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The only concrete proposal President Obama mentioned in his fifth State of the Union address on Tuesday was an increase in the federal minimum wage from $7.25 to $9.00 an hour. Unfortunately, this solution is counterproductive and does little to address the problem of poverty.

While this simple-sounding plan is appealing, it simply won’t work, Heritage Foundation expert James Sherk explains:

Labor economists have repeatedly studied the effects of minimum wage increases. They find no correlation between higher minimum wages and lower poverty. Raising the minimum wage to $9 an hour as the President suggests simply would not reduce poverty.

Here are four reasons increasing the minimum wage won’t resolve poverty: Continue Reading »

The latest poverty numbers fail to take into account the government transfer payments made to low-income families, Heritage Foundation welfare expert Robert Rector said Friday on Fox Business.

These payments, which average $9,000 per recipient, aren’t included in the Census Bureau’s poverty calculations, he told host Stuart Varney.

Watch the video:

Do you think the census should count welfare payments and other subsidies when calculating poverty data?

The pairing of the dramatic rise in births by single mothers and the collapse of marriage in the United States has led to record levels of children living in one-parent households. And new research shows that more children are living in poverty due to the decrease in marriage rates.

Over a third of all single-parent families with children (37 percent) were poor in 2009, according to Heritage Foundation research, but only 6.8 percent of married couples with children were poor. This means that when a child’s father is married to his mother, the probability of the child living in poverty drops by a staggering 82 percent.

Many of the children living in poverty rely on government welfare programs for financial support and help. “We spend billions of dollars a year to educate low-income children, quite appropriately, and billions more for means-tested welfare aid for single mothers,” says Heritage’s welfare expert, Robert Rector.

Government welfare spending fails to address the root of the issue – the decline of marriage. Lawmakers are unaware of or choose to ignore the link between marriage and poverty prevention.

The effects are not isolated to one income group, geographic area or demographic. Rector reports:

In Florida, for example, white families headed by single parents are five times more likely to be poor than those headed by married couples. In Illinois, the poverty rate for a single mother with only a high school diploma is 39.5 percent, compared with 8 percent for a married couple with the same education.

Politicians are ignoring this critical correlation between marriage and poverty. To learn more about childhood poverty and view the research, visit http:/www.heritage.org/childpoverty.

Robert Rector

Widely reported but misleading government statistics about poverty rates have driven a five-decade increase in welfare spending, Heritage Foundation expert Robert Rector writes in the Washington Examiner.

Government data about poverty rates fail to account for massive government programs that gave 100 million Americans an average benefit of $9,000 in 2011. Rector explains:

Continue Reading »

Photo: Flickr/lachicaphoto

Mitt Romney made headlines last week with his comment on CNN that: “I’m not concerned about the very poor.  We have a safety net there.  If it is broke, I’ll fix it.”

Liberals immediately sought to make political hay of the issue.

But as Heritage Foundation welfare expert Robert Rector explains, “the facts about poverty, however, are clear: America’s poor are supported by an enormous and expensive government safety net.”

The federal government operates more than 70 means-tested welfare or anti-poverty programs, among them Temporary Assistance to Needy Families (TANF), the earned income credit, Supplemental Security Income, Food Stamps, the Women Infants and Children (WIC) food program, Medicaid, public housing, low-income energy assistance and the Social Service Block Grant.  These programs provide cash, food, housing, medical care and targeted services to poor and near-poor Americans.

In fiscal year 2011, federal and state government spent $910 billion on these programs.  (This sum does not include Social Security, Medicare or Unemployment Insurance.)  How much is $910 billion?  Well, that comes to around $9,000 for each lower-income American.

Read Rector’s entire report in Human Events.

What's the truth about the Congressional Budget Office's skewed inequality report? Photo: Flickr/hmerinomx

Income inequality will always be present in some way, shape or form, regardless of a country’s economic system. Such inequality is inevitable and as natural in a free-market society as in any other.

But what distinguishes free enterprise from any other system is that inequality is offset by the opportunity to advance oneself through dedication and ingenuity.

Yet a new report from the Congressional Budget Office suggests that many in Washington view inequality as evidence of something sinister.

The Heritage Foundation’s William Beach notes that the CBO’s report clearly implies that differences in income are inherently bad. Its analysis could be used to encourage the government to adopt unfair and immoral measures to equalize incomes. Continue Reading »

Photo: Flickr/Kymberly Janisch

If you examine the Census Bureau’s latest poverty findings, you may be fooled into thinking that the number of poor people in America has climbed to record highs.

In fact, Heritage Foundation experts argue, the bureau’s new measure is misleading, redefining poverty to reflect income inequality–and thereby bolstering the case for a left-wing agenda.

The new poverty measurement does correct some mistakes of the old measurement by including welfare benefits received by low-income families, which the old measurement largely ignored, Heritage’s Robert Rector and Rachel Sheffield argue.

Nonetheless, “inaccurate as the old measure was, the new measure is much worse.” Continue Reading »

Sen. Rand Paul (R-KY) cited research by The Heritage Foundation’s Robert Rector during a Congressional hearing yesterday about poverty in America.

Watch a video of Paul’s remarks:

Be sure to read Rector’s full report, in which he points out that government figures on poverty obscure the reality of poverty. Rector also debunked media spin about yesterday’s poverty numbers on National Review Online.

A new Heritage Foundation report on the reality of poverty in America is receiving quite a bit of attention. Pundits on both the left and the right have taken notice.

But the attention is not limited to politicos and policy wonks.

Stephen Colbert recently devoted a segment on his Comedy Central “news” program, The Colbert Report, to “celebricule” – one website‘s term for celebrating and ridiculing – Heritage’s report.

Though Colbert takes the report out of context and distorts both its evidence and its conclusions to support his humor, in his own odd way he manages to drive home Heritage’s key point. And that point is, as report authors Robert Rector and Rachel Sheffield explain: “Poverty remains an issue of serious social concern, but accurate information about that problem is essential in crafting wise public policy.”

Shrill media reports and lawmaker harangues about poverty typically exaggerate the true extent of deprivation in the United States, according to a new report from The Heritage Foundation.

“Some poor Americans do experience significant hardships, including temporary food shortages or inadequate housing, but these individuals are a minority within the overall poverty population,” explain Heritage’s Robert Rector and Rachel Sheffield.

Heritage’s Mike Brownfield points out some of the report’s unexpected findings:

You’ll be surprised to learn that many of the 30 million Americans defined as “poor” and in need of government assistance aren’t quite what you’d expect—rather than homeless and on the streets, the average poor American household has luxuries like air conditioning, cable TV, and X-box video game consoles.

Rector and Sheffield argue in “What Is Poverty?” that “wise public policy cannot be based on misinformation or misunderstanding.” Instead,

Anti-poverty policy must be based on an accurate assessment of actual living conditions and the causes of deprivation. In the long term, grossly exaggerating the extent and severity of material deprivation in the U.S. will benefit neither the poor, the economy, nor society as a whole.

What do you think is the right solution to poverty? Tell us in the comments.