Poverty politics

"Poverty politics" Continued...

Issue: "Upside down," April 9, 2011

Statisticians and savvy politicians have been aware of these problems, but the measure of poverty stayed the same. And it's hard to get it right: A one-size-fits-all poverty line is hard to draw, and the definition of poverty is a political football. If it changes, some states now classified as poorer will be enriched by federal funds, and some that do better in fighting poverty will lose.

Last year with Democrats dominant at both ends of Pennsylvania Avenue, the Obama administration moved toward changing in four ways the definition of who is poor. Officials embedded radical ideas among some sensible proposals. Among the noncontroversial: When calculating the Supplemental Poverty Measure, take into account welfare payments that those classified as poor receive from about 80 programs. Doing that reduces hugely the number of people defined as going without the basics.

A second SPM change will reflect changing social relationships, with cohabiting couples treated as if married, and the default family pattern seen as one adult and two children rather than 2 + 2. That's realistic but troubling-and given how often cohabiting couples break up, this calculation may mask some poverty problems.

The third SPM change-take into account geography-has a political edge. Housing costs tend to be higher and unemployment greater in states that are more unionized and less oriented toward free enterprise. If the Supplemental Poverty Measure becomes the norm, blue states in general will get more money, red states less.

The fourth SPM change could be the most controversial: Instead of assessing basic needs, the poverty measure will be based on what Americans at the 33rd percentile pay for food, clothing, shelter, and utilities, plus an additional one-fifth of that for other purchases.

For determining whether a household is officially poor, the SPM will count as income money from all sources plus the value of food stamps, housing and utility subsidies, and government nutrition programs. The SPM will subtract from income taxes, work-related expenses, medical out-of-pocket expenses, and childcare costs.

Got it? One thing you may have skipped by in that complicated formula is the designation of the 33rd percentile as the poverty marker. Why 33 percent? The Census Bureau usually reports in quintiles, so why not 20 percent? Maybe because that would substantially lower the number of persons counted as poor.

Using the 33rd percentile, though, the typical "poverty threshold" will climb from the current $22,000, in round numbers, to $25,000 for a household with two adults and two children. (Remember, they spend more than that.) Suddenly millions more will be defined as poor, the poverty rate will jump from about 14 percent to about 16 percent, and a drumbeat for more federal spending can pick up intensity.

Another reason for the 33rd percentile might be that it has some history behind it. Franklin Roosevelt famously spoke in 1937 about one-third of the nation being ill-housed, ill-clad, and ill-nourished: Even if most of that one-third is now decently housed, clothed in ways that make children around the world imitate us, and over-fed (although sometimes still ill-nourished), it's still the bottom third. Liberals who see inequality as the enemy cannot stand this.

Conservatives, though, should criticize the concept that if everyone's income doubles over the course of a decade, the number of people considered poor does not change: That will move us from "A rising tide lifts all boats" to "Your boat is still bigger than mine." Furthermore, our real public-policy goal for those now classified as poor should be not to trap more in welfare but to create more economic opportunities for them to leave poverty.

It's fun, in a policy-wonk way, to play with numbers. For example, adding the cash value of food stamps reduces the number of officially defined poor people by 2 million. Other changes increase the numbers. But it's a bit like the joke about the old person delighted to learn that, due to border changes, her town in Russia was now part of Poland: "Wonderful-I couldn't stand any more of those Russian winters."

It's no joke, though, if we play with numbers instead of concentrating on helping those who are truly tired, aching, and without hope. It's no joke if the federal government increases the clout of officials whose power depends on defining more people as poor. It's no joke if we head down a relativizing road that makes envy rather than enterprise our national pastime.

Marvin Olasky
Marvin Olasky

Marvin is editor in chief of WORLD News Group and the author of more than 20 books, including The Tragedy of American Compassion. Follow Marvin on Twitter @MarvinOlasky.


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