Community Action Association Response to American Enterprise Institute Article on Persistence of Poverty

Thursday, August 16, 2018

Steven Martinez, the CAAP Communications Director has offered a perspective on the article CLIP (Coalition for Low Income Pennsylvanians) posted August 2, which came from the American Enterprise Institute.

Here is the original post

And, thanks to Steven for his comments:

“I think the fundamental issue I have with the argument presented in the article is reflected in this sentence: ‘In a 2015 report, the Bureau of Labor Statistics showed that 95.4% of people who worked for at least half the year did not fit the official definition of being poor.’ In Community Action, generally speaking, we have an issue with the “official definition of being poor”. People above the FPM or SPM are still struggling. I would not consider them living at a modest yet adequate standard of living (even at 200% of poverty). They are not saving for the future. They are still living day-to-day. They are another unexpected catastrophe away from going back into poverty. For many of us, the “official definition of being poor” means nothing in terms of accurately representing wealth and stability. The only value it has is simply determine eligibility for assistance. It doesn’t portray poverty in a “real” way.

“Working poor is a ‘real’ thing. Here’s one simple example. Each of PA’s neighboring states have increased their minimum wage from the federally mandated $7.25. PA has not. The wage differences range from an $8.25 minimum in Delaware to a $12.50 minimum in Washington, DC. Not only has PA failed to keep up with our neighbors, we’ve also failed to keep up with the times. In 1968, PA set the minimum wage to half the median income of full-time workers. At the time the median income was $3.15 per hour, so the minimum wage was set at $1.60. This ensured that low-wage employees still had access to a modest yet adequate standard of living. This ratio has been on a steady decline, because the minimum wage has not been consistently updated with the cost-of-living and inflation. The current minimum wage of $7.25 is 32% of the $22.93 median wage. Continuing to ignore cost-of-living adjustments will leave thousands of working Pennsylvanians in poverty.

“These ideas are best expressed via the EPI’s Family Budget Calculator and the United Way’s ALICE Project. We also wrote a little bit about these ideas in our June newsletter HERE.

“I could go on another rant about work requirements but I’ll save you the headache. Suffice it to say, many of us also take issue with that for a bunch of reasons.

“I think we have to be very careful about how we (folks who represent poverty and human services) think and talk about ‘official poverty measures’. The author of this article frames the discussion in a way that promulgates a bias that is harmful. We should be cognizant of such messaging and call it out when possible – which is what I’m actually trying to do.”