Who Is Poor in the US? It Depends...

The US Census Bureau today released its latest estimates of what it calls the "Supplemental Measure of Poverty." This is a substantial alteration of the original--and still official--poverty line which is based on three times the cost of a minimally nutritious diet, varied according to family structure and age. Actually, the overall level of poverty is very similar using the official poverty measure (15.1 percent of the population) and the supplemental poverty measure (SPM = 16.0 percent of the population). But the SPM is more nuanced because it accounts for government transfers (inflows) and things like taxes paid (outflows), and it takes regional costs of living into account, while not thinking that age should matter when it comes to poverty. Thus, the overall mix of people in poverty turns out to be different between the two measures. Here are three differences that jumped out at me:

1. The official poverty measure indicates that 9.1 percent of the population aged 65 and older is at or below the poverty line, whereas the SPM puts the figure at 14.8. This is entirely the result of the official poverty measure making the ageist assumption that older people have a lower level of need than do younger people.

2.  The official poverty measure indicates that 22.3 percent of children under 18 are in poverty, whereas the SPM puts the figure at 18.1. The SPM takes into account that government programs are helping to alleviate poverty, which is obviously a good thing and needs to be acknowledged.

3. The official poverty measure indicates that the poverty level in California is 16.5, which is slightly above the national level of 15.1, but still below the worst state--Mississippi--which has 20.7 percent at or below poverty. However, the SPM has California at 23.8--the worst in the nation. Why? Two factors seem to play a role: (1) the SPM takes housing costs into account, and housing is very expensive in California, and (2) non-citizens have a higher poverty rate than do citizens in the SPM, and California has a lot of immigrants who are non-citizens. Despite having the highest level of poverty according to the SPM, California's median household income is 16th in the nation, which probably indicates a fair amount of income inequality in the state.