What is the "real" poverty rate?

A single person, living alone, with earnings from employment totaling $10,000 falls below the United States poverty threshold ($10,890 for a one person household in 2011). The Census Bureau classifies that person as “in poverty.”  But what if he or she receives government benefits, such as health care, with a value of $5,000 or more per year?  Should he or she still fall into the “poverty” category?

And what about those families just above the poverty line who, because of out-of-pocket health care costs or child care spending, actually have fewer resources left than those formally classified as “in poverty”?

These are more than just academic questions. Calculating poverty in an accurate, and meaningful, way enables us, first of all, to accurately describe the well-being of our communities. It enables us to understand levels of need and to identify groups with higher than average risks of poor health, poor nutrition, poor academic achievement, and lower life expectancy. Beyond that, however, an accurate calculation of poverty enables us to analyze the effectiveness of programs we have put into place to promote economic development and to protect the vulnerable.

The poverty rate has served, since 1965, as the official yardstick for measuring how many people live in the worst economic straits in the United States. No major changes have occurred in its formula, despite some issues regarding its validity, such as:

·         The original formula does not include non-monetary resources in calculating whether a household falls below the poverty line (the example above). This occurred, in part, because many of the benefits programs we now have in this country had not evolved to their current level in the 1960s.

·         The original formula made reasonable assumptions for the 1960s regarding the proportions of a “minimum needs” household budget required for food, housing and other expenses. (The amount of income necessary to be “above poverty” was calculated by taking the average cost for a minimum diet and multiplying that number by 3.)  However, with changes over five decades in the relative costs of food, housing, health care, transportation, etc., should the Census Bureau revise those proportions?

·         What about taxes?  If a household has a gross income above the poverty threshold, but after taxes, it slips below the federal poverty threshold, should the people in that household fall into the “in poverty” category?

To address the poverty measure issues, Congress appropriated money, in the 1990s, to study the accuracy of the poverty measure, and the National Academy of Sciences formed a task force for that purpose.  The task force confirmed the alleged weaknesses of the measure, and it proposed a new, supplemental measure based on a formula which, among other things:

•  Improved the definition of who is included and excluded in a household when determining whether or not that household is “in poverty.”
• Added the value of government-provided benefits to a household’s income (including in the calculation of total household resources both monetary income and also the value of “near-money benefits” such as nutritional assistance, subsidized housing, and home energy assistance).
• Subtracted from a household’s total resources the taxes (income, Social Security, etc.) which it pays.
• Uses numbers and ratios that better reflect contemporary costs, to calculate poverty thresholds for households of different types and sizes.

So, what does this all mean? How does it change anything? Why is this formula just supplemental to and not replacing the original formula? 

Compared to the current official measure, the new measure reduces the number of children in poverty; but increases the number of elderly in poverty.  It shows fewer blacks, but more Asians, in poverty.  The new measure puts more city dwellers and suburbanites, but fewer rural residents, into poverty.  It shows less poverty in the Midwest and the South, but more in the West and the Northeast.  (About half a million fewer people in the Midwest region of the United States fall below the poverty line, according to the new measure.)

With respect to the national total, The New York Times reported that an “alternate census data set quietly published last week said the number of poor people has grown by 4.6 million since 2006, not by 9.7 million as the bureau reported in September.”  The Times also offered the example of the State of North Carolina, in which poverty grew by 250,000+ by the official measure, but stayed flat with the new measure.

Whether, and if so when, the new measure should replace the current official measure is a question with many facets. Changing the measure is not solely an enterprise for economists and statisticians. The official measure has connections to many policies and programs. That means money – the amounts that communities might receive, the amounts that individuals receive through benefits-eligibility. When financial implications enter the picture, nothing ever remains simple! In addition, the implementation of a new measure would require some “education” among all potential users of information who want to track trends: Agreement would have to be reached about how to describe changes from the past to the present and the future, when the rules for measurement have changed.

At Minnesota Compass, we will continue, for the foreseeable future, to report trends based on the current official measure, but when feasible (if Minnesota numbers are available), we will provide some data from the supplemental measure, to round out everyone’s understanding of the true nature of economic conditions within our population.

If interested, take a look at the U.S. Census Bureau report, and/or take a look at what the Minnesota Legislative Commission to End Poverty by 2020 had to say about some of these issues in their report.

Questions or thoughts? Feel free to call!

What do you think – Should the new formula replace the old? What’s best for our communities as we move forward?

Those 100 Objects, and Our Current Measures of Community Well-Being

My blog about the British Museum’s “100 Objects” which define history attracted the interest of a friend who dug a bit deeper and visited the Museum’s web site and then wrote:

“What I found most interesting were not the specific objects per se, but rather the types of objects and categories that the curators used to group them.

