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Poverty and older Americans: A look behind the numbers

New data released by the U.S. Census Bureau contains information that may come as a surprise: Of the age groups surveyed (ages 18 and under, ages 18-64 and individuals age 65 and older), it was the group of Americans age 65 and older who have the lowest rate of poverty at 9.7 percent.

The report, Income, Poverty, and Health Insurance Coverage in the United States: 2008, also finds that, while poverty increased for the younger groups between 2007 and 2008, it remained the same for older adults, and notes that since 1965, Americans older than age 65 have experienced the greatest decline in poverty of the three age groups studied.

This sounds like good news. But don't start cheering yet. There are reasons for the Census Bureau's seemingly rosy picture of poverty among older Americans.

One reason is that most lower-income older Americans rely on Social Security and Supplemental Security Income to make ends meet. In fact, one-fifth of older Americans get all of their income from Social Security. Their incomes have not gone down because these programs were not directly affected by the financial meltdown.

A second reason is that the poverty threshold used by the U.S. Census Bureau to measure poverty among the elderly is based on three times the cost of groceries. Yes, groceries. This gives a whole new meaning to the term "you are what you eat," doesn't it? 

This measure was developed in 1965, when the cost of food represented a substantially higher percentage of a household budget than it does today. It leaves quite a few substantial expenses - housing, health care, and transportation, among many others - completely out of the picture.

Fortunately, steps are being taken to ensure that poverty among all Americans - including older adults - is more accurately measured. Representative Jim McDermott of Washington has introduced the Measuring American Poverty Act of 2009 (H.R. 2909), which according to a press release would "establish a modern poverty measure to reflect a more accurate picture of what it takes to meet basic needs in America today, including food, clothing and shelter." 

In addition, Wider Opportunities for Women has introduced the Elder Economic Security Standard Index, which is a measure of income adequacy for older adults. By benchmarking the cost of basic necessities for elder households, the Index "illustrates how costs of living vary geographically and are based on the characteristics of elder households: household size, homeownership or renter, mode of transportation, and health status."

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