How to Help the Poor

Using a new measure of poverty which adjusts for area costs of living, in-kind benefits, health care costs and other factors, the Census Bureau released a new report today (reported

-poverty/51108410/1″>here in USA Today) showing that the number of people in poverty is about 49.1 million, 6% higher than the 46.2 million originally estimated in September. The demographics of poverty have shifted as well. Fewer blacks and children live in poverty but the new numbers show more poverty among whites, Asians, Hispanics and the elderly.

Depending on what side of the political spectrum you are on, these numbers can be interpreted as an indictment that more federal and state poverty aid is needed, or that the current system, regardless of how generous it is, is not particularly effective at getting people out of poverty. Of course, an unemployment rate hovering at 9 percent doesn’t help matters. But the debate about how to deal with poverty often centers around the question, “What more should government be doing?” More tax credits? More food stamps? New programs? Free diapers? The more important, but often ignored question is, “What should the government stop doing that creates barriers for the poor?”

Earlier this year, NCPA published a report detailing the challenges faced by the poor in obtaining reasonably-priced services or using their own talents to provide income-producing services. These challenges are often a result of state or local restrictions and requirements that limit competition. For example:

  • Licensing requirements for child care services make it difficult for low-income families to afford child care so they can work; these requirements also create barriers to individuals who wish to earn an income through caring for children in their own homes.
  • Zoning regulations that require minimum lot sizes, expensive building material, or prohibit modular homes make housing unaffordable for the poor.
  • Regulations that prohibit transportation alternatives such as jitneys, or limit the number of cabs allowed in a city increase the cost of transportation for those without cars. These regulations also create barriers for individuals who wish to start their own transportation services as a source of income.

The Census

report also found higher poverty rates in urban areas than in rural areas due to cost of living differences. This is not suprising considering that it is more common for large cities and suburbs to impose restrictions that limit access to affordable services for the poor.

Just as there are alternative ways of measuring poverty, there are also alternative ways ot addressing poverty. Sometimes it can be as simple as lifting regulatory barries that limit the ability of the poor to buy goods and sell services in the marketplace.

 

 

 

 

 

 

 

 

Comments (2)

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  1. P.L. Sonis says:

    True poverty?! I don’t think so. This poverty is the “preserve your federal job”-type of poverty. And it’s a shame. There are truly needy people whom we could help even more if the precious dollars for aid weren’t spent on people who already have $100 sneakers and cell phones.

  2. Jersey Boll says:

    Hot directly related to this topic, but a tax and spending issue just the same, is tour article of 1/19 re: 48.6% of households receive some sort of gov’t assistance. A figure that’s hard to believe, but shows, in black & white why Obama will be hard to beat. It was started before him, but he accelerated the massive dependency he strives for; right of the pages of the Cloward-Piven Strategy which he seems to be following. The fragmented, fighting-each-other R Party, has their hands full with this 48.6 stat.

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