Universe 25 Showed Me The Real Reason People Stay Poor

Universe 25 Showed Me The Real Reason Poor People Stay Poor

“We never free a mind once it reaches a certain age. It is dangerous. The mind has trouble letting go.”

Those were the words Morpheus spoke to Neo in the 1999 film “The Matrix”—the movie some of the teenagers in my boxing class describe as “The one that came out last century, where nothing is real.”

While that description is technically correct, it sure did make me feel a little old.

And while yes, that movie where nothing is real came out 27 years ago, that line holds the key to understanding why the poor get poorer.

If your parents were broke, there’s a good chance you’ll be broke too.

And not because they did something like put a phone bill in your name when you were 5, after they got the phone cut off and couldn’t pay it off. This was a common occurrence in the hood, and it happened to me. I don’t even know if they can even do that anymore, but it happened.

The real reason is that you picked up their habits and beliefs about spending and money, and even as an adult, those stuck with you.

Watch/listen here

Universe 25: The Mouse Experiment That Showed How Dysfunction Is Passed On

To fully appreciate the significance of this, we have to revisit one of the more fascinating experiments in sociology—Universe 25. Before we go any further, here’s a very quick, top-view, abridged, TL; DR summary of Universe 25.

Researcher John Calhoun created a “mouse utopia” with unlimited food, water, and shelter. The population exploded, but as the enclosure became socially crowded, normal behaviors began to break down.

Mice started crashing out on other mice; mothers just abandoned their young; the mice stopped hooking up and having babies; and eventually, the entire colony died out, despite ample food, shelter, and a complete lack of external predators. I say external, because the mice really started going in on each other.

I’ve written two video essays that go more in depth on Universe 25, covering the rise and fall of the mouse colony, the disturbing similarities between humans and looksmaxxing and the mice in the experiment, and the implications and predictions for society as a whole.

Those video essays sparked a lot of interesting replies in the comments—everything from “the mice aren’t people” to declarations that it was the inbreeding of the mice that caused Universe 25 to collapse, to the well-intended but poorly thought-out rebuttal of “the experiment is bunk because it’s never been repeated.”

Which, by the way, doesn’t mean an experiment is bunk.

History is full of experiments that were never repeated—not because they were worthless, but because they were unique or ethically impossible to recreate.

No one recreated the Dutch Hunger Winter to confirm that famine affects unborn children. No one reran the Minnesota Starvation Experiment because intentionally starving people for science is unethical.

The same is true of some of psychology’s most famous studies. The Third Wave classroom demonstration has never been recreated in its original form, and the Stanford Prison Experiment will almost certainly never be repeated under the same conditions.

Both are heavily criticized today, yet they still appear in virtually every introductory psychology textbook because they revealed important insights into authority, conformity, and the power of social environments to shape behavior.

That’s how science usually works.

An experiment doesn’t have to be perfect to be valuable. It has to reveal something worth investigating. And Universe 25 absolutely fits that criterion.

But not all comments were so critical. In fact, most of them were appreciative, supportive, and a few were enlightening. That last category of comments—the enlightening ones—exposed me to some things I did not know about the experiment.

Specifically, one user informed me that some of the mice’s offspring born into the dysfunctional, declining version of the Universe of 25 were actually taken out and placed in a new normal mouse neighborhood and even set up with mice of the opposite sex in a sort of “Tinder for Mice” setup, but it was too late.

They carried their dysfunctional behavior with them into the new habitat, where the mice weren’t living in hell of their own doing. The mice in the new environment not only could not behave like civilized mice, but they weren’t even interested in swiping right for a night of fun with their potential mates.

When I read this, I immediately saw another parallel to human behavior: poverty, crime, and social mobility.

You’re A Product Of Your Environment

Let’s start with something obvious.

The environment you were raised in and the people you were raised by have an incredibly powerful effect on how you turn out. You pick up the language, beliefs, preferences, and even the fears of the people around you.

From the day you’re born until about 10 years old, most of those influences come from your family. And then, from 10 years old on, you spend more time with peers, and those peers have a big impact on you.

We’re going to come back to *just how* big an impact your peers have on you in a bit, but for now, I want to focus on the family bit because—like the mice—we learn a LOT from our family in our early years.

Yes, we are infinitely more complex with much more to learn, but many lifelong habits, skills, abilities, and perspectives are ingrained before we are even 10 years old.

And the only thing you can do is become aware of them, but they are still operating in the background. One of those habits we pick up from our family is our financial literacy.

There’s a tweet that makes the rounds every few months about how schools should teach financial literacy, as if it’s a complex skill and the only reason people are struggling is that no one ever taught people how to create a budget and balance a checkbook—wait, do people even use those anymore?

