A key statistic around which the Poor People’s Campaign: A National Call for Moral Revival is organized is that there are 140 million people who are poor or one emergency away from economic ruin living in the U.S. today. The “140 million” are people of every race, ethnicity, age, faith, gender and sexual orientation and they live in every part of the country.
More than a number, the “140 million” figure is a challenge to the deeply held belief that poverty is a marginal issue. Hunger, homelessness and the stress and fatigue of being overworked and underpaid are far too common. Indeed, when over 40 percent of the nation cannot meet their needs, we are facing a systemic crisis. This crisis cannot be explained away by saying that some of us made some bad decisions, were “in the wrong place at the wrong time” or that prayers and patience will pull us through. In the face of such widespread economic insecurity, we must consider the policies, laws, structures and systems that allow for such conditions to not only persist, but to be overlooked and dismissed.
This month’s briefing focuses on the poverty measure, the “140 million” and the economics behind prioritizing the poor. As Willie Baptist, Poverty Scholar-in-Residence and Director of Education at the Kairos Center, often says, we must have an accurate diagnosis of the problems we want to address. “If we think that what’s coming at us is a teddy bear, but it’s really a grizzly bear, then we will meet that fight with the wrong set of strategies and tactics. We will not organize ourselves in the way that we must to solve the problem.”
One of the policies contributing to our misdiagnosis of poverty is an antiquated poverty measure that is out of sync with our society and economy. Based on this measure, poverty is defined down, anti-poverty programs are under-funded and narratives that perpetuate poverty are reinforced. All of this contributes to the unnecessary suffering of millions of people.
In fact, according to a 2021 report from the Urban Institute, the number of people living under 200% of the SPM grew to almost 149 million in 2020. The report also showed that targeted anti-poverty policies could reduce this figure by over 20 million, meaning that these conditions are neither intractable nor inherent to our economy. Other estimates from Columbia’s Center on Poverty and Social Policy show a similar impact on the 140 million. With an accurate diagnosis, we can identify the right prescription to not only reduce poverty, but end it, and ensure that we all benefit from the wealth, abundance and productivity of our times.
“Being poor ain’t got nothing to do with pulling yourself up by the bootstraps. I went out and I found some boots … And I’m still facing barrier after barrier in the wealthiest nation in the world.”Erica, Illinois Poor People’s Campaign
“I’m Being Punished that I Ever Touched Poverty”
Erica is a leader and member of the Illinois Poor People’s Campaign. Her mother came to this country from the Bahamas. Her mom worked three jobs so Erica could live on the border of a better school district on the south side of Chicago. She remembers being 16 and working alongside her mom in janitorial services. She remembers hearing the kids at her school saying that immigrants and poor people were lazy, even though she knew that wasn’t true.
Today, Erica has a one-year-old son. After a high-risk pregnancy that placed him in the neo-natal intensive care unit, Erica struggled to find work. Then the pandemic hit. As she said during the Moral Monday digital gathering on April 12: “We could not survive off the monies and things that we got through public services. It was near impossible to keep up with everything. Now I have a job. And it’s a decent job. It’s a good job, doing something that I care about. But even now, I have a hard time finding adequate housing, because of my payment records and things that I have back from when I was poor and struggling. That time is being held against me. I’m being punished for the fact that I ever touched poverty. And that ain’t right…
And let me tell you something. Being poor ain’t got nothing to do with pulling yourself up by the bootstraps. I went out and I found some boots. I went and got some laces. I went out and pulled them things tight. I wrapped them things up. And I’m still facing barrier after barrier in the wealthiest nation in the world. And I’m telling y’all right now, this is not right. We have to do better than this.”
The Life Course of Poverty
Although Erica is currently living above the poverty line, her ability to meet her and her family’s needs is by no means secure. She does not have enough savings to withstand a sudden emergency without suffering real economic hardship. In pandemic times, this may mean that becoming infected with COVID-19, changes at work or school due to exposure to COVID-19 or even side effects from the vaccine itself set off a chain of events from which it would be difficult to recover for several months.
Erica is not alone. One year after the pandemic, over 50 percent of low-income households reported having difficulty paying for usual household expenses, household debt burdens have increased and millions of people are financially fragile, living on the edge of hunger and homelessness.
This economic insecurity did not begin with the pandemic and is actually far more common that we are led to believe. According to Mark Rank and Tom Hirschl, “rather than an isolated event that occurs only among what has been labeled the ‘underclass,’ the reality is that the majority of Americans will encounter poverty first-hand during their adult lifetimes…it is a ‘mainstream’ event…and not something that can easily be dismissed as a condition of marginalized groups.” Their research showed that by age 35, one-third of the population would have experienced one year of poverty; by age 85, this proportion grew to two-thirds of the population, with stark racial disparities. While over 90 percent of Black Americans who lived to be 75 would have been poor at some point in their lives, just over half of white Americans would experience the same. They later found that these risks of poverty had increased across racial and gender lines in the years leading up to the Great Recession. Austerity policies that shredded the social safety net and the rise of part-time, temporary, low-wage jobs have likely increased these risks.
