Here’s Some Good News: Poverty Is Falling In The US
The official statistics you see on the state of the economy can make for depressing reading. The media likes to zero in on the one negative economic factor, ignoring all of the positive progress the country has made over the last fifty years or so. While the previous decade didn’t meet the financial expectations of many, the overall trend is clear: we’re reducing poverty like never before.
The official poverty rate is currently 21.1 percent, but the way that the government calculates these figures is a little misleading. As a piece of pure accounting work, it’s accurate. It’s true that poverty rates, when measured by household income, stand at around a fifth of all US households. But when you dig a little deeper into the statistics, you soon see that things aren’t as simple as that. While original incomes are low, benefits-in-kind, such as food stamps, lift a large number of people out of the poverty bracket, improving the numbers.
In the 1950s, the number of people living in poverty was 27.3 percent. Today it’s 21.1 percent, after hitting a low in the 1970s of just 15.1 percent. The reduction in poverty rates appears to coincide with the introduction of government welfare programs, but whether action at the state level was the real driving force is unclear. Poverty rates had been declining for some time before the 1950s, too, thanks to regular economic progress.
If you’re interested in the government’s role in poverty reduction, take a look at the following insightful infographic.
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Ken Boyd
Author: Cost Accounting for Dummies, Accounting All-In-One for Dummies, The CPA Exam for Dummies and 1,001 Accounting Questions for Dummies
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