Not allowed to talk about poverty

BC Stats put out a release yesterday with the headline “Low Income Cut-Offs (LICOs) are a Poor Measure of Poverty” and author Dan Schrier gets in a dirty hit right in first paragraph:

Despite protestations from Statistics Canada that LICOs are not meant to be used as a measure of poverty, there are many groups that insist on using them for exactly that purpose.

We’ve heard this before from Statscan, it is not a new line. But it  is perhaps the most bogus argument ever. I have no problem with someone criticizing the shortcomings of the LICO, because no measure of a complex phenomenon like poverty is going to be perfect. There are Low Income Measures (LIMs) and Market-Based Measures (MBMs) too, though they tend to draw the same conclusions about the numbers. In the absence of an official poverty line and numbers, these are what academics and NGOs working on poverty issues will use.

What is irksome is someone from a stats agency, in this case working for the BC government, saying that because the official agencies refuse to define a measure of poverty and release the results, we the public cannot talk about how large poverty is. BC Stats released a similar such piece about a year ago so it clearly is a bee in Mr Schrier’s statistical bonnet.

But really, until you (Statscan, BC Stats or Dan Schrier) develop an official measure of poverty, stop the condescending finger-wagging at people who care about poverty and use LICOs.

19 comments

  • Yah this is an old saw. Funny that poverty should be conceptually and methodologically too messy measure. Oh that they should have such high standards for the other data and claims they collect.

  • Yeah, I just hate condescending finger wagging.

  • Denise Freedman

    The question of “poverty,” regardless of the measure(s) one uses, as pleasing economically as such measure(s) might well be, distracts attention in the wrong direction.

    It is always pleasing to those with not a serious interest in the totality when, in a discussion of “poverty” one concentrates on, say, the personality or moral characteristics of the “poor.” Not that anyone here is doing so, but this is the inevitable consequence of the “poverty” discourse.

    Where is the discussion of the structural, or political economic, aspect of the totality, i.e., inequality.

    But then, such ‘big picture’ discussions, I suppose, smack of utopias, socialism, or, what was the farce at the recent NDP convention, with “updating” its constitution NOT to include “democratic socialism.”

    Or Andrea Horvath speaking of taking the burdens off families, as the thing in the upcoming election in Ontario.

    Not that this is a bad thing.

    But why has everyone accepted the truly radically conservative position that nothing much can be done.

    Even that nothing much can EVEN BE THOUGHT?!?!

  • I wish I could say what I want to, but cannot. Put it this way, I had no grey hair before being in the barn, within 3-4 years it was all grey. Old saw for sure, I have scratched the head on this one And stared down some at the highest levels on this one shaking my head so much I was dizzy.

  • The provinces called on Statscan to develop the MBM. While not without flaws, it shows very similar levels and trends in low income compared to the LICO.

    My preference would be to track low income using two measures – the LIM (50% below median income for the same family type) and a consumption basket measure like the MBM. The problem with LICO is that it is hard to explain, and has not been rebased for 20 years. Also it fails to capture big differences in hosuing costs between different large urban centres.

  • None of these mentioned are what I would call functionally efficient measures and it is the efforts that bothers me.

  • Denise Freedman

    While I am on moderation, I’m sure it is some sort of technical glitch, the irony of my attempt to raise a discussion of inequality, under a post called “Not Allowed to Talk About Poverty” is more than I can resist.

    At one of the PEF sessions at the recent Canadian Economic Association meetings, Armine Yalnizyan spoke emphatically of the importance of addressing inequality, not “poverty.”

    The discussion of “poverty” reminds of various notions of what is an ‘appropriate’ level of “poverty,” such as the Fraser Institute’s positing of a minimum, but still ‘appropriate’ level of, daily caloric intake for “poor” people on social assistance.

    This was a throwback to the Nazis notion of what was ‘appropriate’ caloric intake for the inmates of concentration camps, that would allow them not to die immediately, before work could be gotten out of them. After all, concentration camps, such as Aushwitz, were not just places to keep ‘undesirable’ people, they were also places where corporations, such as Volkswagen, had their factories, building profit upon such slave labour.

    A discussion of the totality in Nazis Germany was not permitted.

    Such a discussion is, of course, welcomed here in the PEF.

  • I tend to agree with you Denise and by extension Armine. Poverty is by its nature a relative concept and insofar as inequality is relative concept too it strikes me that the two conversations are pretty similar. Take the conversation on inequality. It too is plagued by the question as to what is an acceptable level of inequality. So I am not sure changing the topic is necessarily going to precipitate a game changer.

  • I suspect you stopped reading after the first paragraph. The article presents some of the failings of LICO and does inform the discussion about poverty measures. What I take away from the article is that we need to find a broadly acceptable measure of poverty upon which to build good policy.

  • Denise Freedman

    Inequality may well be relative, Travis, but the discussion around it, unlike poverty, doesn’t exclude those who aren’t “poor.”

    If we’re talking about society, ALL of society, as I certainly am, the discussion of inequality will get us there much more quickly than any discussion of “poverty.”

