United States

What is Poverty in the United States?

According to the Merriam Webster online dictionary, poverty is “the state of one who lacks a usual or socially acceptable amount of money or material possessions”; destitution is “extreme poverty that threatens life itself through starvation or exposure.” The astute reader will realize at the outset that usual or socially acceptable are rather vague terms. While these terms imply that poverty is a relative (that is, depends on the levels of other variables) concept, destitution causes one to think that it is an absolute (that is, it is fixed in terms of a known standard) measure.

The phrase, threatens life itself, leaves one little room to wonder about the levels of other variables. The 2005 Live Aid concerts from Philadelphia to Tokyo were staged to draw media attention to the absolute poverty in many parts of present-day Africa, as the Group of 8 industrialized nations’ leaders met in Scotland to discuss world affairs. Absolute poverty will not disappear anytime soon. Relative poverty, by definition, can only go away if each individual has the same socioeconomic status. This also will not happen anytime soon.

If one is to do something about poverty, how does one operationalize the definition? There needs to be a statistical definition of poverty. A U.S. pioneer in that effort was Mollie Orshansky. For the most-accepted version of her poverty threshold, she used a U.S. Department of Agriculture (DOA) “economy” food plan designed for adequate nutrition with low available funds. From a previous survey by the DOA, she learned that the average family of three or more members spent about one-third of its income on food. Hence, she multiplied the cost of the food plan by three to get the income (after tax, in her view) that would be considered the poverty threshold for a family of that size. Orshansky made adjustments for different family sizes and other demographic attributes, and generated a table of 124 poverty thresholds expressed in 1963 dollars. For bureaucratic reasons, before-tax income was eventually used. A person (family) is considered poor if income falls below the threshold.

One might get the impression that “adequate diet” is related to avoiding starvation and destitution, and that the Orshansky thresholds reflect an absolute measure of poverty. If so, then does the threshold become relative as it moves through time? Some scholars argue that the answer is a definite “yes.”

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