What Does It Mean To Be Poor?

Bruce Bartlett disputes the common calculation used to determine poverty.

Unfortunately, the whole notion of poverty is extremely subjective. The original definition was based on food consumption, which then took about a third of a low-income family's budget. Now it's about 20 percent, but in the meantime many new needs have emerged that one can reasonably argue have become necessities of life.

Two hundred years ago, Adam Smith recognized that our concept of adequate living standards will change over time. Today's luxuries become tomorrow's necessaries. "By necessaries," he said, "I understand, not only the commodities which are indispensably necessary for the support of life, but whatever the custom of the country renders it indecent for creditable people, even of the lowest order, to be without."

Smith noted that a linen shirt would be considered necessary in his time even though the ancient Greeks and Romans got along fine without linen at all. So, too, many items that did not exist even in the recent past are often considered necessary for life today, even by the poor.

In a supplementary report that got no press attention, the Census Bureau looked at some of these new necessities and their ownership by the poor. It turns out that many poor people today own appliances that were considered luxuries when I grew up, and some would still be considered luxuries today. For example, 91 percent of those in the lowest 10 percent of households — all of whom are officially poor — own color TVs; 74 percent own microwave ovens; 55 percent own VCRs; 47 percent own clothes dryers; 42 percent own stereos; 23 percent own dishwashers; 21 percent own computers; and 19 percent own garbage disposals.

I think a misunderstanding of what it means to be poor is part of the reason solving the poverty problem has been unsuccessful. There are plenty of people in America who have it rough and deserve some help, but when compared to worldwide living standards and historical living standards, many of today's "poor" are pretty well off.