Thursday, September 24, 2015

When is poverty really poverty.

From the census bureau:

Living Conditions of the Poor in America

Consumption by Poor Families. Since the Census Bureau dramatically undercounts the actual incomes of the poor, it should be no surprise to find that the U.S. Department of Labor routinely reports that poor families spend $2.40 for every $1.00 of their reported income. If public housing benefits are added to the tally, the ratio of consumption to income rises to $2.60 for every $1.00. In other words, the “income” figures that the Census Bureau uses to calculate poverty dramatically undercount the economic resources available to lower-income households.
Amenities. Because the official Census poverty report undercounts welfare income, it fails to provide meaningful information about the actual living conditions of less affluent Americans. The government’s own data show that the actual living conditions of the more than 45 million people deemed “poor” by the Census Bureau differ greatly from popular conceptions of poverty. Consider these facts taken from various government reports:
  • Eighty percent of poor households have air conditioning. By contrast, at the beginning of the War on Poverty, only about 12 percent of the entire U.S. population enjoyed air conditioning.
  • Nearly three-quarters have a car or truck; 31 percent have two or more cars or trucks.
  • Nearly two-thirds have cable or satellite television.
  • Two-thirds have at least one DVD player, and a quarter have two or more.
  • Half have a personal computer; one in seven has two or more computers.
  • More than half of poor families with children have a video game system such as an Xbox or PlayStation.
  • Forty-three percent have Internet access.
  • Forty percent have a wide-screen plasma or LCD TV.
  • A quarter have a digital video recorder system such as a TIVO.
  • Ninety-two percent of poor households have a microwave.
For decades, the living conditions of the poor have steadily improved. Consumer items that were luxuries or significant purchases for the middle class a few decades ago have become commonplace in poor households. In part, this is caused by a normal downward price trend following the introduction of a new product. Initially, new products tend to be expensive and available only to the affluent. Over time, prices fall sharply, and the product becomes widely prevalent throughout the population, including poor households. This is a general sign of desirable economic progress.

Overall, 100 million individuals—nearly one in three Americans—received benefits from at least one of these programs. Federal and state governments spent $943 billion in 2013 on these programs at an average cost of $9,000 per recipient.
Today, government spends 16 times more, adjusting for inflation, on means-tested welfare or anti-poverty programs than it did when the War on Poverty started. But as welfare spending soared, the decline in poverty came to a grinding halt. As Chart 2 shows, the more the government spent, the less progress against poverty was made.
How can this paradox be explained? How can government spend $9,000 per recipient and have no apparent impact on poverty?


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  2. This looks like something written by Stephen Moore. Dripping with cynicism is an understatement. A certain segment of America cannot go for literally one second of any day without feeling a smoldering anger over government spending, and this article is for them. Whether it says anything truly useful is beside the point because it trumpets two very favorite talking points of the right, 1) The poor aint got it bad at all because they air conditioning and, wait for it, a microwave. 2) It provides a chart somewhere that quantifies that government spending has increased without moving the needle on poverty. This is like catnip.

    On the one hand, people in poverty aint got it bad cause they got consumer shit. On the other, they allegedly aren't doing well because ALL government spending is a failure. Seems like the author, (not you Lou) want it both ways. It would be nice if the hack author of the article had some agenda to improve poverty other than bitch about government programs. An argument could be made that if more people could escape poverty by working, there would be a need for less programs. But, to the rabid, such logic simply can't be entertained because it would entail rethinking income distribution which would likely lead to workers demanding more benefits and we all saw how that worked out with unions because, of course there is no middle ground, only extremes.

    I'll concede something I have long thought, many of our assistance programs today are simply keeping people from starving. Put another way, I think they are exacerbating the problem by subsidizing the workforce for the benefit of employers who could pay more, but won't. I think if you were truly honest about this Lou, you would push that point as strongly as the point that government programs create slackers who don't want to work.

    1. The statistics are from the census bureau.

      I always love it when people blame business for not paying more when we have a surplus of labor. Why pay more when people are waiting in line for that entry level job.

