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Poverty Series III: The Numbers Lie & Myths Abound

Eileen F. had an idyllic middle-class upbringing.  Reared by two loving parents, both professionals in their fields, she attended Ivy League schools and went on to become a teacher.  Now 58 years old and partially disabled, Eileen struggles to pay the $700 per month rent on her small cabin in upstate New York.  She supplements her $463 disability check with odd jobs she can do at home, like transcribing the minutes from town meetings and editing newsletters for a non-profit group.   She earns, on average, a little over $600 a month from these jobs, bringing her income up to about $1100 a month.

It’s a life Eileen never expected, and one she says smashed her expectations, leaving her feeling oddly embarrassed and filled with anxiety.   On occasion, she has to borrow $10 or $20 from better-off friends to pay for basic necessities.  Even though she is insured, she is afraid to get the hip replacement she needs for fear of losing income during the recovery period.

According to national government standards, Eileen F. does not statistically count as one of the millions of Americans living in poverty.  Her yearly income of $13,200 is $2413 above the 2008 poverty threshold for single adults, ages 65 and under, as determined by the U.S. Census Bureau.   The threshold caps at $9,944 for singles over the age of 65, and at $13,540 for a family of two.    It is this threshold that determines national statistics on the number of people living in poverty in the United States.    Last August, the U.S. Census Bureau issued a report stating that 37.3 million Americans, approximately 12.5% of the population, were living in poverty in 2007, a slight increase from the 2006 figure of 36.5 million.

The model used to determine poverty thresholds was born from studies done by Mollie Orshansky for the Social Security Administration in the 1960s.  The Orshansky method has often been criticized,  but has not substantially changed since its adoption as a federal standard.  One of the major flaws in Orshansky’s method, which is based on minimum-level food consumption,  is that it assumes that others costs, such as housing, transportation, and daycare, can be cut back in hard times at the same proportion as food.

In effect, Orshansky started her food-costs-to-total-expenditures procedure by considering a hypothetical average (middle-income) family, spending one third of its income on food, which was faced with a need to cut back on its expenditures.  She made the assumption that the family would be able to cut back its food expenditures and its nonfood expenditures by the same proportion. This assumption was, of course, a simplifying assumption or first approximation, as she herself recognized. However, she had no data to support a specific different relationship between food and nonfood expenditure cutbacks.  Under this assumption, one third of the family’s expenditures would be for food no matter how far it had cut back on its total expenditures. - Social Security Bulletin, Vol. 55, No. 4, Winter 1992, pp. 3-14.

There are many arguments that can be made against the Orshansky method, but the end result is that millions of America’s poor are not counted in the official statistics.  Variables, such as geography, non-cash benefits, and actual cost-of-living expenses make it difficult to gauge the number of people who subsist in our society with inadequate resources to meet essential daily needs. However, it takes no great leap of logic to understand that the figures used by the government grossly underestimate the number of those living in poverty.

Outside of the Census Bureau’s national statistics, which are most often quoted by politicians and the media, there is the matter of who is financially eligible for federal aid programs.   Every year, the Department of Health and Human Services publishes their own poverty guidelines in the Federal Register, employing an adaptation of Orshansky’s threshold.  In 2008, those guidelines were $10,400 for a single adult, $14,000 for a family of two, and $21,200 for a family of four.

Peggy Wireman, Ph.D. has extensive experience with government, economic, and social policy, and recently authored the book,  Connecting the Dots, which “addresses the complex relationships between family and community, and between community and other players affecting family and community life.”  Dr. Wireman, who has a keen understanding of governmental statistics, says that the definition of poverty has been out-of-date for decades.

“It was based on the assumption that people spent one-third of their income on food. Thus, food expenditure was then multiplied to account for everything. The problem is that relatively speaking, the cost of food has gone down while the cost of housing and health care has gone up.  A more realistic approach was developed by Wider Oppurtunties for Women.  They calculated what it would cost a family to live without government subsidy and without charity on a modest budget.  Modest meant housing, food, child care, health care, and a car which used to go to work and for one shopping trip a week.  The budget does not include funds for savings, education, entertainment, or any meals outside the home.   It is about twice the (official) poverty level.”

There is a persistent myth that assistance for poor families is easy to get and readily available.  While States and Counties employ their own guidelines, as well as the federal government’s, in determining who qualifies for various programs, they are all based on models that cut countless poor people off from the possibility of assistance.

