On Poverty, Maybe We're All Wrong

[Omaha Steve]

http://www.washingtonpost.com/wp-dyn/content/article/2007/08/28/AR2007082801669_pf.html

On Poverty, Maybe We're All Wrong

By Steven Pearlstein
Wednesday, August 29, 2007; D01

Most years, what passes for the national debate about poverty is confined to the 24 hours after the government releases its annual report on household incomes, as it did yesterday.

The left expresses moral outrage -- in the richest country the world has ever known, one in every eight residents still lives in poverty -- and calls for government to do something about it.

The right, to the degree that it pays any attention to the issue at all, notes that while the poverty rate goes up and down with the economic cycle, it has remained relatively stable over the past 35 years and, in any case, represents a failure of government meddling, not a mandate for more of it.

That there is a germ of truth to both views does not excuse the fact that the debate has become stale and unproductive, based on misleading data and outdated assumptions.

It is more than a bit disingenuous for liberals to push for worthwhile programs like food stamps, housing vouchers, child tax credits and the earned income tax credit -- and then to constantly cite official income and poverty statistics that do not include the impact of food stamps, housing vouchers, child tax credits and the earned income tax credit.

As it happens, each spring the Census Bureau gets around to computing an alternative after-tax measure of disposable income that includes these various tax and transfer programs, while also making adjustments in the official poverty line to reflect the economic realities of different household sizes. This supplemental report gets little attention, but the adjustments are both statistically and politically significant. In 2005, for example, they dropped the poverty rate from 12.6 percent to 10.3 percent, with the biggest improvement coming in a four-percentage-point reduction in child poverty.

FULL story at link.

[killbotfactory]

1. Has this guy ever been poor in his life?

"But what if this iron law of economics is wrong? What if it doesn't apply at every point along the income scale? If you and everyone around you are desperately poor, maybe it's perfectly rational to think that an extra dollar or two won't make much of a difference in reducing your misery. Or that you won't be able to "study" your way out of the ghetto. Or that if you find a $100 bill on the street, maybe it's logical to blow it on one great night on the town rather than portion it out a dollar a day for 100 days."

What difference does a dollar make, when the poor are nickle and dimed constantly? ATM fees. Overdraft fees, often times multiple overdraft fees due to the way banks process your bills (Big bills get to cut in line. Which means your bank account is emptied. Which means a 30 dollar overdraft fee for every burger or soda you may have bought in the past two days. Meanwhile they are holding your paycheck for as long as possible.) Late Fees. Payroll taxes impact more of their paycheck. Not to mention, one odd problem with a car, or a medical bill (if you have the audacity to not want to die), and all your savings can fly out the window and you're back to square one, or worse, you have to get a payday loan or a credit card to make ends meet.

Unless you are extremely, extremely strict with your budget, and get lucky by having no major problems spring up out of nowhere, then you're going to get fucked out of every penny you earn until you find a higher paying job. At least that's been my experience... but I'm a little bitter.

[Greyhound]

2. I almost posted this yesterday. While it is hardly an epiphany, he does make

some good points and he is making them to the right audience.
:kick: & R