    2. "Why pay more when people are waiting in line for that entry level job."

      Why endlessly devalue the dollar just so some people can sit around, do no physical labor and make money trading stocks.

    3. How would we ever repay the 18.3 trillion in debt if they didn't devalue the dollar.

      Want higher wages consider shrinking the entry level people available to work. Imagine wages rising with a worker shortage.

    4. Repay it by raising taxes on the wealthy? No, the real answer is to build a multi billion dollar wall. In seriousness, this is just banter for fun. Several major things have happened together over a period of 30 odd years, 1) Unions destroyed, 2) Outsourcing, 3) Tradeoff of gobs of cheap shit in exchange for sending away jobs to make said cheap shit, 4) Excessive rising cost in education, 5) Lack of investment in this country because ROI is much better skewed in countries that have no social conscience 6) coporate taxes- of course, 7) Democrats. Nothing specific, just the fact they exist and spew non market garbage 8) acceptance of gay marriage- not sure how, but it's gotta factor

      It's a bit more complex that the author of that ridiculous piece will concede. A balanced view takes time to create, stuff like that above, not so much. It's been preached since 1980

    5. The point is the American poor measured by middle class standards are certainly different from the real poor of the world. I do feel somewhat slighted as I do not have cable or satellite service. Oh the horrors.

      p.s. You did forget our ever present racism.

    6. The reason such comparison are bogus is that the poor in the United States do not live in third world countries. It's one of those things that sounds so good on paper, but really ignores what happens in the real world. Conservatives don't seem to have a problem with the idea that kids who grow up watching their parents get by on food stamps are probably going to be in the same boat. But when it comes to making an assumption that kids who grow up in poverty with no examples of how to climb out of it, the conversation quickly changes to how good our poor have it compared to those in shitty third world countries. It says SOMETHING, but nothing that really relevant. At one time indoor plumbing was a big deal too, should we add that to the list?

      For a Mother who wants to find some way to keep her kid off of dangerous streets, find someway to shell out 300 bucks on an X box just might save his life. Maybe you would just dismiss such an argument. With regard to the internet, if you are a kid growing up without it in this day and age, you are beyond handicapped as your ability to have quick access to information will put you at massive disadvantage to the kids who have it. It's clever to say you can live without this. Of course you can. But if you want to try and better yourself and heaven forbid, maybe have a little enjoyment when you aren't working at some shitty job, having a TV is hardly a luxury.

      Consumerism is just another opiate.

    7. What's missing is the desire to move ahead.

      If government gives you a meager living or you can get a job paying a meager amount sometimes less than what government gives, why try?

      The system is broken. There is no compromise for those that try when you reach that point. Do you continue trying sometimes working 2 jobs or do you take the handout?

      Your assumption is that everyone who has a TV, Internet, a computer is wildly successful or can be. Some just have n o interest in moving ahead, much like my nephew. Had everything you say they should have chose to not participate. Continues not to participate. Unfortunately government sets a standard. Meet that standard, your in, if not keep up slaving away day after day.

      There are many who truly need assistance and there are many who chose not to participate. Unfortunately when administered from 80K feet, there is no difference.

    8. When my Mom remarried, she married a guy who is an electrical engineer (as was my Dad). He is a go getter. His brother, on the other hand, is literally 180 degrees the opposite. They both grew up in a home where their Father was well off, very successful, and they both had exactly the same opportunities to go to school and so on. Why did one put it all to good use while the other became a bust out? There is no simple explanation. The government did not set a standard here.

      In principle, I see merit in an argument that if you can get something without working hard to get it, you are not incentivized to do more than you need to. The problem, I believe, is that this basic principle gets taken to a ridiculous extreme and it is postulated that food stamps have almost single handedly destroyed all will to work in the country. I just don't buy it. Another postulation is that government benefits have risen so richly, that working an honest job is no longer desirable in comparison. I don't buy that either. I believe wages have fallen much faster than benefits have risen. Simultaneously, a very small group has become engorged and it's not like that's done anything useful.

