In 2015 it was reported that up to 50 million American adults had negative wealth and thus numbered among the poorest 10% of the world’s adults. This was disputed by Vox writer Matthew Yglesias, who said, “..that’s absurd. The poorest people in the world are the people with rock-bottom material living standards.”
It’s difficult for many Americans to admit the truth about extreme poverty in our country. Our poorest citizens may not be living in a farming village where they eat millet soup and walk a mile for water. But they have to deal with homelessness, alcoholism, mental health disease, opioid addiction, stress-inducing indebtedness and inequality, and pollution levels that are the highest in the developed world. All of that makes for rock-bottom living standards.
According to Credit Suisse data over the past three years, anywhere from 4 to 10 percent of the world’s poorest decile are Americans. That’s 20 to 50 million adults. It’s likely that many of them are only temporarily in debt, and that they have a much better chance than a third-world villager to climb out of poverty. But it’s just as likely that they’ll be replaced by other impoverished Americans, especially with an aging population woefully unprepared for retirement, and with the great majority of new job prospects temporary or contract-based, without security or benefits.
A second denial
“There are millions of Americans whose suffering, through material poverty and poor health, is as bad or worse than that of the people in Africa or in Asia.” That’s the conclusion of Princeton researcher Angus Deaton, who along with his wife Anne Case documented the “marked deterioration in the morbidity and mortality of middle-aged white non-Hispanics in the United States after 1998.” In a recent opinion he cites the rising mortality rates from drugs, alcohol and suicide. Based on World Bank and Oxford numbers, he estimates that over 5 million Americans are absolutely poor by global standards.
Again a Vox writer takes exception, this time Ryan Briggs, who argues that “poor people in rich countries often receive many non-cash benefits that boost consumption without boosting income.” But it goes both ways. As Deaton points out: “An Indian villager spends little or nothing on housing, heat or child care, and a poor agricultural laborer in the tropics can get by with little clothing or transportation.” Overall, the cost of living is much lower in such places. More importantly, among a deeply troubled class of Americans there are aspects of life that too often outweigh the cash or non-cash benefits. For that we need to look more closely at the meaning of poverty.
Poverty is not just an income number
Using a “dollar a day” estimate to compare poverty levels is impossible. A Brookings report notes: “There is a sad irony in the fact that the analytical tools used to assess welfare in the U.S. are poorly equipped to capture those whose lives are most precarious.” Furthermore, it’s an insult to desperate Americans to suggest that their state in life is better than they might think.
Poverty is not just the few dollars a day coming into the household, cash or non-cash. There is poverty in the diminishing quality of life for the bottom half of America. Poverty is the stress of overwhelming debt; the inability to pay for medical treatment during years of declining health; the lack of community support as part of a true safety net; the near-absence of retirement savings for over half the population; the steady decline of jobs that pay enough to support a family; the well-documented impact of America’s inequality on its citizens’ physical and mental well-being. Part of the definition of poverty is “the state of being inferior in quality.” The extreme level of inequality in the U.S. is battering the poor with a sense of inferiority. It’s ripping apart once-interdependent communities, and it’s triggering a surge in drug and alcohol and suicide “deaths of despair.”
This is not to understate the miserable conditions in many third-world communities. The point is that there are different forms of impoverishment. And, of course, some similar forms. While many villagers in the developing world don’t have sufficient food and water, it’s equally fair to say that millions of Americans have been exposed to contaminated drinking water and live in food deserts, often in frigid climates with substandard housing and insufficient heating. Also, while third-world villagers may not have the opportunities available in the U.S., those very opportunities are becoming less and less available to the neediest Americans.
It’s hard for people with wealth and power to admit all this. Because then they might feel obligated to do something about it.