>how do they do any of the other things that typically require photo ID?

When they are poor enough they either don't or have incredibly limited funds. I'm not sure what you don't understand about this

I just have a really hard time believing there is a large group of individuals without ID when it is essentially mandatory for modern life as an adult. I also am having difficulty believing that the usually less than $25 fee for government issued ID is an obstacle to anyone.

Personally I think a verified voter ID should be both required (so as to prevent voter fraud) and provided freely to everyone.

All that means is that you have an incredibly limited perspective shaped by your personal experiences. I would urge you to talk to people who are living on the streets or who work one or more minimum wage jobs to raise a family