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Povertyin America: One Nation, Pulling Apart
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Introduction to the Poverty in America Project
The United States is a nation pulling apart to a degree unknown in the last 25 years. Despite more than a decade of strong national economic growth, many of America's communities are falling far behind median national measures of economic health. More...

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Americans Lack Spare Cash, Bringing Hardship to Places like Scioto County Ohio

ACNeilsen, the world’s leading marketing information company, reports that Americans once again rank near the top of global ratings when it comes to being strapped for cash (see the story below). The rating company can’t exactly figure out why Americans are so strapped for cash, but note that Americans don’t like to over spend and actually try to follow budgets. So what is the problem then? The answer is simple: Americans are strapped for cash because of the difficulty of making ends meet on minimum wage jobs.

Just ask the Barringer Family of Scioto County Ohio why they have no spare change. As reported in the Cleveland Plain Dealer, the adults in the Barringer family of Scioto County, work five minimum wage jobs to raise three children in a rural part of the state. Even with five jobs they still can’t make ends meet. Where is the American Dream in that?

With Focus on Scraping By, Americans Forego Life’s Little Luxuries

In a Time of ‘’No Spare Cash'’, Focus on Paying Off Debt and Building Savings

SCHAUMBURG, Ill.–Sept. 13, 2006–Americans continue to rank near the very top when it comes to being strapped for cash, according to a new ACNielsen study of consumers in 40 markets worldwide. Nearly one-quarter (22 percent) of U.S. respondents said that once they have covered their basic living expenses, they have no money left over. There is a bright
spot: for the first time since the study began in 2004, the U.S. has lost its usual top spot among countries whose consumers have no cash to spare.

The findings are from the ACNielsen Online Consumer Confidence Study, a twice-yearly global survey that gauges consumers’ confidence in the economy, spending and saving patterns, and major concerns. This survey marks the fourth in the series, the first of which was conducted in October 2004.

The percentage of American consumers who say they have no spare cash remains the same from the last survey, conducted in November 2005, after dropping from 28 percent in the May 2005 survey.

The survey also showed that Americans say they tend to funnel what spare cash they do have into savings or debt relief, rather than new clothes or expensive technology purchases. Paying off debts was claimed as the top use of spare cash (41 percent), with putting money into savings close behind at 38 percent.

“While Americans are notorious for overspending and building debt, these findings show a desire for financial responsibility when it comes to discretionary income,” said John J. Lewis, President & CEO, ACNielsen U.S. “Perhaps because the idea of living from paycheck to paycheck is so prevalent, consumers who have a little extra cash would rather use it to shore up their finances than spend it right away.”

This attitude makes an impact when it comes to consumers’ purchases of expensive items. Americans rank second from last when it comes to spending their extra cash on new technology, with only 17 percent saying that’s where their money goes. U.S. consumers also rank in the bottom ten of all markets surveyed when it comes to spending spare cash on new clothes (26 percent) and vacations (25 percent).

“Clearly the rising cost of energy, particularly gasoline, and a slowing housing market are having a negative impact on the US consumer’s purchasing attitudes,” noted Lewis. “Whether this attitude will ever actually materialize in hard economic terms is yet to be seen.”

The ACNielsen Online Consumer Confidence Survey is the largest global survey of its kind, which gauges consumers’ confidence levels, spending habits/intentions and current major concerns. The survey, which took place in June 2006 over the Internet, polled 21,779 respondents in 40 markets: Australia, Austria, Belgium, Canada, Denmark, Estonia, Finland, France, Germany, Greece, Hong Kong, India, Indonesia, Ireland, Italy, Japan, Korea, Latvia, Lithuania, Malaysia, Netherlands, New Zealand,
Norway, Philippines, Poland, Portugal, Russia, Singapore, South Africa, Spain, Sweden, Switzerland, Taiwan, Thailand, Turkey, United Kingdom, United States, Czechoslovakia, Hungary, and Vietnam.