In Minnesota, for example,  applicants for emergency assistance in the most populous county, Hennepin, must prove that the assistance given will be cost-effective and offer long-term (12 month) resolution to the immediate problem.  What this means is that those who find themselves in an emergency situation –- such as unexpectedly losing their job –- must show the County reason this won’t happen again next month, or the month after that.  Those who haven’t secured new employment have no way to guarantee this, so the County denies emergency assistance to them on the grounds that it would not be cost-effective.

Also disqualified are applicants who pay more than 40% of their gross wages for rent.  Under the county’s guidelines, a single head of household earning $8/hr. could pay no more than $554 per month for shelter. Outside of subsidized housing, a decades-old mortgage, or a dwelling in which the costs are shared by others, a $554 per month family apartment in the Metro area simply does not exist.

Bootstrap theories abound and are widely accepted, but Dr. Wireman has a different take after dedicating years of her life to studying the economic issues of American families.

“Most Americans,” Wireman says, “feel that people are poor because they don’t work hard enough.  Unfortunately, this is a myth.  If all workers who are making poverty-level wages quit tomorrow the country would shut down. We would have no child care centers, no hospitals, no restaurants, no stores.  Unfortunately, too, the myths that prevailed about welfare have been extended to cover all single parents. Working harder at lowly paid jobs does not lift people out of poverty.  The reason so many people are struggling today is that the productivity of workers is no longer being shared equitably with the workers.   The minimum wage corrected for inflation was $10 a hour in 1968. Eighty percent of American workers work in manufacturing of non-supervisory service jobs.  Their wage increase per hour since 1973 has been 35 cents.  Productivity has been rising.  Between 1995 and 2005 it increased by one-third, but two-thirds of this went to top management and the stock market. Only one-third of the increase was shared with the workers.”

In Connecting the Dots,  Dr. Wireman exposes the changes in business practices and public commitments that have made the American Dream unrealistic for millions of workers, both blue and white collar, and lays out a framework that she believes may help undo the damage.

In the interim, the rich are getting richer, and the poor are getting poorer, and women like Eileen, and other people I’ve spoken with in the course of writing this series, including single parents and the elderly, often feel invisible in the colorful, abundant landscape that is the American Dream. They nurture their hopes, and tend to their crises paycheck by paycheck, looking less for temporary handouts than for a long-term way up, and out of the vicious cycle of poverty.

Note: A condensed version of this article was published by the Huffington Post.

Next: Part IV, The Health Care Crisis

18 comments to Poverty Series III: The Numbers Lie & Myths Abound

  • Pirate Queen

    Jane, you keep kicking at the doors that hide the poverty in America, and they all keep opening and yielding to your blows. When the Get Smart series of doors you insist on knocking off their hinges open wide enough, I will join the masses that are being hidden behind them and take to the streets. It has always been the poorest of the poor, the ones who have nothing left to lose who begin the necessary revolutions that begin nations anew.

    Jane’s done the hard work of lighting the dark corner. She was nowhere close to satisfied, her rememberence of own fight through poverty stirred the banked embers of a fighter that had lain quietly agitated until now. We need to help her and get her work out into the blogosphere. Use email, your phones, your voices and get this effort seen, and known, by as many as you possibly can reach. Please!

    The issue of poverty is far greater a concern than who the next puppet may be serving us as president. Freeing the humans, the AMERICANS, that are trapped in the multiple poverties that have been created behind the magic curtains of American politics and corporations will be the determining factor (in my opinion–I hate that even have to say that in this case) in finally getting a true leader for this nation.

    Pass it forward.

    And thank you, Jane!

  • LBJ

    Jane, I love your Twitter about logic and reclaiming our spirit. As someone who’s in social work, though more direct care now and not administrative, I can appreciate this piece. There are tons of things wrong with the way things are computed, and very often those that need help the MOST don’t get it just because of what you mentioned….some arbitrary guideline that shuts them out. Even when help is offered, people don’t understand how SMALL that help is. It’s $60.00 to pay a utility bill, not a thousand to pay the rent….it’s $80.00 in foodstamps, not $200.00 in cash to make it on until unemployment checks start.

    I have known people who got evicted for the lack of one month’s rent…..who ended up in shelters even though they worked. So “help” is not what people assume it is, and your’e right, it’s definitely NOT easy to get!

  • Eileen

    Wow! So well written, Jane, and with easy-to-underand statistics and backup material. May your work open up a few more eyes in the usually blinkered, self-satisfied government bureaucracy.

  • Laurie

    Let’s cut to the chase. You are writing what the rest of us are afraid to even think, let alone verbalize. And you back it up with facts — as a writer is supposed to do. But more than that, you find a way to interject humanity between the sentences. That is a gift, and I thank you for sharing it.


  • Donna L. Faber

    So talented … so perceptive … gifted, even. Wonderful.

