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When it comes to policy that drives the funding of social programs and wealth redistribution, everything is an accounting trick. One example is that the US Cen

When it comes to policy that drives the funding of social programs and wealth redistribution, everything is an accounting trick. One example is that the US Census Bureau's reporting of poverty statistics based on income has changed to NOT include the income of many benefits including food stamps and the Earned Income Tax Credit. If you include these benefits prior to counting the poor, the poverty rate falls to nearly zero. This is why the director of the Census Bureau's report now answers to the White House instead of the Director of Commerce. Bending the numbers is essential to maintaining and expanding institutions. The switch was made when Obama nominated Rebuplican senator Judd Gregg as Commerce Secretary. Given that Gregg had previously voted to abolish the Commerce department, it is likely that his influence would have brought the numbers in line with the facts. But, had Gregg accepted the nomination, it would have opened up a senate seat that would have been filled by the Democratric governor of his state. So to have his cake and eat it too, Obama took control of the number reporting. Gregg did not accept the nomination. Talk about accounting tricks. Another example is the disparity between counting income vs. consumption. Again in the US, when the money spent by poorer classes that are studied is counted it is far greater than what is calculated as their income (which is what policy is based on) This indicates that in-kind gifts and other non-reported income is substantial, but not counted.

vidarh 11y ago
Source? Because the Census Bureau also releases the Supplemental Poverty Measure [1], which amongst other breakdowns includes numbers that adjusts for taxes (if you're going to count for tax credits, you also need to account for taxes paid if the numbers are to make sense), housing benefits, and various in-kind benefits. It also includes various other costs. Table 4a on page 9 gives a breakdown on how different aspects of the Supplemental Poverty Measure affects the total number. The lowest version you can get from that table is 11.8% - if you remove medical out of pocket expenses from the income subtractions before calculating the rate (in other words: if you assume people are perfectly healthy, directly contradicted by evidence, you get a more favourable number of how many people can afford to put food on the table). I'm curious what elements you'd add/remove to the SPM to get to "nearly zero". [1] http://www.census.gov/content/dam/Census/library/publications/2015/demo/p60-254.pdf http://www.census.gov/content/dam/Census/library/publication...
- mbostleman 11y ago
  http://www.forbes.com/sites/timworstall/2013/09/21/the-correct-us-poverty-rate-is-around-and-about-zero/ http://www.forbes.com/sites/timworstall/2013/09/21/the-corre...
  - vidarh 11y ago
    That does not at all support your claim "that the US Census Bureau's reporting of poverty statistics based on income has changed to NOT include the income of many benefits including food stamps and the Earned Income Tax Credit". In fact, it specifically says that the definition has not changed. It does claim as you do that the rate should be near zero, but it does not address the Supplemental Poverty Measure, that does provide a number of scenarios accounting for benefits in kind, and does not end up with numbers near zero when that is taken into account.
- yummyfajitas 11y ago
  Unfortunately the supplemental poverty measure doesn't actually measure poverty, just inequality. The definition is: The 33rd percentile of expenditures on food, clothing, shelter, and utilities (FCSU) of consumer units with exactly two children multiplied by 1.2 http://www.census.gov/hhes/povmeas/methodology/supplemental/research/Short_ResearchSPM2010.pdf http://www.census.gov/hhes/povmeas/methodology/supplemental/... So if you were to reduce the income of everyone from the 34th percentile downward to exactly $1.24/day you'd actually reduce supplemental poverty.
sbov 11y ago
I can see reasons behind doing this either way. A good example is in medications. Lots of people go off medication because they feel better. But they feel better because of the medication. So they no longer feel better after they go off it. Similarly, if all poverty reports in the US included benefits, many conservatives would say: see, we have no more poverty. We can get rid of these programs. But these programs were why we had no-one under the poverty line. We now have poverty again.
- mbostleman 11y ago
  I hear what you're saying and with accurate numbers and transparent assumptions there can be a good debate about that. But I don't think the census should be a political tool. If a person did not, in fact, spend a decade living in poverty thanks to the resources she had (either earned or given to her), why should the census report show that she lived in poverty?
  - Retric 11y ago
    Your basic assumption is that a housing subsidy from HUD is equivalent to cash on hand. Which would imply the US government is as efficient as individuals when it comes to allocating resources which I find highly suspect. In the end a lot of 'government assistance' really lines other peoples pockets and only indirectly assists the poor.
    - lkbm 11y ago
      The US government is a massive bureaucracy, which is bad for efficiency, but they also control the bureaucracy, which gives them an advantage in cutting through red tape, and they can get an economy of scale that an individual can't.
tn13 11y ago
P.S. : This sort of argument would not go well on HN. But you are right. Poverty is an accounting trick for everyone depending on how it suites those who are calculating it. In reality it is a hard thing to measure. But even the back of the envelope calculations would show that Poverty is substantially lower in India, China and many other countries which are known to be very poor.
gohrt 11y ago
You are saying that welfare systems successfully alleviate poverty, to insinuate that welfare systems not needed to alleviate poverty?
- mbostleman 11y ago
  I am saying that to the extent that poverty gets better, it puts at risk the funding (or at least the growth of it) for the social institutions and economic policy that exist for that purpose. Since social programs make up half of US government spending, I am pretty sure that makes them collectively the largest institution in the world. And they're going to defend their jobs and their turf proportionately.
  - deleted 11y ago
    [deleted]
- ptaipale 11y ago
  No, I read it says that welfare systems successfully alleviate poverty, which is why quoting numbers prior to the application of those welfare systems is not giving a realistic assessment of poverty. I.e. if a worker gets $5 in salary and $5 in welfare subsidies, it is somewhat dishonest to argue that because his income is only $5, the welfare subsidies are insufficient. It's the net income after taxes and transfers that should be looked at when considering poverty, not pre-tax pre-transfer income (which quite astonishingly seems to be used fairly often).

