New Census Bureau Numbers for Poor People In the U.S.

Awhile back, I led off a posting by asking how many poor people there are in the U.S. The answer was nobody knows because the official poverty measure is so flawed.

Back in 1995, the National Academy of Sciences produced recommendations for an alternative measure that would take account of actual living costs, geographic differences and the impacts of public benefits. Experts generally agree that such a measure would be a big improvement over what we’ve got.

The Census Bureau has issued alternative poverty estimates based on the NAS recommendations. So do we now know how many poor people there are in the U.S.? No. But we’ve got at least six sets of figures that generally point in the same direction.

All four detailed sets base living costs on the Consumer Expenditure Survey–a two-part program that collects information on what Americans buy and how much they pay.

Two of these sets adjust poverty thresholds for geographic differences. One also subtracts Medicaid out-of-pocket expenses from income. The other includes Medicaid out-of-pockets in the poverty thresholds.

Looking at the first set, what we find is that, in 2008:

• There were 47.4 million poor people in the U.S., as compared to 39.8 million under the official poverty measure.
• The poverty rate was 15.8%, rather than the official 13.2%.
• The child poverty rate was 17.9%, rather than the official 19%. The drop here probably reflects the impacts of food stamps and other non-cash benefits.
• The poverty rate among seniors wasn’t lower than for any other age group, as the official measure indicates, but higher–18.7%. Rising health care costs are probably the culprit here.
• While the poverty rate for blacks was unchanged at 24.7%, poverty rates for all other race/ethnicity groups were higher than the official rates, topped by Hispanics at 29%.

The second set puts most of these figures higher.

• Instead of 47.4 million poor people, we get 50.8 million–16.9% of the population.
• The child poverty rate goes up to 19.8%, rather than down.
• Poverty rates for all race/ethnicity groups go up, with the Hispanic rate reaching 31.8%.
• However, the poverty rate for seniors goes down a bit, to 18.1%.

I wish I knew enough to know which set of figures gives us the more accurate picture.

What’s clear enough is that there were many more poor people in the country than the original Census report indicated–unless you accept the view that the Bureau’s NAS formula is seriously flawed. Here again, I wish I knew more, but the aggressively anti-government source makes me suspicious.

If the formula’s not so bad, then the Bureau’s poverty thresholds are too low. Using the NAS recommendations, the 2008 threshold for a family of two adults and two children would increase from $21,834 to $29,654.

Here’s where the need to know comes up against fiscal politics.

As I’ve written before, bills have again been introduced in the Congress to establish a new poverty measure based generally on the NAS recommendations. They would not replace the current measure as the standard for calculating federal benefits. But the alternative measure would almost certainly show that many poor people are denied benefits because they don’t fall below the official poverty line–or whatever multiplier is used for the program.

Are members of Congress ready to deal with that? What about the Obama administration, which could adopt the alternative measure on its own?

The Census Bureau said it expedited release of the NAS-based poverty estimates because both wanted to see a broader range of numbers. Now they’ve got them. Let’s see what they do.

Census Numbers Bad and Going To Be Worse

The Census Bureau’s 2008 report on income, poverty and health insurance coverage confirms what we already knew. The recession has pushed an enormous number of people into poverty. Between 2007 and 2008:

• The number of people living below the federal poverty threshold increased by nearly 2.6 million–from 12.5% to 13.2% of the population.
• The number of poor children increased to more than 14 million–19% of all children.
• Nearly 34% of black children and 30.6% of Hispanic children were poor.
• The number of children in deep poverty (below 50% of the poverty threshold) rose to nearly 6.3 million–8.5% of all children.

But this is only part of the story. The Coalition on Human Needs gives us a table that compares the most recent figures to the figures for 2000, just before the last recession set in. It shows that in 2008:

• There were 8.2 million more poor people and nearly 2.5 million more poor children than in 2000.
• The percentage of people in poverty was 1.9% higher and the percentage of poor children 3.2% higher.
• The number of children in deep poverty was more than 1.6 million (2.1%) higher.

And that’s still only part of the story because the recession has deepened since 2008. Last year’s unemployment rate averaged 5.8%. It’s now at 9.7%. And economists foresee no turnaround until some time next year, if then.

The Economic Policy Institute projects that by 2010:

• The poverty rate will have climbed to 15.1%–and to 31.6% for blacks.
• More than one in four children will be living in poverty.
• More than 46% of single-mother families will be below the poverty threshold–up from 37% in 2008.

Economists at the Brookings Institution have come to similar conclusions, though their numbers are slightly different. And they doubt the poverty rate will get back to its 2007 level during the next 10 years.

So, they say, the extra funds the economic stimulus package provides for disadvantaged families “will fade away long before the poverty rate is expected to peak.” We need to shore up the safety net for the long term, as well as to ensure that more people have the education and training they need to benefit from the opportunities the economy will ultimately provide.

Deborah Weinstein at CHN also calls both for continuing aid in the economic stimulus package and for investments that will create jobs and renew the economy. Failure to act, she says, will delay our further recovery. But it’s also “a moral wrong, since it causes preventable harm to vulnerable people.”