Either way, I bring this up to point out that while it may feel like financial literacy is something learned and thus teachable, the reality is that it’s more like something absorbed and assimilated.

Long before you understand compound interest, credit scores, or investing, you’ve already spent thousands of hours watching how the adults around you earn money, spend money, react to emergencies, think about the future, and define success.

Those patterns become the default operating system you’re building any programs on, regardless of their sophistication, effectiveness, or efficiency.

Shortform is a platform that offers detailed guides to thousands of popular nonfiction books.

Rather than just summarizing what the book said à la ChatGPT or Claude, Shortform’s book summaries and guides are written by real people—I know because I “auditioned”—and people have a way of synthesizing and making connections that your favorite LLM just can’t do.

Shortform doesn’t just summarize the books. It breaks down the key ideas, adds helpful context, draws connections to related concepts, and includes recommendations for other books to read if you want to go deeper.

If you don’t have time to read the whole book, the great thing about Shortform is that it lets you keep pulling on a thread after a video like this without committing to a college-level reading list..

If this video got you thinking, I’d start with The Psychology of Money by Morgan Housel, The Righteous Mind by Jonathan Haidt, and Thinking, Fast and Slow by Daniel Kahneman.

They all tackle the same question from different directions: why we behave the way we do long before we think we’re making conscious decisions.

Shortform takes those books and distills them into clear, practical guides you can finish in about twenty minutes. You get the major ideas, the supporting research, and actionable takeaways without investing a lot of time or money.

So whether you’re trying to understand money, human behavior, or why changing your environment can change your life, it’s one of the fastest ways I’ve found to go deeper into the ideas we talk about here.

If any of those books sound interesting, check out Shortform using any of these links to get a one-week free trial and, if you stay on, 20% off your yearly subscription.

The Earlier The Change, The More Different The Outcome

The Moving to Opportunity study was a landmark experiment conducted by the Department of Housing and Urban Development. You probably know this as HUD, but you can also think of them as the landlords for America’s public and subsidized housing, a.k.a. the projects and section.

From 1994 to 1998, the Moving To Opportunity study tracked ~4,600 low-income families in high-poverty public housing projects across Baltimore, Boston, Chicago, LA, and New York who were randomly assigned to three groups.

One group received housing vouchers that could be used only in low-poverty areas for the first year, along with counseling to help them find housing. After a year, they could use their vouchers anywhere.

The second group received vouchers that could be used immediately and anywhere, regardless of poverty level, but received no counseling.

The third group…well, they got nothing but the same government benefits they were already receiving. Not great for them, but I guess every experiment needs a control group.

Well, ten years later, Raj Chetty—a man who has made a career out of studying how childhood environments shape adult outcomes and a name that will come up a few more times in this video—followed up with the children who had participated in the study. What he found was remarkable.

Children who moved from higher-poverty public housing to lower-poverty neighborhoods before adolescence—specifically, the age of 13—earned significantly more money as adults, were more likely to attend college, and were less likely to become single parents than children who remained in high-poverty neighborhoods. The younger the child was when they moved, the larger the benefit.

The part about this I find most fascinating is that the only thing that changed was the neighborhood. Aside from the housing vouchers, the participants received no extra benefits, no new jobs, and the same families that lived in the hood now lived in parts of the city where you didn’t have to worry about crackheads snatching your kid’s bag of candy when they went trick-or-treating…if trick-or-treating even happened because of that pesky gang violence.

And going back to those mice—specifically the ones that were put in a new environment but carried some of the same habits—they were between 300 and 350 days old. The equivalent human years would be between 25 and 30.

Harkening back to Morpheus, you can’t free a mind after a certain point.

This idea seems to hold, regardless of the species. But it’s fascinating to see that just as mice carried their lack of survival skills into a calmer environment, humans seem to do the same.

You Can Take The Boy Out Of The Hood, But You Can’t Take Hood Out Of The Boy

The Moving to Opportunity study also showed this as well.

In fact, the original purpose of the study was not to evaluate the future impact on the children involved. It was to examine the impact on the adults.

And if you’ve been following along thus far, the results will not surprise you.

There was no increase in educational attainment, earnings, or employment in either group that relocated. In fact, there was actually a slight decrease in employment.

It turns out that you can take the nigga out of the hood, but you can’t take the hood out of the nigga.

All jokes aside, the reason for this socioeconomic stalemate in the adults is the same reason for the upward mobility that so many of the relocated children experienced.

To understand this, think about the neighborhood you live in for a moment. What makes it feel like home?

It’s not just the stuff in your house, but the people you’ve come to know.

Assuming that you don’t live next to psychos or someone on the sex offender registry, most people are at least on a first-name basis with a few people on their street, regardless of how rough that street is.