      We've sparred a lot on this issue. I tend to think you focus a little too tightly on one small piece of this picture, which is poor people who receive government assistance. You dispute or completely ignore the possibility that those handouts to the poor might be benefitting those at the top just as much. I see a much stronger link. In a pure captialist society, you win or eat shit without much in between. The cheap goods rolling in and the pittance of assistance is keeping people quiet, but I don't think that is going to last forever. I have a nephew in his later 20's now who sounds a lot like yours. He certainly had access to decent education, computers and everything else, but ended up as kind of a bust out himself. The government had nothing to do with that kid ending up the way he did, but his bitter Father and his enabling Grandfather had plenty to do with it. these are anecdotal of course, but I feel like a lot of what you blame on the government is occurring well below the 80k foot ivory tower.

    9. There are so may factors that there is no easy, this is how it is.

      We need a system like Clinton passed, work at a minimum wage job and get benefits. Don't work, have a justifiable reason why you don't work or no benefits. That would make sense.

      Interesting thing happening here in Denver. We have a new face of the homeless in the downtown area. 18-30 year old people are the new homeless that are visible downtown. The new thing, hey can I have your leftovers (returning from lunch or dinner), can I have your drink, then the next thing, hey do you have a 5 you can spare? Most odd, some people working downtown are blaming it on the POT available in the area. I'm not sure what the new demographic is all about. Went over to the place where they handout food and it was the older homeless group getting something for lunch. So the homeless are still there with a new addition.

      I have a nephew much the same. Over 30 and hasn't worked a job in his life. As to your both of them, imagine when they hit 62 and want to collect SS and they have not made minimum contributions. Wonder how they will survive.

    10. I look at the stats in the article and I immediately think how the unemployed in Mexico or in Cuba, two close neighbors of yours would like to survive on the money received by the "Poor" in the United States. Air Con and a car for most of the poor. This standard is available only to the rich in Mexico and Cuba. Even here in Australia there are pockets of disadvantaged where Air Con and a car are beyond reach. However, these people all have plasma TV and beer in the fridge which the government provides via welfare payments. The beer and the TV are first on the shopping list, essentials for life come a distant second.
      Reading the views of Lou and Max,I see nothing but a yawning divide. Somehow if you could close that ideological gap, perhaps you could find a solution to a problem which undoubtedly exists.

      Cheers from Aussie

  3. So what is poverty? If not the commodities that make our lives better and give us access and security, what is poverty? Beyond food and shelter what was poverty in the 30’s?... no horse?.. no telephone?.. no shoes? Quality of life is subjective but we can easily say that modern refrigeration and clean, potable, always available water at the point of use has prevented more mortality and morbidity, lifting more people out of poverty, than all other technological advances combined. Things not available to the vast majority of Americans in the 30’s. When I worked in China in the 1990 less than 5% of that population had refrigeration.

    We are distorting the definition of poverty and of work and indeed attempting to erase in our minds what is surely still alive and well in all of the world; survival of the fittest. Before I was 16 I did many jobs that today have been regulated away from children. They certainly didn’t pay a subsistence wage but they gave me a good work ethic and pocket money which my parents encouraged me to save... and just as importantly, they made a farmers operation sustainable, the little trash collection business profitable enough to continue and a family restaurant the ability to stay open.

    In the 80’s little farmers lost their lands to big operations... operations that used itinerant labor, much of it illegal. I remember driving my granddads pickup behind his tractor as we went from field to the house. I was 12 years old. He started letting me steer it when I was 8. Today laws restrict kids from being around farm machinery... child labor laws prevent the family farmer from using their children to make a living. Learning a good work ethic certainly involves watching mom and dad... even if it means watching them have to suffer the long lines at the food bank... it also means doing chores that help the family and having the opportunity to learn about work at a young age even if it is paid cheaply.

    When people talk about poverty in America, they seldom look at the broad picture that America and the poorest people in it are better off than 80% of the worlds population and that they are better fed, better housed, better connected and better entertained than the vast majority of the world.

