A bigger flaw with the argument comes with Bartels’s second piece of evidence. He cites scholars at Columbia University who have concluded that Social Security, the earned income tax credit and other programs are responsible for the entirety of the decline in one measure of poverty over that period. The measure those scholars used, however, changes over time as the economy does.
It counts you as poor if you make less than a household at the 33rd percentile of household expenditures spends. The White House’s Council of Economic Advisers said in a recent report that to the extent poverty is measured in relative terms like this, ending it “may be nearly impossible.”
This measure also stacks the deck in favor of government and against markets as an anti-poverty tool — or, more precisely, in favor of redistribution rather than economic growth. If economic growth doubled the income of the poorest households but also increased that 33rd-percentile baseline for spending by a comparable amount, the poverty rate would remain unchanged.
If, on the other hand, you took money from households that made more than this relative poverty line and gave it to households that made less, you’d reduce the poverty rate. The measure of poverty the scholars used is a reasonable one for some purposes, but it’s inappropriate for the purpose Bartels is using it for.
This is presented as a sophisticated wonky argument and so I think it is fair to address it as such.
It’s best to start with this sentence: “It counts you as poor if you make less than a household at the 33rd percentile of household expenditures spends.”
I am very familiar with the study he is referring to, which uses a modified version of the new Census Supplemental Poverty Measurement (SPM). The poverty line for this historical trend is not set at the 33rd percentile of household expenditures. It is set at the 33rd percentile of household expenditures on food, clothing, shelter, and utilities (FCSU) multiplied by 1.2. These are very different things and the FCSU is not going to move at nearly the same rate as the 33rd percentile of household expenditures.
If we are looking at the SPM line since 1967 (the relevant time period for the Bartels claim Ponnuru is meant to be criticizing), it has not actually moved much at all. Until about 2000, it ran in total lockstep with the official poverty measurement (OPM) line, which is only adjusted for inflation. From there, probably for housing-related reasons, it climbed somewhat faster, resting at around $25k in 2012, relative to the $23.5k for the official measure. (Given what we know of income trends, this minor rise is almost certainly not because people got richer at the 33rd percentile of FCSU expenditures, but because they took on more debt.)
So, in fact, for Bartels’ claim about poverty reduction since 1967, this SPM data is perfectly fine. We haven’t seen the 33rd percentile of FCSU spending jump considerably over the past 45 years, which you would probably guess if you paid any attention to income trends at the bottom, which also haven’t budged. When Bartels uses this SPM data to talk about what has reduced poverty since 1967, he does so entirely correctly and appropriately.
Because the SPM line ran in lock step with the OPM line with only the slightest of (likely debt-fueled) deviations in the last decade, Ponnuru’s hypothetical objection does not reach the real data and Bartels usage of it. If the SPM had outpaced the OPM a ton and there were lots of people who had cleared the OPM line but not the SPM line, then you might have something. But that’s not what has gone on. Ponnuru’s argument against Bartels is trash.