Over the weekend, an article by a financial advisor named Michael Green made headlines in a number of prominent media sources.
In this article, Green argues that the federal poverty line for a family four shouldn’t be $32,000 as the U.S. Department of Health and Human Services designates it, but should instead be $140,000.
Green comes to this conclusion by collecting average costs for a range of goods and adding them up.
This is similar to the approach taken by the Massachusetts Institute of Technology Amy Glasmeier in her Living Wage Calculator.
Her number for Ohio comes out to $38.47 per hour, which equals about $80,000. So considerably more than the federal poverty line, but considerably less than what Green comes up with.
There are reasons to be skeptical about this approach to measuring poverty.
A central question here as a former philosophy undergraduate and a current poverty analyst is “what is poverty?”
Whether we’re thinking about poverty as a measure of absolute deprivation connected to some sort of sense of biological needs or if we’re seeing it as a measure of relative deprivation connected to social needs, using average expenditure on a wide range of goods as the sole determinant of the threshold is a problematic way to define poverty.
The most widely-accepted measure of poverty by poverty researchers is the Supplemental Poverty Measure.
This is a poverty measure that uses spending as a baseline for its measurement, but instead of using average spending as the baseline, it measures how many households are below a certain percentage of average spending.
Its threshold for a family of four in 2024 was about $39,000. So still considerably higher than the $32,000 of the official poverty threshold, but far below the MIT and Green calculations.
In the Organisation for Economic Co-operation and Development, an international organization for development of economic policy, poverty is defined at 50% of median household income.
This is a handy measure when measuring across countries due to simplicity, and also captures the essence of practical poverty policy across countries: how many people fall far from the norm when it comes to household resources.
Using this measurement, a poverty threshold for Ohio would be about $36,000, half of the median household income at $72,000.
How do we make sense of these different measures? Is the poverty threshold $32,000, $39,000, $80,000, or $140,000?
As a policy analyst, my answer to this question is this: which of these actually fit with our understanding of how poverty works in the United States?
If you surveyed people at $75,000, would they, on average, consider themselves to be living in poverty?
If not, then an $80,000 poverty threshold is defining that family into a financial position they don’t consider themselves to be in. Moreover, $140,000 stretches the definition of poverty to absurdity.
Another test: what is the point of the poverty measure?
According to the Census Bureau, there are 1.2 million Ohio residents living under the official poverty threshold and 1.1 million Ohio residents under the supplemental poverty threshold.
If the goal of poverty policy is to help the people who need it most, shouldn’t this population of one million plus warrant more attention than the over 9 million who make under $140,000?
Poverty measure is an inexact science.
But widening the scope of poverty to include four out of five U.S. families is a great way to miss out on the plight of those struggling the most in the state.
Measurements like relative poverty measures or the Supplemental Poverty Measure give policymakers a much clearer picture of poverty than summing average costs of goods across society.