IBJOpinion

HICKS: Let's fight poverty, but also keep it in perspective

Mike Hicks
December 25, 2010
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Mike Hicks

There is a certain poignant irony in the U.S. Census Bureau’s release of 2010 poverty statistics this Christmas week. It reminds us that, behind the green eyeshades of professional data collectors, the folks at the Census Bureau have an acute marketing sense.

The Gospel of Luke tells us that Mary and Joseph traveled to their familial birthplace as part of a census. The details and timing of the Roman census are hazy, but the intent of these counts was to levy taxes for Rome. This is a rich story and serves as a high point of the New Testament’s beautifully subversive backdrop of freedom from tyranny. Unlike the Roman census of Quirinius, the modern U.S. census affects the distribution, not collection, of tax dollars. It is understandably a bit more welcomed.

Among the first of the big census releases (that will continue for years) are local poverty rates for 2010. These are widely reported, but what do the data tell us? The sad truth is, almost nothing of consequence. Here’s why:

According to international measures of poverty, the United States has almost none. The rest of the world measures poverty by how much your household consumes in goods and services, not how much it earns. So, the seven students who work in my research center slip into the ranks of the impoverished, according to our census. None of my students is rich, but to place an MBA student alongside the 2 billion or so people in the world who subsist on a couple of dollars a day is morally vacuous. This is equally true of the poorest of Americans, whose average Medicaid costs alone place them squarely in the world’s middle class. So, how then to think about and measure poverty in America?

I think it is better to sidestep the official poverty statistics and focus on the problems of the poorest quarter of Americans and ask: How can policy help? The answer isn’t encouraging. While maybe half of the poorest quarter are there temporarily—due to school or job change—almost everyone who is truly poor possesses one or more of three common characteristics: disability, drug addiction or teen-age parenting. I could include lack of a high school diploma, but there is nearly a perfect overlap between these categories. These things need to be said to drive our policy response, not to append a morality tale. It is devilishly hard to make the lives of the poor more tolerable, much less improve their future. The same lack of judgment that leads to drug addiction and teen-age pregnancy is unsurprisingly not well-rewarded in labor markets. Disability is even less easily remedied.

We’d do best by recognizing that poverty in America is wholly a relative thing. This makes it far less onerous than true poverty around the world. This recognition shouldn’t change materially our wish to see it go away—that is a more enduring lesson from the time of Quirinius. But understanding the problem might better help us with its fix and prognosis.•

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Hicks is director of the Center for Business and Economic Research at Ball State University. His column appears weekly. He can be reached at cber@bsu.edu.

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  1. These liberals are out of control. They want to drive our economy into the ground and double and triple our electric bills. Sierra Club, stay out of Indy!

  2. These activist liberal judges have gotten out of control. Thankfully we have a sensible supreme court that overturns their absurd rulings!

  3. Maybe they shouldn't be throwing money at the IRL or whatever they call it now. Probably should save that money for actual operations.

  4. For you central Indiana folks that don't know what a good pizza is, Aurelio's will take care of that. There are some good pizza places in central Indiana but nothing like this!!!

  5. I am troubled with this whole string of comments as I am not sure anyone pointed out that many of the "high paying" positions have been eliminated identified by asterisks as of fiscal year 2012. That indicates to me that the hospitals are making responsible yet difficult decisions and eliminating heavy paying positions. To make this more problematic, we have created a society of "entitlement" where individuals believe they should receive free services at no cost to them. I have yet to get a house repair done at no cost nor have I taken my car that is out of warranty for repair for free repair expecting the government to pay for it even though it is the second largest investment one makes in their life besides purchasing a home. Yet, we continue to hear verbal and aggressive abuse from the consumer who expects free services and have to reward them as a result of HCAHPS surveys which we have no influence over as it is 3rd party required by CMS. Peel the onion and get to the root of the problem...you will find that society has created the problem and our current political landscape and not the people who were fortunate to lead healthcare in the right direction before becoming distorted. As a side note, I had a friend sit in an ED in Canada for nearly two days prior to being evaluated and then finally...3 months later got a CT of the head. You pay for what you get...

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