Yet, despite this being a common experience, the reality and “life course” of poverty remains obscured by how we define and measure it.
“The reality is that the majority of Americans will encounter poverty first-hand during their adult lifetimes.”
How Poverty is Measured
Developed in the early 1960s by Molly Orshansky, the poverty measure we have today is based on food and expense data from the 1950s. The formula assumed that the average household included a wage-earner and a model housewife, who was a careful shopper, skillful cook and household manager. Orshansky was an economist who worked for the U.S. Department of Agriculture and the Social Security Administration, but even by the early 1970s, she cautioned that the measure was insufficient in terms of measuring poverty; however, the Nixon Administration adopted the formula to establish the “official poverty measure” (OPM).
Other than being adjusted for inflation, the OPM has remained essentially the same for over 50 years. Even though the costs of many basic necessities have outpaced inflation, and others, like health care or childcare, were not even imagined at the time, the OPM assumes the same basic formula and worldview as it did when originally developed. According to the 2021 Department of Health and Human Services’ Poverty Guidelines, the poverty measure for a single person is approximately $12,880 per year, with every additional person adding $4540 to that threshold. For a family of four, the poverty threshold would come out to $12,880 + (3 x $4540) or $26,500.
When compared to the contemporary costs of basic necessities, this threshold is absurdly low. According to the Department of Housing and Urban Development, fair market rent for a two-bedroom apartment in Raleigh, North Carolina, is $1200. This would amount to 82 percent of the poverty line for a family of two and 66 percent of the poverty line for a family of three, leaving very little income leftover for food, utilities, transportation, school or anything else.
The OPM was marginally improved by the Supplemental Poverty Measure (SPM), which was developed after the National Academy of Sciences recommended a new poverty measure in 1995. The SPM takes into account critical out-of-pocket expenses for food, clothing, housing and utilities, as well as government transfers like SNAP (food stamps) and the EITC, and is adjusted for geography and housing tenure. In 2019, the SPM threshold for a family of four was anywhere from just over $21,000 for a home-owning household in non-metro Iowa to nearly $37,000 for a renting family in Los Angeles. These improvements are meaningful, but still too low. According to HUD’s estimates, fair market rent for a 2-bedroom apartment in Los Angeles costs about $2000. This would take up two-thirds of the SPM threshold for a family of four, just on rent alone.
An inadequate poverty line leads to inadequate poverty policies. Anti-poverty programs like TANF, SNAP, WIC and others are consistently under-funded from year to year. The poverty measure is even used to justify policies that further entrench poverty and inequality. In the debate around increasing the minimum wage to $15 / hour, Sen. Joe Manchin used the poverty line to advocate for $11 / hour instead, saying $11 would be enough to bring people above that line.
An inadequate measure also contributes to narratives that stigmatize poverty and explain it as a temporary setback, the inevitable consequence of our own failures or just bad luck. Even in their most innocuous form, these narratives are deeply internalized and demoralizing. Anu is an artist and consultant who, several years ago lost her housing, healthcare and income all in one month. For the next three years, she had no permanent address and her personal belongings were scattered across a large city, yet she was never counted among the homeless population. During those years, she made between $7000 and $18,000 a year, sometimes falling below the poverty line, sometimes above, but she never made enough money to secure her basic needs. Today, she and her partner work 14-hour days, have mold in their apartment that impacts their health and, even with their combined incomes, no other place to go. As she recently testified, “I think I’ve been lied to about this idea of having a ‘middle-class identity.’ I went to a good college, I have a good degree, but that didn’t protect me from going through any of this. It just hid the truth that I was living one paycheck away from homelessness.”
The 140 Million
From its very beginning, the Poor People’s Campaign has looked beyond the poverty measure to understand who is poor in the U.S today. After years of organizing and building relationships in hundreds of communities across the country, we knew that the poverty measure was not capturing the full extent of economic insecurity people were facing. For this reason, in the “Souls of Poor Folk” Moral Audit report, we locked onto a new number to articulate who was at the core of our commitments: the 140 million.
According to our research, there are 140 million people who are poor or one emergency away from being poor in the nation. Among the 140 million are: 52.1 percent or 38.5 million children (below 18); 42.0 percent or 21 million elders (above 64); 41.6 percent or 65.8 million men; 45 percent or 74.2 million women; 59.7 percent or 23.7 million Black, non-Hispanic people; 64.1 percent or 38 million Latino/a people; 40.8 percent or 8 million Asian people; 58.9 percent or 2.14 million Native/Indigenous people; and 33.5 percent or 65.6 million white, non-Hispanic people.
