Last year in United States, poverty has increased or decreased. Make your choice. The poverty rate has increased according to the Census Bureau's narrow official measure, but it fell by the additional office measure, which takes into account a wider range of income and expenses, including 'pandemic help.
I think poverty reduction by complementary measure is the real story of 2020, but what interests me really, that is the long term pattern. Is poverty in America trending up, down, or is itthe roughly stable over the past decades? Looking around you might convince yourself that it is getting worse. You see homeless people on the streets, you hear about people being broken by medical bills, you read articles about jobs that go overseas or that disappear automatically.
The good news is that the poverty rate goes down once you take into account all the resources that low-income people can draw on, including vouchers. food, housing and heating assistance, school meals, income from work and child tax credits. These sources are captured in the Census Bureau Supplementary Measure, but not in the Official Poverty Measure.
You don 't hear much about this achievement . This does not correspond to the discourse of the left, which says that we mustair more to help the poor, or the right wing, which says any government effort to eradicate poverty by giving people more money is doomed.
The graph below, based on an analysis by Bruce Meyer of the Harris School of Public Policy at the University of Chicago and James Sullivan of the University of Notre Dame, shows no sustained progress in the official measure of poverty, but a rapid decline in two alternative measures.
The two alternative measures of poverty that Meyer and Sullivan constructed are based on household consumption of goods and services, which like the census Bureau's supplemental measure is designed to capture resources that the official measure lacks. It goes back further than the Supplementary Index, which started in 2009. In Alternative 1, Meyer and Sullivan also used an alternative index forr prices. They say the Bureau of Labor Statistics overestimates inflation, giving the impression that some people's income is falling in real terms when it is not. Alternative 2 uses their consumption measure but sticks to the government's inflation rate. They calibrated their alternative poverty rates to match the official 2015 rate.
"We are winning the war on poverty", m ' Sullivan said.
The war on poverty pays off
Percentage of households in the United States below the poverty line, by official measure and two alternatives. Alternative 1 uses a broad definition of consumption and a lower measure of inflation. Alternative 2 uses the broad definition of standard consumption and inflation. Image
Source: Bruce Meyer and James Sullivan
The next two charts, based on World Bank data, show global progress against poverty. The only continent where the number of people living in extreme poverty is increasing dramatically is Africa.
Extreme poverty is now concentrated in Africa
Image Image figcaption>
Number of people living in extreme poverty in 1990 and 2017 by region, in million, according to the World Bank.
Source: World Bank
It 's good news that we are making progress, but it ' s not the end of the story. All of these charts attempt to track poverty on an relative basis - in other words, how much money you have. Another way is to measure poverty on a relative basis, ie how much money you have compared with the people around you. Some European countries set the poverty line at 60% of median income, for example.
On the one hand, a relative measure of poverty may seem silly. If the incomes of the poor double, they are obviously better off, but they would still be considered poor on a relative if median incomes also doubled. A relative measure of poverty is actually a measure of inequality.
But the relative measure of poverty has its own problems, especially when it is applied over long periods. The standard of living has increased over time, so that things that were once a luxury are now seen as near necessities. The most fabulous royal family households of ancient times may seem poor to a modern day enumerator; they lacked running water, flush toilets, refrigerators, central heating, air conditioning, automobiles and cell phones. Also, slight differences in the inflation rates used in poverty calculations create huge discrepancies when applied over decades, as the work of Meyer and Sullivan shows.
One solution is to build a hybrid definition of poverty that takes into account both relative and relative poverty. " I would
Americans are generous in helping those affected by natural disasters and other disasters, but when the most severe recession never recorded hit last year, they didn 't appear to open their wallets. An investigation by Gallup in April 2020, as theThe Covid-19 was at its peak, found that the part of Americans claiming to have donated money to charities during the previous was 73 percent, the lowest since Gallup started asking the question in 2001. The previous low, 79 percent, was in another recession year, 2009. One possibility is that people have pulled out because that they worried about their own finances: The biggest drop in giving was among those earning less than $ 40,000 a year, who were most at risk of the recession.
Quote of the day
“ I often say that when you can measure what you are talking about andexpress it in numbers, now you k something about it; but when you cannot measure it, when you cannot express it in numbers, your knowledge is of a lean and unsatisfying kind: It may be the beginning of knowledge, but you have to hardly, in your thoughts, advanced to the stage of science, whatever the subject. "
- William Thomas Baron Kelvin, " Popular Lectures and Addresses: Constitution of the Subject "(1891).
Do you have any comments? Send a note to coy-newsletterHfrance.fr .