  • Julia

    Well said Jane. Now can you educate Sarah Palin and McCain a little?

    My grandmother talks a lot about the times of the depression still, I wonder if I’ll be talking with my grandchildren about the good old days. Sad really.

    On a more positive note… part of Obama’s economic plan is to NOT tax seniors that make $50,000 or less a year. They won’t even have to file taxes. So that’s a start.


  • Tammy

    I’m with Pirate Queen -
    We can all forward Jane’s amazing work to friends, family, co-workers. It must be seen by as many as possible!

  • Gia

    I just spent a weekend with a lot of conservative soccer moms and dads. This conversation actually came up at one point….and they said some of the exact same things you said here about the poor are poor because they don’t want to work hard. After the poor bashing went on for about 10 minutes, I had enough.

    What I said was, “there are poor people all over the world. We live in one of the richest Countries in this world, and it’s ridiculous that there are so many Americans doing without basic necessities. Do you honestly think that most poor people aren’t working their asses off to give them and their families a better life? The system is not set up to help people move ahead, it’s set up for them to continue to fall just when they begin to stand. What we think, say, and do about and for people who have had a tough time in this life, in my opinion really reflects our character.”

    I got up, went outside to smoke a cigarette. When I came back, the subject had moved on to baseball.

    It sickens me that this way of thinking is the norm of our society. Most people are trapped in their own little worlds, with no desire of escaping….

  • kris D.

    yeaaaah. what they said….

    keep peeling back those layers, Jane. your writing is stronger with each article. your voice will soon be carried far and wide. again, i am grateful you have chosen to champion such worthy and important issues….and not feeding into the BS that is the emperor’s new clothes.

  • Elaine

    Not so long ago, I was penniless because after years of living a lie in misery, I left my husband. I thought I was prepared, I had savings and I was more than ready, but as I raced off to start my new life, in anger, he froze all of my bank accounts.

    As I drove away from bank, unable to take any of my money out, I realized I had twenty dollars and all I could fit in my car to my name. That day was when I first knew poor. See, about an hour later, that one twenty-dollar bill that I stupidly set on the passenger seat, blew out the car window on the ramp of 94 and Dale Street! I saw it swirl in slow motion through the air and land roadside in my rear view mirror. I circled around to go get it. Tears rolling down my cheek, I pushed through tall grass and searched up and down that ramp for about an hour - I never did find it.

    For months, I was financially devastated, sitting in an office with a great paying job and having no way to get at the money I needed to eat or live. After cashing in my cup of saved coins and pawning my wedding ring, I was able to survive on a steady diet of 5 for $.86 Ramen Soup, washing my clothes without detergent, and sleeping at a co-worker’s house. Thank God for my friends that helped me out because I had no clue how to be poor!

    I will never forget that time, and can see a much different ending had I had children in tow. A short time of poor could have easily spiraled into long-term poverty. I am personally very scared to ever be like that again, and can only imagine what it must feel like in this current economy, especially for the elderly or single parents. I am just hoping articles like this, and raising public awareness will keep focus on the children of poverty because as this crisis gets more intense they are the most defenseless.

    I am also reminded me that even if you are sitting high on a stack of hard earned money and consider yourself unaffected…poverty, this depression, the latest financial downturns, they really are happening to all of us - our money isn’t really ours right now! It’s a blip in some computer database with a possible backing of cash from China if the bank fails.
    These “soccer parents” putting on the big show with judgments and prestige, you know the really cool ‘credit rich’ people with sunglasses that cost more than my shoes? They ARE affected and don’t let them behave other wise. I found something that works, just start yawning…Seriously open your mouth, breath in hard and pat your lips because it’s just all bullshit. I suppose it must really suck to build your life on a credit system that is now failing, but to continue to carry forward a judgment on others who are hurting right now is just plain ridiculous.

    Of the two parties that are asking for our vote in November, neither really seems to give a real, sincere, flying you-know-what about the future of the rank and file, uninsured poor. Frankly, they both turn my stomach and spoil my belief in government EVER saving the day. In fact, I can’t help but think that the only way poverty will really be abolished for good will be when we ‘Jane six-packs’ of the country put our heads together to get things done.

    And so today, I am officially reminded that I learned a huge lesson the day that twenty flew out the window. Poor is extremely powerful. Poor DOES have pride, and when previously affluent people experience it, they are the most likely to crumble. I realized that there IS a dollar sign on peace of mind, but if you keep it simple, love people not things, and give back to those less fortunate, like people gave to me during that time, it can make a huge difference.

