The Census came out with the latest figures on poverty in America:
The data presented here are from the Current Population Survey (CPS), 2013 Annual Social and Economic Supplement (ASEC), the source of official poverty estimates. The CPS ASEC is a sample survey of approximately 100,000 household nationwide. These data reflect conditions in calendar year 2012.
- In 2012, the official poverty rate was 15.0 percent. There were 46.5 million people in poverty.
- For the second consecutive year, neither the official poverty rate nor the number of people in poverty at the national level were statistically different from the previous year’s estimates.
- The 2012 poverty rate was 2.5 percentage points higher than in 2007, the year before the most recent recession.
- In 2012, the poverty rate for people living in the West was statistically lower than the 2011 estimate.
- For most groups, the number of people in poverty did not show a statistically significant change. However, between 2011 and 2012, the number of people in poverty did increase for people aged 65 and older, people living in the South, and people living outside metropolitan statistical areas.
- The poverty rate in 2012 for children under age 18 was 21.8 percent. The poverty rate for people aged 18 to 64 was 13.7 percent, while the rate for people aged 65 and older was 9.1 percent. None of these poverty rates were statistically different from their 2011 estimates. Click Here
The Census provides a PDF file that looks at poverty over time: Click Here
Looking at this data, it does not appear that much progress has been made. This analysis is based on the official poverty line, which has the virtue of comparability but has long been criticized for not being a realistic measure. When it was developed in the 1960s, food expenditures were used as the basis: a minimum “food basket” was developed and poverty was set at 3 times that figure. It has been adjusted for inflation over time.
In 2012, a family of 3 with a household income of $19,090 is considered to be below the poverty line. A family of 3 with a household income of $19,100 is not considered poor. Whether a family of 3 earning $20,000 would have enough money to meet all basic expenses will vary tremendously by location. The inability to take into account location differences is one of the criticisms of the poverty measure.
The measure has also received some criticism because it does not count certain benefits received, like food stamps and housing vouchers–benefits which add to the household income and could raise people out poverty. The Center on Budget Policy and Priorities believe that by ignoring those benefits, we miss their impact on raising people above the poverty line.
They state that if these other anti-poverty benefits were included, “the poverty rated dropped by eight percentage points between 1964 (the year the War on Poverty was declared) and 2011, from an estimated 18.9 percent to 10.9 percent. That’s twice as large as the decline in the official poverty rate over this period, which fell from 19.0 percent to 15.0 percent.“
“Comparisons of Official Poverty Figures Back to 1960s Are Not Sound
“Some policymakers and other commentators have compared the official poverty rate in the 1960s to the poverty rate today and concluded that little progress has been made. That comparison yields distorted results, however, because the official poverty measure captures relatively little of the poverty relief that today’s safety net provides, especially to low-income non-elderly households.
If we adjust the poverty and income data to count the major non-cash benefits (other than health insurance programs) established or substantially expanded since the 1960s (SNAP, rent subsidies, the EITC, and more recently, the refundable Child Tax Credit), we get a fuller picture of how the lowest-income Americans’ economic circumstances have changed over the past half- century. Under this expanded measure, poverty trends since the 1960s are clearly positive, as a recent Center analysis finds:a
- Under the expanded poverty measure, the poverty rate dropped by eight percentage points between 1964 (the year the War on Poverty was declared) and 2011, from an estimated 18.9 percent to 10.9 percent. That’s twice as large as the decline in the official poverty rate over this period, which fell from 19.0 percent to 15.0 percent.
- By the expanded measure, poverty dropped from 12.0 percent in 1969, the lowest rate in the 1960s, to 9.7 percent in 2007, the last year before the recession. (Both 1969 and 2007 were peak years of the business cycle so are comparable from the standpoint of the economy.)
Moreover, the increase in poverty in the Great Recession was only half as great under the expanded poverty measure as under the official measure, reflecting the impact of non-cash benefits and tax credits. From 2007 to 2011, the poverty rate rose 1.2 percentage points under the expanded measure (to 10.9 percent) but by 2.5 percentage points under the official measure (to 15.0 percent).
This expanded measure has its own flaws for evaluating the number of Americans who are poor. It does not account for differences in the cost of living in different geographic areas or the impact of work expenses (such as child care) or out-of-pocket medical expenses on a family’s ability to afford food, clothing, and shelter. The federal government’s Supplemental Poverty Measure addresses these and other issues, but data for it are not available back to the 1960s.
a The analysis examines the effects of non-cash benefits and tax credits on poverty using available Census data since 1979 and using estimates based on budget data in earlier years. Because the refundable tax credits did not yet exist in the 1960s and the food stamp and housing assistance programs were very small, counting these programs as income makes little difference to poverty rates for years in the 1960s (no more than 0.1 percentage point in 1964 and 1969). See Sherman, “Official Poverty Measure Masks Gains Made Over Last 50 Years.”