The 140 million include 35-40 million people who are living below the poverty threshold (SPM) and 95-100 million people who are living right above it. While the first group is referred to as “poor,” the second group is more often described as “low-income,” living everyday just one traffic violation, pay cut or health crisis away from the threshold. This is, for the most part, a distinction without a difference, because many people living above the line will fall below it over the course of a year.
It also presents a challenge to our common perception of poverty as expressed by the OPM or SPM. When candidate Joe Biden used the 140 million figure to describe the number of “poor” people in the country, the Washington Post fact checker brought him under scrutiny, saying not all of these people were living under the poverty line. Of course, anyone living one emergency above the poverty line will tell you that Mr. Biden wasn’t wrong; he was just redefining “poor” to include everyone who was “low-income,” too.
The 140 million can, thereby, be wielded to break through narratives that minimize and marginalize poverty. As Shawn Fremstad, Senior Policy Fellow at the Center on Economic and Policy Research, has said, “One of the most important things about the ‘140 million’ number is that it shows that, whatever line you draw, the people below that line aren’t all that different from the people right above it. And there is a coalition of people coming together across that line — some of whom are really destitute and others who are living precariously above it, but they can see what’s in front of them. Instead of getting sliced and diced, the 140 million number allows people to see themselves in the same boat and build coalitions across class, race, gender and across this poverty line that keeps them apart.”
Further, the 140 million sets a higher standard against which to measure anti-poverty policies. Temporary relief that brings people above the poverty line just isn’t enough. We must strive for anti-poverty policies that establish economic security throughout our lifetimes, including by guaranteeing adequate incomes, good jobs, living wages, housing, health care and developing social welfare programs that target racial wealth inequality, child poverty and household poverty together. Given that poverty is not only a common experience, but that the probability of that experience increases with age, we cannot settle for anything less.
“Instead of getting sliced and diced, the 140 million number allows people to see themselves in the same boat and build coalitions across class, race, gender and across this poverty line that keeps them apart.”
The Macroeconomics of Prioritizing the Poor
More than a number, the 140 million is really a theory of change. As we have previously written, our society is organized around an abiding faith in the rich to save the rest of us. Baked into our fundamental understanding of what the economy is and how it works, we assume that policies and systems that benefit the rich will benefit us all, even though our everyday experiences disprove this theory. The pandemic has clearly shown us that the interests of the rich do not correspond with our own.
At the same time, pandemic times are creating an opportunity to push back against these assumptions. A 2021 paper from the London School of Economics showed that, aside from consistently benefiting the wealthy, fifty years of trickle down tax policies have had no meaningful effect on unemployment or even economic growth. Instead, they have mainly led to greater inequality.
In contrast, policies that provide direct assistance to poor and low-income households have been shown to have economy-wide benefits. A 2021 report from the Brookings Institute looked at the macroeconomic effects of President Biden’s $1.9 trillion relief package. The report clearly shows that resources given to poor and low-income households have a greater impact on the economy than resources going to businesses. Every dollar that is given to “financially vulnerable” households was multiplied into $1.20, whereas every dollar given to businesses was multiplied into $0.30. Because the study assumed that the support to poor households would eventually expire, the graph below shows a steep drop in its impact; however, it still makes a strong argument for long-term income supports to poor and low-income households that can and will circulate back into the economy.
Likewise, every dollar spent on SNAP (food stamps) during an economic downturn generates between $1.50 and $1.80 of economic activity; every dollar that goes into raising the minimum wage adds $1.20 in economic activity; and the Economic Policy Institute estimated that the $600 per week of unemployment insurance provided by the CARES Act was supporting approximately 5 million jobs.
In other words, policies that center the 140 million are not only the right thing to do, they are good economics. As a pandemic response, we need policies that provide health care, clean water, housing and living wages for all; accessible and reliable communications and broadband technology; safe and equitable public education; and a social welfare system that can withstand external shocks. It would mean protecting our families from having to take on unbearable levels of debt. It would mean moving resources away from industries that harm and isolate our communities, like war, fossil fuels and prisons, and towards building diverse local economies that are resilient, networked and nourished. It would mean valuing all work, paid and unpaid, by ensuring decent and adequate incomes. And it would mean a new poverty measure that reflects what it takes to live decently in our society today.
These are not new ideas, but their time is long overdue. In the late 1960s, Rev. Dr. Martin Luther King, Jr., called for guaranteed jobs and incomes. He said that a guaranteed income must be set to the median income of society and increase over time as social income grows. He knew it was not enough to peg our social programs either to the lowest possible standard of living or to inflation. Rather, they must keep up with the growth and development of our economy, so we could grow our common wealth and well-being.
Today, it is abundantly clear that meeting the social needs of the 140 million can provide the basis for a different kind of economic recovery. Unless we move in this direction, we will face greater wealth and resource inequality and heightened threats of violence to our people and planet.
Prioritizing the 140 million is not a question of charity, but of our common survival.