Wednesday, November 16, 2005

American "Poverty" = Global "Middle Class"

The most widely quoted federal statistic on deprivation and need in modern America is the ''poverty rate''--a measure tracking households with annual incomes below a ''poverty threshold'' established at the beginning of the Johnson administration's ''war on poverty'' in the 1960's and adjusted over time for inflation. According to the latest poverty rate estimates--released by the Census Bureau on Aug. 30--the total percentage of Americans living in poverty was higher in 2004 (12.7 percent) than in 1974 (11.2 percent). According to that same report, poverty rates for American families and children were likewise higher last year than three decades earlier.

On its face, this momentous story should have shocked the nation. After all, it suggested (among other alarming things) that Washington's long and expensive campaign to eliminate domestic poverty has been a colossal failure. [...]

The profound flaws in our officially calculated poverty rate are revealed by its very intimation that the poverty situation in America was ''better'' in 1974 than it is today. Those of us of a certain age remember the year 1974--in all its recession-plagued, ''stagflation''-burdened glory. But even the most basic facts bearing on poverty alleviation confute the proposition that material circumstances in America are harsher for the vulnerable today than three decades ago. Per capita income adjusted for inflation is over 60 percent higher today than in 1974. The unemployment rate is lower, and the percentage of adults with paying jobs is distinctly higher. Thirty years ago, the proportion of adults without a high school diploma was more than twice as high as today (39 percent versus 16 percent). And antipoverty spending is vastly higher today than in 1974, even after inflation adjustments.

In the face of such evidence, what do you call an indicator that stubbornly insists that the percentage of Americans below a fixed poverty threshold has increased? [...]

The soundings from the poverty rate are further belied by information on actual living standards for low-income Americans. In 1972-73, for example, just 42 percent of the bottom fifth of American households owned a car; in 2003, almost three-quarters of ''poverty households'' had one. By 2001, only 6 percent of ''poverty households'' lived in ''crowded'' homes (more than one person per room)--down from 26 percent in 1970. By 2003, the fraction of poverty households with central air-conditioning (45 percent) was much higher than the 1980 level for the non-poor (29 percent).

Besides these living trends, there are what we might call the ''dying trends'': that is to say, America's health and mortality patterns. All strata of America--including the disadvantaged--are markedly healthier today than three decades ago. Though the officially calculated poverty rate for children was higher in 2004 than 1974 (17.8 percent versus 15.4 percent), the infant mortality rate--that most telling measure of wellbeing--fell by almost three-fifths over those same years, to 6.7 per 1,000 births from 16.7 per 1,000...

By Nicholas Eberstadt
September 9, 2005


Blogger Hey Skipper said...

Reminds me of all those figures showing incomes haven't kept up with inflation. Only someone who completely ignorant of the wider economy would fail to see that (as this) is nonsense on stilts.

And what wasn't mentioned? Welfare reform ...

November 16, 2005 9:09 AM  
Blogger Bret said...

Hmmm. Y'all don't have trackbacks. For your entertainment, my analysis as to why the poverty rate is overstated is Poverty Poorly Understood.

November 16, 2005 4:00 PM  
Blogger Hey Skipper said...


A couple things. First, the article you linked to is, well, excellent.

Second: despite the likelihood of exposing my ignoramousness, what is trackback?

November 16, 2005 5:39 PM  
Blogger Bret said...

Hey skipper:

Wikipedia explains trackback's better than I ever could:

On my blog we use the Haloscan trackback service. Though we haven't had a lot of people using the feature so far...

Thanks for the compliment on the my article. I enjoy the postings over here as well. Indeed, I've added The Daily Duck to the list of links on my Great Guys blog. I figure that'll get you a least one more visitor per year. :-)

November 17, 2005 2:01 PM  

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