Changing the official poverty measure leads to 49.7 million Americans in poverty

If recommendations from social scientists are followed, the official US government measure of poverty will change and nearly 50 million Americans will be categorized as in poverty:

The number of poor people in America is 3 million higher than the official count, encompassing 1 in 6 residents due to out-of-pocket medical costs and work-related expenses, according to a revised census measure released Wednesday.

The new measure is aimed at providing a fuller picture of poverty, but does not replace the official government numbers. Put in place two years ago by the Obama administration, it generally is considered more reliable by social scientists because it factors in living expenses as well as the effects of government aid, such as food stamps and tax credits.

Administration officials have declined to say whether the new measure eventually could replace the official poverty formula, which is used to allocate federal dollars to states and localities and to determine eligibility for safety-net programs such as Medicaid.

Congress would have to agree to adopt the new measure, which generally would result in a higher poverty rate from year to year and thus higher government payouts for aid programs.

Some other interesting data in the story as well: Social Security reduces poverty for those over 65 years old quite a bit and food stamps reduce the number of Americans in poverty by over 5 million.

On one hand, it is hard to argue with calls for a more accurate measure of poverty. This would better reflect actual living situations and give the government a better tool for addressing the issue. On the other hand, this is quite the political football. Don’t poor Americans have plenty of electronics (a bad argument)? But, as Joseph Stiglitz notes in the article, how can one of the wealthiest countries in the world have 1 out of every 6 residents living below the poverty line?

One thought on “Changing the official poverty measure leads to 49.7 million Americans in poverty

  1. Pingback: Poverty measure that goes beyond income or financial resources | Legally Sociable

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