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Aircon and food stamps
Father Larry Snyder, who is president of Catholic Charities USA, told the US House of Representatives Ways and Means Committee’s Income Security and Family Support Subcommittee that the federal government has reduced the resources provided to assist those who are impoverished:
“There has been a conscious and deliberate retreat from our nation’s commitment to economic justice for those who are poor.”
“Poverty in the United States is a human-made disaster, it is not a force of nature beyond our control; rather it is the result of economic, social, and political choices that we Americans have made, both as individuals and as a society.”
In his testimony, the priest rejected:
"..the commonly held view that poverty is due to failures and deficiencies of individuals... While it is true that individual choices and behaviors do influence one’s chances of living in poverty, these individual behaviors are frequently outweighed by the structures and policies that shape the opportunities of people who are poor.”
According to Catholic Online, Father Snyder testified that:
Communities across the United States are witnessing “the suffering of children” who lack access to health care and good nutrition, working families that must “hold down two and three jobs just to make ends meet” and senior citizens “dehumanized and demoralized when they have to choose between utilities and food."
Poverty, as calculated in official US figures, has grown rapidly under the Bush administration, but in fact it has been on the increase since the time of President Nixon. In 1973, 23 million Americans, just over 11 percent of the US population, lived in poverty. The current figure of 38 million is almost 13 percent of the population.
Statistical poverty, US-style
Many nations measure poverty rates in relative terms, thus allowing an estimate of how many people are excluded from the normal activities and comforts of society because their income is far below the average level in that country. Britain and other EU countries, for example, use a threshold of 60% of median average income to measure the numbers in poverty. This actually tells us the degree of inequality within the poorer half of the population. Using the EU method would put the United States poverty rate at about 24%, compared to the average of 16% for developed countries.
The official US figures are based on a different concept. They give an absolute, rather than a relative measure of poverty. In a recent report for CityMayors.com, Tony Favro explained:
The current method used by the federal government to calculate poverty thresholds was designed in the early-1960s as part of President Lyndon Johnson’s War on Poverty. Essentially, It is a measure of severe deprivation – the minimum amount of money needed for subsistence. Poverty thresholds are absolute dollar amounts (e.g., $10, 210 for an individual; $20,650 for a family of four). The thresholds vary by family size, but not by geography... Poverty thresholds are adjusted periodically using the Consumer Price Index, a measure of inflation.
Because they do not take into account the higher cost of living in the major urban areas, the official figures may significantly understate the actual scale of hardship in the United States:
...Most analyses find that a revised poverty calculation would increase the number of Americans classified as poor. Therefore, a major barrier to redefining poverty thresholds is political. US presidents are reluctant to have official poverty numbers revised upward during their terms in office. Another barrier is financial, since expenditures for many federal programs are tied to the official poverty rate – the more poverty, the more the federal government would have to pay into these programs.
Using a more up-to-date absolute method of calculating poverty, such as that used in Canada, would show that many more people in the USA are on low incomes. The Canadians use the concept of the Low-Income Cut-Off Line, the point at which individuals or families must devote 60 per cent of their annual income to basic necessities such as food, clothing, rent, transportation, insurances, child care, school supplies, and household supplies. According to Favro:
Using the Canadian standard, New York City’s poverty rate would not be the official 21.2 per cent, but 38.2 per cent. In San Jose, California – the center of Silicon Valley and the symbol of wealth and power in the US – the poverty rate would leap from 8.8 per cent to 20.9 per cent...
The application of Canadian methodology to the US situation is not merely an academic exercise. It illustrates that poverty in America goes well beyond the stereotypical image of the homeless vagrant or the drug addict. The new face of American poverty often includes the restaurant dishwasher, office clerk, deli worker, maintenance worker, single working mother with children, and, in some high-cost-of-living cities, the nurse, the firefighter, and the school teacher.
The poverty deniers
The official US poverty figure as a measure of the extent of material deprivation is also disputed- for opposite reasons- by right-wing foundations and newspapers. An article published by the Heritage Foundation cites the rate of home ownership as a reason to doubt that poor Americans are truly badly-off:
Forty-six percent of all poor households actually own their own homes. The average home owned by persons classified as poor by the Census Bureau is a three-bedroom house with one-and-a-half baths, a garage, and a porch or patio.
