U.S. Winning the ‘War on Poverty’
By Jazelle Hunt NNPA Washington Correspondent | 12/24/2013, noon
WASHINGTON (NNPA) – Nearly 50 years after President Lyndon B. Johnson declared war on poverty, a new report finds that robust social safety net programs are slowly leading the nation to victory.
According to the report, “Trends in Poverty With an Anchored Supplemental Poverty Measure,” the poverty rate has dropped 40 percent since 1967, as a result of provisions such as housing vouchers, free school lunch unemployment benefits, Social Security, food stamps, and more. Without these programs, the researchers find, the percentage of Americans living in poverty would be twice as high.
“Our research tells us that these programs are important for families struggling to put food on the table and find adequate shelter,” says study co-author Christopher Wimer, a research scientist at the Columbia Population Research Center. “For a family of four our measure puts the poverty threshold higher at about $25,000 a year, which is not going to go so far.”
The Census Bureau introduced the official poverty measure (OPM) in 1963 to aid in distributing federal aid. At that time it was based on income and the cost of food. Today, the measure is based on a family’s size, cash income, and ages of its members.
The study’s authors say that it’s an outdated and insufficient measure—not only are there non-cash types of income (such as food stamps or housing subsidies), but also the OPM excludes tax burden, and only considers families linked by blood, marriage, or adoption (same-sex partners or cohabiting couples with children, for example, do not count as family).
It seems the Census Bureau picked up on these deficiencies; in 2010 it introduced the supplemental poverty measure (SPM). This measure uses an improved threshold, a more inclusive tally of a family’s expenses and resources, and a broader definition of “family.”
Although the SPM is only intended for research use (the OPM is still used for federal spending), the authors contend that it offers a better picture of American poverty.
According to the OPM, the poverty threshold is around $23,000, and has been since the late ‘90s. The SPM offers a higher threshold, largely because it reflects changes in cost of living more acutely—and it also means more people qualify as poor.
To study poverty trends over the last 45 years, the researchers used today’s SPM threshold and applied it to American families’ household data since 1967 (adjusting for inflation). That year, the official poverty rate was 14 percent; and it hasn’t changed much since then, lingering between 11 and 15 percent over 45 years of data. But with the SPM, the poverty rate has steadily declined—in 1967 it would have been 26 percent. It’s come down to 16 percent as of 2012, which means that poverty has fallen 40 percent since 1967.
The measure also reveals the impact of anti-poverty programs and policies by examining the effect of taxes (tax requirements, breaks, and credits) and transfers (in-kind federal income, such as housing vouchers and free school lunch). Without including taxes and transfers in the SPM measure the poverty rate would have been 27 percent in 2012. In other words, tax breaks and safety net programs have saved 13 percent of lower-middle income Americans from poverty.