    America is like a house in a wider community... not everyone in the community will do well and the fate of every household lies in its hard work, management and a bit of luck. America is providing less effort and has a serious management problem. A direct result of the utopian dream of flattening the world? Even when vast majority of people live in ‘equality’ as liberal doctrine demands, there will still be those who can afford better medical care, more wholesome food... and higher quality schools from which to learn how to say above the fray. They are working tirelessly every day to help liberals remove the wealth from the lesser wealthy to give to the poor... they are helping to create the rules that everyone receives the same ‘good life’... a life that they have skilfully exempted themselves from. I mean, who could expect the president to drive his own Prius... or congress to use the same medical system as the rest of us.

    When we say that there are some jobs Americans just won’t do... do we ever think why? Do we ever wonder why someone else is willing to trek across deserts and oceans just to do those jobs. Why they are willing to live 20 in a house and sleeping on the floor (Standards you would deplore of an American family). What incentives have we created for illegals? What incentives have we created for Americans? After all, humans, indeed most living things are incentive driven.. either by the negative incentives of pain or the positive incentives of reward. That’s not a capitalist theory... that’s nature...

    It is interesting to me how liberals treat nature. On one hand, they embrace it as a natural, unalterable fact of life... like sexuality and sexual behaviour but deny it and or find it easily malleable with other things like most of Darwin’s findings....

  4. This reminds me of the Pope prattling on about how the modern world (read wealthy) must elevate the poverty of the poor in one breath and then condemn climate change on the other....

    Without any doubt the benefit of reliable, always on 24/7 electrical power, modern society and most of the wealth created by it would cess to exist. Why?

    As I mentioned above ... with it you obtain modern refrigeration and clean, potable water without which society and its health would look very different.

    There are only a few sources capable of producing always-on and available, 24x7 electrical generation.

    They are geothermal, hydroelectric, nuclear and fossil....Period.

    Solar and wind are not reliable energy sources. They are nice when they exist but you cannot count on them to be always available and producing, yet that is exactly what you need to produce the hallmark of modern society -- a switch that always turns on the light when placed in the "ON" position.

    Geothermal is limited.... hydroelectric is pretty well maxed out and every time it is added somewhere it devastates the ecosystem sending someone into a palaver Which risk is greater?

    Nuclear power is potentially dangerous in more than one respect. Unused technologies such as thorium are considerably safer but still not without risks. This leaves us with fossil fuels.

    To shun fossil fuels is to consign the developing world to remain forever bound in the chains of poverty, disease and death... and they would still use wood and coal. To restrict it in the developed world is to diminish the wealth creating properties is supports.

    Uplifting a few billion people out of privation and providing them reliable electrical power will do a hell of a lot more to help them than global warming will hurt even if it's true that we're causing it; a theory that I am not certain is supported by the facts particularly in light of so many recent revelations about the reliability and credibility of the source of data used to justify the claim.

  5. I have just finished dinner, cooked by my wife of fifty five years, whom I consider the best cook in Tasmania. I have consumed my usual glass and a half of a good wine but I hope it does not cloud my judgment. Having read the two posts of TS I can find minor details about which we could disagree. I can however find the general tenor of the remarks by TS as being something with which I concur. Unfortunately the world has to find a solution to poverty and those of us ,perhaps just outside the recognized line, will continue to believe it is not our problem.

    1. Oh, I don’t think it’s not our problem. I think a lot of well meaning people have placed the emphasis on the wrong things. Just as I believe very poor government policy and law has exacerbated racial tensions in the US... well intentioned but ill conceived plans have, over the long term, done more harm to generations of people. One notable fact with regard to poverty is the number of single black mothers. Were it not for a children’s support program that favoured children with single parents, fathers would not have left, certainly not in the numbers that have occurred. A policy that forces fathers to choose between staying at home and their children having food is not a particularly well considered plan. (Unless your intention is to destroy the nuclear family)

      One thing that I discovered a few months ago is that the African continent has a series of large aquifers with one being larger than the Ogallala Aquifer that provides water to the entire central US and supports what was once called the Bread basket to the world.

