Do Americans Know What Poverty Is?
| August 13, 2012 | Posted by Roshawn Watson under Personal Finance, US Economy |
By: Roshawn Watson (special note at the end of post)
Increasingly, I’ve become aware that the definitions of “poverty” and “low income” have changed. Fortunately, long gone are the times during the Great Depression where the typical poor would get into bread lines for rations. During the Great Recession, it is a decidedly different portrait altogether (not to diminish anyone’s suffering). Over the years, we have lightly addressed “broke people” trying to look wealthy with My Big, Fat, Trashy Home, The Phony Rich, Broke People Stop Giving Me Financial Advice, Broke People Afford Everything, and many others articles. The truth is that there is a serious ongoing debate as what constitute being “poor” in America. Political arguments and ideology aside, do Americans even know what poverty is?
Data Suggest Some Technology are Shared Equally By “Poor” and “Nonpoor” Alike
One reason it is difficult to define who is poor in America nowadays is because you can not presume wealth based on possessions. Many modern conveniences once considered luxuries are now taken for granted and deemed “essential.” If this sounds exaggerated, consider that 62% of households earning less than $20,000 per year own between 2 and 4 televisions compared to 68% of those earning $120,000 or more. While the 2009 Residential Energy Consumption Survey didn’t provide statistical analysis for this comparison, I wouldn’t be surprised if those numbers were statistically the same. Moreover, the Heritage Foundation found that nearly two-thirds of poor households have cable or satellite TV, and greater than half of poor households with children have a video game system, such as Xbox or Playstation.
Sixty-two percent of households earning less than $20,000 per year own between 2 and 4 televisions compared to 68% of those earning $120,000 or more.
Of course, not all technology is equally shared at all income levels. For instance, 52% of the lowest income families do not have a computer compared with a mere 3% of the highest income homes. Likewise, around 69% of the poorest households do not use a dishwasher while only 10% of the richest are without this convenience. Nonetheless, the data certainly indicate that depicting the typical American poor as being extremely deprived may not be entirely accurate.
Related Article: My Big, Fat, Trashy Home: The Fall of the McMansion
Who are the “Poor” Anyway?…. Apparently Almost Everybody!
Part of the challenge in defining poverty is the measure used to classify income. For example, did you know half of the people in the US are considered “poor” or “low income?” That shocking statistic comes from USA Today: “48% of Americans — 146.4 million people — were either in poverty or were low income, meaning they earned between 100% and 199% of the poverty level.” That perfectly illustrates just how all encompassing our definition of “poor” can be. The data suggest that poverty, what many people would consider a deviation from normal (i.e., the middle class), is downright commonplace. In fact, with half of the US qualifying as poor or low income, anyone would be hard-pressed to find someone NOT affected directly or indirectly by poverty.
Related Article: The Phony Rich
One obvious downside, with no disrespect or insensitivity intended, to defining poverty and low income so broadly in the US is that it diminishes the potency of what being poor really means. I attended a recent show by comedian Bill Cosby, and he indicated that many of us today have very little concept of what being poor really meant during his childhood (i.e., before television was invented). Based on his description of his parents denying his request for 10 cents to purchase the “best (toy) race car in world” (and other funny musings), I’m inclined to agree, inflation or not. I suspect some of us have strong cognitive biases to reject any notion that we’re not as poor as we think we are; after all, wealth is constantly portrayed negatively anyway, so many of us harbor inherent negativity towards wealth (even if they are subconscious). Additionally, being labelled as poor also shields us from criticism for not being able to afford a more affluent lifestyle or having “too much.” If everyone is struggling to make it, there’s solidarity rather than division and strife.
Related Article: Broke People Stop Giving Me Financial Advice
Nonetheless, I find myself wondering if our broad definition of poverty is why so many wealthy Americans go abroad to enrich the lives of the poor from other countries before looking domestically: not because they are global citizens in the activist sense but rather because they feel that the typical American poor are not truly poor to begin with (relatively speaking of course). For example, the Heritage Report found that poor Americans had more living space than average-income Europeans. The space limitations of Europe notwithstanding, that’s still particularly telling.