The American Dream Puzzle

Approaching Labor Day tomorrow, what do we know about the American economy and the future of work? What type of labor market do we face, who has a job and who doesn’t? Where are the best jobs and where have the best jobs gone? For whom does work pay the rich or the poor? How are people managing in a world of increasing economic insecurity? With an economy sporting the lowest job recovery rate since the recession of 1949 how are Americans making ends meet? Sunday morning’s headlines provide some of the answers.

Jobless recovery

“There are just 3.5 percent more jobs than at the end of the last recession. That is less than half the lowest of the nine previous moves — a gain of 7.6 percent in the period after the 1953-54 recession. And that figure was held down by the fact that another recession, in 1957-58, had taken place by then.” Floyd Norris, New York Times

Work is in services

“The share of employment represented by private-sector goods-producing industries fell by more than half, to less than 17 percent from more than 37 percent. Employment in that sector peaked at 25.2 million people in 1979. Now it is 22.4 million, even though total employment is up 50 percent since 1979.” Mary Williams Walsh. New York Times

Work still pays for some of the rich

“The census report, for instance, showed strong income growth last year only at the 95th percentile of the distribution, which covers families making $166,000 a year. Even at the 90th percentile, as well as the 50th and further down, according to the Labor Department, pay increases have trailed inflation over the last three years.” David Leonhardt , New York Times

Women are working men are increasingly not working

“Women are more likely to be in the labor force than they were 20 years ago, but men in the prime working ages of 20 to 54 are less likely to have jobs. But perhaps the most notable trend is that men and women are both much more likely to keep working than were their parents in what used to be known as the golden years.” Floyd Norris, New York Times

Americans are deeply in debt

“As a result, debt payments now consume 19.4 percent of the income of the average American family, and 23 percent of the families in the bottom two-fifths of families by income devote at least 40 percent of their income to debt payments.

Household debt rose to 132 percent of disposable income last year, partly because many Americans have pushed their credit card debt to the max and because many, including many high-income Americans, have piled on the mortgage debt. Last year, for the first time since the Depression, the personal savings rate for the nation fell below zero, meaning that Americans are spending more than they are earning (and are saving no money on a net basis). “Steve Greenhouse, New York Times

Whose American Dream? Census Figures Bring Sobering News

Approaching the Labor Day weekend, there is not much good news out there for working Americans. Incomes are down since 1999, 5.9 percent nationally and in some states more than 10 percent. Poverty rates held steady, which means 37 million Americans still fall below the poverty line. So much for the recent economic recovery touted by President Bush. Reported in the New York Times, “among the poor, 43 percent were living below half the poverty line in 2005 — $7,800 for a family of three. That’s the highest percentage of people in “deep poverty” since the government started keeping track of those numbers in 1975.” Things are simply getting worst for many more people and in very serious ways.

A sign of underlying economic weakness is the percentage of the population covered by health insurance which rose to 46.6 million, an increase of 1.3 million since 2004. Despite state policies to fill the breech of employer-based health care, 1.6 million more children are unprotected. Families, children and working adults are making less income and enjoying fewer protections today.

Growing income inequality is setting new records. Persons in the top 20 percent of the population earn 19 times more than persons in the bottom 20 percent of the population. The New York Times rightly points out that growth alone is an insufficient indicator of national well-being. Like the mean of a statistical distribution, focusing on growth provides no sense of who is benefiting from economic change. Indeed, interviewed in the New York Times, Bob Greenstein, executive director of the Center for Budget and Policy Priorities, shows that the average person living below the poverty line actually earned $3200 less in 2005 compared with the previous year. Obscured by these figures are much worse circumstances for many Americans. On this weekend celebrating the laboring classes, it is difficult to see any rewards from hard work. What ever happened to the “American Dream?”

Living on the edge:Above poverty, many families still struggle

A recent article by Features Writer Amanda Bensen of the Post-Star of Glens Falls New York sums up the living experience of many Americans today who can’t get by on the minimum wage.

AMANDA BENSEN,
Features Writer, The Post-Star
Glens Falls, NY

abensen@poststar.com
Saturday, August 05, 2006

Michelle Stewart dreams of spending just one day at a store without peeking at a price tag and having to tell her kids, ‘No.’