Those connections, more than the address, are what make a neighborhood or even an entire city feel like home. The interactions between you and the people who inhabit that space.

The adults who moved to a new neighborhood—although it was safer and nicer—not only didn’t know anyone but also struggled to fit in.

Their minds were well past the point of being freed, so assimilating into the neighborhood and benefitting from the people around them was probably limited to a simple “hi” when you see someone putting the trash on the side of the road.

But kids, on the other hand, well, that’s something a bit different.

Unlike adults, kids don’t have the luxury of *not* interacting with their peers. I mean, there are certainly antisocial loners, but they are few and far between. Plus, you have to remember: this research was done in the 90s.

You couldn’t just hang out all day watching guys break down mouse experiments and socioeconomic theory on YouTube.

Even the video gaming experience was different. When I went to school out of the hood across town, I met my best friends because we were talking trash about who was better at Marvel vs Capcom.

We went to the arcade, put a quarter on the sticks, and settled it. And we became friends that way.

It’s way easier for kids to integrate into the world around them, and when they do, they become more like the kids they’re surrounded by. Again, Raj Chetty demonstrated this.

Show Me Your Friends, I’ll Show You Your Future

In 2022, Raj Chetty and his team analyzed data on 72.2 million Facebook users aged 25 to 44.

To be included, users had to reside in the United States, have been active on Facebook within the previous 30 days, have at least 100 U.S.-based Facebook friends, and have a known ZIP code. That gave them a dataset representing roughly 84% of Americans in that age range.

Without getting into the weeds, they developed a way to estimate people’s socioeconomic status and map the friendships between people from different income levels.

They were trying to answer a simple question:

What is the strongest predictor that a poor kid won’t stay poor? Or, if you want to take a more cynical angle on the question, what’s the strongest sign that you ain’t gonna make it?

It turns out that the single greatest predictor that you won’t be poor when you grow up—assuming that you grew up poor—was whether or not you had become friends as a child with people who weren’t poor.

And I want to be very clear here, because the researchers were very clear: the effect was not observed if you merely went to school or did activities with kids who had more money.

Only the kids who built legit friendships—the type where you’re over their house so often the parents could claim you on their taxes—with more affluent kids experienced the effect.

Also, much like the Moving to Opportunity research, the effect was stronger the earlier in childhood those friendships were made.

Now there are a number of reasons why this could be. It could be anything from seeing examples and gaining mentorship to being offered networking and employment opportunities.

Most people default to the latter explanation—after all, the old saying goes “it’s who you know, not what you know”—and that’s certainly true, but in this case, it’s not in the way that most people expect.

Setting An Example Without Trying

Networking certainly helps. I won’t insult your intelligence by suggesting otherwise.

If your friend’s father owns a plumbing company and offers you a summer job, or your roommate tells you about an internship before it’s posted online, those are real advantages, and we know that a majority of jobs are filled before they even get posted. The posting is more of an HR courtesy to give the illusion of purely meritocratic hiring.

But if networking were the primary explanation, we’d expect simply attending the same schools or living in the same neighborhoods as wealthier children to produce the same results.

But Chetty’s team found that it didn’t.

The effect appeared only when children formed genuine friendships across socioeconomic lines, not when they merely occupied the same physical space, even if for 4 to 7 years or longer.

What’s really happening is something much deeper: calibration.

Every person develops an internal gauge for what a normal life looks like.

Long before we’re old enough to even think about beliefs and values and begin consciously developing them, they’re being modeled and shown to us.

You internalize what work, money, and relationships look like before you even know what those things are.

You learn how much money is enough, how to handle debt or plan for emergencies, and even whether you should look for work, start a business, or live off the system.

You don’t get answers to these questions from textbooks. You absorb them by watching the people around you.

Psychologist Albert Bandura spent much of his career demonstrating that children learn through observation.

In his famous Bobo Doll experiments, children who watched adults behave aggressively became more likely to behave aggressively themselves, even without explicit instruction.

They weren’t taught aggression in a classroom. They just watched what adults considered acceptable behavior and calibrated their own behavior accordingly.

Money works much the same way.

A child growing up in a family where saving for retirement, paying bills on time, and discussing college are routine doesn’t view those behaviors as exceptional. That’s just regular life, and they at least expect to maintain the status quo.

On the flip side, a child who grows up surrounded by chronic unemployment, payday loans, frequent evictions, or constant financial crises doesn’t necessarily think that these things are good. They just think they’re normal.

There is a subtle but significant distinction between what a person thinks is right and what a person thinks is normal, and it’s one of the most powerful forces shaping our future..

This idea extends way beyond finance into every aspect of your life.

If no one you know has ever attended college, college feels less like an obvious next step and more like something other people do.

