Official poverty measures leave out many programs that help families get by

One flaw of the official poverty measure is that it doesn’t account for government assistance programs that are not income but improve people’s economic situation. For example, Supplemental Nutrition Assistance Program (SNAP) helps put food on the table for millions of families, but the impact of that assistance doesn’t show up anywhere in official poverty statistics. 

SNAP blunted the impact of poverty so that if it counted, SNAP would have lifted 309,000 seniors out of poverty across the US in 2018.

The data also shows that if we counted medical expenses, senior poverty would be 4% worse. That means an estimated 2.1 million older Americans would be in poverty if medical expenses counted. 

The U.S. Census Bureau recognized the limitations of the official way we determine who lives below poverty, and several years ago introduced the Supplemental Poverty Measure (SPM). For example, if certain government assistance programs were included in poverty measures, the rate of child poverty would be lower.

Unlike many public assistance programs that help people make ends meet, Social Security counts as income in official poverty measures. The U.S. Census Bureau calculated that in 2018, the senior poverty rate would have been 37.8% (rather than the official measure of 9.7%) without Social Security Income. Across the country, Social Security alone lifted nearly 18 million American seniors out of poverty in 2018.

Real GDP increase from closing racial wealth gap, $ trillion1

Depending on assumptions regarding growth in racial wealth gap, real GDP could be 4–6% higher by 2028 if gap is closed, translating to an increase of $2,900–$4,300 in GDP per capita4

1 2018 dollars.

2 Assumes that, over time, wealth gap will close in linear fashion, reaching scenario’s assumed targets by 2028.

3 $2,631 billion–$3,990 billion in nominal dollars.

4 $7,500–$11,400 in nominal dollars.

Source(s):
U.S. Census Bureau, Supplemental Poverty Measure, 2018