“It’s kind of sad, but I think a lot of people feel that way,” she said. “I’m just so tired of struggling.”

Her husband, Charles, makes about twice the state’s minimum wage of $6.75 an hour as a dump truck driver, and often works up to 25 hours of overtime a week. They do their best to stretch his paycheck across a wide canyon of expenses each week, but there never seems to be enough for their family of four in Hudson Falls.

“He gets paid every Friday, and by about Tuesday, after paying rent and some bills and doing the shopping, there’s about $60 left,” she said.

Christina Mattison of Fort Ann is in a similar situation. She earns about $7.50 an hour as a cashier for a retail chain, and her fiancee, James Mariani, earns twice that much as an overnight retail stocker. But their combined wages are barely enough to cover household expenses, let alone pay a baby-sitter for their four children — so they work opposite shifts, staggering their sleep schedules as needed. “We’ve been struggling a lot lately, especially with gas prices going up,” Mattison said. “This winter’s going to be tough, because we have fuel heat, but I don’t even want to think about that yet.”

According to the government’s definition of poverty, as measured by the U.S. Census Bureau, neither of these families are poor. The official poverty threshold for a family of four is $19,806 in annual income, which translates to a full-time hourly wage of about $9.50 in a single-income family. For a family with four children, like Mattison’s and Mariani’s, the threshold rises to about $26,000, or two workers earning $6.25 per hour. They are well past that mark.

But in recent years, many economists have pointed out that the poverty rate is calculated with an overly simplistic formula that hasn’t changed since the 1960s, and does not include the effect of factors like taxes, home ownership, health care and child care costs.

“There’s almost no place in America where you can live on $20,000 as a family of four…you need at least $36,000 to pay basic expenses,” said Amy Glasmeier, director of the Poverty in America project at Penn State University, which developed a city-specific Living Wage Calculator based on census data and economic statistics.

The more complex reality, she said, is that a large swath of the population is barely getting by, making too much to qualify for public assistance but not enough to cover all their expenses. They may not have not crossed the threshold into poverty, but they live on its doorstep. In Michelle’s words, “it’s better to be poorer than poor or richer than rich” than stuck in the middle. For example, when Charles was briefly unemployed earlier this year, the Stewarts applied for food stamps. But for a family of four, the maximum gross monthly income that qualifies for assistance is currently $2097. They were $12 over the limit even though he had not worked for two weeks.

“I can’t tell you how many people say things to me like, ‘People ought to be able to get by on that kind of money,’ but they don’t do the math!” Glasmeier said. “A lot of people don’t do the math because it’s too scary. They don’t want to know how close they are to the edge.”

Stewart is all too familiar with the math. She knows exactly what it costs to pay the rent ($900 a month for a small three-bedroom house, and they’re still catching up on past months), fill the gas tank on their ‘89 Chevy Blazer ($62 and rising), make three healthy meals for her family every day (around $125 a week), pay the car insurance ($187 a month), and outfit their two kids with school clothes and supplies (at least $400 each).

“My husband makes decent money, and we’re still not making it,” Michelle said. “So I don’t know how any family could survive on minimum wage. The cost of living here is just so high.”

Minimum wage is higher in New York than in many other states — it will rise to $7.15 an hour on Jan. 1, while the federal rate remains stuck at $5.15 — but it’s still a far cry from what many people consider a living wage. Michelle thinks it’s getting harder and harder for families like her own to make it, and she’s not alone.

“Lower middle income workers, which is what I would call anyone making under $50,000 a year, are feeling really significant constraints based on changing national economic circumstances,” Glasmeier said. “They’re the first to feel the effect of things like rising gas prices and higher interest rates.”

Such workers, she added, are also the least likely to have any sort of financial safety net if they meet with unexpected costs.

“In some cases and in some places, these are families who find themselves at the end of the month with insufficient money, being forced to make choices between making their payments and buying food,” she said. “It’s far more dire, and far more precarious, than the American public would ever care to believe.”

