Jonathan Rosenblum worries about The Hidden Costs of Poverty, including its negative effects on children:
Though the economic crisis of the chareidi community in Israel is much discussed subject, that discussion typically focuses on the threat to our yeshivos or trumpeting the percentage of children under the poverty line to demonstrate the failure of the government’s social and economic program. Much less frequently discussed is the impact of poverty on our homes and families. …
NOT UNRELATED TO THE STRESS ON MARRIAGES from a lack of money even for basic necessities is the adverse impact on children. We would like to think that the simplicity with which we live conveys to our children a message of mesirus nefesh for Torah. And that is no doubt true in many cases.
But where there is constant discussion in the house of a lack of money or squabbling between parents over monetary matters, the children may end up receiving a message far different than that which the parents intended to convey. The message for many children in such a situation is that money is the solution to all problems and that Torah learning is the cause. And that may be true even where the parents mesirus nefesh is in fact extraordinary and a reflection of both parents’ sincere desire to sacrifice for the husband’s growth in Torah learning. …
In the end the hidden costs of rampant poverty on the quality of our marriages and our children may turn out to be even greater than the more obvious consequences of poverty.
More recently, he pleads for us to talk seriously about poverty, including, again, its effects on children:
The poverty figures are well known. What is less frequently discussed, however, is the toll that crushing poverty takes on individual lives and our society as a whole. I would not go so far as the talmid chacham who recently told me that poverty underlies every one of our problems as a society. But I would say that poverty exacerbates, sometimes greatly, every single problem from drop-out youth to marital discord. Speak to any chareidi social worker, working mainly with low-income clients, and you will quickly understand all the multiple consequences of never-ending financial stress.
Every expert in the field of “at-risk” youth, for instance, will tell you that learning difficulties are a leading predictor of later drop-out. Many early learning problems can be overcome. Tutoring, different forms of remedial therapies, and sometimes drugs or alternative medicine remedies can all play a major role. But tutoring is expensive, often prohibitively so for a family struggling to put food on the table. And even where therapies are covered by health plans, stressed parents, with multiple children to attend to and no car to easily transport the child in need, may simply not take advantage.
But every cloud has a silver lining; Malcolm Gladwell tells us that Andrew Carnegie believed that “the cottage of the poor” is the incubator of great men:
The rags-to-riches story—that staple of American biography—has over the years been given two very different interpretations. The nineteenth-century version stressed the value of compensating for disadvantage. If you wanted to end up on top, the thinking went, it was better to start at the bottom, because it was there that you learned the discipline and motivation essential for success. “New York merchants preferred to hire country boys, on the theory that they worked harder, and were more resolute, obedient, and cheerful than native New Yorkers,” Irvin G. Wyllie wrote in his 1954 study “The Self-Made Man in America.” Andrew Carnegie, whose personal history was the defining self-made-man narrative of the nineteenth century, insisted that there was an advantage to being “cradled, nursed and reared in the stimulating school of poverty.” According to Carnegie, “It is not from the sons of the millionaire or the noble that the world receives its teachers, its martyrs, its inventors, its statesmen, its poets, or even its men of affairs. It is from the cottage of the poor that all these spring.”
And Hazal believed this too:
שלחו מתם … הזהרו בבני עניים שמהן תצא תורה שנאמר יזל מים מדליו שמהן תצא תורה ומפני מה אין מצויין תלמידי חכמים לצאת תלמידי חכמים מבניהן אמר רב יוסף שלא יאמרו תורה ירושה היא להם רב ששת בריה דרב אידי אומר כדי שלא יתגדרו על הצבור רב אשי אומר משום דקרי לאינשי חמרי רבינא אומר שאין מברכים בתורה תחלה …1
הזהרו בבני עניים. להשתדל ללמדם תורה שמהן תצא תורה שאין להם עסק אחר ועוד שדעתם שפלה עליהם:2
A related statement of Hazal:
[שלח] (רבי יהודה בן בתירא מנציבין) … הזהרו בבני עמי הארץ שמהן תצא תורה3
הזהרו בבני עמי הארץ. שנעשו תלמידי חכמים לעשות להם כבוד שמהם תצא תורה לישראל שהרי יצאו שמעיה ואבטליון מבני בניו של סנחריב ומבני בניו של המן למדו תורה בבני ברק כדלקמן …4
So perhaps the current economic difficulties portend a banner yield of Gedolim in the next generation …