Senator Dodd Introduces Bill to Modernize Federal Measure of Poverty
By Megan Volger
September 14, 2009
Senator Chris Dodd (CT) introduced legislation on August 6 that calls for updating the guidelines that define poverty in America. Entitled Measuring American Poverty Act of 2009 (MAP), Dodd’s bill is the Senate companion bill to H.R. 2909 introduced in the House on June 17 by Representative Jim McDermott (WA).
Currently, the United States poverty measurement is based on an outdated formula from the 1950s. It states that if the money a family has (the “income measure”) is less than the money a family needs to meet its basic needs (the “poverty threshold”), then the family is considered poor. The “poverty threshold” is calculated as three times the 1950s cost of emergency foodstuff, food only for temporary use when funds are low. The flaw in this measurement is that food no longer counts for one-third of a family’s budget. Today, food represents a much smaller percentage of a family’s critical expenses. Excessive health costs, new state and federal income taxes, child care and transportation to and from work make up a greater portion of the modern family’s budget. In addition, the Earned Income Tax Credit, the Child Tax Credit, food assistance, housing assistance, home energy assistance, child care assistance and other near-cash benefits provided through the tax code or paid directly to providers are also not accounted for in the current poverty measurement.
are assistance and other near-cash benefits provided through the tax code or paid directly to providers are also not accounted for in the current poverty measurement.
The new Modern Poverty Measure proposed in MAP considers the taxes and unavoidable expenses that drain a family’s resources and accounts for the increase in prices of food, clothing, shelter, utilities as well as taking into account geographic differences. The Modern Poverty Measure would largely follow the recommendations of the National Academy of Sciences to improve and update the current poverty measurement.
In a press statement, Dodd stated, “What the MAP Act will do is help us to understand the scope of the poverty crisis in America, and to better evaluate the effectiveness of our solutions to it. We have a difficult job ahead of us, as we look to lift Americans out of poverty, provide middle-class families with a strong safety net, and restore the American Dream for working men and women. But we must begin by facing unafraid the true nature and scope of the poverty crisis.”
The Conference of Mayors supports both the Senate and the House bills. The nation’s mayors reaffirmed their commitment to supporting legislation modernizing the federal measure of American poverty during the 77th Annual Meeting of the U.S. Conference of Mayors. They adopted the “Revising the Federal Measure of Poverty” resolution, which can be found on usmayors.org.