Much of the debate about poverty focuses on (a) statistical measures of poverty and (b) the clash between advocates and opponents of welfare programs and government regulation of the market. Measures of poverty can be either absolute or relative.
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2 Current Poverty Rate 3 Perceived flaws in U.S. poverty measure 4 Food Security 5 More information 6 External Links |
The "Orshansky Poverty Thresholds" form the basis for the current measure of poverty in the U.S. Mollie Orshansky was an economist working for the Social Security Administration (SSA). Her work appeared at an opportune moment. The Johnson administration had declared “war on poverty” in early 1964. Orshansky’s article was published later that year. Since her measure was absolute (i.e., did not depend other events), it made “winning” this war more likely. The newly formed Office of Economic Opportunity adopted the lower of the Orshansky poverty thresholds for statistical, planning and budgetary purposes in May 1965.
The Bureau of the Budget (now the Office of Management and Budget) adopted Orshansky’s definition for statistical use in all Executive departments in 1969.
The measure gave a range of income cutoffs, or thresholds, adjusted for factors such as family size, sex of the family head, number of children under 18 years old, and farm or non-farm residence. The economy food plan (the least costly of four nutritionally adequate food plans designed by the Department of Agriculture) was at the core of this definition of poverty.
The Department of Agriculture found that families of three or more persons spent about one third of their after-tax income on food. For these families poverty thresholds were set at three times the cost of the economy food plan. Different procedures were used for calculating poverty thresholds for two person households and persons living alone. Annual updates of the SSA poverty thresholds were based on price changes in the economy food plan.
Two changes were made to the poverty definition in 1969. Thresholds for non-farm families were tied to annual changes in the Consumer Price Index (CPI) rather than changes in the cost of the economy food plan. Farm thresholds were raised from 70 to 85 percent of the non-farm levels.
In 1981, further changes were made to the poverty definition. Separate thresholds for “farm” and “female-householder” families were eliminated. The largest family size category became “nine persons or more.”
Apart from these changes, the U.S. government's approach to measuring poverty has remained static for the past forty years.
The official poverty rate in the U.S. in 2002 was 12.1 percent. This was up from 11.7 percent in 2001. This means that 34.6 million people were below the official poverty thresholds. This is 1.7 million more than the 32.9 million in poverty in 2001. The poverty rate for children remained constant at 16.7 percent between 2001 and 2002. However, the number of children in poverty increased to 12.1 million in 2002, up from 11.7 million in 2001.
In recent years, there have been a number of concerns raised concerning the official U.S. poverty measure. In 1995, the National Research Council's Committee on National Statistics convened a panel on measuring poverty in the U.S. The findings of the panel were that "the official poverty measure in the United States is flawed and does not adequately inform policy-makers or the public about who is poor and who is not poor."
The panel was chaired by Robert Michael, former Dean of the Harris School of the University of Chicago. According to Michael, the official U.S. poverty measure "has not kept pace with far-reaching changes in society and the economy." The panel proposed a model based on disposable income:
Eighty-nine percent of American households were food secure throughout the entire year 2002, meaning that they had access, at all times, to enough food for an active, healthy life for all household members. The remaining households were food insecure at least some time during that year. The prevalence of food insecurity rose from 10.7 percent in 2001 to 11.1 percent in 2002, and the prevalence of food insecurity with hunger rose from 3.3 percent to 3.5 percent. This report, based on data from the December 2002 food security survey, provides statistics on the food security of U.S. households, as well as on how much they spent for food and the extent to which food-insecure households participated in Federal and community food assistance programs.
The Other America by Michael Harrington (ISBN 068482678X)
Measures of poverty
The official U.S. poverty measure
Since the 1960s, the United States Government has defined poverty in absolute terms. When the Johnson administration declared "war on poverty" in 1964, it chose an absolute measure. The "absolute poverty line" is the threshold below which families or individuals are considered to be lacking the resources to meet the basic needs for healthy living; having insufficient income to provide the food, shelter and clothing needed to preserve health.Relative measures of poverty
Another way of looking at poverty is in relative terms. "Relative poverty" can be defined as having significantly less access to income and wealth than other members of society. In 1999, the income of a family at the poverty line was $17,020. This was 28.49 percent of the median income in the U.S. In 1959 a family at the poverty line had an income that was 42.64 percent of the medium income. Thus a poor family in 1999 had relatively less income than a poor family in 1959. Current Poverty Rate
Perceived flaws in U.S. poverty measure
Food Security
More information
External Links