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Economists long have criticized the official poverty rate as inadequate. Based on a half-century-old government formula, the official rate continues to assume the average family spends one-third of its income on food. Those costs have declined to a much smaller share, more like one-seventh.
In reaction to some of the criticism, the Obama administration in 2010 asked the Census Bureau to develop a new poverty measure, based partly on recommendations made by the National Academy of Sciences. The goal is to help lawmakers better gauge the effectiveness of anti-poverty programs.
For instance, the new measure finds that if it weren’t for Social Security payments, the poverty rate would rise to 54.7 percent for people 65 and older and 24.5 percent for all age groups.
Refundable tax credits such as the earned income tax credit helped lift 9 million people above the poverty line. Without the credits, child poverty would rise from 18 percent to 24.7 percent.
Associated Press writer Mary Clare Jalonick contributed to this report.
Census Bureau: www.census.gov
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