The tools of human civilization really haven't changed all that much, aside from technological advances. Currency, weapons, maps...

The categories were interesting to me, because they provide a framework for evaluating the current state of our society:

• ·         What is the current condition of our cities? (First Cities and States)
• ·         How is the economy doing? (First Global Economy)
• ·         What advances have we made in science and literature? This could also be interpreted as advances in public education; are kids learning? (Beginning of Science and Literature)
• ·         What is the current state of basic needs and food security? (After the Ice Age...)
• ·         What are we doing to teach tolerance? (Tolerance & Intolerance)
• ·         What has happened to people’s faith, not only in spiritual leaders, but in our political leaders? (Rise of World Faiths)
• ·         What are we doing to strengthen our communities; what will be our legacy? (Empire Builders)
• ·         Who are the next generation of leaders, and who is forging the way? (Pilgrims, Raiders & Traders)
• ·         What is the impact of status symbols and mass communications on decisions that are made? (Status symbols, Mass Production, and Mass Persuasion)

Thus all leading back to the questions of: What is it that makes us human (Making Us Human), and how can we use our tools to create a world that reflects the best of our humanity? (The World of Our Making)

Perhaps someday, much like trying to crack ancient hieroglyphics, our successors will try to recover information from massive computer servers that tell the story.”

Minnesota Compass tracks directly some of these categories used to classify and describe the course of human history (for example, education and the economy) – in order to understand how we continue (hopefully) to make progress in the 21^st century. Our recently launched neighborhood indicators section offers insight into the condition of our cities. Several elements of our work provide tools for understanding and addressing issues of tolerance, of mass persuasion, and of empire building, even though we don’t measure these directly.

In addition, we seek to strengthen our communities by gathering together in meetings and seminars with thousands of people each year and communicating through our website and publications with tens of thousands more. And, at no point in history, more than in this “Information Age”, does there exist a greater need for a solid platform of credible, nonpartisan information, to which people can apply their creativity and act on their values to create a better world for all.

From one’s own little perch looking outward, it might appear that we inhabit a big, complex world. Yet from another perspective, we live on just one very tiny chunk of rock in a universe expanding to infinity. We have a duty to keep that little rock in the best possible condition. The civilization we’ve created on the rock reflects human achievement; perhaps not equaled anywhere else in the vast universe, and perhaps never capable of replication.

Through Minnesota Compass and all of our work at WilderResearch, we want to take the many small steps with our partners that, in combination, will achieve progress for the human race.

Defining Our History and Ourselves (in 100 Objects)

If you wanted to select a set of objects which illustrate how history has shaped us, or perhaps vice versa, what would you choose? What objects, culled from throughout the course of time, define us as humans? What object from the distant past would you place first on the list? What object would you place last, to represent the very present?

The British Museum took on the task, as reported in last Sunday’s New York Times, to “distill the history of the world” and produced a list of 100 objects.

The oldest object of the 100: a stone chopping tool found in Tanzania, considered “the beginning of the tool box”. A bird-shaped pestle, found in New Guinea around 6000-2000 B.C. evoked the comment: “The history of our most modern cereals and vegetables begins around 10,000 years ago…It was a time of newly domesticated animals, powerful gods, dangerous weather, good sex and even better food.” The Rosetta Stone appears on the list, as you might expect, with the comment that “This dreary bit of broken granite has played a starring role in three fascinating and different stories:” … Greek kings … French and British imperial competition across the Middle East … and the “scholarly contest that led to the most famous decipherment in history – the cracking of hieroglyphics.”

What do you think that the 100 or so curators of the British Museum, who spent 4 years on this project, selected as the ultimate object? Think about it; I’ll mention it in a moment.

My favorite (based on the Times article; I still want to read the book) is the credit card. Perhaps nothing epitomizes modern day interconnectedness and globalization better than the curators’ selection of a Visa credit card issued by HSBC. “This particular gold card is issued by the London-based bank called HSBC, the Hong Kong and Shanghai Banking Corporation. It functions through the backing of the United States-based credit association, Visa, and has on it writing in Arabic – it is in short connected to the whole world, part of a global financial system, backed by a complex electronic superstructure that many of us barely think about.”

That says a lot about why we must address local and regional issues within the context of our worldwide social and economic interdependencies.