“If you took the typical poor household(s) and put them on TV, no one would think they are poor… they struggle to make ends meet, but they are not in any type of deprivation.” (Robert Rector, author of the Heritage Foundation report)
Consumption-based versus Necessities-based Definition of Poverty
Another challenge in defining what makes households “poor” stems from whether you are focusing on consumption or needs. Consumption wise, you may not be able to readily distinguish the “poor” from the “middle class.” For instance, sure there were notable differences between computers and dishwashers ownership present between low and high income levels but not when you looked at subscriptions to cable and satellite and ownership of televisions, video games, and DVD players. However, if you instead investigate who was struggling the most to provide health care, child care, transportation, and many other things that are typically characterized as basic necessities, advocates say that the poor are disproportionately affected. Advocates also claim access to these needs should be the focus of the debate and aid while detractors argue that the fact that possessions do not reliably delineate the poor from those with high incomes in itself suggests that significant progress has been made.
Related Article: Broke People Afford Everything
Closing Thoughts
Often we talk about the average millionaire being misrepresented in the media and the difficulty in defining the middle class, but perhaps we should now add the poor to the list of those mischaracterized and misunderstood.
What say you? Is challenging the notion that of how bad off the poor are simply a “mean-spirited… attempt to deflect any discussion of the causes of the economic collapse…(while) there’s a growing chasm between the haves and the have-nots?” Alternatively, have the media and and low-income advocacy groups used such a broad brush when describing the “poor” and “low income” that such terms are now exaggerated, lacking potency, and void of any substantive meaning? In short, can you be poor with a flat screen HDTV and new smartphone?
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Warning: Due to the sensitivity of the subject matter of this post, I recognize that strong feelings on both sides of the issue may be evoked. Please be advised that in no way is this article meant to be an attack on anyone or endorse of any political ideology. I am simply addressing the topic. Please keep comments respectful!
An excellent post to start the week, Shawn.
I agree with so much of what you have written. I have lived in Africa and Asia for multiple years in the past, and what you point out is true: poverty in the USA is wealth in many many parts of the world.
The poor in the USA are mischaracterized or misrepresented. We tend to focus on what we don't have, instead of what we do have, with the result being envy and jealousy. Negative emotions, those, and they don't prepare us for success in any way.
Thanks so much Thad. Your comment reminds me of when we went to Jamaica a couple of years ago. Similarly, listening to the locals describe their lives there was totally different from what one would expect in the US. We have definitely benefited from increased quality of life. I am not a fan of the politics of envy, but that's a discussion for another day and another post.
Good post. In fact I was thinking about writing a short piece this morning on Guor Marial the Olympic marathoner whose relatives live in a village in South Sudan without electricity. They had to walk over 30 miles to see him run on TV. Worth thinking about – no electricity, no transportation – not to mention the the violence and overall hardship they have endured. It is no wonder that much of the world sees America as a land of opportunity. They see our "poor" as wealthy.
That’s a great example. I am also aware that it is a VERY sensitive subject. I hessitate to even bring it up because I am not trying to offend people. That said, I think in the partisan rhetoric we miss some basic understanding of what true “poverty” and “wealth” are. I would be the first to admit that it is all relative but to what end?
Perhaps if we changed the labels, the conversation would evolve. Instead of poor and rich, we could categorize people into other groups- maybe based on the amount of debt they have. Even "rich" people can be overwhelmed with debt and be cash-poor despite a large income.
But to do that, we'd need to stop using just two groups to describe people. There are many different levels of debt.
Of course, one of the problems with my idea is most people don't want to think about how the multiple levels of debt, income or other variables work together- they just want it to be simple. Having two groups is much easier.
Dave, I do agree that the conversation needs to evole. I think personal agendas and political ideology have obfuscated the real issues. Of course, any can be manipulated by the "rich" and "poor."
I too have traveled to numerous places and have seen what real poor is. Poor in our country is in many ways rich compared to others. Even our homeless have nice shelters to hit and places where they can stay warm. This isn't the case in other countries. In places like Africa, poor really are poor.
Yeah, it is amazing what a global perspective will do. It does not diminish others suffering but it certainly gives you context about the conditions that we sometimes find so horrendous. Those overseas trips stay with you. I think one would have to be a total narcissist for it to not affect you.
Poor in this country seems awful, and I'm sure it's not fun for those in that position. However, it may actually seem like a great life to some folks in different parts of the world. I've traveled to several Asian countries, and have seen people begging. Abject poverty on that scale seems much different than what we have here. I'm thankful every day for what I have, even though there are moments that I might let that perspective slip.
At the end of the day, this is such a healthy way to approach it: count your blessings. I guess secondly we all, as global citizens, should do our parts. As I was just sharing with Miss T, it is very hard to not be affected by overseas trip to poor nations. It will change your perspective, sense of entitlement, sense of fairness and much more like few things will.
I agree with the other comments. Poor people in other countries have so much more difficulties than poor people in the US. You are probably right that most poor people here would be seen as middle class or rich on 3rd world countries.
