Many Blacks Are Actually Better Off than Reports Suggest, New Measure Says

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The U.S. Census Bureau’s new Supplemental Poverty Measure says African Americans are better off than previously reported, and a bureau official attributes the difference to alternative living arrangements and government benefits.

African Americans Are Better Off
African Americans are not as impoverished as the United States Census Bureau’s 2011 Official Poverty Measure (OPM) stated, according to the bureau’s new Supplemental Poverty Measure (SPM).
“This is a group whose families have incomes that are often below the poverty line, so the starting point is an issue for African Americans,” Census Bureau research economist Kathleen Short told UrbanFaith via tele-conference after she presented her SPM report at a Brookings Institution press conference this morning.
“They’re starting with low income, so we’re going to see the benefits received by those families will be effective either in moving them across the poverty line or from the bottom of an income distribution,” she said.
African Americans are also more likely to live in alternative housing arrangements that are taken into account in the new measure, Short said. “When we create these new units, we’re bringing together people who have income who aren’t in the official measure,” she explained.
Addressing Criticisms of Bureau’s Official Poverty Measure
At the press conference, Short introduced the SPM as an “experimental measure” that addresses criticisms of the OPM, but said it “will not be used to estimate eligibility for programs or allocate funds.”
The SPM measures poverty by calculating resources that include cash income and federal government “in-kind” benefits that families can use to meet basic needs. Necessary expenses including, but not limited to taxes, clothing, housing, utilities, child care, child support, and out-out-of-pocket medical expenses are subtracted from the income total in the new measure.
It also assumes that un-related members of a household share resources as an economic unit, takes in to account the cost of living in different geographic regions and community types, and divides households into homeowners with mortgages, homeowners without mortgages, and renters.
The OPM was adopted in 1969 and is based on cash income, the cost of a minimum diet multiplied by three, and household units that only include members related by birth, marriage, or adoption. Unrelated members of the same household over the age of fifteen are treated as individuals in the OPM.
Ron Haskins, a Brookings Institution senior fellow for economic studies, said the Census Bureau “has done exactly the right thing” by producing the SPM, which he speculated will now be the “focus of attention,” even though he fears the OPM will not change.
“Anybody who has ever been involved in a congressional fight on a formula will agree with me,” said Haskins.
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SOURCE: UrbanFaith
Christine A. Scheller

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