The harm she’s talking about speaks for itself in the poverty thresholds all these dire figures are based on. Nearly 40 million people below these thresholds–more than 17 million people at half or less than these.

Surely we can’t just tell these people to tighten their belts, keep on striving and wait for better days.

Aid to the “Deserving Poor”

Back in the Elizabethan Age, when the first public poverty program was created, poor people were officially divided into three categories:

• The deserving poor–those who should receive in-kind or cash assistance because they were unable to work due to age or illnesss
• The deserving unemployed–those who should be put in workhouses or, if very young, given apprenticeships because they were able and willing to work but couldn’t find jobs
• The undeserving poor–those who should be beaten or subject to worse punishments because they had recourse to begging

What brought this to mind was a recent article in the New York Times that focuses on the debate over the economic recovery package and our somewhat schizoid view of welfare.

As the article says, right-wing Republicans view tax relief for low-income people–but not for businesses–as welfare. It’s unearned support that stifles initiative or, in the inimitable words of Robert Rector of the Heritage Foundation, “reward[s] idleness and penalize[s] marriage.”

But what about the vast majority of policymakers–and we who elect them? We seem to agree that low-income children, elderly people and people with severe disabilities are “deserving poor.” We also seem to agree, up to a point, that this category includes other low-income people. Hence, food stamps and housing vouchers.

But in many states, unemployment insurance is reserved for low-income workers who aren’t at the bottom of the income scale. So are other important benefits like the Earned Income Tax Credit and the Child and Dependent Tax Credit. Both these credits kick in only when a worker earns more than a specified minimum and increase with his or her earnings. Do we have a spice of the “undeserving poor” mentality here?

I think there’s no question we do when it comes to the Temporary Assistance for Needy Families (TANF) program. Virtually all adults in the program are subject to reduced benefits unless they continuously engage in activities designed to get them jobs that pay enough to lift them above the income eligibility cut-off. They also have a maximum lifetime eligibility of five years. If you don’t find and keep a job that can support you and your family, you’re going to suffer.

So we seem conflicted about whether poor people who are working and those who are able and willing to work but unemployed are “deserving” or instead prone to idleness like the Elizabethan beggars. We gear tax credits to galvanize workers into boot-strapping themselves up the income scale. We put conditions in TANF to ensure that recipients don’t just sit home and watch TV.

We wouldn’t need these carrots and sticks. But, if the economy keeps spiraling downward, some of us may be subject to them anyway–perhaps already are. And that could do a lot to move us, as a nation, toward policies that treat all low-income people as deserving of a decent standard of living–and respect.

Obesity and Poverty

The Executive Director of Bread for the City has written an open letter to the Washington Post in response to its recent article on obesity and hunger. The letter reports recent steps Bread has taken to help its clients “not only eat, but eat well”–nutrition counseling and healthy cooking classes, improvements in the nutrition profile of the foods it provides.

It’s good to see Bread for the City taking the lead on this important issue and especially to learn that it’s practicing what it preaches. But, as its letter says, high obesity rates among poor people are not something Bread and other nonprofits can tackle alone. And they must be tackled because obesity is linked to serious (and costly) chronic health problems, including hypertension, diabetes, heart disease and arthritis.

Bread calls on the new Administration to expand access to food assistance programs in a way that prioritizes nutrition. As the Post reports, the incoming Secretary of Agriculture seems ready to propose higher nutrition standards for in-school meals. These would certainly help. But, as everyone knows, a more comprehensive approach is needed.

Of course, obesity is not restricted to poor people. It’s a major public health issue for the entire population. However, the federal government and state and local governments too have greater opportunities to influence what poor people do and don’t do. They can exercise this influence sensibly and respectfully or otherwise.

The federal government already shapes the diets of some poor people with its list of foods state agencies can authorize under the Special Supplemental Nutrition Program for Women, Infants and Children (WIC). Now some are proposing that it restrict use of food stamps to healthy foods and beverages.

This idea is fraught with problems. An article in USDA’s Amber Waves identifies some of them. As it indicates, there’s no easy way to draw a bright white line between healthy and unhealthy food products.  Nor is it certain that the resulting restrictions would meaningfully change purchasing behavior. To these practical issues, I would add the paternalistic coercion that would be involved. Uncle Sam knows what’s best for you and is going to see to it that you live right.

It would make more sense, I think, to look at the obesity issue holistically and design a variety of coordinated programs that would empower poor people to maintain a balanced diet. Here are four basic questions that can trigger solutions:

• Do poor people have the resources to stave off hunger–a possible trigger for overeating and fat storage?
• Do they have the resources to buy a variety of healthful foods, including fresh fruits and vegetables?
• Do they have ready access to sources of a variety of healthful foods?
• Do they have the know-how to maintain a balanced diet on a limited budget?

Despite a number of promising initiatives, the answer to all these questions is a resounding No.

So there’s a lot of work here for governments at all levels and for private sector businesses, nutritionists, other health professionals and nonprofits, including Bread. We’ve enough experience to know they’ll achieve most if they collaborate.