What You Need When You’re Poor

Heritage Foundation Hasn’t a Clue

Melissa Boteach and Donna Cooper skewer the conservative think tank’s ridiculous ideas about what low-income Americans spend the bulk of their money on.

Smart federal investments in nutrition programs stem the degree to which struggling families face hunger and food insecurity. (Flickr/<a href=sean dreilinger)" data-srcset=" 610w, 610w, 610w, 500w, 250w" data-sizes="auto" />
Smart federal investments in nutrition programs stem the degree to which struggling families face hunger and food insecurity. (Flickr/sean dreilinger)

The majority of the American people strongly oppose the passage of debt and budget deals that harm the middle class, devastate the lives of poor families, and ignore the realities of our still sputtering economy. Yet the conservative majority in the House of Representatives and their like-minded colleagues in the Senate have now forced through cuts to bedrock federal programs that underpin America’s middle-class and low-income families—just when they thought things couldn’t get worse.

the poverty line has fallen as a percentage of median income

To help justify this assault, the Heritage Foundation released its latest distorted picture of poverty in America. And, as usual, Rush Limbaugh could be counted on to perpetuate these distortions through the airwaves. The purpose: To suggest poor families have it too good for the government to worry about them anymore. The report relies on old data from before the Great Recession of 2007-2009 to pitch the argument that the poor are doing just fine because they have it all—refrigerators, microwave ovens, window unit air conditioners, televisions, and cell phones.

These arguments are mean and misleading on several accounts. First, the electronic devices that Heritage cites are everyday necessities today. Who has iceboxes anymore? Who doesn’t need a cell phone to find a job or keep one? Fortunately, these appliances are all significantly cheaper these days, but not so the real everyday basics such as quality child care and out-of-pocket medical costs, both of which have risen much faster than inflation, squeezing the budgets of the poor and middle-class alike. In fact, if anything, those who we consider poor today are far more out of the social mainstream in terms of their basic income than when our poverty measure was first set in the 1960s.

Indeed, the rising cost of paying for electricity for the very appliances that Heritage thinks are indicators of luxury are eating a bigger and bigger hole into the pockets of the poor. Today struggling families are spending at least 15 percent of their household budget to pay their electric bills, and the poorest of the poor shell out an even higher percentage of their income for this basic expense. Somehow Heritage manages to completely ignore the fact in America, the U.S. Department of Agriculture found in 2008 that half (50.3 percent) of poor households with children said there were days when they didn’t know how or if they could pay for their next meal.

And these families are paying an extraordinary share of their income for basic housing, too. While the average renter makes about $13.52 an hour, the national average wage needed to afford a fair market rent for a two-bedroom apartment is around $18.46 an hour. This problem is exacerbated for minimum wage working parents who earn just $7.25 an hour.

To avoid a real discussion of these issues, the Heritage Foundation craftily creates indexes that rank households on skewed measures of “amenities” that suggest that no further federal action is needed to buoy the standard of living of poor and working-class families. Such indexes are heartless and foolish. Heartless because they ignore the fact that it takes much more than a few appliances to support a family. And foolish because they lend credence to the calls for cutting the supports that research has shown are necessary for every child to become a healthy and productive adult.

Smart federal investments in nutrition programs stem the degree to which struggling families face hunger and food insecurity. Reasonable investments in affordable housing and community development make it possible for millions to keep a roof over their head. Our economy also depends on countercyclical programs such as food stamps, Medicaid, unemployment insurance, and the earned income tax credit. By putting resources directly in the hands of struggling families, these programs boost consumer demand, keep small businesses humming, and create jobs that strengthen the middle class.

With 44 million Americans in poverty, 25 million people in need of full-time work, and overall wage stagnation slowly eroding the middle class, the final budget agreement that will be negotiated and voted upon later this year must be carefully crafted to create jobs and ensure the continued stability of these families. For the sake of the millions of Americans who have lost a job, lost their home, or lost their health insurance, let’s hope members of Congress don’t fall for the Heritage and Limbaugh line that the poor aren’t that bad off when they start lining up trillions in cuts. A refrigerator does not a middle-class family make.

Melissa Boteach is the Half in Ten Manager at the Center for American Progress Action Fund and Donna Cooper is a Senior Fellow with the Economic Policy team at American Progress.

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Melissa Boteach

Senior Vice President, Poverty to Prosperity Program

Donna Cooper

Senior Fellow