vidarh 11y ago

Source? Because the Census Bureau also releases the Supplemental Poverty Measure [1], which amongst other breakdowns includes numbers that adjusts for taxes (if you're going to count for tax credits, you also need to account for taxes paid if the numbers are to make sense), housing benefits, and various in-kind benefits. It also includes various other costs. Table 4a on page 9 gives a breakdown on how different aspects of the Supplemental Poverty Measure affects the total number. The lowest version you can get from that table is 11.8% - if you remove medical out of pocket expenses from the income subtractions before calculating the rate (in other words: if you assume people are perfectly healthy, directly contradicted by evidence, you get a more favourable number of how many people can afford to put food on the table). I'm curious what elements you'd add/remove to the SPM to get to "nearly zero". [1] http://www.census.gov/content/dam/Census/library/publications/2015/demo/p60-254.pdf http://www.census.gov/content/dam/Census/library/publication...

mbostleman 11y ago
http://www.forbes.com/sites/timworstall/2013/09/21/the-correct-us-poverty-rate-is-around-and-about-zero/ http://www.forbes.com/sites/timworstall/2013/09/21/the-corre...
- vidarh 11y ago
  That does not at all support your claim "that the US Census Bureau's reporting of poverty statistics based on income has changed to NOT include the income of many benefits including food stamps and the Earned Income Tax Credit". In fact, it specifically says that the definition has not changed. It does claim as you do that the rate should be near zero, but it does not address the Supplemental Poverty Measure, that does provide a number of scenarios accounting for benefits in kind, and does not end up with numbers near zero when that is taken into account.
yummyfajitas 11y ago
Unfortunately the supplemental poverty measure doesn't actually measure poverty, just inequality. The definition is: The 33rd percentile of expenditures on food, clothing, shelter, and utilities (FCSU) of consumer units with exactly two children multiplied by 1.2 http://www.census.gov/hhes/povmeas/methodology/supplemental/research/Short_ResearchSPM2010.pdf http://www.census.gov/hhes/povmeas/methodology/supplemental/... So if you were to reduce the income of everyone from the 34th percentile downward to exactly $1.24/day you'd actually reduce supplemental poverty.

sbov 11y ago

I can see reasons behind doing this either way. A good example is in medications. Lots of people go off medication because they feel better. But they feel better because of the medication. So they no longer feel better after they go off it. Similarly, if all poverty reports in the US included benefits, many conservatives would say: see, we have no more poverty. We can get rid of these programs. But these programs were why we had no-one under the poverty line. We now have poverty again.

mbostleman 11y ago
I hear what you're saying and with accurate numbers and transparent assumptions there can be a good debate about that. But I don't think the census should be a political tool. If a person did not, in fact, spend a decade living in poverty thanks to the resources she had (either earned or given to her), why should the census report show that she lived in poverty?
- Retric 11y ago
  Your basic assumption is that a housing subsidy from HUD is equivalent to cash on hand. Which would imply the US government is as efficient as individuals when it comes to allocating resources which I find highly suspect. In the end a lot of 'government assistance' really lines other peoples pockets and only indirectly assists the poor.
  - lkbm 11y ago
    The US government is a massive bureaucracy, which is bad for efficiency, but they also control the bureaucracy, which gives them an advantage in cutting through red tape, and they can get an economy of scale that an individual can't.

tn13 11y ago

P.S. : This sort of argument would not go well on HN. But you are right. Poverty is an accounting trick for everyone depending on how it suites those who are calculating it. In reality it is a hard thing to measure. But even the back of the envelope calculations would show that Poverty is substantially lower in India, China and many other countries which are known to be very poor.

gohrt 11y ago

You are saying that welfare systems successfully alleviate poverty, to insinuate that welfare systems not needed to alleviate poverty?

mbostleman 11y ago
I am saying that to the extent that poverty gets better, it puts at risk the funding (or at least the growth of it) for the social institutions and economic policy that exist for that purpose. Since social programs make up half of US government spending, I am pretty sure that makes them collectively the largest institution in the world. And they're going to defend their jobs and their turf proportionately.
- deleted 11y ago
  [deleted]
ptaipale 11y ago
No, I read it says that welfare systems successfully alleviate poverty, which is why quoting numbers prior to the application of those welfare systems is not giving a realistic assessment of poverty. I.e. if a worker gets $5 in salary and $5 in welfare subsidies, it is somewhat dishonest to argue that because his income is only $5, the welfare subsidies are insufficient. It's the net income after taxes and transfers that should be looked at when considering poverty, not pre-tax pre-transfer income (which quite astonishingly seems to be used fairly often).