It’s often said, “How can a nation as rich as America have so much poverty?” Well, you might say, “Compared to what?”
So here’s a place to start. The source for the following data (2019) is the OECD, the Organization for Economic Cooperation and Development. It’s a membership organization of the most developed nations in the world that adhere to democratic and free market principles. Of the top 26 high economy countries in terms of rate of poverty, the U.S. ranks last.
The ranking is based on the percentage of the population falling below one half of a particular country’s median household income. Using this measure, the average percentage of poverty for the top five nations with lowest poverty (Iceland, Denmark, Finland, France and the Netherlands) is 6.3 percent. Of all the 26 nations the average rate of poverty is 11 percent, and the median rate is 10.3 percent. The United States stands last at 17.8 percent. Some of the nations ranking better than the U.S. are Portugal, Greece, Hungary, Poland, Ireland, Japan and Korea.
Childhood poverty rates are worse. Again, using OECD 2019 data, “The United States again leads all nations in having the highest rates of child poverty at 20.9 percent, while the overall average stands at 11.7 percent. Again we see the Scandinavian countries having the lowest rates of child poverty, with Denmark seeing only 2.9 percent of its children falling into poverty.
What triggered my interest in learning more about the growth of poverty in the U.S. was a recent article in the New York Times about shoplifting. Arielle Reid of the Legal Aid Society was quoted as saying that, “Shoplifting is a crime of poverty.” Jose Filipo works in a bodega owned by his uncle in New York. Shoplifting is on the rise since the pandemic but what caught my eye was that he said that the most frequently stolen items were laundry detergent and baby formula. They now keep the baby formula behind the register.
Poverty rates in fact are hard to measure and by U.S. census methods, the rates over the past 50 years have yo-yoed between 10.5 and 15.5 percent. The poverty line in the U.S. for a family of four is currently pegged at $26,695. According to the U.S. Census Bureau, the level of poverty in Highland County as of July 2021 is 13.9 percent. Yet according to DATAUSA, an enterprise of Deloitte, Datawheel and the MIT Media Lab, the poverty level in Highland County is 19 percent, a 2.24 percent decrease from 2019 to 2020.
It’s easy to point to today’s rising food costs, the rising costs of fuel, increasing health care costs, the scarcity of affordable housing, and wages falling behind rising inflation. The problem with these diagnoses is that rates of poverty, while fluctuating over the past 50 years, have essentially been in a state of stasis. It’s easier, as one pundit put it, to afford a cheap cell phone now than 20 years ago when they were a rich man’s toy, but you can’t eat a cheap cell phone. Michael Harrington, author of the book “The Other America” once said, “It’s easier in the United States to be decently dressed than it is to be decently housed, fed or doctored.”
And there were and are the lingering effects of the COVID pandemic. According to the World Economic Forum, in the U.S., “employment for low-wage workers in 2021 had fallen by 21% from January 2020 levels, while employment for high-income workers had gained 9.6%.”
It’s important to remember that in free market democracies around the world, economic forces and pandemic consequences have rained down with equal opportunity, yet the U.S. remains yards behind others in the race against poverty.
Corporations in our capitalist society drive wealth and are responsible for what many around the world admire about the United States. Deference to this world of business is essential to our well being if rationally and wisely overseen.
Mahatma Gandhi once said that, “The greatness of a nation can be judged by how it treats its weakest member.” Nelson Mandela had a similar thought: “A nation should not be judged by how it treats its highest citizens, but its lowest ones.”
In a column last week I wrote about the growing strength of soft power. Gandhi and Mandela speak to this notion as an underlining cord of a powerful and inspirational nation state.
One of the many things that caused the fall of the Soviet Union was the neglected and exploited condition of its citizens wrought by the likes of Stalin, Brezhnev, Yeltsin and Kosygin. Xi Jinping faces the same challenges, especially as its citizens experience intensifying surveillance and the deprivations that can set in with a rapidly aging society.
What separates the U.S. from most other global, high-level economic and free-market countries when it comes to managing poverty is our policy priorities. The historical facts are that poverty levels in the United States have remained stagnant for about the last 50 years.
I’m not enough of an expert on poverty and its underlying causes to solve these problems as some countries’ policy experts have been able to do, but the question for us is this: How important is it to our nation that we lead the free-market world of democratic nations in limiting poverty with all its attendant and pernicious societal effects?
Bill Sims is a Hillsboro resident, retired president of the Denver Council on Foreign Relations, an author and runs a small farm in Berrysville with his wife. He is a former educator, executive and foundation president.