Poverty in The US

Essay by anersarataUniversity, Master'sA+, March 2004

download word file, 7 pages 3.7

0. Introduction

National poverty data are calculated using the official Census definition of poverty, under this definition poverty is determined by comparing pretax cash income with the poverty threshold, which adjusts for family size and composition. The federal government classified a family of four as "poor" if its cash income was less than $18,100; for a family of three, the poverty threshold was $15,020; for a married couple, $11,940; and for an individual, $8,860. . The number of poor families in America increased by more than 6% in 2001, with 6.8 million families - one out of every ten - living below the poverty line in 2001. In 2002, according to the official measure, 12.1 percent of the total U.S. population lived in poverty .

There are many problems connected to the measure of poverty that the US Census Bureau uses. The definition was first calculated in the mid 1960s as three times the minimum basket of food a family would need.

Since then it has only been adjusted to inflation, and it has not taken into account that the spending pattern of American families have changed quite a lot since the 1960s.

This means that these poverty data can easily be compared and used for measuring the progress against poverty. At the same time, it is at times difficult to find out and to decide what kind of benefits are taken into account when the poverty line is drawn. Benefits such as Earned Income Tax Credit (EITC) are excluded and costs such as child care are excluded. Because of this, the poverty rate could be as high as 20% or as low as 10%, all depending on what is included.

1. Evolution of the poverty in the USA

As we can see in Table 1 of the appendix 1,