    Talking about “poverty” would seem to leave out CEO bonuses, bailouts, and corporate income taxes, among other things, putting into their place the ‘moral’ ‘failures’ of “poor people.”

  • I don’t think I agree. Discussion of poverty can be manipulated in that way, of course. But discussion of almost any aspect of how people are doing in an economy can be warped to blame anyone who isn’t doing as well as the rich. Take unemployment–people always blame the unemployed for laziness and moral failings, pretty much any time the subject comes up. Should we then respond by turning tail and being afraid to discuss unemployment? Certainly not. Unemployment is very important. So is poverty. I don’t think it’s reasonable to ignore the poor just because right-wingers have reasonably effective bogus frames for the topic. Right-wingers have reasonably effective bogus frames for everything; our job is to find more effective truthful frames.

    It shouldn’t be that hard. After all, these victim-blaming arguments become particularly obviously drivel when you’re looking at fairly rapid changes in the level of poverty, unemployment and so forth. I mean, what are such people saying–that today’s generation of workers is far lazier and has much less moral fibre than the generation that was working last year or two years ago? The Great Recession was caused by a sudden, massive corruption of the work force’s morals? It was all about masses of people suddenly deciding they were sick of being responsible members of society with incomes, going in to their bosses and saying “I realized I want to be homeless. My work ethic just ran out, I guess.” Shyeah, that sounds plausible. So really, it doesn’t take a lot of work to make this nonsense sound as silly as it actually is.

    The point of getting statistics about poverty over time surely is to look at how it changes. The mere fact that what you’re looking at is *changes* in poverty undermines the position that not much can be done–if it changes over time for various reasons, clearly it is not just eternally static, and presumably can be made to change over time using policy.

    As to CEO bonuses and so on, surely one of the major claims of the left is that the masses of money going to the rich are so huge that they are a major driver of poverty, in that that money is literally being taken away from the poor in a mostly zero-sum game. The real force of objections to the massive accumulation of income and property by the wealthy is precisely that there is less for everyone else; how then does a discussion of poverty leave this stuff out?

  • Denise Freedman

    I know you weren’t referring to me when you suggested people were “turning tail and being afraid to discuss unemployment” and/or “poverty.”

    No one is suggesting such a thing.

    On the contrary, I, for one, AM suggesting that the way to address “poverty” and “unemployment” is to address the totality, the entire society, which has now become indistinguishable from the political economy.

  • There is a focal point that one can merge the inequality issue and poverty and that is the decline of the middle.

    It is both a question of stock and flow. We make not that the middle is declining, but we also make not of poverty increasing.

    The flow from the middle increases towards the poverty end of the scale. We also can focus on the flow from poverty into the middle and what has been done to prevent this- public service cuts, education and training cuts, day care cuts, etc. Amount of mock chicken versus fresh chicken breast sandwiches consumed annually by a family- when you have eaten enough mock chicken, you will know that poverty and inequality are very similar- it is a matter of stocks and flows and to me it is all wrapped up in the same brown soggy lunch bag.

  • Denise Freedman

    I appreciate your effort to merge discussions of “poverty” and inequality, Paul.

    However, I suggest your discussion of “stock and flow” is incomplete without including the upper classes, particularly the upper upper classes, with their amassing not only of incomes but also wealth in the last decade or two, certainly since the end of the, so-called, post WWII “social consensus.”

    And the evolution of a certain arrogant, public, political economic attitude; I think of Kevin O’Leary.

    Even the discussion your propose still seems to focus less on cause than on effects; I would simply repeat the point that the reason for “poverty” and for the “declining middle” is the increase of the wealthy.

    Is this still problematic?

    I see no intrinsic inutility in empirical quantitative measures, and mathematical modelling, of “poverty” and the “declining middle,” but remain unconvinced of the use of such measures when the ontological decision has been made not to include their historical relationships with the cancerous growth of wealth in the top .5% or even .05%.

    Is such a mathematical model beyond the power of econometrics? And even if it weren’t, would it do anything more than put the political economy it describes into a deep ontological freeze? Reifiying it?

    If we are still at the stage where we need to “prove” “poverty” and the “declining middle”–BTW to WHO and to what level of PROOF, and what will THEY consider ADEQUATE proof–when will we ever get out of the PROOF stage and into the CHANGE stage?

    Can we even imagine what the CHANGE stage might actually look like? Other than more of the same?

    Is description a substitution for change?

  • Thanks all for the comments. Just to clarify, my post was not about justifying the LICO, and I did not want to get into the arguments about how poverty can and should be defined (relative, absolute, etc.) as we have had that debate before on this blog.

    My point was just to dig at Statscan and BC Stats people who produce LICOs and LIMs (HRSDC actually does the MBM), then go and say they are not poverty measures, but without defining a poverty measure themselves. It is an annoying argument. I agree that it would be better if the agency just picked one (or two or three) measures of poverty and produced the results.

    But since we are on the topic, it was Adam Smith that first proposed that poverty is relative to the society you live in.

