Tuesday, November 22, 2011

Mickey Kaus debunks the New York Times article on the "near poor."

The New York Times ran a prominent article last week on "near poverty":

They drive cars, but seldom new ones. They earn paychecks, but not big ones. Many own homes. Most pay taxes. Half are married, and nearly half live in the suburbs. None are poor, but many describe themselves as barely scraping by.

Down but not quite out, these Americans form a diverse group sometimes called “near poor” and sometimes simply overlooked — and a new count suggests they are far more numerous than previously understood.
As a commenter on Kaus's blog points out, it's amazing that driving a non-new car is now considered a sign of poverty or anything close to it.

Here are my favorite points by Kaus (with all emphasis in the original):
– “Perhaps the most surprising finding is that 28 percent work full-time, year round.” The Times thinks this 28 percent figure is surprisingly high. (“These estimates defy the stereotypes of low-income families,” says the Census official). Does 28% seem high to you? To me it seems low.

– “Bruce Meyer, an economist at the University of Chicago, warned that the numbers are likely to mask considerable diversity. Some households, especially the elderly, may have considerable savings.” The “near poor” category also includes unemployed 23 year old college graduates from wealthy families, stockbrokers who had a really bad year, moderately paid workers who live in Silicon Valley (where, thanks to the cost-of-living correction, you can make $51,000 and still be “near poor”). Indeed, the vast diversity of the “near poor” category makes it virtually useless. It is a granfalloon, Kurt Vonnegut’s term for a false class of people.

– . . . [A]s society grows richer, you’d think more people would be able to take a year off and live off their assets. Yet they show up as poor—because the poverty numbers measure income, not wealth. (I qualified for the low-income Earned Income Tax Credit once when I owned a house in Georgetown. There was no asset test.) I’m not saying these people are a significant portion of the statistically poor. But they’re probably a growing portion (maybe even the “fastest growing portion,” to use the standard journalistic con that makes the growth of a small population seem significant). . . .

– I’m also suspicious of the way the fancy new poverty measure takes into account regional variations in the cost of living and medical expenses. I live in an expensive part of an expensive region because it is worth it to me. I could live in North Dakota. Does that make me “poor” or have I chosen to consume in one way (nice town) rather than another?
IN THE COMMENTS: Remembering how American "poverty" looked in the Soviet Union.


Indigo Red said...

I recall a PBS special many years ago when the Soviet Union still existed, that explored poverty in America. It showed poor families in NYC who lived in a small apartment, a poor family with a passle of kids in W. Virginia, and others from all over the US in dire circumstances by American standards.

Meanwhile, at the Soviet Embassy, propagandists were watching and pitched the idea of showing the program in the USSR to show how bad it was in the USA. Soviet folks gathered on the appointed night in crowded apartments to watch on old, persnickety black and white televisions. What they saw shocked the workers and their reaction shocked the smart guys in the Kremlin.

The people saw even the poorest Americans living in stand alone homes, city apartments not shared with other families, indoor bathes and toilets, color televisions, one or more cars in garages and driveways, food filled refrigerators in kithchens with stove and oven, electricity 24 hours every day, and it went on and on.

Within a decade, the USSR fell and credit was given to Reagan and some to Gorbachev. Kremlin officials who remembered history, credited PBS and blamed themselves for stupidly airing the program.

I'm afraid most Americans, including me, have no idea what poor or near poor is.