In 2007, there were 36,247 people living in poverty in California. In a state with a population of 36 million, according to the U.S. Census Bureau, that means one out of every 1,000 people in California is living in poverty. In Santa Barbara County, the latest Census Bureau information (from 2004) showed that 12.5 percent of people living in the county were below the poverty level.
There’s increasing evidence, however, that this number isn’t indicative of the amount of people struggling to get by
financially—in California or on the Central Coast.
The Foodbank of Santa Barbara County has seen a 30 percent rise in need in the past year, local nonprofits such as the Community Action Commission (CAC) are reporting increasing interest in their services, and every day more and more locals are choosing to give up their houses to foreclosure rather than fight to keep them another day.
Poverty is one thing, but being poor is something else entirely. Where to draw the line between poverty, being poor, and even what constitutes the middle class is up for debate.
“People we might consider middle income are really struggling,” said Fran Forman, executive director of the Community Action Commission of Santa Barbara County.
By “we,” Forman means agencies like the CAC that are required to use the federally mandated poverty line as a guideline for administering services such as the Head Start program, a federally funded pre-school program for low-income kids. Whether she personally thinks that these families are “middle income” is another story altogether.
The official national poverty threshold for a family of four is $21,203 a year. That’s not enough money for a family to live healthfully on the Central Coast, Forman said.
“Maybe in Mississippi or other states that have a much lower cost of living,” she said.
In Santa Barbara County, the high cost of living is difficult to deal with in the best of times. Add in a little bit of hardship, and families can slip.
“A lot of our clients are people who, until a little while ago, were potential donors,” said Erik Talkin, executive director of the Foodbank of Santa Barbara County.
Talkin said that in his experience, all it takes for a lot of people to go from middle class or lower middle class to being classified as poor is a few unlucky breaks. Still, some of the families taking advantage of the services offered by the Foodbank and their partners wouldn’t be classified as living in poverty, under federal standards.
The poverty line was established in the United States by one woman: Mollie Orshanksy. She wrote the guidelines in 1963 while working for the Social Security Administration. According to the U.S. Department of Health and Human Services, Orshanksy based the poverty threshold on the “economy food plan,” the cheapest of four food plans developed by the U.S. Department of Agriculture. She calculated the amount of money that would be spent on food under that plan and then multiplied it by three, assuming that a family would spend a third of its income on food.
The poverty line was never meant to designate how much families should be able to live on. Instead, Orshanksy said in her report, “if it is not possible to state unequivocally ‘how much is enough,’ it should be possible to assert with confidence how much, on average, is too little.”
Since the time that Orshanksy determined how much money is too little, that number hasn’t changed, except to be adjusted for inflation. As a result, some economists—not to mention those who run nonprofit agencies—are questioning whether a new measure should be used to determine poverty.
“We’ve frozen it so it’s just increasingly out of date,” economist Robert Plotnick said of the poverty line. “It’s too low.”
Plotnick is a professor at the University of Washington and a social policy economist for West Coast Poverty Center, the newest of three regional poverty centers funded by the U.S. Department of Health and Human Services. He said that the federal poverty line is useful in the short term as a measuring device, but long term, it just isn’t getting the job done.
The problem, he explained, is that measuring poverty is a difficult thing to do. For starters, poverty is relative. Who’s to say what poor is or what being poor means?
“The notion of not being able to afford something is very subjective,” Plotnick said.
A better way to measure poverty would be to use relative standards, he explained. Relative standards compare one person or family’s income with the standards of society as a whole.
Euro Stat, the agency that acts as a sort of Census Bureau for the European Union, defines poverty as less than 60 percent of the median income in a country. In the United States, the median income is $52,000 a year. A person making about $30,000 a year would be right on that poverty line if the United States were to convert to the European technique to measure poverty.
This way of measuring is an improvement on the U.S method because it takes into account what other people are earning in relation to one’s own salary, Plotnick said. But it’s still simply a monetary measure. He said that most economists who study this issue—and even the federal government, to some extent—are moving toward a relative scale.
