Heritage Foundation poverty paper focuses on material bounty

The Heritage Foundation published a report Monday examining what an average poor household looks like in the U.S., remarking such families have more living space than the average European, enjoy standard kitchen amenities and purchase entertainment systems like video game consoles and cable or satellite television.

From the report:

As scholar James Q. Wilson has stated, “The poorest Americans today live a better life than all but the richest persons a hundred years ago.” In 2005, the typical household defined as poor by the government had a car and air conditioning. For entertainment, the household had two color televisions, cable or satellite TV, a DVD player, and a VCR. If there were children, especially boys, in the home, the family had a game system, such as an Xbox or a PlayStation. In the kitchen, the household had a refrigerator, an oven and stove, and a microwave. Other household conveniences included a clothes washer, clothes dryer, ceiling fans, a cordless phone, and a coffee maker.

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Consumer items that were luxuries or significant purchases for the middle class a few decades ago have become commonplace in poor households. In part, this is caused by a normal downward trend in price following the introduction of a new product. Initially, new products tend to be expensive and available only to the affluent. Over time, prices fall sharply, and the product saturates the entire population, including poor households.

As a rule of thumb, poor households tend to obtain modern conveniences about a dozen years after the middle class. Today, most poor families have conveniences that were unaffordable to the middle class not too long ago.

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The home of the average poor family was in good repair and not overcrowded. In fact, the typical poor American had more living space than the average European. (Note: That’s average European, not poor European.) The average poor family was able to obtain medical care when needed. When asked, most poor families stated they had had sufficient funds during the past year to meet all essential needs.

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The average intake of protein, vitamins, and minerals by poor children is indistinguishable from children in the upper middle class and, in most cases, is well above recommended norms. Poor boys today at ages 18 and 19 are actually taller and heavier than middle-class boys of similar age in the late 1950s and are a full one inch taller and 10 pounds heavier than American soldiers who fought in World War II. The major dietary problem facing poor Americans is eating too much, not too little; the majority of poor adults, like most Americans, are overweight.

The writers of the paper conclude, “Sound public policy cannot be based on faulty information or misunderstanding … In the long term, grossly exaggerating the extent and severity of material deprivation in the U.S. will benefit neither the poor, the economy, nor society as a whole.”

Other studies looking at the nation’s poor consider items not related to material bounty.

A 2009 FDIC report noted over a quarter of Americans are unbanked or underbanked, meaning they rely on alternative financial services like payday loan lenders, pawnshops or rely strictly on cash. The underbanked may have a checking account but rely heavily on these fringe financial services to access credit.  A book by Gary Rivlin, Broke USA: From Pawnshops to Poverty Inc. How The Working Poor Became Big Business, noted payday loan lenders charge an effective borrowing rate of 400 percent, with $2,000 going into paying off a $500 advance when all fees and late payment fines are calculated.

And in a recent study titled “Flexible Workplace Solutions for Low-Wage Hourly Workers,” low-wage workers struggle to find work stability and regular hours, suffering a strain in family life for the high volatility that comes with low-paying jobs. The study found a quarter of Americans fall into the category of low-income status. Lack of adequate health care, benefits and scant opportunities to take time off make this population particularly prone to poor health and squeeze families financially when the worker’s hours are whittled down.