How Poor Is Poor?

The government's method of determining who's poor is so outdated that census experts say the poverty picture is much worse than we think

Bruce Nissen, program director of Florida International University's Center for Labor Research and Studies, also believes the official poverty threshold is off by a mile, especially in an immigrant-dominated town like Miami. "The lowest inflation in terms of cost has been food, so today food is about twenty percent of a budget," Nissen explains. "So you should actually multiply [the amount a family spends on food] by five, not three. But if you do that, the numbers jump unbelievably. Real poverty is way higher than any official measures."

The Census Bureau's chief of poverty and health statistics, John Iceland, maintains that the agency is responsible simply for collecting and presenting the numbers, not for the highly political business of setting national policy, which takes place at the upper levels of government. "We use the current guidelines and produce poverty estimates based on that," he advises. "Some people find that informative and useful, and some don't." He pauses, then adds with the slightly wry tone of an experienced bureaucrat, "I myself am completely agnostic on the matter." (The Census Bureau does produce an annual report on poverty that includes an unofficial set of "experimental" measures based on recommendations from the National Academy of Sciences. But being unofficial, it doesn't count for much when decisions about public assistance are made.)

Ohio State's Keith Kilty says that's the rub. "There are many public-assistance programs that still use the poverty threshold even though that's probably too low," he points out. "But one of the real problems with changing it is that the number of people who need help would go up. Since 1996, when Clinton signed the Welfare Reform Act, welfare caseloads have dropped by 50 percent, but poverty rates have dropped only about 25 percent. So obviously there are a lot of people out there who can use more help."

Steve Satterwhite

In Miami the discrepancies can be revealed by applying a "self-sufficiency standard" created by the Human Services Coalition of Miami-Dade County in conjunction with Wider Opportunities for Women. Their formula takes into account the actual local costs of housing, child care, food, transportation, health care, and other basic needs. Its estimate of what it takes to get by in Miami tends to be at least double the federal standard.

The Human Services Coalition is currently working with Miami Mayor Manny Diaz to have a so-called living-wage ordinance enacted in the city, with the additional idea that contractors would be encouraged to hire city residents for jobs. Miami-Dade County enacted a living-wage ordinance in 1999. It requires most companies with county contracts to pay workers a decent wage. FIU's Bruce Nissen, who did the research leading to the county law, believes a similar ordinance in the City of Miami could have a significant impact. "In this case, [the poverty's] gotten so bad I almost feel sorry for city officials," he jokes. "This is a problem that can't be solved by one thing. The living wage, rooting out corruption, a better education system -- it will take a lot of different efforts chipping away at it."

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