If everyone in your social circle works forty-hour weeks, that’s what adulthood looks like. If everyone hustles multiple jobs or relies on gig work, that becomes your reference point instead.

Behavioral economists have long recognized that people evaluate their circumstances relative to a reference group rather than against some objective standard.

We instinctively compare ourselves to the people around us. Our ambitions, expectations, and even our definition of success are calibrated by our peers far more than by abstract ideals.

The children who escaped poverty didn’t simply gain access to wealthier people. They gained access to a different version of normal.

The affluent friends in Chetty’s study likely did much more than provide networking opportunities. They demonstrated, often without realizing it, what life looked like in households where college applications were expected, careers were planned years in advance, retirement accounts existed, and financial emergencies weren’t weekly occurrences.

Those children weren’t merely exposed to more resources; they were exposed to different assumptions about how life unfolds.

Once you change someone’s definition of normal, you don’t have to convince them to pursue a different future.

They’ll often begin pursuing it on their own because, from their perspective, that’s simply what people like them do.

What Morpheus Was Really Telling Us

When Morpheus tells Neo, “We never free a mind once it reaches a certain age,” he isn’t really talking about computer simulations. He’s really talking about identity.

By the time we’re adults, the world isn’t just something we live in. It’s a set of experiences we’ve absorbed AND something we’ve built following the subconscious lessons we’ve taken from those experiences.

The voices of our parents become our inner monologue. The habits of our peers become our instincts. Our friends’ expectations become the standards by which we judge ourselves.

What began as our environment becomes our identity, and it’s nearly impossible to separate the two.

I always tell people that moving to escape your problems won’t help, because you are the source of them. No matter where you go, you will recreate them. I figured that out intuitively, but it seems like there is a psychological —or at least philosophically verified, if such a thing exists—confirmation of the idea that manages to piss a lot of people off when I point it out.

The adults in the Moving to Opportunity study were given safer neighborhoods, better schools, lower crime rates, and cleaner streets. But they didn’t suddenly become different people because the neighborhood around them changed. They had already internalized one version of reality.

The children, on the other hand, were still writing the software. They hadn’t yet decided what adulthood was supposed to look like. Their expectations and identities were still under construction, so the new environment became part of who they were instead of something they merely lived beside.

The same pattern emerged in Calhoun’s mice. When adult mice from the collapsing colony were placed into healthier environments, they didn’t instantly begin behaving like mice that had grown up there. The old colony had become part of them. They carried it into the new enclosure. Their physical surroundings changed overnight, but their behavioral world did not.

Perhaps that’s the most unsettling lesson of Universe 25.

The experiment wasn’t simply showing that environments influence behavior. We already knew that.

Rather, it suggested something far more profound: given enough time, an environment ceases to be something around you and instead becomes internalized.

Again, you can take the nigga out of the hood, but you can’t take the hood out of the nigga.

That’s why escaping poverty is about more than just earning more money.

Changing the scenery is relatively easy. Rewriting the version of the world you’ve carried around with you for years is the real challenge.

Now, if you grew up poor, this might sound like a downer, but there is a message of hope in all of this.

If our identities were purely genetic or fixed after a certain point, there would be very little we could do about them.

But the evidence points in another direction. We become the people our environments repeatedly ask us to be. That means we can also become different people by repeatedly placing ourselves in different environments, around different expectations, and among people whose version of “normal” is better than our own.

The process is slow because identity changes slowly, but it changes nonetheless.

Maybe Morpheus was only half right.

Freeing a mature mind is difficult. It may even be dangerous. But it isn’t impossible.

It simply requires recognizing something most of us never realize: the most powerful environment in your life isn’t the neighborhood you live in today.

It’s the one you still carry around inside your head.

References

Calhoun’s notes from the Universe 25 experiment
https://physicsoflife.pl/dict/pic/calhoun/calhoun%27s-experiment.pdf

Making friends with kids who aren’t poor increases chances of not being being poor as an adult
https://www.nature.com/articles/s41586-022-04996-4

Moving to Opportunity Experiment
https://www.nber.org/programs-projects/projects-and-centers/moving-opportunity?page=1&perPage=50

Moving to Opportunity Raj Chetty Follow Up
https://pubmed.ncbi.nlm.nih.gov/29546974/

Albert Bandura Bobo Doll Experiment
https://en.wikipedia.org/wiki/Bobo_doll_experiment

Dutch Winter Experiment
https://pmc.ncbi.nlm.nih.gov/articles/PMC7934722/

Stanford Prison Experiment
https://fee.org/articles/power-prison-and-punishment-the-stanford-experiment/

The Third Wave Experiment
https://en.wikipedia.org/wiki/The_Third_Wave_(experiment)