Wednesday, August 22, 2012

What is poverty?

This past weekend, I attended the annual meeting of the American Sociological Association in Denver. It was absolutely fascinating. Scholars attend such meetings to get the most up-to-date research in the field, get feedback on their research, learn about new data or new fields, meet other scholars in the field, obtain new materials or learn new ways to improve their teaching, and train graduate students who present their own work. Some scholars I spoke with also said that they were energized by the conference, by the excitement of so many people working so rigorously on social research. As people, for example, discussed their datasets and statistical findings or displayed quotations from the many people they had interviewed, you could feel the excitement in the air.

I had the great opportunity to hear a presentation on poverty measures by sociologist Diana Pearce of the University of Washington. According to Pearce, when we say that someone is living in poverty, we mean that someone's income does not adequately cover their basic needs. In other words, poverty is income insufficiency or income inadequacy. In the 1960s, Mollie Orshansky developed the official federal poverty thresholds based on USDA food budgets. Pearce argued that the federal poverty line (FPL), however, has not raised to reflect the real costs of living and does not take into account that it costs more to live in some places than in others. According to her website:
The federal poverty level (FPL) is based on USDA food budgets that meet minimal nutritional standards. Because families in the 1950s spent an average of one-third of their income on food, it was assumed that multiplying the food budget by three would result in an amount that would be adequate to meet other basic needs as well. Since its creation, the FPL has only been updated for inflation. FPL thresholds reflect the number of adults and children, but they do not vary by age of children, nor by place.
As a result, federal and state agencies, as well as foundations, have to make "work arounds," such as setting food stamp eligibility at 130% of the federal poverty line.

To fix these problems, in 2010, the federal government implemented the Supplemental Poverty Measure (SPM), which takes into account the real costs nationally (through the Consumer Expenditure Survey) of basic necessities and geographical differences in, specifically, housing costs. According to the Census:
Thresholds used in the new measure will be derived from Consumer Expenditure Survey expenditure data on basic necessities (food, shelter, clothing and utilities) and will be adjusted for geographic differences in the cost of housing.
Pearce argued that the SPM still does not deal with the real costs of basic needs. So, she has put forth the Self-Sufficiency Standard (SSS), used by many government agencies:
The Self-Sufficiency Standard defines how much income a family of a certain composition in a given place needs to adequately meet their basic needs -- without public or private assistance.
The SSS measures whether income adequately covers basic necessities (food, shelter, clothing, utilities), health care, and work-related costs (transportation, taxes, and child care). If income adequately covers these costs, then that person is self-sufficient and not living in poverty.

Of the many interesting things that the SSS reveals is that most (78-85%) households with incomes below the Self-Sufficiency Standard have at least one worker, and half of these households includes a full-time worker. The Recession has especially hit these working poor households.

At this link, you can find the SSS for your state. For DC, the SSS is $21,224 for a single adult and $38,151 for an adult and an infant: 

One can understand these high self-sufficiency wages when we think about the high cost of child care and housing, as well as food, in the DC area. You can also use a calculator to figure out whether your personal income is adequate for a location (like Ward 6 in DC) and whether you are eligible for public assistance. We can thank Diana Pearce for clarifying the issue of poverty. Now, what can be done about income insufficiency in Ward 6? 

P.S. See my previous post "Who are the poor in Ward 6"? 

No comments:

Post a Comment

Due to spammers, I am restricting comments.