No net to fall into Glasmeier describes the growing gap between America’s rich and poor in terms of income brackets, comparing the lowest-earning 20 percent to the highest-earning 20 percent of the population. Between 1979 and 2003, bottom-bracket incomes rose 14 percent, or about $17,000. In the same time period, the incomes of the highest earners rose 200 percent, or about $625,000.

“Which group would you like to be in?” she remarked dryly.

In other highly developed countries, she said, there is a sense of obligation to the poor, but the American attitude toward poverty is less forgiving.

“The American ethos seems to be that everyone deserves a chance, but you’re supposed to make it on your own,” she said. “But what happens if something that you have no control over suddenly turns your life upside down?”

That’s what happened to the Stewarts. Two years ago, faced with nearly $50,000 in bills after Michelle was hospitalized for a week with no health insurance, the couple filed for personal bankruptcy. Michelle has applied for at least 10 office jobs in the last few months, and has been told she is underqualified, overqualified, or just “not able to commit enough,” which she attributes to telling prospective employers that her children are her top priority.

If she does find work, she worries about leaving her children, now 11 and 14, on their own for too long. Child care can cost $150 or more a week.

“When you’re earning like $9 an hour and subtracting child care and gas costs, it almost isn’t worth it,” she said.

She knows several families who have moved to the Carolinas and Florida, where they’ve heard wages are higher, taxes are lower, and the cost of living is cheaper. The Stewarts are considering a similar move, although they don’t want to uproot their family.

James and Christina, who will marry next spring, have set their sights on something closer to home — the new Advanced Micro Devices plant moving into Malta. James, who has some college education and is a certified computer technician, hopes he can to get a better-paying job there, so Christina can afford to stay home with the kids. “I’d like to be able to provide them with everything they need, so they never have to worry,” he said.

The Stewarts are less optimistic, although they haven’t given up. They doubt they will ever be able to save for retirement or send their kids to college.

“It’s kind of a joke in our house — we’ll say we’re going to write up our wills, and our son will say, ‘What are you going to leave me, Dad’s work pants?’” Michelle said. “I guess all I can really leave them is the hope that they won’t be like us. That they’ll make it big.”

Inequality Continues to Grow in America

While U.S. academics are incisively pointing to growing income inequality in America, The Economist, Britain’s Neoliberal news magazine, is actually getting it and writing about the situation boldly. In “The Rich, the Poor, and the Growing Gap Between Them”, The Economist points out that the rich have been the real beneficiaries of the G. W. Bush years. Drawing on a flurry of academic articles published by the National Bureau of Economic Research, the magazine points out that while the productivity growth of the early 1990s appeared to benefit the population as a whole in terms of rising wages, the pattern changed sometime after 1995. Productivity increases since the late 1990s have failed to affect overall wages, benefiting instead only the highest skilled in the economy. As The Economist points out:

“After you adjust for inflation, the wages of the typical American worker—the one at the very middle of the income distribution—have risen less than 1% since 2000. In the previous five years, they rose over 6%. If you take into account the value of employee benefits, such as health care, the contrast is a little less stark. But, whatever the measure, it seems clear that only the most skilled workers have seen their pay packets swell much in the current economic expansion. The fruits of productivity gains have been skewed towards the highest earners, and towards companies, whose profits have reached record levels as a share of GDP.” (061506)

Economists point out that the lack of a wage increase has been blunted by the increase in housing values, which have led home-owning Americans to believe that their relative economic position is improving or at least staying the same. Real estate analysts now suggest that the housing bubble is beginning to show signs of fatigue as rising interest rates make refinancing and “buying up” more expensive and more uncertain. Even housing markets like Boston are beginning to soften, house sales prices are falling, and houses are simply staying on the market longer.

Since the late 1990s, rising house values lulled Americans into a real estate buying binge funded in part with cheap money drawn from home equity loans, many purchased with variable interest rates. Now that interest rates are rising, borrowers are scrambling to pay off these debts to escape costly interest charges on loans that were spent to fuel consumption. Observers worry that the great American consumption machine may begin to lose some of its voracious appetite for foreign-made goods as people worry more about rising inflation, the costly war in Iraq, the huge and rising current account deficit and the accompanying trade-related deficits with China.

