Categories
Antiwork

The US calculates it poverty deliberately to hide how bad poverty actually is. This contributes to not seeing the need to raise the minimum wage.

In a rich country like the US, we shouldn't even have poverty but, if there is poverty, it's important to accurately calculate the poverty line. The current poverty formula was developed in the 1960s using a report that came out in the 50s that stated a family spent 1/3 their income on food. This report assumed there was a Stay-at-home-mom to be thrifty. So each month the USDA publishes numbers on food costs. It's broken up by single vs family and how many children under a certain age. Then it's divided by budget, thrifty to luxury essentially. Well once a year, to adjust for inflation, the US takes the thrifty budget x 3, and that's the monthly poverty line. Except US households no longer spend 30% of their income on food. The USDA in 2021 put this number at roughly 10%. So the formula is extremely outdated. How does the…


In a rich country like the US, we shouldn't even have poverty but, if there is poverty, it's important to accurately calculate the poverty line.

The current poverty formula was developed in the 1960s using a report that came out in the 50s that stated a family spent 1/3 their income on food. This report assumed there was a Stay-at-home-mom to be thrifty.

So each month the USDA publishes numbers on food costs. It's broken up by single vs family and how many children under a certain age. Then it's divided by budget, thrifty to luxury essentially. Well once a year, to adjust for inflation, the US takes the thrifty budget x 3, and that's the monthly poverty line.

Except US households no longer spend 30% of their income on food. The USDA in 2021 put this number at roughly 10%.

So the formula is extremely outdated.

How does the rest of the world calculate poverty? Well in Europe it's generally 60% of the median individual income.

What would the poverty line in the US look like if it was calculated this was?

In 2021 the census calculated the median personal income for all workers over 15, even part time was $45,470. The median income for full time workers was 56,473.

So 60% of 45,470 (because the poverty line shouldn't matter if your full or part time) is

$27282 for a single person.

In 2022 the US poverty line for 1 person was $13,590.

There have been numerous studies in the last decade about how the poverty line is not calculated correctly, some buy the govt. But it hasn't been updated.

Why? Because if they update it using modern metrics it shines light on how bad wages are in the US. its just another nail in the coffin for US capitalism (not that any capitalism is great). Keeping the formula as is keeps the percentage of people in poverty calculations extra low, making the US look better.

After all, the fed min wage is 7.25 which is 15,080 a yr if full time. See that person on minimum wage is a over the poverty line of 13,590!

Sources:

https://www.census.gov/library/publications/2021/demo/p60-273.html

https://www.census.gov/topics/income-poverty/poverty/about/history-of-the-poverty-measure.html

Leave a Reply

Your email address will not be published.