    Thank you Jane for forcing me to remember that I need to follow the lessons I learned. I’m inspired to do better.

  • Jeanne

    Elaine - that’s just how I feel. Jane’s writing reminds me and prompts me to be a better woman and human being on this planet. Her voice needs to be heard.

  • Mel.

    Been typically and even “officially” poor (according to the numbers set my our government) and one of those times was working as an AmeriCorps volunteer. After six months, and earning $600 per month, for my efforts (this will make you laugh) doing economic development surveys for a town in Montana, I had to quit serving my country to make better-than-minimum-wage income. Now, if the government didn’t think I needed a living wage to serve our nation, what ever made me think they’d care about citizens over investors when people lose their homes, jobs and dignity? Silly me. Thanks, Jane, for continuing to address this crisis. This dialogue is long overdue. (I think I’ll pull out my old Madame Defarge costume for this Holloween. Think “W”/the Administration would get the picture of how citizens feel?)

  • Julia

    Mel your job reminded me of the one I had with the Census Bureau who if I remember right, I never got a check over $400 and of course no benefits. I wonder what it would take to lay off a President, VP and a few Senators?

  • Amanda

    My mom had to use Welfare when she went back to school when I was in the 8th grade until right before I graduated.

    I want to say right now that welfare is a joke. For anyone who wants to better their life it is a total joke. All it does is help you find a crap job that will barely sustain you so they can pull your benefits.
    To get ahead and make a better path for your family is hard in this country. The poverty level income is unrealistic because you have to be able to buy school supplies, clothes, shoes, outrageously priced food, prescriptions, gas, electric, water, shelter, gas for your car, a car, all of these things are now absolutely necessary to maintain.
    People live under the myth that people are poor because they spend money on stupid stuff, which in some cases is probably true, like cable and high speed internet. However, even normal TV is going to cost you 50 bucks at some point this year with the switch to digital. I know My family JUST NOW got cable because we are in a place where we can afford it.
    Housing under 550 is a joke unless you want to live in a rat infested dump in the bad part of town. I pay 550 for my 3 bedroom home but that is because it is not in the best of shape and my landlord knows it.
    college needs to be a free thing. If they think every American should now be college educated to get by in life then the government should pay for it because it then becomes as necessary as high school and elementary school.

  • Pamela

    It is obscene what people are expected to live on. The poverty line in Canada as of 2006 is $10,314 dollars for one person. A family of six should be able to live on $28,593

    Who are they kidding? The average rent for a DUMPY one bedroom in Toronto is $ 884. This strikes me as low. The last one bedroom I had - 6 years ago was 1100 + utilities. If you want to live in a shit hole slum you may be lucky enough to score something for 800 bucks.

    Social assistance offers $339 for shelter per person, monthly. They give an additional $241 dollars for utilities, food, clothing.

    There are many people who grow up on welfare through NO fault of their own. My father was an alcoholic deadbeat who never contributed a cent to my upbringing. My mother was single and forced onto the system, unable to work and pay daycare for two babies. We did NOT choose to live in poverty. Most don’t. Blaming people for the hand they are dealt is ignorance at it’s peak.

    I hope I live long enough for some equality to find everyone. Not holding my breath - but hopeful.

  • Anne

    This is excellent, your research well done. I’ve a sent a copy to a friend in a the US Senate office. Thank you.

  • Barbara

    What the Minnesota Emergency program does is reward people who DON’T have to pay the rent that others pay. This was quite awhile ago and it may have changed since, but my friend’s daughter came to live with them, her two kids in tow, and she gave her mom a form to fill out saying she paid something like $380 in rent. She didn’t pay anything. She got approved.

    It seems to me that there are people who know how to “work” the system, and because they know these rules they can do things like my friend’s daughter did. Or they can go crash with a friend while their app. is being processed.

    Other people (most probably) who are just desperate, and who don’t know the rules and wouldn’t even want to play the game, probably go in thinking they’re going to get help, and then don’t because they didn’t learn how to manipulate the system to their benefit.

  • Little Sun

    When I first read this section, last week, I tried to write a comment but it ended up being something of a long quiet but rather graphic scream. This isn’t much better but at least it’s pared down a bit..

