Millions of children at risk if government changes poverty measurePoverty & Family Economics
Millions of children could lose access to healthcare, nutritious food, early childhood education, heating assistance and other critical resources if the government enacts new poverty calculations being explored by the Trump Administration.
The Office of Management and Budget issued a request for comment on May 7 on a proposal to adjust the Official Poverty Measure (OPM) calculated by the U.S. Census Bureau that could underestimate the number of children and families living in poverty.
The proposal seeks to change the rate of inflation used to calculate the poverty threshold each year. Accurately indexing the poverty threshold to inflation is critical to ensuring that it fully accounts for rising prices that weaken the power of the dollar. A switch from the current indicator to one that underestimates the rate of inflation could result in an artificially low estimate of the number of children and families who fall below the official poverty line.
Because a family’s eligibility for several critical assistance programs depends on their income in relationship to the poverty threshold as determined by OPM, such a change could cause millions to lose access to those important programs that depend on Department of Health and Human Services guidelines to determine eligibility, including but not limited to:
- Parts of Medicaid
- Children’s Health Insurance Program
- Head Start
- Supplemental Nutrition Assistance Program (SNAP)
- Special Supplemental Nutrition Program for Women, Infants, and Children (WIC)
- National School Lunch and Breakfast Programs
- Low Income Home Energy Assistance Program (LIHEAP)
- Legal Services for the Poor through the Legal Services Corporation
(Note that Supplemental Security Income, the Earned Income Tax Credit/Child Tax Credit and housing assistance are not included.)
A recent study from the National Academy of Sciences confirms what we know to be true: child poverty remains high in the U.S. and there is a direct causal link between poverty and negative outcomes for children’s healthy development. The current poverty level is already unrealistically low, standing at just $24,858 a year for a family of four with two children. The measure is based on an outdated calculation of a family’s expenses, since expenses such as housing and child care are often the biggest costs for households and they are not considered in the OPM formula.
According to the Basic Needs Budget Calculator created by the National Center for Children in Poverty, a family of four (two parents and two children) living in Washington, D.C. needs an annual income of $72,297 a year to meet basic needs such as rent and utilities, food, child care, health insurance premiums, out-of-pocket medical costs, transportation costs and more.
While the majority of poor and low-income households with children have at least one parent who is working, low wages combined with skyrocketing rents and the high costs of everyday goods mean parents still struggle to make ends meet. Furthermore, past data has suggested that families in poverty actually experience inflation at higher rates than families with higher socioeconomic status, due to the constraints they face in substituting lower priced goods.
Many households with children living at or near the poverty line already face barriers to accessing assistance programs and often the level of assistance is too low to lift them out of poverty. Most families run out of SNAP benefits before the end of the month. Any adjustments to the OPM should seek to correct, rather than exacerbate, the existing formula’s deficiencies so that families in need can actually access critical supports.
The Trump administration is apparently exploring several alternative inflation measures by which to adjust the OPM. However, the administration’s regulatory track record is one of seeking technical changes that would reduce the ability of low-income and immigrant families to access important supports like SNAP and Medicaid. Similarly, the President’s FY2020 Budget proposal includes policy changes that would undermine children’s participation in various assistance programs.
Children’s advocates are therefore very concerned that the administration’s interest in altering the OPM reflects a desire to use a lower measure of inflation to decrease the poverty threshold and subsequently reduce eligibility for programs that support children’s health, nutrition, educational achievement and more. Children disproportionately experience poverty in the U.S., with poverty rates that are 62 percent higher than adults. They make up a large percentage of the participants in programs such as Medicaid and SNAP and therefore stand to be the biggest losers if this change is enacted.
Comments on this proposal are due on Friday, June 21st and can be made here. We encourage you to submit comments highlighting the way that restricted eligibility to critical programs would harm the children and families you serve.
For additional ways to take action in reducing child poverty, we urge you to join the End Child Poverty US campaign at https://www.endchildpovertyus.org/join-us.