A focus on homeowners’ travails ignores the far more serious problem in America: rising income inequality. The U.S. income distribution now ranks second in level of inequality behind Brazil and substantially above other OECD countries. Income inequality is at its highest level since 1929. Again, The Economist bluntly states:

“If all Americans were set on a ladder with ten rungs, the gap between the wages of those on the ninth rung and those on the first has risen by a third since 1980. Put another way, the typical worker earns only 10% more in real terms than his counterpart 25 years ago, even though overall productivity has risen much faster. Economists have long debated why America’s income disparities suddenly widened after 1980. The consensus is that the main cause was technology, which increased the demand for skilled workers relative to their supply, with freer trade reinforcing the effect. Some evidence suggests that institutional changes, particularly the weakening of unions, made the going harder for people at the bottom.”

In reading all of these articles, it is difficult to understand why the American press and the Democratic Party are at a loss for issues to write about. There is plenty of fodder for articles about the life and times of Americans. This is particularly true of the Democrats, who seem to lurch from day to day, topic to topic, without opening their eyes to the real difficulties facing at least half of all Americans. This list includes rising gasoline prices, increasing interest rates, mediocre to non-existent health care, rising costs of public education and stagnant wages for all but those workers with high skills. These problems affect a huge share of America’s citizens. Who needs to look further than the local Wal-Mart to see who is hurting and just barely getting by? Maybe it’s true that the Democratic leadership contains too many “haves” to really understand the plight of the “have nots”.

Or is it that the Democrats simply lack the ability to really feel empathy? Understanding empathy, according to the Wellesley Centers for Women, can be tricky. Citing noted psychologist Robert W. Levenson, director of the Institute of Personality and Social Research at the University of California, Berkeley, guest Columnist Judy Foreman says empathy comes in three forms. “Cognitive empathy: “knowing what someone is feeling.” This does not automatically imply kindness. “Emotional empathy,” is what most of us mean by the term, “feeling what someone is feeling.” And compassionate empathy is doing something about it – offering a teddy bear or a kiss.”

In the first case, cognitive empathy is simply awareness––it does not presume altruism, changes in behavior, or gestures of kindness. Thus, people can understand poverty and rising income inequality and do nothing about it. Emotional empathy means that you can feel sad about the presence of poverty in the world, but give up nothing to change it. Only compassionate empathy, notes Levenson, results in actions like the formulation of policies that reduce inequality, the explicit reduction of income inequality, and giving up something to help others.

The article on the Wellesley Centers for Women web site notes that empathy can be “learned” through imitation. Here’s what this means for the Democrats: Don’t just read “think tank” publications that highlight growing inequality; don’t just walk among Americans, experiencing economic insecurity when you shop at Wal-Mart (because both rich and poor shop at Wal-Mart); and don’t give only at your local place of worship or to your favorite charity. Instead, come up with powerful arguments and formulate meaningful policies that stop rewarding the rich minority through the likes of tax breaks, and stop congratulating corporate America for its ridiculous corporate CEO salaries. They don’t need your help; the rest of the nation needs you to understand their situation and act on their behalf.

Chasing Jobs in the New Economy: a Timeless Preoccupation

Taking a break from the usual theme of this site, I return to a subject well-studied over the last 20 years: job chasing. Lessons from the past offer words of caution about expending public resources in search of the next high tech fling.

At last week’s Biotech 2006 industry convention in Chicago, Jim Greenwood, president of the national Biotechnology Industry Organization, said, “It’s safe to say that every state in the country is targeting the life sciences as a major growth industry.” In the same Sunday Globe article, Stephen Heuser was reported as stating that 44 states have some type of program to “build research facilities in the hopes of seeding new biotech development…”. Before Massachusetts and other states expend considerable resources in catching the next high-tech wave, we should look at historically sobering evidence of the folly of many of these efforts.

