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LA City Councilman Richard Alarcon and representatives from over 20 organizations announced that they will be calling on new the President-elect and Congress to update the Federal Poverty Guidelines. They'll be making their way to Washington DC to lobby for the cause. From Alarcon's office:
The Federal Poverty Guidelines were established in 1963 by the Social Security Administration to establish a baseline for measuring poverty. The guidelines take the dollar costs of food for families of three or more people and multiply that number by a factor of three. The Federal Poverty Guidelines do not take into account regional differences in the cost of living, meaning a family living in rural Wyoming is measured the same as a family living in Los Angeles despite the considerable cost differences. Currently, the threshold for poverty for a family of four is $21,650.
In 2007, the City Council supported a resolution introduced by Councilmember Alarcon to support updating the Federal Poverty Guidelines and called on all of the presidential candidates (Democrats and Republicans) to take a position on this issue. Sen. Obama wrote a letter in support, while Sen. McCain did not respond.Changing the formula of how poverty is calculated from the current
federal poverty guidelines to a regionally based formula would allow the
federal government to better target poverty-prevention resources and
give a better picture of the extent of poverty in the United States.
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The real problem is not the regional differences, its the way the guideline was calculated to begin with. The 1963 guideline was based on the average price of food in 1963, and assumed that people spent only 1/3 of their income on housing. Today most people spend at least 1/2 if not more of their income on housing.
Since 1963, the guideline has not been readjusted to account for today's typical spending patterns, it has only been adjusted for inflation each year. Either way, we are in sore need of an update.