Measuring the U.S. Economy May Not Be as Simple . . .

[MountainLaurel]

Subtitle on Web page: Experts say official statistics consistently understate poverty.

The Census Bureau tomorrow will release the latest statistics on poverty in the United States, the income level of an average household and the number of Americans still lacking health insurance.

Don't believe the numbers.

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This seemingly technical problem has real-world consequences, allocating federal assistance to some who don't need it while cutting off others who do, raising the costs of programs like Social Security, or pushing policies for problems that may not exist.

For example, since poverty levels are not adjusted for regional costs of living, the working poor in expensive urban centers like Washington are routinely excluded from federal programs because their income lifts them above the official poverty line. The rural poor in low-cost states like Arkansas often can afford considerably higher standards of living than their urban compatriots. Yet they may be eligible for food stamps, housing aid, free school lunches and other programs that exclude the urbanites.

In March, Michelle Billups, 42, began working full time in the dining hall of the Washington charitable group So Others Might Eat. She earns $8 an hour to support herself and her 17-year-old daughter Shannon. This month, Billups was told she is no longer eligible for $225 in food stamps, a program available for District residents with incomes up to 130 percent of the federal poverty line. Billups' $16,640 annual income is $153 higher than that threshold for a family of two.

In a study to be released Thursday, the liberal Economic Policy Institute estimates that a family like Billups's, with one parent and one child, requires an annual income of $47,460 to meet its basic needs in Washington. That family in Fayetteville, Ark., would need $24,096.

Perhaps no statistic has more critics than the poverty rate, which in 2003 stood at 12.5 percent, the latest Census data available. University of Chicago economist Robert T. Michael, who chaired a National Academy of Sciences panel tasked to update poverty statistics a decade ago, called the current poverty data "truly awful."

"The poverty statistics are absolutely wrong," agreed Rebecca M. Blank, dean of the University of Michigan's school of public policy, who served on the panel.

http://www.washingtonpost.com/wp-dyn/content/article/2005/08/28/AR2005082800730.html