“If your income is too low, you’re out of the mainstream,” Plotnick explained. “You can’t afford what other people can afford.”
That doesn’t mean that since Donald Trump can afford a luxury penthouse on the park, everyone should be able to afford one. Relative poverty has more to do with daily standards—stuff like a car, a computer, clothes, and, yes, fresh food.
But even all of those items are subjective. There are some economic conservatives who believe that if a family can afford a television set, they’re not poor, Plotnick said. Others argue that owning a TV doesn’t necessarily discount a family from poverty since owning a TV is a standard in the United States as a whole.
The Joseph Rowntree Foundation took the notion of relative poverty one step farther. The British-based organization is named after the first man to attempt to define poverty in the late 1800s. Rowntree based his poverty line on the ability to afford basic food, housing, and clothes.
The foundation that took his name tried another approach, asking focus groups of British citizens to discuss and decide upon what every person should be able to afford in order to function in society. What they came up with became the “minimum income standard.”
This is just a study—not the way that Britain measures poverty—but the methods actually make more sense in some ways than a simple poverty threshold does, Plotnick said. The idea is that if society as a whole deems something a necessity, then those who can’t afford it can’t fully function in that society.
In some areas, the focus groups were frugal, deciding that a car isn’t necessary to function, but a certain amount of alcohol was—specifically, enough to get drunk on about twice a month. They also allotted for a new suit or new clothes each year, as well as being able to pay for household goods, such as new bedding and curtains.
Household services such as an Internet connection and occasional babysitting were factored in, as were a certain amount of long-distance calls. Under “social and cultural participation,” focus group members decided that families should have enough money to buy gifts every once in a while, to give kids some pocket money, and to be able to participate in sports. In total, the report found that a couple with two children needs $37,655 a year to function in society.
That’s almost $15,000 more a year than the poverty threshold for a family of four in the United States.
The Census Bureau hasn’t started asking people how much alcohol they can afford—and they’re not about to, Plotnick said. But in recent years, others questions have made it onto the list, such as “Has your electricity been shut off in the last year?” “Can you afford basic health care?” “Have you been able to afford enough food?”
The answers to these questions don’t make it onto the official poverty counts, but they are being used by the government to help determine a more accurate representation of poverty in the United States—to a point.
The current poverty measure isn’t going to go anywhere soon, Plotnick said. Politics keep the government from changing it, he said, and establishing a new measure would be so darn complicated.
“Experts and decision makers wring their hands,” he said. “They know it’s not the right one, but they don’t know what is right.”
The Community Action Commission’s Forman said that the poverty guidelines are probably one of the first subjects to be brought up in conversation every time she goes to a conference attended by the leaders of nonprofit and social service agencies. But every time they bring it up to the federal government, all they hear back is that it’s a complicated issue.
There is some recognition by the federal government that $21,000 a year for a family of four isn’t enough. In December 2007, the government changed the eligibility requirements for federal programs such as Head Start. The new guideline is 130 percent above the poverty line, though Forman explained that they’re required to give preference to those still living below the poverty line.
“Because this is becoming an issue in the nation, we are now able to offer our services to more people,” Forman said.
Right now, she said that about 10 percent of the people on their client list have incomes above the poverty line.
Plotnick pointed out that other government programs, such as food stamps, have also made the change.
“We’re acknowledging that it’s not enough,” he said.
And that’s especially so in Santa Barbara County, where Forman said that the majority of her clientele is young families with both parents working full-time jobs.
“It’s really good people who are just trying to make it and make a good life for their children,” she said.
And, she said, these people are, for the most part, true locals.
“I don’t think a lot of new low-income people have come into the area,” Forman said, “because they know better.”
Contact Sports Editor Sarah E. Thien at sthien@santamariasun.com.
This article appears in Sep 4-11, 2008.