I liked the comment about a two-inch-square ivory label once attached to the sandals of the Egyptian pharaoh, King Den. “The nearest modern equivalent I can think of to this label is the ID card that people working in an office now have to wear round their necks to get past the security checks.” The Head of Ife, from Nigeria A.D. 1400-1500 is striking. “It is one of a group of 13 heads, superbly cast in brass, all discovered in 1938 in the grounds of a royal palace in Ife, Nigeria, which astonished the world with their beauty. They were immediately recognized as supreme documents of a culture that had left no written record, and they embody the history of an African kingdom that was one of the most advanced and urbanized of its day.” A North American Otter Pipe (Ohio, 200 B.C.-A.D. 100) juxtaposed modern values with the earlier development of civilization: “Although smoking is now largely seen as a fatal vice, 2000 years ago in North America pipe smoking was a fundamental ceremonial and religious part of human life. Different groups of Native Americans lived across the continent, in ways much more varied than Hollywood westerns would suggest. Those Americans living in middle America – the lands around the mighty Mississippi and Ohio Rivers, from the gulf of Mexico to the Great Lakes – were farmers.”

So, what appears last on the list, to reflect 2010?

As the Times reported: “a plastic, solar-powered light about the size of a coffee mug that came with a charger and cost $45. It can illuminate an entire room, enough to change the lives of a family with no electricity. ‘It is a transformative object, one that sets people free,’ Mr. MacGregor said. ‘Once they have access to solar power, they have access to the Internet, then they have access to the world of knowledge.’”

Very true, with profound implications.

So, take a look at the article in the Times, if you can.  Read the book.  Then, think:  What would you select?

Say It Ain't So, Beverly -- Because Misusing Data Cheats Our Students

Widespread cheating occurred in the Atlanta school system.  Principals and teachers changed students’ answers on tests, so that their schools’ overall performance would look better.  Some whistleblowers claim that the district terminated them for their honesty.

It’s shocking. The misbehavior of school district staff lasted probably ten years. Cheating occurred in 44 of 56 schools examined by investigators, who identified 178 teachers and principals as participants in the cheating.

As the Atlanta Journal-Constitution reported: “Superintendent Beverly Hall and her top aides ignored, buried, destroyed or altered complaints about misconduct, claimed ignorance of wrongdoing and accused naysayers of failing to believe in poor children’s ability to learn.”

These school district employees did not just cheat the system, in a misguided effort to artificially create a good image or to earn a higher bonus. They cheated the children.

A great disappointment. I had admired the Atlanta superintendent, Beverly Hall; in fact, I visited her district and spoke with her personally. She expressed an outcomes-oriented approach. She believed that all staff, from the superintendent, to the classroom teacher, to the cafeteria aide and the bus driver, must understand the part they play in the education of a child, in order for the whole system to be effective.

Described in the New York Times as, a “Jamaican-born graduate of Fordham University’s doctoral program, who began teaching in some of New York’s toughest classrooms”, she established a presence in Atlanta as a “forceful, erudite and data-driven superintendent”.

Beverly Hall stressed the importance of using data. She emphasized focusing on objective measures of whether students can read and write. Yet, for whatever reason, she drifted. The investigators concluded: “What has become clear through our investigation is that ultimately, the data, and meeting ‘targets’ by whatever means necessary, became more important than true academic progress.”

Beverly Hall lost sight of the mission of the public schools. She failed as a leader.  She left her post under a cloud of suspicion, if not in disgrace, in a city that, at one time according to the Times, “considered her a savior”.

However, I strongly caution against misinterpreting the events in Atlanta and concluding that we should not strive to achieve clearly defined outcomes and/or that we should not measure academic performance accurately and objectively.  When new test scores appear each year, controversy frequently erupts over whether and how to use the scores (e.g., whether underperforming schools should be publicly identified, whether No Child Left Behind offers an effective approach, etc.) We can’t let these controversies over the use of data obscure the fact that we need good data in order to improve the lives of our children.

Making organizations effective, transforming them to increase their impact, stimulating innovation – all these require good, sound data.  Assisting a child to do better academically, improving the performance of a school, eliminating the achievement gap in an entire community – these all require good, sound data too.

But data simply offer a tool. Like any tool, data (including academic test measures) can be used wisely and appropriately, or ignorantly and inappropriately. Sound data are one, but only one, necessary ingredient in the success of schools and other organizations.

I know a fourth-grade teacher in an urban school district who, on the first day of class each year, had many students arrive who could perform only at a first or second grade level. By the end of the year, she could bring some of them all the way up to fourth-grade achievement standards, but some only to second or third grade standards.  Was she rewarded for all of those she advanced, or only for those who rose to fourth-grade standards?  Unfortunately, the latter – which was very discouraging for someone with a dedication to teaching, along with the energy and competence to teach well.  However, we can’t blame academic testing.  The problem is not that the school district tested and measured performance; the problem is that district administrators often lack the wisdom and ingenuity to create a system that uses data wisely and that rewards teachers for fostering academic success, not just for the extent to which they elevate test scores to some unrealistic threshold.

