A recent United Nations report blasting President Trump and America in general for harboring “contempt” and “hatred for the poor” is based on highly inaccurate data that can’t easily be used to compare the U.S. to other nations.
The U.N. report’s main contentions read like an attack on the Trump administration by the Democratic Party: America has 40 million poor people, including 18.5 million who live in extreme poverty; U.S. policies regarding the poor are “cruel and inhuman;” the Trump tax cuts aren’t working and will worsen inequality; and the U.S. needs to spend less on defense of our nation and more on social programs.
But, wait a minute: the U.N. report’s main contentions are based on the U.S. Census Bureau’s official poverty measure data for 2016 – the last full year of President Obama’s second term. So it would be absurd to say that private citizen Donald Trump had any responsibility for the many shortcomings of the Obama administration or any other administration in power before he became president.
The U.N. might as well blame Trump for causing the Great Depression – before he was born.
An even bigger problem with the report, especially given that the organization attacking American policy is the U.N., is that the Census Bureau data for 2016 isn’t accurate and can’t be used to compare U.S. anti-poverty programs with programs in other developed nations.
The Census Bureau makes its annual estimates of Americans’ well-being by sending out thousands of surveys. Many households don’t respond to these random surveys. Of the people who do respond, those who receive federal, state or local government welfare assistance significantly underreport what they receive.
This isn’t necessarily fraud, because the random surveys don’t determine eligibility for government assistance. Rather, it simply shows that when struggling families receive the survey asking what they earned in the prior year and what welfare payments they received, they often simply don’t know.
The problem of inaccurate census survey responses has been known for years and has been studied by both government officials and academics.
A recent study by Bruce D. Meyer and Nikolas Mittag found a huge mismatch between census data and government money spent on behalf of poor people involving four programs in New York: food stamps (the Supplemental Nutrition Assistance Program, known as SNAP), Temporary Assistance for Needy Families (TANF), general assistance and housing assistance.
The study found that census surveys “missed over one-third of housing assistance that recipients received, 40 percent of food-stamp assistance, and 60 percent of TANF and General Assistance aid to recipients.”
That’s an enormous level of errors – making the survey results practically worthless.
Extrapolated only to the $63.7 billion received by 42.2 million Americans in 2017 for food assistance, the huge inaccuracy rate of the surveys means more than $25 billion in federal food assistance was missed by the U.N. in its critical report.
Separately, census researchers found that a full 50 percent of households receiving SNAP food assistance didn’t report it on their surveys. The Census Bureau also found that “there may still be significant underreporting of overall housing assistance benefits.” The amount of housing aid missed by census surveys was estimated at almost $3,000 per year per household.
The bottom line is that the wildly inaccurate census statistics that are the basis for the U.N.’s condemnatory report on U.S. poverty programs completely discredit the report. Instead of some 18.5 million Americans living in “extreme poverty” – as the U.N. report inaccurately claims – the real number is less than half of that.
Turning to another accusation leveled by the U.N., the report claims that the tax cuts signed into law by President Trump after they were approved by Republicans in Congress will deepen inequality and worsen the plight of the poor.
But we have already seen that massive underreporting of government assistance by the poor leads to an overstating of poverty numbers. The same problem also results in heightening apparent inequality.
Further, contrary to economists such as France’s Thomas Piketty, the main driver of growing inequality of wealth isn’t the wealthy getting paid more at the expense of the poor. Rather, it’s the massive increase in home equity, mostly owned by the middle class, artificially driven up by government restrictions that slow new home construction. This is a big reason why California has the nation’s highest supplemental poverty rate.
In addition, there is an honest disagreement in America over the best approach to reducing poverty.
Democrats contend we need higher marginal tax rates on individuals and businesses to fund a larger welfare state. Taking more from the wealthy to distribute to the poor will ease income inequality, they argue.
In contrast, President Trump and Republicans stress the importance of strengthening our economy and creating good jobs for American workers. They understand a paycheck is always better than a welfare check to help Americans work their way out of poverty, reinforce dignity and strengthen families.
Fortunately for all of us, the Trump administration and congressional Republicans are succeeding in creating more jobs to bring prosperity to millions more Americans.
As The New York Times – hardly a cheerleader for President Trump – reported at the beginning of this month regarding May unemployment statistics: “The American economy roared into overdrive last month, the Labor Department reported Friday, extending the longest streak of job growth on record and echoing other recent signs of strength. The unemployment rate fell to 3.8 percent, its lowest level since the heady days of the dot-com boom in early 2000.”
African-American and Hispanic unemployment is now at record lows. Hundreds of thousands of Americans, many of whom lost hope and were dependent on government assistance, are now working and seeing that it might be possible to live a life of independence.
Don’t hold your breath for the U.N. follow-up report containing this good news. But if even The New York Times says the economy is doing well under President Trump, you know he must be doing something right.