How the Census Overcounts Poverty

Census poverty figures use a narrow measurement of income that leaves out many major anti-poverty programs that are run through the tax code and leave millions of Americans with more money after federal taxes. One out of seven Americans are officially in poverty, according to the new report, but one out of ten taxpayers receive tax payments in the form of refundable tax credits that are greater than what they owe in income and payroll taxes. That is, their tax bill makes them money.

An individual's income may put that person below the poverty line, according to the Census measure. But that measure ignores the on-the-ground effects of some of the most critical anti-poverty weapons, most notably the Earned Income Tax Credit, Medicaid, food stamps, and housing subsidies. Recently, for example, the EITC alone provided more than $40 billion annually to the working poor.

By excluding these benefits, the Census poverty figures fail to recognize that these programs lift many people out of actual poverty.

Read the full story on CNN.

Presented by

Derek Thompson is a senior editor at The Atlantic, where he writes about economics, labor markets, and the entertainment business.

The Blacksmith: A Short Film About Art Forged From Metal

"I'm exploiting the maximum of what you can ask a piece of metal to do."

Join the Discussion

After you comment, click Post. If you’re not already logged in you will be asked to log in or register.

blog comments powered by Disqus

Video

Riding Unicycles in a Cave

"If you fall down and break your leg, there's no way out."

Video

Carrot: A Pitch-Perfect Satire of Tech

"It's not just a vegetable. It's what a vegetable should be."

Video

An Ingenious 360-Degree Time-Lapse

Watch the world become a cartoonishly small playground

Video

The Benefits of Living Alone on a Mountain

"You really have to love solitary time by yourself."

Video

The Rise of the Cat Tattoo

How a Brooklyn tattoo artist popularized the "cattoo"

More in Business

Just In