Wednesday, July 26, 2006

Poverty in the US

Tim Whorstell over at TCS makes an important point about how the government measures poverty -- and how much of the assistance given the poor isn't counted as "relieving" poverty.

" assistance in 1979 was $35 billion, in 1986, $32 billion. The non-cash part was $97 billion in 1979 and $136 billion in 1986 (figures in 1986 dollars). The craziness is that the 32 and 35 numbers are included in the incomes before we calculate those who are in poverty. The 97 and 136 are not. So we've actually had a rise of $36 billion in spending upon the poor but (that portion of their incomes that come from the Feds anyway) the incomes of the poor have fallen by $3 billion. Given the way these numbers are calculated, the way the official figures work, no wonder we haven't been able to eradicate poverty."

So food stamps, the earned income tax credit, housing assistance, medicaid, and any other program that assists the poor but doesn't give pre-tax cash doesn't technically reduce poverty.
Of course, most people being counted as poor own a car, a microwave oven and at least one TV, among other modern conveniences. Poor Americans have it better than most people on the planet.

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