Air Conditioning, Cable TV, and an Xbox: What is Poverty in the United States Today? (Page 5)
by Robert Rector and Rachel Sheffield, reprinted from a July 19, 2011 heritage.org report
Official Government Poverty Numbers Misrepresent U.S. Around the Globe
One of the most regrettable aspects of official U.S. government poverty statistics is the misleading negative image that they project around the world. U.S. government poverty numbers are like a Potemkin village in reverse, suggesting to the rest of the globe that living conditions in the U.S. are much worse than they actually are.
For example, Al Jazeera uses U.S. government poverty numbers to tell the world what a terrible place the U.S. is. Al Jazeera tells a global audience: “37 million people—that is one in eight Americans—live below the official poverty line. That means these people are often homeless, hungry, and have no health insurance.” Al Jazeera shows a representative poor American family: six people living in a one-bedroom apartment. Other stories go farther. An Al Jazeera special report on “poverty in America” shows America’s poor as homeless or living in rat-infested, crumbling shacks while suffering from life-threatening malnutrition.
Al Jazeera is not alone. The Teheran Times informs its readers:
According to the U.S. Census Bureau, an astonishing 47 million Americans out of a population of about 310 million live in poverty in the Unites [sic] States, a number equivalent to one out of every seven people…. [O]ne in five children in the United States live in poverty, with almost half of them living in extreme poverty. 
Similarly, the Chinese government uses the U.S. Census Bureau’s misleading poverty reports to condemn the U.S. government for human rights violations. In its official report on The Human Rights Record of the United States in 2010, the Chinese government asserts:
The United States is the world’s richest country, but Americans’ economic, social and cultural rights protection is going from bad to worse….The U.S. Census Bureau reported on September 16, 2010 that a total of 44 million Americans found themselves in poverty in 2009, four million more than that of 2008.
Beijing fumes that, in America, the number of “[p]eople in hunger increased sharply…. About 50 million Americans experienced food shortage [in 2009]” and that “nearly one in four children struggles with hunger.”
Russia Today (RT) is a multilingual television news network funded by the Russian government. RT broadcasts news in English, Spanish, and Arabic to over 100 nations around the globe. Like Al Jazeera, Russia Today has a fascination for U.S. government poverty figures, which it uses to project a horrifying picture of the U.S. around the globe. Using official Census figures, RT informs audiences that “one in seven Americans [are] living in poverty.” It then gives “a perfect example of the face of poverty in the United States”: a tent village for homeless people in the woods in New Jersey that is run by a church group. According to RT, the homeless living there apparently work without ceasing for less than the minimum wage. RT leads viewers to believe that one in seven Americans crowd into charity soup kitchens each day to fend off starvation. The network gleefully tells viewers that widespread poverty in America is “like a third world nightmare.”
Al Jazeera and the governments of Iran, China, and Russia have their own ideological and geopolitical goals. Their depictions of the U.S. as a failed, nightmare society are no surprise. However, it is ironic that the U.S. government’s own misleading poverty report has become a major prop in anti-American propaganda around the world. Poverty in America is far from the nightmare of extreme material deprivation that it is portrayed to be, but the U.S. government has yet to explain that fact to the rest of the world or even to the American public.
Increasing the Misinformation: Obama’s New “Poverty” Measure
There is a vast gap between poverty as understood by the American public and poverty as currently measured by the government. Sadly, President Barack Obama plans to make this situation worse by creating a new “poverty” measure that deliberately severs all connection between “poverty” and actual deprivation. This new measure will serve as a propaganda tool in Obama’s endless quest to “spread the wealth” and will eventually displace the current poverty measure.
Under the new measure, a family will be judged poor if its income falls below certain specified income thresholds or standards. There is nothing new in this, but unlike the current poverty income standards, the new income thresholds will have a built-in escalator clause. They will rise automatically in direct proportion to any rise in the living standards of the average American.
The current poverty measure counts (albeit inaccurately) absolute purchasing power (how much meat and potatoes a person can buy). The new measure will count comparative purchasing power (how much meat and potatoes a person can buy relative to other people). As the nation becomes wealthier, the poverty standards will increase in proportion. In other words, Obama will employ a statistical trick to give a new meaning to the saying that “the poor will always be with you.”
