If you have a refrigerator and a stove you aren’t really poor! Or at least that is what a recent report, “Air Conditioning, Cable TV and an Xbox: What is Poverty in the United States Today,” by the Heritage Foundation claims.
The report’s premise is that public policy discussions on poverty are meaningless absent a detailed description of the actual living conditions of poor households. Specifically, the report asserts that although the Census Bureau reports that over 30 million Americans are living in poverty, in reality, this number overestimates poverty because poor families own things like refrigerators, stoves, microwaves, washers and dryers, and ceiling fans. Oh and let’s not forget to include the coffee maker that poor families own instead of going to Starbucks for their $4 latte!
Putting aside the fact that, according to 2009 Census Bureau data, 43.6 million people were actually in poverty (which is the highest number in the 51 years that the U.S. has published poverty rates), the report analyzes data from the Residential Energy Consumption Survey (RECS) which measures energy consumption and ownership of various “conveniences.” Comparing the amenities available to poor households versus those available to all households, the report asserts that the average poor person has a living standard far higher than the public imagines. According to the authors’ analysis, both typical households and poor households each have air conditioning, washing machines and dryers, refrigerators, stoves and ovens, TVs and cable or satellites, a DVD and VCR, and cordless phones. Based on this analysis, the report concludes that poor households are living well today. As the report states, “the poorest Americans today live a better life than all but the richest persons a hundred years ago.”
But everyone is better off today than they were 100 years ago!! The wealthy are better off than they were 100 years ago, too. The real issue is how the poor fare in today’s economy, not how they would have fared in the economy 100 years ago.
For example, the report acknowledges that, although poor households were less likely to have air conditioning in any given year, the share of all households with air conditioning has steadily increased over the past 25 years. (Admittedly, I am sitting in an air conditioned room writing this while outside it’s over 100 degrees, so I currently think air conditioning is certainly not a luxury.) The reality, however, is that poor families have air conditioning solely because most of today’s homes were constructed with it. It’s not a luxury that the poor are indulging in; it’s merely what is available in the housing market. Do we know whether poor families are actually using the air conditioning in their homes, or are they unable to because they cannot afford it?
The report also asserts that poor Americans are well housed because their dwellings are spacious compared to international standards. All American homes are spacious compared with most other countries’ housing, but that doesn’t mean that poor families are living in palaces!
According to the report, homelessness is not a problem either. The authors assert that only 240,000 out of the total 643,000 Americans without a permanent domicile are actually “homeless” because they live in cars, abandoned buildings, alleyways, or parks. The rest of the so-called homeless are in emergency shelters or transitional housing so they don’t really count as homeless. Moreover, the report explains that individuals typically lose housing, reside in emergency housing for a few weeks and then re-enter permanent housing, so the homeless rate isn’t really a problem. But how long is it before they lose this new housing because they can’t continue to pay for it? The report does admit that there has been an increase in the number of families with children who use homeless shelters, but asserts that the increase isn’t a “tidal wave of increased homelessness.” Perhaps the increase isn’t as large because those families that lost their homes have moved in with other family members. Or perhaps it’s because poor families are relying on Section 8 housing instead of sleeping the streets, though they may have to line their sleeping bags up in the gutters soon with HUD programs among the many public benefits programs that the Republican budget proposal would cut.
Similarly, the report implies that having a refrigerator, stove, and oven means that families are not poor. Families should have these items. It’s whether or not there food to put in the fridge and to cook on the stove that matters! Of course the authors also argue that food is available because, even though there has been an increase in the use of charity food pantries and soup kitchens during the recession, only one poor family in five took food from a pantry and even less ate at a soup kitchen. Would that be because more people applied for food stamps to get by instead? And, by the way, food stamps are another public benefit program on the chopping block, so there probably will be longer lines at the soup kitchen soon.
Although the recession has increased the number of families in poverty, the authors contend that once the recession ends the living conditions of the poor are likely to continue to improve as they have in the past. So I am guessing that the racial wealth gap, which has increased fourfold in the past 25 years, is likely to improve to as well? After all minorities and low-income families were the hardest hit by the recession so they should bounce back pretty quickly, if the report is correct.
The report claims that the creation of a new poverty measure is simply a propaganda tool in President Obama’s endless quest to “spread the wealth.” In other words, the new measure’s focus on income inequality rather than poverty is a way to get the American public to unknowingly buy into the goal of income leveling. Yet, even if the new poverty measure was the “Trojan horse” that the authors claim, the horse has already left the barn because research shows that 92% of Americans already favor income redistribution.
The report correctly states that the current federal poverty measure, which defines poverty in terms of income and ignores public benefits, undercounts the economic resources provided to poor people. The new poverty measure would correct this by including such benefits into the poverty calculation. Since the new poverty measure is merely a ruse, though, I guess we shouldn’t mention that part.
Perhaps the only thing that the authors do get right is the fact that “accurate information about the extent and severity of poverty is imperative for the development of effective public policies.” They are correct when they say that “misrepresentations of poverty data lead to a misallocation of resources and, by obscuring the causes of deprivation, impedes the development of effective countermeasures.” Unfortunately it’s the data and how government dollars should be allocated that they get wrong. As the report points out, federal and state governments spent $714 billion on means-tested welfare programs in 2008. However, the federal government also spent over $400 billion in asset building policies that mostly benefit the wealthy. So maybe the right allocation would be to redistribute the asset building expenditures and tax credits from the wealthy to the poor. Perhaps then there wouldn’t be a welfare state, because the poor would actually own assets that would help them move away from welfare programs.