This isn't an argument that poor people make bad economic decisions. Rather he is arguing that they are making decisions that are rational from their perspective.

Investing 10 dollars in the saving account would just reduce their poverty from 100% soul crushing to 99.9999995% soul crushing at some point far down the road, assuming they live long enough to collect. But winning the lottery would get them out of poverty entirely, now. Suddenly the lottery ticket idea doesn't sound so bad.

Personally, I think he has a point. But I think the idea that the poor often have a short sighted and self defeating culture is also true. Which has more impact is something I will have to think about.

Jay