November 3, 1998 | Commentary on Welfare and Welfare Spending , Poverty and Inequality

"Poor" is a Relative Term

Talk about exaggeration. Earlier this fall the U.S. Census Bureau issued a report claiming there are more than 30 million Americans living "in poverty." But a closer look at these "poor" people shows them to be far less impoverished than you might think.

According to government data collected by my colleague Robert Rector, 97 percent of the households labeled "poor" by the Census Bureau own color televisions, nearly three-quarters have video cassette recorders, and 70 percent own cars.

A lot of the poor also own their own homes, 41 percent to be exact. And these homes aren't small. The average poor person in America has 440 square feet of living space, more than the typical middle-class resident of Paris, London or Vienna.

Very few poor people go hungry either. A 1989 survey by the Department of Health and Human Services found just 3 percent of Americans saying they "sometimes" do not have enough to eat. On the contrary, the chief nutritional problem facing the poor is obesity.

No one would deny that some Americans are truly needy. But 35.6 million of them? Only if you accept the Census Bureau's bizarre definition of poverty. For example, in determining whether someone is "poor," the Census Bureau counts only current income, ignoring assets accumulated in prior years. So if Bill Gates had a bad year and made no income he could be labeled poor, despite his accumulated billions. This helps explain why more than 200,000 "poor" people own homes worth more than $300,000.

The Census Bureau also misses a lot of income. In 1996, the Department of Commerce determined that the aggregate personal income of Americans was $6.8 trillion. Yet the Census Bureau counted only $4.8 trillion.

Where did the extra $2 trillion go? A significant portion went to the poor. In 1995 the Census Bureau said the income of the poorest 20 percent of U.S. households averaged only $8,350. Yet the Labor Department claimed these same households spent $14,607. In other words, the average "poor" household spent $6,257 more than the Census Bureau said it makes. And these figures don't even include the value of government housing and health-care assistance.

The annual Census poverty report was created as a public relations gimmick to push President Lyndon Johnson's "War on Poverty." The goal was to enlarge the apparent number of the poor, thus building support for Johnson's welfare policies.

Those policies did raise incomes in poor communities, by transferring money from those who work to those who don't-or won't. But these same policies destroyed many families. When the War on Poverty began, 7.7 percent of children were born out of wedlock. Today, due in large measure to welfare programs that discourage marriage, the illegitimacy rate is 32 percent.

By undermining hard work, self control and marital stability, the War on Poverty has harmed those it intended to help. The Census poverty report contributes to these misguided policies by inflating the population of the poor, giving liberals ammunition to push for more social spending.

It would be bad enough if the Census poverty report were just inaccurate. It's unconscionable that it is used to promote the same programs that spawned urban decay in the first place. The next time you hear inflated estimates of how many poor people there are in America, take them with a grain of salt-or better yet, a whole salt shaker.

Edwin J. Feulner is president of The Heritage Foundation (, a Washington-based public policy research institute.

About the Author

Edwin J. Feulner, Ph.D. Founder, Chairman of the Asian Studies Center, and Chung Ju-yung Fellow
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