09/09/2005 11:04:17 am
America Is Winning the War on Poverty. In recent days, it has been reported that poverty in the US has increased. In fact, it is said to be bigger than it was 30 years ago. And all this comes from the reported share of the population which lives below the so-called "poverty line". In The New York Times, Nicholas Eberstadt today shows why this is wrong:

"Per capita income adjusted for inflation is over 60 percent higher today than in 1974. The unemployment rate is lower, and the percentage of adults with paying jobs is distinctly higher. Thirty years ago, the proportion of adults without a high school diploma was more than twice as high as today (39 percent versus 16 percent). ...

The soundings from the poverty rate are further belied by information on actual living standards for low-income Americans. In 1972-73, for example, just 42 percent of the bottom fifth of American households owned a car; in 2003, almost three-quarters of ?poverty households had one. By 2001, only 6 percent of ?poverty households? lived in ?crowded? homes (more than one person per room) - down from 26 percent in 1970. By 2003, the fraction of poverty households with central air-conditioning (45 percent) was much higher than the 1980 level for the non-poor (29 percent). ...

Though the officially calculated poverty rate for children was higher in 2004 than 1974 (17.8 percent versus 15.4 percent), the infant mortality rate - that most telling measure of wellbeing - fell by almost three-fifths over those same years, to 6.7 per 1,000 births from 16.7 per 1,000. ...

The poverty rate has always been derived from reported household income. ... But a better gauge of a household?s material deprivation is not what it earns, but what it spends. When we look at spending patterns, we immediately see a huge discrepancy between reported incomes and reported expenditures for low-income Americans. In the Labor Department?s latest Consumer Expenditure Survey (2003), the average reported income for the bottom fifth of households was $8,201, while reported outlays came to $18,492 - well over twice that amount."

Read the entire article here (thanks, Fredrik) - >