As far back as 150 years ago, states and communities around the U.S. openly and aggressively courted companies; in this particular case, the then high-tech industry of the day––watches. The industry, a transplant from Britain and Switzerland, arrived in the U.S. first as finished products sold by jewelers, blacksmiths, and the occasional clock maker. Within decades, the forefathers of the industry traveled to Europe and through devious means brought back the blueprints and industrial equipment designs needed to manufacture watch parts. In about 10 years, the U.S. had the beginnings of an industry, greatly enhanced by developments associated with the Civil War. The infant industry was protected from competition by a trade embargo against European imports, especially British and Swiss watches and parts. Perhaps more importantly at that time, watches were a necessary part of a soldier’s military gear––after all, time was an important part of the execution of battles. With ample protection and rising demand, the industry boomed.

By 1868, the industry had taken off. In a decade, it grew from a small number of companies, historically headquartered in the environs surrounding Boston, to more than 100 firms spread across the U.S.––all seeking venture capital and enthusiastic local and state governments willing to invest local funds in the hopes of attracting a new factory.

This industry’s growth was spectacular. In 20 years, the number of companies went from 10 to more than 100, employing thousands of workers. When all was said and done, millions of dollars were spent by local and state governments and other investors in building the infrastructure required to manufacture watches. But just as rapidly, lower tariff barriers, excessive price competition, and the reemergence of lower-cost competition from Switzerland led to the industry’s collapse. Most of the factories and firms folded and used equipment piled up, but not before entrepreneurs moved across the country convincing cities like Wichita, Kansas, to build factories and order machine tools to manufacture watches. Wichita has the dubious distinction of being a city that invested in an entire factory, including new machine tools, which never opened. It was scrapped even before the ribbon-cutting ceremony could take place.

The point of this history lesson is simple and timeless. Companies and capitalists expect to risk their funds in chasing an industrial dream based on getting in on the ground floor of an industrial boom. But, it is folly for states and localities to do so, no matter what industrial developers and industrial trade associations say about the built-out prospects of a new industry like biotech. If history repeats itself, and it frequently does, when it comes to unbridled, risk-filled industrial boosterism, time runs out, literally, and most places are left holding the bag. Therefore, states and communities that are either currently competing or expecting to compete in the biotech game should consider only investing in activities that will have a permanent impact on local conditions and some degree of transferability in their economy. Building up training and education infrastructure is one such durable investment. Providing tax breaks to underwrite the costs of new construction and operations is not. Unfortunately, if the rhetoric heard at last week’s expo in Chicago is any indication of where boosterists are heading, then for many it may be too late. Community advocates should approach this industry with some skepticism––attempting to follow Castenada’s adage, that those who do not learn from the lessons of the past are bound to repeat them. Like industrial innovation feeding frenzies of the past, only a few players win, but not before many others sink under the weight of their misplaced enthusiasm.

Amy Glasmeier is the E. Willard Miller Professor of Economic Geography, Penn State and the author of Manufacturing Time: The History of the World Watch Industry 1750-2000, published by Guildford Press.

What Should Define ‘Being Poor’ in America?

Over the last several months, numerous articles in The New York Times, The Christian Science Monitor, The Wall Street Journal and other news sources including National Public Radio have drawn attention to the plight of the poor in America. In a detailed accounting of the 1960s media-led portrayal of poverty in America, in an article in the New Yorker, “How Poor is Poor?” John Cassidy challenges the proposition that few persons can be considered poor in America if access to material goods is taken into account. He takes on journalists and pundits who suggest if we define poor as the absence or curtailed access to such goods as cars, televisions, washing machines and houses then few if any persons in America can be considered poor and argues instead to recognize the existence and importance of relative poverty . Based on research conducted in the US and other developed countries, Cassidy argues that relative poverty in a high income country has serious debilitating consequences on the personal well being, health, and aspiration levels of the poor.

“Since relative deprivation confers many of the disadvantages of absolute deprivation, it should be reflected in the poverty statistics. A simple way to do this would be to classify a household as impoverished if its pre-tax income was, say, less than half the median income—the income of the household at the center of the income-distribution curve. In 2004, the median pre-tax household income was $44,684; a poverty line based on relative deprivation would have been $22,342. (As under the current system, adjustments could be made for different family sizes.)”

