U.S. Poverty Has Plunged

Chris EdwardsThe governmentsays that America ’s poverty rate is 11.8 percent. Italso says that the poverty rate has hovered around 11 to 15 percent since 1970 suggesting little or no progress against poverty in decades.But the Census Bureau ’s official poverty rate is biased upwards and kind of meaningless. In terms of material well-being, families near the bottom are much better off today than in past decades because of general economic growth and larger government hand-outs.In aCato study, John Early recalculated the U.S. poverty rate using more complete data and found that it fell from 19.5 percent in 1963 to just 2.2 percent in 2017. (The study ’s charts are updatedhere.)  Early is a formerAssistant Commissioner of the Bureau of Labor Statistics.Bruce Meyer and James Sullivan perform a similar exercise inthis new study. They find that the poverty rate fell from 13.0 percent in 1980 to 2.8 percent in 2018. Meyer-Sullivan calculate their figure based on consumption rather than income, but the general idea is the same. Meyer is at the University of Chicago and Sullivan is at the University of Notre Dame.The Early and Meyer-Sullivan estimates are charted below. Both estimates reflect a large reduction in material deprivation for less fortunate Americans. Unfortunately, this great news about the American economy is usually ignored in media reports and political discussions.Both Early and Meyer-Sullivan use a more accurate inflation measure than the one used for adjustin...
Source: Cato-at-liberty - Category: American Health Authors: Source Type: blogs