September 26, 2011
Defining and Understanding Poverty in America
Poverty and hunger in America have been much in the news in recent months. The economic conditions make this sadly expected, but I find the intense journalistic focus has done little to help us understand the issue. How much poverty we have and how bad it is remain elusive questions. The causes of poverty are, ironically, better known.
According the United Nations there is no poverty in America. This is because everywhere but America, poverty is defined by how much you consume, not how much you earn. So, an American man who is homeless throughout all of a year, but receives ten donated meals a week, 100 nights in a shelter, one free medical exam, a flu shot and a dollar a day panhandling is comfortably above the average consumption level of residents of India and sub-Saharan Africa. If he receives Medicaid, his standard of living jumps past the average Chinese citizen, along with about a half billion more Asians. Clearly the UN has a point, but satisfying their definitions of poverty is a lamentably low bar for this great nation.
According the official US poverty statistics, we perpetually have something between 11 percent and 16 percent of the population living in poverty. This has not changed since the start of the War on Poverty in 1964, and this is because our definition measures income inequality—a serious matter—not hunger or want.
A number of advocates for the poor claim that half of America’s children live with food insecurity (to quote a recent news article), and some advocacy groups claim one in five American kids go hungry each year. While this seems plausible, serious and documented research informs us that obesity is a growing health risk closely linked to poverty. While it is possible to be both hungry and fat (see accompanying photograph), the fix to this surely does not lie in more public assistance. Something different, in both understanding and approach to the issue are needed.
Poverty and want in America cannot be seriously addressed until we can develop a better metric. To do so we need to structure a measure of poverty that assesses what each person consumes, not what they earn—this is the essence of a recent recommendation by the National Academy of Sciences. This is critical, and (to exemplify the problem) it is worth noting that according to official statistics the three most impoverished places in Indiana are Bloomington, West Lafayette and Muncie. These may be places of low income but are not places where hunger and desperation loom (except after my evening class).
Measuring poverty well is not enough. We also have to realize that what we have done to remedy its grip is ineffective at best. The factors that propel and keep families poor are well known: substance abuse, quitting high school and teenage pregnancy. Sadly, poverty is not the result of economic problems, which would be a relatively easy fix. The real cause of poverty is embedded in bad decisions by teenagers, where earnest and effective remedies are few.
About the Author
Educational Attainment, the 21st Century Fund and the Future of SchoolingIndiana ranks 42nd in educational attainment.
Big Savings for Ending Prevailing WageMy statistical models show that repealing state prevailing wage laws save taxpayers money.
Re-Thinking Economic Development A large share of the most mobile families—perhaps half—no longer need to live near where they work.
Money Illusion and InflationPrice fluctuation could cause inflation to last longer, but it didn’t cause the inflation, it simply extends the pain.View archives