POVERTY

Psychology of Poverty

Psychology of Poverty

Introduction

For the most part, individuals and families are considered to be poor if and when their income and resources are deemed insufficient for them to “normally” participate in society. Miles Corak writes that identifying and measuring poverty in industrialized countries involves at least three things: identifying and measuring resources necessary for survival; establishing thresholds that distinguish poor from non-poor; and counting individual adults and children that find themselves below the thresholds. The low-income cutoff (LICO) and the low-income measure (LIM) are commonly used to do this, and involve the calculation of proportion of income levels deemed appropriate or typical for survival—both measures of low income (or poverty) calculated in relation to other national incomes. A third, market basket measures (MBM), is a budget study of consumption and costs of resources, and is deemed to be a more “absolute” measure of poverty. It too remains in reference to the wider community and social context (Cattaneo, 2009).

To increase my understanding regarding poverty and its economical impact, this paper will present the responses of three different people from different races, who were interviewed (fictitiously). The three interviews were done on 27-29 January, 2005 to three individuals. All of them were asked three questions: 1) Why do you think some people are poor? 2) Why do you think some people are rich? 3) Which social class do you think you belong to? The information collected is matched with the three explanations mentioned above with reference to lecture notes (Bullock, Jan 25, 2006) and Tables II and III in Cozzarelli's research (2002). Since none of my interviewees have a political affiliation, I am going to put it aside in my analysis.

Discussion

According to the Census Bureau, the poverty rate in the United States rose to 13.2 percent in 2008, the highest level since 1997, and a significant increase from 12.5 percent in 2007. This translates to 40 million people living below the poverty line, which is defined as an income of $22,205 for a family of four. The benchmark for ascertaining poverty levels is currently set at three times the annual cost of groceries. This does not take into account the rising child care, housing, transportation and medical expenses or variations in geography in living costs. Neither does it consider noncash aid. During the recession of 2008-09, the poor got poorer and the middle class lost ground (Cattaneo, 2009). The poverty rate among Americans aged 65 years and older is nearly twice as high (18.6 percent) as the traditional 10 percent. Alarmingly, for the first time in history, 1.2 million more of America's poor are living in the suburbs than in the cities. The Center for American Progress further estimates that approximately 17 percent of children in the United States live in or near poverty, and the annual cost to the country's economy of children growing up poor, resulting in their eventual lower productivity and earnings and higher crime rates and health costs, is over half a trillion dollars (Fritz, ...