The formula the federal government uses to measure poverty in the U.S. is outdated and should be modernized to better reflect the true picture of poverty in America. That's the finding of a new report from the Annie E. Casey Foundation. Terry Haven with Voices for Utah Children said the Federal Poverty Level (FPL) guidelines, established in the 1960s, only consider the cost of food and none of the other major expenses of raising a family.
"It doesn't take into account costs of basic expenses like housing, transportation, health care, childcare," Haven said. "All of those things that we know a family has to pay for."
Haven said the poverty guidelines also don't consider the cost-of-living differences that can change based on where a person lives.
The report from the Casey Foundation calls on the government to start using the Supplemental Poverty Measure developed by the U.S. Census Bureau in 2011. Haven said it measures the impact of the Earned Income Tax Credit (EITC), Supplemental Nutrition Assistance Program (SNAP), and other safety-net programs. She said without such programs, Utah's 11 percent child poverty rate could double.
"The programs that you sometimes want to cut, they're working, they're working to reduce poverty," Haven said. "They're doing what they're supposed to do. There really are safety net programs. If you were going to eliminate those safety nets you're going to see an additional 98,000 children in poverty in Utah."
Haven said using the Supplemental Poverty Measure can also help lawmakers develop a keener understanding of which safety net programs are working the best. She said child poverty costs the U.S. an estimated $500 billion a year in lost productivity and earnings, as well as health and crime-related costs.