a small Political History:
A traditional perspective is that the imbalance is part of historical variation between the rich and poor and that government interference of the gains of the financially successful only creates more envy of them. A radical contrast to this is that capitalism itself causes the inequality in wages and the level of poverty we have in America. Therefore many solutions stem for decreasing the gap in wages as socialism, on paper and in theory indicates but with differing applications hasn’t actual created. So the role of moderate’s use of the government to create solutions to the social and economic problems of poverty is how it has been confronted.
FDR’s New Deal after the great depression and continued with LBJ’s New Society of the 1960s have had the largest impact to reduce poverty in America at the presidential level. Social Security provides support to needy families, the disabled, elderly, and unemployed paid for form taxes. State and local actions usually come in the form of education programs for the impoverished to lessen the gap. Headstart programs for example are meant to give children of low income families a better change to reaching college by providing them more attention at school and in their homes to learn.
Two Ways of Measuring Proverty
(from wikipedia see Source page)
There are two basic versions of the federal poverty measure: the poverty thresholds (which are the primary version) and the poverty guidelines. The Census Bureau issues the poverty thresholds, which are generally used for statistical purposes—for example, to estimate the number of people in poverty nationwide each year and classify them by type of residence, race, and other social, economic, and demographic characteristics. The Department of Health and Human Services issues the poverty guidelines for administrative purposes—for instance, to determine whether a person or family is eligible for assistance through various federal programs.
Since the 1960s, the United States Government has defined poverty in absolute terms. When the Johnson administration declared "war on poverty" in 1964, it chose an absolute measure. The "absolute poverty line" is the threshold below which families or individuals are considered to be lacking the resources to meet the basic needs for healthy living; having insufficient income to provide the food, shelter and clothing needed to preserve health.
The "Orshansky Poverty Thresholds" form the basis for the current measure of poverty in the U.S. Mollie Orshansky was an economist working for the Social Security Administration (SSA). Her work appeared at an opportune moment. Orshansky's article was published later in the same year that Johnson declared war on poverty. Since her measure was absolute (i.e., did not depend on other events), it made it possible to objectively answer whether the U.S. government was "winning" this war. The newly formed United States Office of Economic Opportunity adopted the lower of the Orshansky poverty thresholds for statistical, planning, and budgetary purposes in May 1965.
The Bureau of the Budget (now the Office of Management and Budget) adopted Orshansky's definition for statistical use in all Executive departments. The measure gave a range of income cutoffs, or thresholds, adjusted for factors such as family size, sex of the family head, number of children under 18 years old, and farm or non-farm residence. The economy food plan (the least costly of four nutritionally adequate food plans designed by the Department of Agriculture) was at the core of this definition of poverty.
The Department of Agriculture found that families of three or more persons spent about one third of their after-tax income on food. For these families, poverty thresholds were set at three times the cost of the economy food plan. Different procedures were used for calculating poverty thresholds for two-person households and persons living alone. Annual updates of the SSA poverty thresholds were based on price changes in the economy food plan.
Two changes were made to the poverty definition in 1969. Thresholds for non-farm families were tied to annual changes in the Consumer Price Index (CPI) rather than changes in the cost of the economy food plan. Farm thresholds were raised from 70 to 85% of the non-farm levels.
In 1981, further changes were made to the poverty definition. Separate thresholds for "farm" and "female-householder" families were eliminated. The largest family size category became "nine persons or more."
Apart from these changes, the U.S. government's approach to measuring poverty has remained static for the past forty years.