In a time of high societal angst about personal and national security, social exclusion is a critical issue that must be addressed at the highest levels of government.

Equal Opportunity Evades Black Men in America

In the atlas, Poverty in America: One Nation Pulling Apart, we focused on the link between the challenges facing the black family and the plight of black men, especially men between the ages of 18-35. Reporting in the New York Times, Erik Eckholm cites three new studies that echo the findings of the Atlas and underscore the challenges facing black men in “Black Males Left Behind” (edited by Ronald B. Mincy, Urban Institute Press, 2006), “Reconnecting Disadvantaged Young Men” (Harry J. Holzer, Peter Edelman and Paul Offner, Urban Institute Press, 2006) and “Punishment and Inequality in America” (Bruce Western, Russell Sage Press, forthcoming).

Key findings include:

“The share of young black men without jobs has climbed relentlessly, with only a slight pause during the economic peak of the late 1990’s.

In 2000, 65 percent of black male high school dropouts in their 20’s were jobless — that is, unable to find work, not seeking it or incarcerated.

By 2004, the share had grown to 72 percent, compared with 34 percent of white and 19 percent of Hispanic dropouts.

Even when high school graduates were included, half of black men in their 20’s were jobless in 2004, up from 46 percent in 2000.

Incarceration rates climbed in the 1990’s and reached historic highs in the past few years. In 1995, 16 percent of black men in their 20’s who did not attend college were in jail or prison; by 2004, 21 percent were incarcerated. By their mid-30’s, 6 in 10 black men who had dropped out of school had spent time in prison.

In the inner cities, more than half of all black men do not finish high school”.

Over the decade of the 1990s, public programs focused on reducing the welfare rolls of women, especially African American women with children. Despite the severity of the statistics referenced in the Atlas and reported in Eckholm’s article about the fate of black men, no similar effort of the scale of welfare reform has been undertaken to assist black men in accessing the American labor market. As author Ronald Mincy laments in the article: “We spent $50 billion in efforts that produced the turnaround for poor women,” Mr. Mincy said. “We are not even beginning to think about the men’s problem on similar orders of magnitude.”

Remove the Decision to Set the Definition of Poverty From the President’s Office

For more than 10 years, scholars, scientists and policy makers have been discussing and debating the need for a new measure of poverty that captures the experience of economic distress in America. Despite many discussions of the need to update the measure to more accurately reflect the meaning of being poor in America, because of politics and the fact that the measure’s threshold is set in the President’s office, there is no political will to really determine what actually and meaningfully constitutes being poor in America today.

The current poverty measure no longer accurately represents the experience of families and individuals. Created in the 1960s by Ms. Mollie Oshansky, of the Social Security Administration, the poverty measure was based on the caculation of a “thrifty diet” for a family of four. The measure was intended as a first cut of what economic security meant at the time. As originally constructed, the existing poverty measure no longer reflects the lived experience of Americans who are poor.

Writing for the New York Times, Anna Bernasek points out that the original measure focussed on food as a share of total expenses, which has dramatically declined since the 1960s (from 30 to 12% today). More important today are so called “non-essentials” such as housing, clothing, transportation, and medical expenses. In 1995, a National Academy Panel offered a set of revisions to make the poverty measure reflect today’s reality. Why weren’t any of the suggestions adopted? As Ann Bernasek noted, ”

The answer is politics. Thanks to a quirk of history, the poverty indicator, unlike many other economic statistics, is not under the jurisdiction of an authoritative statistical agency like the Bureau of Economic Analysis or the Bureau of Labor Statistics.

Instead, it resides in perhaps the most political place of all: the office of the president. And during the last four decades, no president of either party has wanted to draw attention to a statistic that the nation has come to take for granted, especially if updating it might cause the number of people regarded as living in poverty to increase.

Ideology, meanwhile, has muddied the debate about how to improve the poverty count. Some experts have tended to advocate adjustments that raise the poverty line, while others prefer ways that decrease it. “

The first step forward in developing a realistic measure of poverty is to remove the determination of the poverty measure from the Office of the President and turn it over to an independent commission or agency involved in matters associated with poverty alleviation.