There’s an old bumper sticker still out that that started with President Reagan, who concluded, “We fought a war on poverty, and poverty won.” Although the quote gained some traction last year — the 50th anniversary of the War on Poverty — new evidence is disproving the clichés that government doesn’t work, and public policy doesn’t matter when it comes to creating opportunity.
Anti-poverty strategies actually have helped to lift families out of poverty. The Annie E. Casey Foundation’s new Data Snapshot Measuring Access to Opportunity in the United States documents how safety net programs help millions of families meet their children’s basic needs.
We know that because after a half century of flawed analysis, we now have a better way to measure poverty.
The official poverty measure was developed in 1963 by a former U.S. Social Security Administration employee who calculated a family’s needs by taking the costs of groceries, which consumed a higher share of a family’s budget back then, and multiplying it by three. At the time, food represented one-third of the expenses for many families.
Fortunately, we have a tool that does a much better job of measuring poverty based on today’s household economics. The Supplemental Poverty Measure or SPM, is based on a modern family budget and is adjusted to consider variations in costs across the country. It more accurately accounts for changes in costs over time for expenses such as food, health care, housing, transportation and child care.
And more importantly, it enables everyone who is concerned about reducing poverty to understand the effectiveness of programs such as the Earned Income Tax Credit and the Supplemental Nutrition Assistance Program, which help provide household resources and food for millions of children. By using the Supplemental Poverty Measure, we see that without these federal and state supports for families, the child poverty rate would have been almost double, rising as high as 33 percent, rather than the still-unacceptable 18 percent, according to the most recent data.
The SPM also shows some of the same urgent challenges as the official measure does. For example, children of color are more likely than white children to live in poverty. Also, the child poverty rates for Latino and African American children is 29 percent, roughly three times that of white children (10 percent). There are significant variations by state, and it’s troubling that our most populous state, California, has the highest child poverty rate, at 27 percent. The next three largest states — Texas, Florida and New York — also have some of the highest child poverty rates.
By any measure, child poverty is at an unacceptably high rate. What the SPM shows, however, is that without interventions to alleviate poverty, millions of children would be faring even worse.
State and federal policymakers can see the critical impact of public policies more clearly through the Supplemental Poverty Measure. This more accurate picture means policymakers are more likely to make good decisions about how to provide families with the tools and skills they need to get on a path to opportunity.
Despite the important information provided by the Supplemental Poverty Measure, the official poverty measure continues to be useful because it is a yardstick that is embedded in numerous government programs and enables us to track trends consistently from year to year, decade to decade. While this measure is fine for those purposes, it fails to give local, state and federal policymakers the best possible data to drive decisions, and it doesn’t give us a true sense of how government programs can make a difference in addressing poverty. The Supplemental Poverty Measure is a much more effective, accurate measure for these purposes.
Sound policy decisions depend on sound analysis and accurate data. And there are few more important policy decisions than how to ensure our investments are connecting families to the opportunities needed to build a brighter future.
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