Is it true fewer Maine residents are living in poverty? Don’t be fooled by easy answers.
Last week, the U.S. Census Bureau announced the results of what’s called the Current Population Survey. The survey of 100,000 households nationwide found that Maine’s poverty rate was 12.8 percent in 2012, down slightly from 13.4 percent in 2011.
Those on the right used the supposed decline to claim Gov. Paul LePage’s policies have worked. “Folks, this is a direct result of Republican reforms that tightened up Maine’s massive welfare system while encouraging work,” Maine House GOP spokesman David Sorensen wrote to the media.
At the same time, liberal groups touted the success of social service programs.
It’s incorrect to draw policy conclusions from a rate change that has no meaning. The 0.6 percent difference between 2011 and 2012 is within the statistical standard error.
Second, the Current Population Survey may be useful for examining national trajectories — rates over a long period of time. But it’s not considered the most accurate gauge of how many people are actually living below the poverty line.
That role belongs to the newer Census Bureau’s American Community Survey, which has a sample size about 35 times larger than the Current Population Survey. It sampled 3.54 million households nationwide in 2012 to pinpoint a variety of demographic, population and housing trends.
It just so happened the results of the American Community Survey were released later last week. Its numbers give a clearer picture of poverty in Maine: In 2012, the poverty rate was 14.7 percent, which is not statistically different from the 2011 rate of 14.1 percent.
It is a significant change from 2010, however, when the rate was 12.9 percent, and when compared with 2009, when the rate was 12.3 percent. The poverty numbers essentially show Maine is still trying to recover from the recession. It has definitely not, however, seen a statistical decrease in the poverty rate.
Though many will rightfully point out that the U.S. uses outdated measurements to gauge who lives in poverty — they were developed in the 1960s, based largely on what it costs to live on a short-term, emergency-type diet — the poverty rate is important because it provides one of many ways to track economic trends.
But it’s difficult to extrapolate from only the rate itself whether social service programs are working. That’s because when the Census Bureau determines the income used to compute someone’s poverty status, it doesn’t count noncash benefits such as food stamps, child care tax credits and housing subsidies. If it did, the poverty rate would be lower.
On the other hand, Social Security and unemployment benefits are included in the income used to measure poverty status. If they weren’t part of the poverty measurement, the poverty rate would be higher.
But it’s not valid to draw conclusions about the effectiveness of certain social safety net programs based on the changing poverty rate. The effect of those programs is not necessarily reflected in the poverty statistics, and anyway, measuring program effectiveness requires a far more thoughtful analysis.
It is not accurate to state, for instance, that the Supplemental Nutrition Assistance Program is or isn’t working because the poverty rate has remained stagnant over the last two years. Instead, analysts need to examine the effect of SNAP. And they have.
The nonpartisan Congressional Budget Office, for example, has detailed how SNAP operates as designed: Because of income eligibility requirements, food stamps use increases and decreases as the economy changes; the stimulus also expanded the program to prevent more people from falling into poverty due to the recession.
And a study by the U.S. Department of Agriculture’s Economic Research Service found the program “significantly improves the welfare of low-income households.” It particularly helps alleviate the depth and severity of poverty among children.
All the discussion about the proper way to measure poverty ignores debate about how Maine residents are actually faring. For that, more measures, such as median household income, are needed. That measurement shows a familiar trend: Maine residents are still hurting. The median household income in 2012 was $46,709, down from $49,378 in 2008.
Be wary when people tout programs or policies based on a single measurement over a short period of time. Poverty and the economy are far more complicated than numbers that are easily absorbed and twisted at a glance.