War on Poverty

I want to tread very lightly today. Writing about poverty is a lot like writing about legalizing pot – people can get very heated up about it, and the topic has more angles than an I.M. Pei building.

More than likely we can’t even agree on a proper definition of poverty. Below I paste a standard government definition of poverty now apparently used by both the Census and the Office of Management and Budget. I want to start our conversation today with some data and some simple points. You can, if you so desire, add and subtract as you see fit.

I will begin with some points about wars and then move on to some data. You can take it from there.  

The simple point about war is that you usually want to win it. When I played the card game War with my brother, I never won but I definitely wanted to win. Of course, countries sometimes get into real wars and lose. But I doubt that was the purpose. And so it goes with the war on poverty. One would think that Lyndon B. Johnson had in mind reducing the number of poor people in America. Even if he couldn’t reduce the number of poor people, I suspect he would have said he wanted the poverty rate to fall over time. The poverty rate is the percentage of people in a population who are poor.

And so we turn to the data. It is from the US Bureau of the Census and the full citation is below. The most remarkable numbers are the number of poor people from 1959 to 2017. The number of poor people in 1959 were 39,490. In 2017 the number was 39,698. War on poverty? Hmmm. More poor people in 2017 than in 1959.

But, you say, the population has grown enormously since 1959. We need to look at the poverty rate. So, let’s do that. In 1959, the rate was 22.4% of the population. That was very high but by 1969 it was down to 12.1% of the population. One might have proclaimed victory over poverty insofar as the years from 1959 to 1969 go.

But guess what? The rate in 2017 was 12.3%. In the almost half a century since 1969, the rate did not fall again. Despite all the programs we have put in place in those 48 years, we still have the same percentage of our population in poverty.

One might argue that 12% means success. We can’t really do much better than that. But judging from the cries for increasing poverty programs, many people must think that 12% is not a good number. People want it lower than that. The war on poverty has not, apparently, been won in the last 48 years.

The poverty rate did not stay at 12.3% in all those years. The poverty rate was generally lower in expansion years. It was as low as 11.1%, for example, in 1973. During recessions the rate increased. In 2010, it hit 15.1% of the population. So since around 1969, we have a poverty rate that has been anchored at about 12% but rises and falls cyclically.

I went to an Organization for Economic Cooperation and Development (OECD) website and found a comparison of poverty rates across 40 countries for 2017. The USA had the third highest poverty rate, only better than Costa Rica and S.Africa. Apparently other countries have found ways to do better.  (https://data.oecd.org/inequality/poverty-rate.htm )

So what? My conservative friends would say many things. The threshold definition of poverty is pretty high – around $30,000 today -- and that doesn’t even include support from some welfare programs. They might say that the poor today are much better off than the poor yesterday. They would argue against taxing the rich more to continue or expand the war on poverty. My liberal buddies would argue otherwise. They would point out that people are really hurting, and our definition of poverty does not include people who might be a smidge over the line, yet suffering similar consequences.

My question is this. Is it not possible to do better with the money we use now to help people in poverty? Is it not possible to better understand the real and structural factors that move people into poverty temporarily and those that “sentence” them to unending poverty? Is there a difference between programs that make poverty tolerable and those that end it? I have a feeling that if we quit shouting at each other we might actually be able to understand the enemy in the war and do a better job of actually winning the war. A stalemate seems so wrong.

Poverty Definition: Following the Office of Management and Budget's (OMB) Statistical Policy Directive 14, the Census Bureau uses a set of money income thresholds that vary by family size and composition to determine who is in poverty. If a family's total income is less than the family's threshold, then that family and every individual in it is considered in poverty. The official poverty thresholds do not vary geographically, but they are updated for inflation using the Consumer Price Index (CPI-U). The official poverty definition uses money income before taxes and does not include capital gains or noncash benefits (such as public housing, Medicaid, and food stamps).

SOURCE: U.S. Bureau of the Census, Current Population Survey, Annual Social and Economic Supplements.   For information on confidentiality protection, sampling error, nonsampling error, and definitions, see www2.census.gov/programs-surveys/cps/techdocs/cpsmar18.pdf. Footnotes are available at www.census.gov/topics/income-poverty/poverty/guidance/poverty-footnotes/cps-historic-footnotes.html.