Who is Poor?

Is poverty different for different groups in the population?

According to a report from the internet, the poverty rate represents an average over the entire population, and does not really tell us who, in particular, is well off, who is worse off. For that, it is necessary to examine poverty levels for particular groups. Most notably, blacks and Hispanics have poverty rates that greatly exceed the average. The poverty rate for all blacks and Hispanics remained near 30 percent during the 1980s and mid-1990s. Thereafter it began to fall. In 2000, the rate for blacks dropped to 22.1 percent and for Hispanics to 21.2 percent—the lowest rate for both groups since the United States began measuring poverty. By 2009, however, the poverty rate for both groups had risen to more than 25 percent.

Poverty using different measures of income

The existing official measure of poverty has been widely criticized. Under the procedures by which the official poverty rate is calculated, only cash income is counted in determining whether a family is poor; cash welfare programs count, but benefits from noncash programs, such as food stamps, medical care, social services, education and training, and housing are not included. Taxes paid, such as Social Security payroll taxes, and tax credits, such as the Earned Income Tax Credit, are also excluded from poverty calculations. Because government spending on means-tested noncash benefits and tax credits has increased more rapidly than spending on means-tested cash benefits over the years, ignoring noncash benefits is an increasingly serious omission if we want a broad picture of the impact of government programs on poverty.