      I am sure that you have them in Australia; commercials for things like save the children where they ask for money to drill wells in Africa to provide water for people to eke out merger crops and give a child’s parched mouth a bit of moisture. Now these commercials have been running for decades and yet, sitting on huge amounts of accessible water, they still haven’t managed to find enough water to grow their own crops... It seems to me, the personal desire to do something and a lot of well meaning donations went down someone’s well... but tha’d be cynical...

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    3. The world will always have wealthy as well as poor people. The rest of us are in between.

      It's a wonderful notion that we can lift the poor into the middle class. After trillions spent in the US over 50 years we have the same percentage of poor. Their standard of living is certainly better however the bar has been raised as to poor, middle class standards. How can that be?

      As a society we need to provide for those that cannot provide for themselves. Do we have a responsibility to provide for those that chose not to provide for themselves? Do we have a duty to provide for a person who has 2 children and has another knowing they cannot provide for the 2 and yet have another? How about the same person with 3 that they cannot provide for and has a 4th? Where does personal responsibility take over from government responsibility?

      One side of the US assumes the government should provide for all regardless if they chose to participate or not. The other side believes government we the people need to help those that cannot help themselves. One day soon we will reach that magic number when lenders will no longer accept the treasury note without a large risk factor added in to the interest rate. That day we will all grow up and society will need to decide, can we continue to support 1/3 of Mexico's population via illegal immigration. Who can we afford to take care of and to what extent. How much can the government support seniors via Social Security, healthcare even though they paid for 50 years supporting the SS and Medicare systems.. Can we afford to be the policeman of the world without compensation from the world. Can we afford a national healthcare system that government has bloated with mandates and regulations.

      Having said all that, We have a few years to pretend everything is ok unless someone grows up sooner in Washington and the American people open their eyes to the fact we cannot do everything we want without paying a price.

    4. And yes this is a bit cynical however it probably reflects more of a reality we choose not to accept at present.

    5. Poverty is relative. The vast underground economy continues to grow. Food stamps, welfare, student financial aid, make work programs, etc, all provide a form of currency that enables millions to live shadowy existences, in plain sight, off the grid.

      Socialism does this, why debate it, this is nothing new. Obama didn't create this vicious wheel he just refined it. The magnitude of course is now alarmimg. 9T to 18T in six and a half years. Ms. Yellen nearly fainting as she attempts to explain why the promotion of inflation is the primary driver of the Fed's deer in the headlights policies.

      This is what the Tea Baggers, as Maxie pad so kindly calls us, have been saying since 2009. The media of course throwing accolades at themselves for discovering the reason that three outsiders, and a communist, now lead the various polls. DUHH.

      Poverty? Poverty you posit? The way this freight train is running you ain't seem nothing yet.

  6. Poverty is relative. Metaphysically, we truly do not need more than steady supply of food, shelter, clean water and ideally companionship. If you live in a remote wilderness, poverty is much different than in an industrialized city. It is about power though. When you are impoverished and living in a city, the deck is stacked against you to start climbing up into another socioeconomic class. Get busted for pot, and I"m talking just a little here, and you are really screwed for the future. THIS is the kind of shit I"m talking about.

    But, going further, you can have all that cheap shit for creature comforts, and whether intended or not, the cheap cost of that shit buys off poor people. I wonder what would happen if people were given a choice, IE if you literally presented to them a choice between a chance to get a good education or AC, or a flat screen TV, what would they take? if they took the school, they would increase the amount of competition up the food chain in a group who I think is just as content as the poor to enjoy a protected status. Most of you claim people like me protect a group who doesn't want to work all that hard, and I claim the same in reverse. Human nature, like electricity is to always take the path of least resistance. Some type A's in the world will always get up and thrive on the possibility of killing something physically or metaphorically, and of course they have their mirror opposites. Many in the middle however, will always look for some way to make their lives easier. And once they have that protection, they will strive to keep it.