Home ownership among poor Americans has indeed been rising, driven by de-regulation of the lending 'industry' and the growth (until recently) of the subprime mortgage sector.
Nicholas Eberstadt, writing for the American Enterprise Institute (AEI), claims:
Obviously, the official poverty rate isn't reflecting shifting living conditions in the United States. A wealth of evidence shows that those who are counted as poor today have dramatically higher living standards than their counterparts in the 1960s, when the poverty rate was originally devised...
Eberstadt points to improvements in health and increases in the possession of consumer goods since the 1960s:
Undernourishment and hunger were common among the most vulnerable elements of society 40 years ago; today, by contrast, obesity is the main nutritional problem facing adult Americans, rich and poor alike. And even children considered poor by official standards are better nourished today than in the 1960s...
Today's poor households are more likely to have telephone service and television sets than even non-poor households in 1970... according to a Department of Energy survey in 2001, most poverty households have microwaves, VCRs or DVDs, and cable television--conveniences unavailable in even the most affluent homes at the time the poverty rate measure was first released.
For the affluent and the disadvantaged alike, life expectancy in America has risen significantly since the nation's poverty measures were first developed... Since 1965... the U.S. infant mortality rate (the risk of death in the year after birth) has dropped by more than 70 percent.
Yet in that time, the USA's comparative international ranking in infant mortality has fallen from 12th to 28th place. Third World (but socialist) Cuba, which is now at 21st place, has a distinctly better infant mortality rate than does the USA. It is the high incidence of deaths of babies in poor and black families which accounts for the USA's dismal relative ranking when compared to other developed countries.
Mr Eberstadt's explanation for the disparity between the growing official poverty rate and "the steady improvement in the living standards of America's poor" is that:
...the poverty rate assumes that a household's annual spending cannot, by definition, exceed its annual income.
Of course, this is not true... For instance, when families are experiencing an unusually bad year, they may spend more than they earn if they see better prospects in the future. Similarly, a young worker may go into debt if she anticipates increases in her pay or benefits. Living standards, in other words, are linked to purchasing power--and a family's purchasing power is not limited to its annual earnings.
Among low-income households in the United States, the gap between reported income and reported spending has widened gradually since the 1960s... in 2004, spending by the poorest fifth of American families exceeded income by a whopping 95 percent...
The downside of the disparity between income and expenditure is debt. Eberstadt plays this down, referring to increasing average 'net worth' among poorer people in the last several years. But this rise in 'net worth' was just a reflection of rising house prices. So long as interest rates were low and house prices kept rising, increasing debt was a hidden problem.
Eberstadt continues:
Another important factor could be the increasing instability of American incomes... the income of American families is likely to bounce around much more today than it did three decades ago--whether due to greater global competition, increasing rewards for education or other factors. Intensified swings, in turn, mean that more households may, in any given year, earn low incomes and be temporarily classified as living in poverty. But they continue to spend as they did before, anticipating that their incomes will bounce back.
A blighted progress
But the AEI's expert writer neglects to mention a very important factor- advances in technology. Mechanisation and intensification of farming has dramatically cut the cost of food production over the last 40 years. Important new medical treatments have been discovered since the 1960s. Nobody had a microwave or a DVD in the 1960s because these devices were not yet being manufactured. The general historical pattern is that the benefits of technological change become available first to the rich, and then, some time later, to poorer people.
Another key factor is the role of state benefits. Despite cutbacks, government programmes at national and local level have continued to be a very important contributor to the living standards of poor people in the USA. In 2003, 21.3 million people received food stamps, worth $185 per month to a typical recipient household.
The rosy picture of material conditions for those at the bottom of the heap, as painted by the Heritage Foundation and the American Enterprise Institute, fails to take into account the interaction between income inequality and the USA's individualistic, consumerist and status-obsessed culture. Michael Roberts of Marxist.com noted sadly:
...most Americans still believe in the American dream, namely that if "you are poor and work hard, you have a chance of becoming rich". According to a recent poll, 80% of Americans believe that, up from 60% in the 1980s.