I thought poor meant making less money than the poverty line. Thanks for correcting that misconception.
Yes Joe, I guess the lesson I gained was even poverty is VERY relative. I don't want to kill anyone's dreams of becoming more but people really lack context when they go on and on about how rich we already are.
I had worked with a russian immigrant who had been waiting in line for an apartment in her homeland.
Two years after she emigrated her apartment application was approved. She started out cleaning houses in Brooklyn. Her first apartment in NYC was much larger than the apartment she would have gotten in russia.
And that was the smallest place she has lived in while here in the US.
In any distribution there will always be a lower quintile. But to say that people are poor by world standards is a stretch.
That perfectly illustrates the relativity of wealth and poverty. I get that people are hungry by change… using the world's standards though, I think many complainers would get a wake up call. Like Dave said, the conversation needs to evolve. Thank you for your comment.
I think you're destined to stay poor if you have a smartphone, flat screen tv, no computer and no thoughts about becoming educated.
That's not a bad point at all. I guess you are saying that the writing is on the wall.
I don't think Americans today have much idea at all about what poor means. And I'm not saying I"m any different. It's funny that the "poor' discussion began in your post by talking about TVs and phones and computers. Those are definitley luxury items and should certainly not be included in a discussion about actually really poor people. True poorness, truly poor people, do just what you referred to. THey're waiting in lines for food, they're power was shut off months ago, their clothes have holes in them that weren't put there intentionally by Abercrombie and Fitch… America just doesn't have the poor of other countries or like we used to be… well, we do have alot of people in debt though.
Great point. Debt does give the illusion of prosperity. If we didn't have easy access to credit on a consumer level, I think many people's consumption would be more conservative and perhaps the outlook and the discussion of poverty would be decidedly more grounded in reality rather than ideology.
Years ago, I would drive passed a trailer park on my way home. There was a trailer sitting not far from the road that always had the front door propped open. Inside was a giant 50 to 60" television. This was at least 5 years ago when televisions like that ran thousands of dollars.
JW, that’s is so very sad. I always wonder if people even have a concept of how silly some of these inconsistencies are. Why would you want to have a plasma worth thousands but live in a trailer or the ghetto unless that’s where they really want to be? I mean no judgement but I see people driving luxury cars and living in dangerous neighborhoods constantly, and that really confuses me. It makes me feel like they care more about what people think than their safety. If that is the case, where are the priorities?
Why is it sad, really? I live in "substandard housing", but my kids got a scholarship to an amazing private school and I need to fill in some tuition so we live we more simply. But I have a violin worth thousands. I only play a couple of hours a day, but it gives me great enjoyment. In fact, I also have a book collection that may be worth a few thousand. Should I sell these things so I can afford, what, a couple of months mortgage on a newer house when I am perfectly comfortable here? I don't really see why the prejudice against trailer parks. I don't see the appeal in watching television, much less on a gigantic screen, but most people seem to love it. And how do you know, really, that the trailer park person you are judging isn't a person who lives simply, carries no debt at all because he/she found that a trailer can be paid off quite quickly and just happened to buy that tv as a way to facilitate getting together with friends who all come and hang out and watch favorite sports together?
You're right, I was judging, but I wasn't meaning to. Thanks for the correction, as I should be way more careful! Here's where I was coming from: I frequently see people driving luxury cars and with expensive clothes and shoes but living in dangerous neighborhoods constantly, and that really confuses me. It makes me feel like they care more about what people think than their safety. If that is the case, where are the priorities?
Have to chime in here – my in-laws were some of those "trailer" people, and they did it for exactly the reason Sar describes: they could afford to buy it outright and didn't pay a dime on a mortgage for more than 30 years! When they did upgrade to a house, they did it in REGAL style, and did so in CASH!
That said, though, I completely see where you're coming from Shawn. My husband and I marvel at the people who seem to value the latest gadgets above their kids' education, their safety, their health, etc. What a fabulous read this article was! By the way, did you see the recent PBS documentary on the Great Depression? It just goes to show what REAL poverty is.
