According to the latest poverty rate estimates – released by the Census Bureau on Aug. 30 – the total percentage of Americans living in poverty was higher in 2004 (12.7 percent) than in 1974 (11.2 percent). According to that same report, poverty rates for American families and children were likewise higher last year than three decades earlier.
But can this be true?
Per capita income adjusted for inflation is over 60 percent higher today than in 1974. The unemployment rate is lower, and the percentage of adults with paying jobs is distinctly higher. Thirty years ago, the proportion of adults without a high school diploma was more than twice as high as today (39 percent versus 16 percent). And antipoverty spending is vastly higher today than in 1974, even after inflation adjustments…
The soundings from the poverty rate are further belied by information on actual living standards for low-income Americans. In 1972-73, for example, just 42 percent of the bottom fifth of American households owned a car; in 2003, almost three-quarters of "poverty households" had one. By 2001, only 6 percent of "poverty households" lived in "crowded" homes (more than one person per room) – down from 26 percent in 1970. By 2003, the fraction of poverty households with central air-conditioning (45 percent) was much higher than the 1980 level for the non-poor (29 percent).
Besides these living trends, there are what we might call the "dying trends": that is to say, America’s health and mortality patterns. All strata of America – including the disadvantaged – are markedly healthier today than three decades ago. Though the officially calculated poverty rate for children was higher in 2004 than 1974 (17.8 percent versus 15.4 percent), the infant mortality rate – that most telling measure of wellbeing – fell by almost three-fifths over those same years, to 6.7 per 1,000 births from 16.7 per 1,000.
Here is the link. There are two bottom lines. First, we have made more progress against poverty than the numbers indicate. Second, we should look first to consumption data, not income data.