that the person needs the money, that they rely on the kindness of strangers to help them out.

One problem with panhandling licenses is that they are rarely free. The license might cost $10 a year, but think about what $10 could buy for a person who has next to nothing. And oftentimes, the license also requires a person to have some sort of state issued photo identification. I know that where I live, I pass a few panhandlers who appear to have mental disabilities such that I would question their ability to understand the need for a license and their ability to go and get the license. And these are the people who the laws are designed to protect.

The panhandling laws appear to be designed to prevent people from taking advantage of the generosity of others and protect those who can’t earn money any other way. And yet those are the people who would have the most trouble obtaining the license in the first place.

I don’t know what the solution is. And like I said, when I give money to a panhandler, I have to remember that the money is now theirs to do with what they want. I would just rather give the money to someone who actually needs it.

Megan Smith

Megan is a 40-something government employee in the Washington, DC area. She got interested in Personal Finance when she got out of college and realized that her paycheck wasn’t going to go as far as she had hoped. Since starting this blog, she has managed to buy a house and make a solid start on her retirement goals, and hopes to help others do the same. Here is her story:

In 2007, I was a gainfully employed 20-something with no debt but not a lot of knowledge about personal finance.  It was a co-worker’s comment about Roth IRAs that sent me to the internet, searching for information.  It was then that I realized that I really didn’t know a whole lot about personal finance and that my current financial situation was due a lot to inherent frugal tendencies, generous family members, a fear of debt, and good luck.  While that was working for me, clearly I needed a better plan.

While I had no debt, I was also pretty much living paycheck to paycheck and not worrying about going over budget (I say this as if I had a real budget) because I had an emergency fund set aside to cover any overages.

Except that’s not what an emergency fund is for.

So I did a lot of research, read a lot of blogs, and decided that I needed a plan.  I needed to budget.  I needed to know what I was spending my money on.  I needed to prepare for the future.

I decided to create a blog not only to make myself accountable to others but also to share the knowledge that I gained along the way.  I’ve learned so much from my fellow bloggers, and I hope that my readers can find something useful in what I have to share as well.