The Leadership Conference on Civil and Human Rights

Table of Contents

• Introduction

Executive Branch

• Looking Forward to New Blood in Washington
• Interview with Bob Edgar

On the Hill

• The Americans With Disabilities Act, Act Two
• As Home Foreclosures Climb, Efforts to Help Troubled Homeowners Continue
• The Year in Judicial and Executive Nominations
• Advocating for Federal Leadership on Education
• Facing New Challenges with the 2010 Census
• Modernizing the Federal Poverty Measure
• Piecemeal Legislation, Raids Take Place of Immigration Overhaul
• Below the Surface
• Interview with Kathryn Kolbert

In the Courts

• Wrapping up the Supreme Court’s 2007-2008 Term

In the States

• Colorado: Battleground for More Than Just the Presidency.
• Interview with Lilly Ledbetter

Leadership Conference Activities

• Preventing a Digital TV Divide
• Examining the State of Fair Housing in the 21st Century
• Bringing Diverse Communities Together
• 32nd Annual Hubert H. Humphrey Civil Rights Award Dinner
• Interview with John Payton

Modernizing the Federal Poverty Measure

Corrine Yu

As fears about the weakening economy continue to grow, the call for modernizing how the nation measures poverty has taken on new urgency.

Anti-poverty advocates called on lawmakers to establish a new federal poverty measure at a House Subcommittee on Income Security and Family Support hearing on July 17, citing a broad consensus that the current measure, crafted in the 1960s, was significantly outdated.

Rep. Jim McDermott, D. Wash., drafted legislation designed to modernize the calculation of poverty thresholds and poverty rates. The McDermott bill, styled the Measuring American Poverty Act, reflects the 1995 recommendations of the National Academy of Sciences Panel on Poverty and Family Assistance, which many experts supported.

A poverty threshold is the minimum level of income deemed necessary to achieve an adequate standard of living.  Those making less than this level are considered to be living in poverty.

The McDermott bill notes that "the official poverty measure, while helpful, is based on outdated assumptions and fails to accurately measure economic deprivation or take into account the availability of many economic resources."

Instead, it proposes a measure of poverty that would be based on current consumption patterns for food, clothing, shelter and other basic necessities. Additionally, it would take into account income assistance from public programs (e.g., the Earned Income Tax Credit, food stamps, and housing assistance) and necessary expenses (e.g., federal taxes, work expenses, and out-of-pocket medical expenses).  The new measure would also take into account geographical differences in the cost of living.

The current measure sets the poverty threshold at $21,200 for an individual, a figure that advocates say does not accurately reflect the contemporary costs of meeting basic needs, yielding something not "remotely close to a well thought out, accurate measure of who is genuinely poor," according to Douglas Nelson, president and CEO of the Annie E. Casey Foundation.

The current poverty measure omits such key expenses as transportation to work, child care, and state and local taxes. Nor does it include on the positive side a variety of non-cash benefits on which low-income families rely, such as food stamps, housing assistance, the Earned Income Tax Credit, and the Child Tax Credit.

"The apparent simplicity of [the current] measure masks a number of straightforward deficiencies," said Dr. Mark Levitan, the director of poverty research for the City of New York Center for Economic Opportunity.

Michael Bloomberg, the mayor of New York City, proposed a new poverty measure in July that is based largely on the National Academy of Sciences’ 1995 proposal.

Panelists at the hearing stressed the importance of a federal poverty measure that accurately accounts for tax credits and other non-cash benefits, as well as for work expenses and medical out-of-pocket expenses. Both steps would affect the numbers in poverty.

"If we want to track the well-being of America's low-income families, and if we want to effectively measure the effects of our antipoverty policies… it is long past time to make this change," said Dr. Rebecca Blank, the Robert V. Kerr Senior Fellow at the Brookings Institution. "We need a statistic that demonstrates how policy and economic changes affect…low-income families.”

The Leadership Conference on Civil Rights (LCCR) has declared its commitment to setting a national goal to cut poverty in half in ten years.  LCCR is a founding partner of Half in Ten: From Poverty to Prosperity, a new campaign run jointly by ACORN, the Center for American Progress Action Fund, the Coalition on Human Needs and LCCR. 

Corrine Yu is senior counsel and managing policy director for the Leadership Conference on Civil Rights.