A Richer Way To Measure Poverty

The way we currently measure poverty is, shall we say, based on a paucity of data. New York is deploying a new system of measuring poverty that aims to give a greater depth and richness to the poverty picture.

The Atlantic reports the old way of calculating poverty was based on a family’s pre-tax income and the number of folks in that family. That number was then compared to the cost of food. But there are so many more costs than food, and they can vary greatly from state to state and town to town.

New York’s new system takes into account the cost of housing, both food and clothing, and how much government aid a family gets. After all, $20,000 in income, the government’s poverty line for a family of four, goes a lot further in rural Virginia then it does downtown New York.

Are there differences in the calculations? The results are preliminary but by the government measurement of poverty, 21.2% of children in 2009 fell into the poverty category. Using the more granular system, it drops to 17.9%. That’s good news. But the poverty rate for the elderly leaps up from 8.9% to 17.9%, because the new measurement includes out-of-pocket medical costs.

A Better Way to Measure Poverty [The Atlantic]