Poverty's many dimensions

RALEIGH -- The Census Bureau reported Tuesday that more than 1.25 million North Carolinians lived in poverty in 2007. For a family of four, living under the poverty level means living on less than $1,767 per month, or $58 a day.

This is a sobering statistic and one that conceals as much as it reveals. It requires us to think of poverty in terms of income alone, as if poverty were simply a matter of what families can and cannot afford.

Such a view is dangerously one-dimensional. Poverty is as much about where people come from, what they own and the education level and work opportunities of their family members as how much they make. It is a problem in multiple dimensions.

This view of poverty is not reflected in the statistics released Tuesday. Indeed, our official poverty measure is an arbitrary calculation.

In the 1960s, a Social Security Administration worker took the cheapest possible family food plan and, calculating that families at the time spent about one-third of their income on food, simply multiplied the cost of the "thrifty" food plan by three. Thus was born the federal poverty level.

Adjustments have been made to account for changes in the price of food, but the formula remains unaltered, despite the fact that three-times-the-price-of-food is no longer a realistic way to determine what a family needs to survive.

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SINCE THE FEDERAL POVERTY LEVEL'S INCEPTION, experts and others have called for a new and less arbitrary measure -- one that does account for shifts over the years in the relative costs of life's necessities. Policymakers and candidates for office have renewed this call in recent months. We applaud these efforts and encourage the adoption of a more accurate measure.

Whether or not the measure of poverty changes, however, Congress must implement proven policies to support families struggling to make ends meet as gas prices rise and the economy slows.

Expanding the Child Tax Credit to reach the many low-income working families too poor to qualify, and increasing the credit amount, would improve the situation for nearly half a million North Carolina children who would get a new or larger credit. State legislators have a role to play, too, by increasing the state Earned Income Tax Credit, an effective and targeted support for working families that also provides a stimulus to local economies.

And yet it is not enough to measure and act in one dimension. Poverty is about more than income -- it also depends on the quality of communities where people live and the relationships and know-how to build assets for the future.

In poor communities, choices are limited, if they exist at all. A lack of grocery stores and financial institutions means going without or traveling farther to buy healthy food or paying more to cash a check. Unhealthy and unaffordable housing puts children at risk and squeezes family budgets. Schools without the resources to teach poor children block the path to a better future.

The pathway to saving money is also more difficult for poor families. The wider availability of high-cost credit, and the state lottery, have disproportionately affected poor households. These anti-thrift institutions distract us from the evidence that poor people can save if information and institutions are accessible.

Products and institutions, however, are rarely set up for small investors and savers. And schools do not even teach the basics in money management.

Good money management skills are hard to come by for poor children whose families are less likely to have relationships with mainstream financial institutions. Without the training or tools to build their own assets, poor children are disadvantaged as they enter the job market and seek greater stability for their own families.

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WHEN CONGRESS RETURNS IN SEPTEMBER, it should put in place policies that provide income supports to working families. Congress must also enact policies that help families build assets. The Savings for Working Families Act and the ASPIRE Act create such a lifetime savings infrastructure for workers and children alike.

Revitalizing communities should also be a priority beyond the important housing bill passed last month. Rebuilding our neighborhoods' crumbling infrastructure through investments in community schools and main streets is a start.

Only when we invest in policies that better prepare our young people with financial education and savings, and connect all communities to high-quality services, will households be better able to weather the next economic downturn. Only when we begin to see poverty embedded in the multiple dimensions of real life -- family income and assets and healthy communities -- will we be able to foster opportunity in its place and prosperity truly will be available to all.