San Antonio Newspaper Highlights Inclusion Proposals

In an editorial noting that opponents of expanding health insurance coverage to more families are using limitations of the poverty measure to argue that federal funding should be limited to the lowest income households, the San Antonio Express-News highlights the possibility of using a social inclusion measure rather than the current measure of material deprivation.

Plus, the editorial notes that cars are a necessity in almost every household given the way our communities have expanded – thus the cost of car ownership should be part of the formula.

Numbers have a way of obscuring reality.

Such is the case with the federal poverty guidelines, which ostensibly measure who is and isn't "poor." But the calculations have not kept up with changes in society and should be revisited.

The concept was created in 1963 by Mollie Orshansky, an economist with the Social Security Administration. It dovetailed nicely with the need for metrics to fight President Lyndon B. Johnson's so-called War on Poverty.

Orshansky considered two main factors: what a family in 1955 America would need to spend on "nutritionally adequate" meals, and the assumption that a family of three or more spent about a third of its after-tax money on food. The figure for a family of four was $3,165 a year.

Today, that figure is $20,650 for a family of four. The figure, by the way, is the same whether one lives in New York City; Ottumwa, Iowa; or San Antonio. Only Hawaii and Alaska have higher guidelines.

Orshansky presented her findings in a 1965 article as a measure of "income inadequacy," not "income adequacy."

There is nothing wrong with Orshansky's findings, but her work served as a research tool, not a statistic for creating federal poverty policy, according to historians.

Yet today, the federal poverty guidelines are used to determine everything from food stamps, parts of the Medicaid program to the free and reduced lunch program….

Over time, the guidelines have risen to reflect inflation, but they do not reflect changes in the American standard of living. For example, fewer mothers worked outside the home in the 1950s. These days, anyone with a child in day care knows how expensive such services can be.

Changes in society often lead to greater pressures on the poor to acquire "necessities." For example, rising car ownership levels and suburbanization lead to deteriorating public transportation, essentially forcing the poor "to buy cars or hire taxis in order to get places where public transport used to take them," according to an analysis by the Health and Human Services Department.

While it's necessary to have federal measures by which to gauge relative wealth or poverty, such measures should incorporate changes in the American standard of living to better reflect what people can afford in today's world.

One suggested method to more adequately express that change is to tie the poverty line to some percentage of median income, say 50 percent. As the median income goes up, so does the poverty level. Another idea is to adjust the guideline to account for regional cost-of-living differences.

Orshansky died this year at the age of 91. Her contributions to the field of economics provided a necessary framework with which to analyze poverty in this country.

It's time to build on that work and update our notion of what it means to be poor in America.

Note: My emphasis added.