In fact, the children of even middle income families in the USA have only a 1.8% chance of getting into the top 5% income bracket. A child from a poor US family is far, far more likely to join the country's seven million who are in prison, on parole or probation than they are to rise to the ranks of the economic elite.
Those in the lowest income brackets in the United States provide the fodder for the country's huge illegal drugs industry, the recruits to its enormous prison population, and, despite medical advances, they have death rates which are 50% higher than the median average.
Mission impossible
In pure material terms, most of the officially poor in the USA are among the wealthier people on our planet. As the Heritage Foundation and the American Enterprise Institute point out, many of these 38 million people have air conditioning and some have two bathrooms, a garage and a porch or patio, while 560 million people in Asia, Africa and Latin America lack basic sanitation, and 133 million live in shanty towns, squatter camps and other non-durable housing.
This, literally, comes with the territory; the United States is vastly wealthier than any other country- its per capita GDP by purchasing power parity is 30% higher than that of Britain, for instance. In the USA, air conditioned homes and a garage come as standard, even to many people on lower incomes.
The comparison down to the Third World is steep; so too is the comparison upwards within the USA- from the bottom 10% of households whose annual income is less than $10,500, through the insecure US 'middle class', on median household incomes averaging $46,000, to the top 5% on about $400,000 per year, and then to the couple of hundred 'super-rich' families on $200 million per year or more.
As Nicholas Eberstadt states, more 'bouncing around' between levels of prosperity takes place than previously. Among those who are currently bouncing downwards are those who were lured into taking out 'subprime' mortgages in order to become homeowners. According to a survey by the Center for Responsible Lending, 2.2 million households are facing foreclosure on home loans taken out between 1998 and 2006.
Heather Haddon of the the New Jersey Herald News notes that voluntary organisations and state programmes are unable to cope with the rising tide of homelessness:
Mary Johnson of Consumer Credit Counseling Services of New Jersey, a Cedar Knolls nonprofit that sees 3,000 local clients annually, says her agency is pressed to help those on the brink of foreclosure.
"We are dealing with people who are living in their cars," Johnson said. Her agency refers these clients to homeless services, but Johnson has found that the programs are too overwhelmed to provide relief.
Passaic County foreclosures are rising. Between 2005 and 2006, foreclosure requests increased by 12 percent, an analysis of county Sheriff's Department statistics shows. Based on the first three months of 2007, foreclosures are projected to rise even further, by 22 percent.
During his visit to Capitol Hill, Father Larry Snyder described American poverty as "a moral and social wound on the soul of the nation". One could add that it is both an open and a hidden wound; the inevitable injury of a society in which success is both essential and, for many millions, impossible; the shameful sore which experiences and expresses some of the worst moral and social problems of the world's richest country.
Sources:
http://www.catholic.org/national/national_story.php?id=23904
http://www.usccb.org/cchd/povertyusa/povfact2.htm
http://www.citymayors.com/society/usa-poverty.html
http://www.heritage.org/Research/Welfare/bg1713.cfm
http://www.aei.org/publications/filter.all,pubID.24855/pub_detail.asp
http://www.un.org/Pubs/chronicle/2006/issue2/0206p24.htm
http://en.wikipedia.org/wiki/Household_income_in_the_United_States
http://www.marxist.com/usa-statistics-shock240506.htm
http://www.nutraingredients-usa.com/news/ng.asp?id=61741-food-stamps-bill-crn
http://seattlepi.nwsource.com/opinion/313449_focus29.html
http://www.responsiblelending.org/issues/mortgage/reports/page.jsp?itemID=31214551
http://www.northjersey.com/page.php?qstr=eXJpcnk3ZjczN2Y3dnFlZUVFeXkzNTkmZmdiZWw3Zjd2cWVlRUV5eTcxMDkyNjcmeXJpcnk3ZjcxN2Y3dnFlZUVFeXkz