The Atlanta Public Schools lacked genuine leadership.  The Atlanta Public Schools used data inappropriately.  Again from the report:  “Data can be properly used as a tool to assess academic progress. But data can also be used as an abusive and cruel weapon to embarrass and punish classroom teachers and principals or as a pretext to termination. After hundreds of interviews, it has become clear that Dr. Hall and her staff used data as a way to exert oppressive pressure to meet targets.”

"This unfortunate incident highlights the need for transparency and accountability throughout our education system," stated Secretary of Education Arne Duncan.  "Having good information to measure student progress is an absolute bedrock requirement in ensuring that schools are preparing our children for success."

With sound information about children’s academic progress, along with information about other aspects of their lives, we can empower school staff; we can empower parents; we can empower communities. We can stimulate creativity as teams of staff seek to improve outcomes over time and as they receive positive reinforcement for innovations that increase success.  We can raise awareness in our communities about what needs to be done, and provide a yardstick to understand our progress in improving the education of our precious, young, community members.

Geoffrey Canada, a pioneer in educational reform and someone I have also spoken with personally on a few occasions, has stated in various ways that, when he attends a presentation on the effectiveness of an educational program, “the longer it takes them to get to the data, the worse I know the story will be”. He understands the importance of good measurement, but he creates at the Harlem Children’s Zone a culture in which measurement occurs to inform, to simulate new ideas for increasing the rate of success, and to praise accomplishments.

At Wilder Research, we enjoy empowering communities, empowering schools, empowering organizations – to achieve all that they can imagine, and more, through the effective use of sound research and high quality data.  We live in an information world; let’s treat information as we would any valuable resource and use it wisely and appropriately to improve our quality of life.

Thinking and Acting Globally and Locally: Minnesota's Cities and Our Quality of Life

“ 'The world isn’t flat,' writes Edward Glaeser, 'it’s paved.' At any rate, most of the places where people prefer to dwell are paved. More than half of humanity now lives in cities... "

So begins a review of a new book about cities.*

Cities have, for thousands of years, constituted for us humans major centers for the production of goods and services, for commerce and finance, and for the development of human thought through institutions of learning and through media. Not to mention the opportunities which cities have offered for cultural amalgamation – the blending of traditions, beliefs, political views – and for the appreciation of many fine and exotic foods!

Despite globalization, what happens in our immediate communities often matters the most to people. And it should – as long as we continually view local events in the larger contexts of our region, our state, our nation, our world. “Think globally, act locally.” has become almost banal. However, let’s not discard it. Let’s revise that expression in a way to inspire us to realize that, in this globalized world, we need to think both locally and globally and to act both locally and globally. What we do in our locality affects others throughout the world; what others do in their localities affects us – not just in the short term, but in the long term as well.

What trends are most important right now, in Minneapolis, or Burnsville, or Duluth, or Moorhead, or Owatonna? Perhaps the employment rate? What about the poverty rate? Or the crime rate? It’s a trick question, of course. All have importance for the future of our population. We must address each, and our approach must include local, national, and global action.

How do the various levels, from local to global, interact? And what difference does it make, if we want to improve our quality of life?

Take the environment, for example. If we don’t address global warming – a remote, hard-to-understand concept for most of us – life will become so difficult and hard to manage on the local level that none of our efforts to improve our communities socially and economically will have any chance of success. (We may not find ourselves in the position of The Maldives, a nation with a high probability of disappearing during the next 100 years, due to rising sea levels, but our situation will differ radically from the present because of climate changes local and global.) So, local decisions to build up (in cities), not out (in suburbs and rural areas), for example, can, if wisely made, help both to improve local housing conditions and to ameliorate adverse climate conditions in the long term.

For one more, take jobs. Our best-laid plans for local jobs development will reach a futile end, if our country does not resolve its debt crisis. That does not simply mean making a decision about the debt ceiling. It means the creation of a new consciousness among elected officials nationally regarding how we move forward with entitlement programs, defense spending, and the government bureaucracy. Without that consciousness, along with a new framework for government spending, the currently leaking ship, which is the U.S. national economy, will sink. Quality of life indicators will sink as well.

The issue of raising taxes and/or cutting spending is a discussion for another time. Regardless of what we do, we must nurture local investment and entrepreneurial talent while simultaneously creating national and global policies and conditions that will enable local enterprise to succeed. Thinking and acting globally and locally.

Our Minnesota Compass quality-of-life project now tracks trends at the state, region, county levels, and when possible, at the city-level (populations of 20,000+). Those of us who want to push for local progress can use Compass to examine trends at all levels. To view geographic profiles, go to mncompass.org and click on your region of the map.

* Review in The Economist, February 10, 2011, of the book, Triumph of the City: How Our Greatest Invention Makes Us Richer, Smarter, Greener, Healthier and Happier. By Edward Glaeser.