Are Poor People in America Really Poor?

by Neal Frankle, CFP ®

Have you ever stopped to ask yourself what you really know about the poor people in America? I know I never have. Are most poor people homeless? Are most poor people hungry? I’m not proud of saying this, but I never stopped to consider it. A few months ago I read an editorial in Investor’s Business Daily that discusses this issue, and I found it fascinating.

The article referenced the Heritage Foundation, which publishes government data on American poverty. Here are the facts about America’s poor according to the Heritage Foundation:

  • Most have air conditioners and cable TV
  • They are well housed
  • They have a steady supply of food and access to medical attention
  • 99.6% have refrigerators
  • 97.7% have televisions, stoves and ovens
  • 81.4% own microwave ovens
  • 78.3% have air conditioners

These numbers are very close to those enjoyed by all U.S. households. True, they’re not using these amenities in estate-sized homes, but they’re not living in tin huts either. According to Heritage, poor people in the United States have (on average) more living space than the average European non-poor person.

Interested in learning more about poor people in the United States?

  • 65% have more than one TV
  • 64% own a DVD player
  • 54% have a cell phone
  • 48% have a coffee maker (I don’t have one yet)
  • 38% own a computer
  • 29% have internet, and the same percentage have video game systems.

What does this mean?

America still has a huge poverty problem. We need to do a better job. Too many people go hungry at night, don’t have proper education or a roof over their heads. But it’s probably a smaller number than we imagine. And having read this report I came up with a few questions of my own. Is it possible that the people who really go without do so because we define too many as poor? Are we using our resources to help those who may not really need our help at the expense of those who really do? Maybe most of our poor simply need to learn how to make more money and be incentivized correctly.

Most of our “poor” are actually doing better than middle class citizens of other wealthy countries. True, the poor don’t have the life they dream of, and they don’t live in the neighborhoods they ultimately want to live in. But the question is, do we really think it’s a good use of resources to target this group with more benefits? When you consider that doing so comes at the direct expense of those who may really be desperate for help they aren’t getting, does it change your answer?

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