American Poverty

American Poverty

Matthew Desmond’s argument, that the last 50 years have seen no progress in America against poverty, is based on the official government measure of poverty. It is true that the official poverty rate has fluctuated between 10 and 15 percent for the past 50 years.

But there’s a problem with that interpretation of the data. “It’s for a very simple reason that serious researchers have known for a very long time: The official poverty measure does not include much of the government assistance,” Corinth said. “If you were to include all the benefits we provide, you get a much different picture of poverty.”

Corinth and other researchers have calculated the “full-income poverty rate,” which includes all the government assistance poor people receive. Where the official poverty rate was 10.5 percent in 2019, the full-income poverty rate was 1.6 percent. The full-income poverty rate was around 19 percent in 1963, around 7 percent 20 years later, and gradually declining to 1.6 percent since then — a long-running decline, contrary to Desmond’s portrayal.

Scott Winship, director of AEI’s Center of Opportunity and Social Mobility, illustrated the absurdity of Desmond’s use of the official poverty number by running it in reverse. He said, “If you use today’s official poverty line, the poverty rate in 1963 would have been 70 percent.”