The poor make the same foolish choices as the rich, as far as I can see. I have been defined as "poor" – an evaluation for a subsidized mortgage placed me in the "very low income" spot, which kind of surprised me! But I don't get any aid at this time, except for some scholarships for my children. When I feel as if I can commit to a mortgage (meaning a steady income!), I will happily take advantage to the mortgage assistance, though. But the odd thing is that I never feel poor. My kids have video games (and old system given to them and I occasionally buy used games for – around $5 each), we have plenty of food (although I do all of my own cooking and we rarely eat out – this makes us healthier, though, so is this good or bad?), We live in a very small, but reasonably safe, rental filled with used furniture, yard sale games,books, creative practical crafts, etc., . An incredibly rich life by any standards. But I have discovered that I have less debt (as in $0) and more savings than many of my "wealthier" friends. Many, many people that believe they are solidly middle class are only a couple of paychecks away from homelessness. Or, perhaps even more commonly, one serious illness away from real poverty. So really, the foolishness pretty much goes across the board. So who is poor, and who is rich? When you know you have "enough" maybe you are rich, even though your clothes have holes. The arguments about what poverty is are mainly designed to remove aid for the poor, and there are plenty of real, honest to goodness people living in real poverty in this country, children who skip meals and are getting an incredibly deficient "public" education which is virtually guaranteed to perpetuate a cycle of poverty. Communities where there are no longer any real jobs and therefore the community breaks down. Distrust and finger pointing only serve to create further divisions. used to be a no-brainer that investing in education and communities was the key to a strong economy. I was recently reading a reproduction of pamphlets put out by the government in the UK during WWII. The point of them was to ensure that everyone had enough clothing, utilities and food to keep body and soul together during their hard times. Now it seems as if government's point is to ensure that the rich have everything that they want. But for the working class, the jobs are drying up. The best and brightest or the ones with the competent parents might get skimmed off and given a leg up if they are lucky. But we are creating a culture of perpetual poverty. Reminds me of the England of Dicken's time.
Dear SAR,
Thanks for sharing your story. You have done so many things "right" financially such as having no debt and living within your means. I do think you are correct that many people (i.e., 40% are a couple paychecks away from poverty), and many people don't carry adequate insurance nor have enough wealth and could not weather a serious illness, just like you say. I deliberately avoided the political debate, as it seems too counter productive for the purposes of this blog (PF not political). I don't know if I agree with the premise that the poor and the rich make the same mistakes, but it may surprise you who I consider "rich" though, but that's for another post. Thanks for your 2 comments, you provided a very important counterpoint and enriched the discussion.
Elizabeth, your in-laws are something special. That type of sacrifice and dedication is atypical and laudable. I think my wife and I have seen so many people fit the second type of family that you describe that it is hard to stay objective. After all, it is only human nature to favor fun over responsibilities. I did NOT watch the PBS documentary and wish I had. It sounds like I missed a good one.
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Notions of poverty change, I do agree; furthermore, measuring poverty is notoriously difficult. Probably one way forward will be to go for what you refer as 'consumption-based vs necessity-based' definitions. Similarly I have been thinking for sometime now that placing our whole economy on notions of success that measure it by growth is problematic – the world will be a different place entirely if economic success is measured bot by frowth but sustainability, for instance. I am mentioning this because this notion of success as 'growth' and 'more' is probably also what shift perceptions of poverty – after all it is a relative category.
Maria,
This is a great point as well. The definition of poverty isn't constant. One limitation to evaluating the economy based on growth solely is that sometimes what causes short term growth isn't sustainable and can do long-term harm, which it sounds was your point. This is an interesting high-level discussion. Thanks!
Searching for definitions of poverty in the Web, I found relative poverty and absolute poverty. While relative poverty is more about inequality (the haves and the have-nots), absolute poverty is cristal clear: the severe deprivation of basic human needs like food, water sanitation, clothing, shelter, health care, education and information (and even the prices of all these services depend of the place). Somewhere I heard that "poor" is a state of mind. So how do the Americans know when they are relatively poor?
Okay, that is great because it adds clarity to a VERY subjective issues!!!! In terms of how Americans would know if they are relatively poor, I think you can always compare yourself to someone richer regardless of how much you have. In the Bible, the Queen of Sheba (I think) lost her breathe when she saw just how much King Solomon had, and I think she came bearing a gift valued in excess of $10,000,000 (I believe). My point is "relative" poverty and wealth are very slippery slopes.
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I would say that poverty would be someone who cannot afford to work and pay for food and a roof over their own head (including electricity and heat), and basic telephone service. One or more TVs/computers/cell phones merely means that they have achieve middle class status. But that's my own humble opinion, which we are all welcome to. 🙂
Dear "Rich,"
I totally understand where you are coming from. I kind of feel that the definition of poverty has changed so much and so quietly that many of us wouldn't readily recognize what the typical poor families even look like anymore. Like you, many people describe extreme deprivation when thinking about the poor, but that certainly is not all low income advocacy groups and politicians are talking about when referencing the poor. Thanks for a great comment!
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