    As someone who grew up poor, worked my way out, then abruptly once desperately needed our so-called social services systems’ “safety nets” and as someone who has advocated for many others in dire need in the years since, I can assure of this: those who most desperately need help from the “system” (one they may well have paid into for years and years and years) are the least likely to ever get help and, if they do, will likely be more repetitively traumatized by the “system” than those who least need it. Unless you live in a rural area and happen to have a cousin that runs the local office, to navigate any of the systems–Welfare, Foodstamps, Social Security Disability, Medicare, SSI, Worker’s Comp, State Disability, whatever–is to be judged, suspected, abused, degraded, dehumanized, objectified, disappeared, made to jump through impossible and labyrinthine bureaucratic hoops with no consideration for one’s humanity and the realities of one’s circumstances. Many are simply incapable of jumping through the required hoops to get what aid might be available and paid advocates are but a dream someone once had in most places. Volunteers are virtually non-existent. And if you’re lucky enough to have a more educated, pushy, or able-bodied friend or relative, they will likely end up causing you more trouble with their own impatience, tend to give up, or will likely end up just as stymied as you are.

    If you don’t have children, you may get no help at all or very little, depending on what state you live in. If you have kids, in addition to your stresses and worries about providing for your children, you will be judged and demeaned for having children. Regardless of who you are or what your issues are, your fate may well depend on what “system” worker you happen to end up with and how they feel that day and/ or how well-trained or intelligent they are. (The rules are byzantine and even those with brains, commitment, and training can’t always figure them out.) If you have no phone, no address, no money or transportation to get required documents, or copy after copy made of those documents, (the “system” will likely lose your documents, repeatedly)–if you’re illiterate, disabled, physically ill, have a mental illness, don’t know how to advocate for yourself, etc., etc…. well, you’re probably screwed from the start in many places. If you are severely disabled or dying, you’ll have to try for welfare and whatever else you can, even if you have little chance of getting anything anywhere, because Social Security Disability (that thing you’ve paid a chunk of your weekly check for, for years) automatically turns down the vast majority of applications no matter what. The appeals process then takes an average of 2 1/2 years, endless brutal doctors’ evaluations, and almost always requires an attorney who will get a cut of the back money SSD will, by then, owe you–if you should live so long. The “system’s” basic hope appears to be that you will die before the appeals process is completed.

    If you have transportation that may be held against you. It may be considered an asset you have to get rid of in order to qualify for anything. If you have no transportation then you will likely miss or be late for appointments which may not only result in you being cut off whatever help you’ve managed to get, it could put you back at square one in the process. If you live in a neighborhood where your mail is regularly stolen or your mailman is on crack and rarely gets anybody’s mail to the right address (happens in more often in most places than most people dream or realize, especially in places where poor people live), you may not only lose your check but you may miss one of an endless array of new documentation request letters… which will lead you onto new byways of bureaucratic hell you haven’t wandered through yet.

    Oh, and if you’re congenitally honest, that’s another strike against you! Once upon a time, I was abruptly thrust into empty belly poverty when I was severely disabled from an on the job injury shortly after moving to a new city where I had no support system. I couldn’t get to the food banks that gave out some food because of my disabilities and wouldn’t have been able to get groceries home for the same reasons. They were usually out of food by the third day of the month at that time anyway. Some nice community organizer folks did bring one food box to my little room once sort of by accident. The lady upstairs it was meant for had died. Canned food. Couldn’t operate a can opener though because of my disability. Ever try swaying on the street looking scary (I was green and weighed 90 lbs.) and stinking (hard to get clean when you can’t buy soap) and trying to ask passersby to open a can of food for you? Loads of fun. Just one of those fun-lovin’ poor folks counting to ten repeatedly hoping to not fall down and drawing sustenance from flowers growing up through sidewalk cracks… I really don’t recommend it to comfortable folks as a hobby…

    Anyway, back to the honest thing: After spending all I had left but for 26 cents on buses, and, many misadventures later, I finally got to the welfare office where I was denied emergency foodstamps for THIRTY days because, silly me, I was stupid enough to say I had 26 cents in my pocket and $2.38 in a bank account I had no checks for and couldn’t get to… And that’s just one tiny relatively clean little blip of a story among thousands much, much more hideous stories I could share about my experiences and those I’ve advocated for. Lovely “safety nets” we working folks all pay into…

    Those who have never been in a position of empty belly poverty and true desperation tend to gape in wonder when they discover that many inner city welfare offices have bullet proof glass between the social workers and the clients… A few go-rounds with the “system” (in which the social workers are underpaid and also often terribly dehumanized) and even a relatively healthy, able-bodied, generally peace-loving person may begin to get just an inkling just why that might be necessary…

    Being hungry belly poor more than “sucks”. Working for a “system” that’s supposed to help people who’ve fallen on desperate times beyond “sucks”.

    When I hear people who haven’t ever been in such a situation talk about “welfare queens”, I generally try to walk in the other direction…

    Keep writing, please, Jane. We need more voice, perhaps a bit less strident than my is wont to become on this subject…