Measuring the real poverty rate

September 12, 2012 at 10:22 am 2 comments

Today we have a re-post from Progressive Pulse on the impact of safety net programs, such as food stamps and housing assistance, on the actual poverty rate. Rob Schofield explains that, although poverty still remains high, these benefits do in fact help people who’s incomes are at poverty levels.

From Progressive Pulse:

Senior Researcher Arloc Sherman of the Center on Budget and Policy Priorities put up an extremely helpful and illuminating post yesterday afternoon on the group’s Off the Charts blog about poverty.

It shows a critical fact that is frequently misrepresented or not reported in the public debate:  While poverty has been on the rise over the last decade, non-cash public benefits like housing assistance and food stamps (SNAP) do make a significant difference in keeping it in check.  He notes that because the “official” poverty rate is based on pre-tax cash income, it ignores important non-cash benefits that, when factored in, lower the poverty rate.

This does not mean, however, as conservatives frequently try to argue,  that there really aren’t any poor people in the U.S. As Sherman’s numbers confirm (see his graph above) even with non-cash benefits factored in, real poverty is on the rise and still at absurd and unacceptable levels.

The bottom line takeaway, however, appears to be this: Public benefits (both cash and non-cash) work. As Sherman puts it: “we shouldn’t get distracted by comparisons that fail to account for how effectively major parts of the safety net have fought poverty.”

In other words, these programs keep millions of people out of abject poverty at a more than reasonable price and help correct for the many imperfections of our modern, dog-eat-dog economy. We would do well to significantly bolster our investment in these saftey net programs in years to come if we want to help turn the lines in the graph above back toward the X axis.  

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