Why Do Rich Countries Have Poor People

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Why Do Rich Countries Have Poor People?

• Amy Glasmeier
• Penn State
• Professor of Regional Planning and Geography
• University of Washington West Coast Poverty
  Center
• April 7, 2008

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What Can We Learn From Comparisons of Poverty in
the US and the UK?

• How different starting conditions can lead to
  similar results -- structure
• How measurement shapes understanding
• How identity is reshaped by policy discourse
• The undeniable role that geography plays in
  issues of equity and distribution
• How scholarly research can help fill the void in
  current discussions of policy

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Begin With A Recent Historical Glance
A wage earner at the 90th percentile makes five
times the income of the wage earner at the 10th
percentile.
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Beginning with Definitions
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Relative Versus Absolute Definitions

• Relative measures commonly used outside the US
• Standard based on threshold set compared to
  national income
• Debates then about configuration (what is in and
  what is out)
• Absolute measures nominal money income for
  persons/persons in a household

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How We MEASURE Poverty From thrifty food budget
to poverty line
Molly Orshansky, 1970s
The poverty thresholds (also called poverty
lines) are income levels that the Census Bureau
compares to actual family income to determine
poverty status.  The current, official
thresholds are referred to as the Orshansky
thresholds, after government economist Mollie
Orshansky, who combined measures of need and
expenditure.  This metric was chosen to avoid
a debate about income redistribution absolute
poverty could be eradicated, relative poverty
would always persist.
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2007 HHS Poverty Guidelines
SOURCE  Federal Register, Vol. 72, No. 15,
January 24, 2007, pp. 31473148
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USING CURRENT DEFINITION, NUMBER AND PERCENT OF
POPULATION IN POVERTY 2006
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In the 1960s the Elderly were Poor In 2006, the
poor are Children.
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The UK

• Definition not as easy or as consistent over time
• Low Income Family Series (72-85)
• Income below which aid required
• Households Below Income Average Series
• One metric lt 60 median income
• The UK has adopted the EU definition

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In 2005/06 the UK used threshold of 60 of the
average (median) household (disposable) income in
that year.

• Single adult with no dependent children 108
  (-216/week) per week.
• 186 per week for a couple with no dependent
  children
• 182 per week for a single adult with two
  children under the age of 14
• 260 (_520/week) per week for a couple with two
  children under the age of 14. 
• (Income measured after income tax, council tax
  and housing costs, where housing costs include
  rents, mortgage interest (but not the repayment
  of principal), buildings insurance and water
  charges. 

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http//www.poverty.org.uk/reports/mpse202007.pdf
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http//www.poverty.org.uk/reports/mpse202007.pdf
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Who is Poor in the UK
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Statistics at a Glance

• In 2005/06, around 13 million people in the UK
  were living in households below this low income
  threshold.  This is around a fifth (22) of the
  population.
• The number increased ¾ million compared with the
  previous year, 2004/05.  It follows six
  uninterrupted years of decreases from 1998/1999
  to 2004/05 and is the first increase since
  1996/97.
• The number of people on low incomes is still
  lower than it was during the early 1990s but much
  greater than in the early 1980s.
• The proportion of children and pensioners who
  live in low income households has been falling. 
  In contrast, the proportion for working-age
  adults without dependent children has remained
  broadly unchanged. 
• A third of all people in low income households
  are now working-age adults without dependent
  children, and the majority of these are single
  adults rather than couples.

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UK and US 60 of Median Income, US Absolute
Measure
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Mapping poverty in the UK is a relatively recent
preoccupation of scholars. This is due to data
limitations, mapping tools, and public
interest. For more than a decade Danny Dorling,
a professor at Sheffield, has constructed maps,
formulated measures and been in the news about
the geography of poverty. Unfortunately, the
lack of detailed historical data reduces our
ability to render poverty over time.
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Playing Poverty Forward

• The United States

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• FROM THE BEGINNING, WHY POVERTY WAS SO DIFFICULT
  TO TACKLE NO SINGLE CAUSE. FROM THE NEW YORK
  TIMES IN 1964
• Which of the following is correct
• Most poor families in the US are those whose
  principal wage earner is unemployed.
• Most families whose principal wage earner is
  unemployed are poor.
• Paradox the majority of those unemployed are not
  poor. And the majority of the poor are not
  unemployed.

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CONSTRUCTING THE IMAGE OF POVERTY IN AMERICA

• White, poor, isolated, illiterate, unemployed,
  lost in time
• APPALACHIA

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APPALACHIA 1964
Black number total state population white
fractional number in Appalachia
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THERE WAS MORE THAN JUST APPALACHIA
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Native American Poverty
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Back in 1964, not making it on the farm and in
rural areas forced people to migrate to the cities
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THE PROBLEMS OF THE CITIES

• While we recognized the problems of the cities
• Population groups unable to find work
• Those that found work couldnt make it pay
• Housing was unavailable
• Health care was unavailable
• Schools were ill prepared to cope with the
  concentrated influx of people
• Congressional policy responses collided with a
  Washington perspective insufficiently sensitive
  to the issues and delusional about the magnitudes
  and the historical basis of poverty problems.

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Johnson makes a pact to carry out Kennedys wish
and shapes the Great Society based on his own
perspective of the problem
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Policy Trajectory

• Strong policy in the US late 1960s-early
  1970spoverty down from the 1960s
• UK was overall policy redistributive
• Both shift upward in response to the early 1980s
  recession, then back down
• Divergence in the 1990s the US goes mean the UK
  goes paternalistic

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What we see now

• Patterns of poverty are little changed
• Problems now include rising working poor,
  non-living wage jobs
• Growing economic insecurity for children
• No longer a welfare mom problem

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Poverty in The Greater London Region, 60 of
Median Income, CACI Data 2006
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Percent of the Population in Poverty by County,
Census 2003
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Percent of Income Earners at 60 of Median
Income or Less, County, Census 2000
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Percent Children in Poverty, County Census 2000
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Rising Vulnerability of the Poor

• An increase in economic insecurity
• Growing spatial isolation in urban and rural
  areas
• Jobs, but what qualitymake people work, even if
  work doesnt pay a living wage
• Countries differ on starting conditions
• Housing, health care, education

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The Last Decade of Policy

• The UK
• A Great Society-type program, emphasizing
  children and parents
• People and places
• Yet, paternalistic and without job creation and
  quality improvement
• The US
• Tie receipt of welfare requires work
• Working hard, but not getting by and failling
  further behind
• Locked in and Left out

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Moving Forward

• Rising inequality will we see a new Poor
  Peoples movement? UK yes, US, probably not.
• Poor people working too hard to organize
• Mechanisms of social control and receipt of
  minimal help dissuade people from acting on their
  own behalf
• The American Paradox Everyone deserves a chance
  and you are expected to make it on your ownhow
  long will this last?

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Poverty Policy in America

• To succeed, does policy have to be about middle
  class concerns?
• Will current period of uncertainty make a
  difference?
• Is a brush with poverty enough to lead to new
  policy?