PovertyintheUS Final Exam EssayDec13

PovertyintheUS Final Exam EssayDec13 - Gaurav Singh...

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Gaurav Singh Poverty in the US 114006240 Final Essay Dear Mrs. President, As you are well aware, poverty policy in the United States is a complex and deeply rooted issue. The following brief will discuss the various methods of measuring poverty, as well as the many reasons and theories behind the nature of poverty in America. Some measures prove to provide immense benefits, while others are less substantial in measuring poverty rates. In addition, the brief will provide recommendations and potential solutions for implementing successful anti-poverty strategies. Education and community development are essential themes in studying the nature of poverty, and lack of these is the root of many poverty related problems. While the United States is considered a hegemonic power in the global realm, it has a surprisingly high poverty rate, one that can be attributed to many societal, cultural, and economic forces. There are multiple ways in which poverty is measured in the United States. Absolute measures of poverty have thresholds that remain constant over time. It is understood that with this method, there is a subsistence level of income or consumption below which people should be deemed economically deprived. The current poverty measure in the United States is an absolute measure of poverty. In 1963, Molly Orshansky of the Social Security Administration developed a poverty threshold that was adopted by the government. Orshansky based her poverty thresholds on the "thrifty food plan," which was the cheapest of four food plans developed by the Department of Agriculture. Based on the 1955 Household Food Consumption Survey from the USDA, Orshansky knew that families of three or more spent about one third of their after-tax income on food. She then multiplied the cost of the USDA economy food plan by three to arrive at the minimal yearly income a family would need. Using 1963 as a base year, she calculated that a family of four would spend $1,033 for food per year. Using her formula based on the 1955 survey, she arrived at $3,100 a year as the poverty threshold for a family of four in 1963. Relative poverty measures can be defined as economic deprivation. They are based on the notion that poverty is relative to a society’s existing level of economic, social and cultural development. Unlike absolute measures, relative measures are able to account for regional poverty and fluctuating standards of living. They are updated based on changes in real expenditures for certain consumption categories, which generally rise as standards of living rise. I truly believe that a combination of these measures is the most accurate method of measuring poverty. Perhaps a quasi-relative poverty measure is more fitting because it accounts for food, clothing, shelter, and utilities, which are the essentials for living. In addition, I strongly contend that a poverty measure should indeed account for regional poverty. Certainly, the standard of living in rural Mississippi is lower than in New York City.
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PovertyintheUS Final Exam EssayDec13 - Gaurav Singh...

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