The new poverty measure will produce very odd results. For example, if the real income of every single American were to triple magically overnight, the new poverty measure would show no drop in poverty because the poverty income standards would also triple. Under the Obama system, poverty can be reduced only if the incomes of the “poor” are rising faster than the incomes of everyone else. Another paradox of the new poverty measure is that countries such as Bangladesh and Albania will have lower poverty rates than the U.S.—even though the actual living conditions in those countries are extremely low—simply because they have narrower distribution of incomes, albeit very low incomes.
According to Obama’s measure, economic growth has no impact on poverty. Since the beginning of the 20th century, the incomes of nearly all Americans have increased sevenfold after adjusting for inflation. However, from Obama’s perspective, this increase in real incomes had no effect on poverty because the incomes of those at the bottom of the income distribution did not rise faster than the incomes of those in the middle.
In plain English, Obama’s new poverty-measure system will measure income “inequality,” not “poverty.” But he cannot call it an inequality index because the American voter is unwilling to support massive welfare increases, soaring deficits, and tax increases just to equalize incomes. However, if the goal of income leveling is camouflaged as a desperate struggle against poverty, malnutrition, hunger, and dire deprivation, then the political prospects improve.
The new measure is a public relations Trojan horse, smuggling in a “spread-the-wealth” agenda under the ruse of fighting significant material deprivation—a condition that is already rare in American society.
Poverty as traditionally defined by the Census Bureau has little connection with poverty as understood by the average American. The new Obama poverty measure will stretch this semantic gap, artificially swelling the number of poor Americans and severing any link between the government’s concept of poverty and even modest deprivation. It will make grappling with the real deprivation that does exist even more difficult.
Conclusion: What is Poverty?
In 2010, the U.S. Census Bureau declared that one in seven Americans lived “in poverty.” Catholic Charities has declared, “The existence of such widespread poverty amidst such enormous wealth is a moral and social wound in the soul of the country.”
To the average American, the word “poverty” implies significant material deprivation, an inability to provide a family with adequate nutritious food, reasonable shelter, and clothing. Activists reinforce this view, declaring that being poor in the U.S. means being “unable to obtain the basic material necessities of life.” The news media amplify this idea: Most news stories on poverty feature homeless families, people living in crumbling shacks, or lines of the downtrodden eating in soup kitchens.
The actual living conditions of America’s poor are far different from these images. In 2005, the typical household defined as poor by the government had a car and air conditioning. For entertainment, the household had two color televisions, cable or satellite TV, a DVD player, and a VCR. If there were children, especially boys, in the home, the family had a game system, such as an Xbox or PlayStation. In the kitchen, the household had a refrigerator, an oven and stove, and a microwave. Other household conveniences included a clothes washer, a clothes dryer, ceiling fans, a cordless phone, and a coffee maker.
The home of the typical poor family was not overcrowded and was in good repair. The family was able to obtain medical care when needed. By its own report, the family was not hungry and had sufficient funds during the past year to meet all essential needs.
Poor families clearly struggle to make ends meet, but in most cases, they are struggling to pay for air conditioning and cable TV while putting food on the table. The current recession has increased the number of Americans who are poor, but it does not appear to have greatly reduced the living standards of the average poor family.
True, the average poor family does not represent every poor family. There is a range of living conditions among the poor. Some poor households fare better than the average household described above. Others are worse off. Although the overwhelming majority of the poor are well housed, at any single point in time during the recession in 2009, around one in 70 poor persons was homeless. Although the majority of poor families have an adequate and reasonably steady supply of food, many worry about keeping food on the table, and one in five experienced temporary food shortages at various times in 2009.
Those who are without food or homeless will find no comfort in the fact that their condition is relatively infrequent. Their distress is real and a serious concern.
Nonetheless, wise public policy cannot be based on misinformation or misunderstanding. Anti-poverty policy must be based on an accurate assessment of actual living conditions and the causes of deprivation. In the long term, grossly exaggerating the extent and severity of material deprivation in the U.S. will benefit neither the poor, the economy, nor society as a whole.
—Robert Rector is Senior Research Fellow in the Domestic Policy Studies Department, and Rachel Sheffield is a Research Assistant in the Richard and Helen DeVos Center for Religion and Civil Society, at The Heritage Foundation.