  • Thanks for the comment Denise,

    I think my main point is exactly what you are getting at. What is it in this last 30 years that have created these divergences in patterns of income and what is coming ahead of us now that Harper has traded in his backhoe minority for a bulldozer majority.

    What actions have influenced these flows. For example the fight for public service retention a huge upcoming battle is rarely framed within the media as a weighted net benefit heavily in favour for those in the middle and lower ends of the income range.

    Attacks on education and training, the traditional ladder for social mobility.

    In a Porter like way though- I do agree with you very much, that the upper end in Canada has rarely been a cultural focal point when it comes to flows. Look at the recent cheer leading in Canada’s media on the weekend- trumping up this huge inflow of millionaires, and hailing it as some kind of social victory! That was depressingly succinct as to the arrogance of the media.

    One thought that does give me nightmares though- what happens if the the gains workers made post WW2 during the keynsian expansion were but episodic. What if the middle class dream and the increased flows to the middle during that 30 year period (as unequal as it was especially in terms of race and gender) but a fleeting retrenchment of the power inherent to historical asymmetrical concrete of wealth in our “democratic” flight to social organization.

    I do think it is the nightmare that must become a more real focal point when we think about flows and stocks and actions.

    Reframing the middle class dream has got to be the goal- there is no route left to that dream- especially with the direction we have taken under financial capitalism. And it is not a difficult reframing we saved the banks and financiers from miser and we are now embedding that misery to rot out pillage the middle and even worse we will rape and kill the poor.

    Just look at the food price variation and the fallout on the least able to withstand such variations since the great recession.

  • Denise Freedman

    I share your nightmare, Paul.

    But I have a more fundamental nightmare.

    As I write this comment, Al Apps, the president of the Liberal Part of Canada, is on CPAC talking about how his party is “pro-market” and still relevant.

    The nightmare I have comes during discussions about how to challenge the disfunction of society–a concern we share.

    It concerns me that the discussion in these comments, which I have tried to widen from the, forgive me, Marc, narrow technical points of which is the better quantitative measure, is reluctant to take as its focal point a vision of something different–as if the market is all there is.

    I don’t accept TINA.

    Technocratic tinkering, which is more than implied with quantitative measures, with the very creation of man–yes, the market is not given by god or nature (though economics usually gives that impression) but is a creation of power, maintained by power–will not accomplish the goals of equality, joy, and a truly productive dialogue with nature.

    I am often silent–so long it seems that I ended up on moderation :)–because there often is no ‘in’ to widen the conversation.

    My fervent hope is that heterodox economics won’t also become trapped in the amber of ontological freeze that orthodox economics has–with not only the dire circumstances we have cataloged above, but with the spirit-sapping “conclusion” that the only way forward is not to change, but “to stay the course.”

  • For Denise Freedman:
    If you haven’t seen it, Armine Y. authored an interesting CCPA piece on the share of income of the richest 1%, 0.1% and 0.01% in Canada over the last 90 years.
    It’s at: http://www.policyalternatives.ca/publications/reports/rise-canadas-richest-1.

    Quebec has countered that to some extent. My family was definitely a beneficiary of its policies when my children were young. I still shake my head in disbelief at the family unfriendly policies in the other provinces. (see http://www.progressive-economics.ca/2011/06/18/still-progressive-and-family-friendly-evaluating-quebec%E2%80%99s-income-tax-policy/).

  • The strange thing here is, I agree completely with what you do want to do, but I really don’t understand what your problem is either with the post we’re all responding to or with the notion of talking about poverty.

    Or rather, it seems as if you do want to talk about poverty, you just want to talk about the rich skimming the wealth out of society as a major causal factor. But I don’t see where anyone disputed that. And while I agree that it’s good to make general claims about the whole political economy and how it fits together, not every post or article can be about everything all at once. In order to make serious claims about the way wealth and poverty and various other conditions fit together, it is advisable to know something about each of those individual things.

    My beliefs are also rather more radical than those of some of the economists blogging on this site. So I do think sometimes that the discussion stays within narrower bounds than I might want. Indeed, what gives Paul nightmares is something that I’ve come to consider a basic truth–as long as capitalism remains, most of the time for most of the people it is going to be drastically unequal an nightmarish. The implication is that some kind of social/political transformation away from capitalism is badly needed.

    But that doesn’t necessarily mean there’s much point in going after these economists. It seems to me like we’re an operating team and we’ve got the patient on the table suffering from big time heart failure. The surgeon is talking about how to do bypass operations, and he knows quite a bit about them. You’re criticizing him on the basis that the patient is obese and basically needs a much better diet, more exercise, and ideally to live in a health-promoting walkable urban space rather than an unhealthy commuter suburb-with-malls. This is all true, and maybe even stuff the surgeon doesn’t understand. But sheesh, hopefully we can all pull together long enough to get the patient off the freaking operating table. There’s nothing wrong with adding some discussion of the broader problems that lead to heart attacks, but the discussion of operations isn’t actually wrong under the circumstances either so there’s no reason to phrase your addition as criticism. We all at least want the patient to survive, unlike the rich guys who want to sell him for parts.

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