Tag: War on Poverty

MLLG

Victory in the War Against Poverty

George Noga

Victory in the War Against Poverty

There is no poverty per se in America

GEORGE NOGA
FEB 18, 2024

According to official US Census Bureau statistics compiled in 2023 (based on 2022 data), the poverty rate¹ is 12.4% resulting in 38 million Americans in poverty. This means the US has one of the highest poverty rates and child poverty rates of any developed country, with more people living in poverty than Indonesia and a higher poverty rate than Europe. This simply doesn’t pass the smell test.

man in black jacket and black pants sitting on white snow covered ground during daytime

As demonstrated herein, there is virtually no poverty in America. The true poverty rate is between 2.5% and 3.5% and consists almost entirely of people with severe cognitive challenges. The real problem is not poverty per se, but social dysfunction resulting from low IQ which then leads to poverty – more about this infra.

Following are some of the most egregious flaws in the official measure of poverty.

  • Excludes income from 88 government programs for low-income Americans
  • Fails to include refundable tax credits including the EITC
  • Debit cards loaded with food stamp benefits not counted as income
  • Based on spending² rather than income, only 2.5% are below the poverty line
  • No income from the underground (cash) economy is included
  • 42% of poor households own homes with an average of 3 bedrooms, 1.5 bathrooms, a garage and a patio or deck; 80% have air conditioning³
  • Poverty is defined in relative terms; it rises along with median income
  • 70% of the those below the poverty line report they suffer no material hardships and can meet all their essential needs for food, shelter, clothing and health care

The True Poverty Rate

As reported supra, when based on spending, the poverty rate falls to 2.5%. A BLS⁴ study based on spending (excluding only taxes) found that the poorest quintile of Americans spends only about $1,200 per year less than the second lowest quintile and only $3,000 less than the middle quintile. The richest quintile spends only double that of the poorest quintile. How’s that for equality?

Based on a 2022 population of 320 million, 2.5% is equal to 8.0 million people in poverty, while 3.5% equals 11.2 million people. The Census Bureau reports 38 million in poverty, but when we exclude the 70% who self report no hardship, we get 11.4 million or 3.6% below the poverty threshold. In yet another independent confirmation, a recent Wall Street Journal article pegged the true poverty rate at 2.5%.⁵ Based on all the prior data, the true US poverty rate is between 2.5% and 3.5%. It would approach zero percent if those with the most severe cognitive challenges were excluded.

No Poverty Per Se in America

In any normal population distribution, 2.5% have an IQ of 70 or below, i.e. they struggle to fill out a simple form. Not uncoincidentally, these are the very same people who fall below the poverty line, as low cognitive ability is associated with a myriad of social pathologies. If you looked at a Venn diagram, the two circles (those in poverty and those with low “G”, or general intelligence) would nearly completely overlap. These people deserve our compassion and assistance. We do not help them with political correctness and by ignoring the true cause of their predicament.

The conclusion is straightforward. The number of Americans in poverty is nearly precisely equal to the number with extremely low ”G”. They are one and the same. Therefore, poverty per se in America is incredibly rare and borders on non-existent. America can declare victory in its 60-year war against poverty.

The war on poverty is being waged against the wrong enemy. Public policy solutions must be redirected at the pathologies associated with low “G” and away from providing economic benefits. We need to tailor solutions focused on low ability and untreated mental illness. Poverty is a sociological, not an economic, problem.

Is America More Poverty Stricken Than Haiti?

Relative poverty is a metric used by international organizations to measure poverty; it defines poverty as less than 50% of median income. According to this convoluted statistic, a country that is uniformly and utterly destitute has less poverty than America. Where everyone is dirt poor, no one is relatively poor. According to relative poverty calculations, a much higher percentage of Americans are poor than in Haiti, Chad, Congo and Cuba. I can’t make this stuff up.

  1. The Census Bureau reports two different measures of poverty. The official measure, in existence since the 1960s, is 11.5%, and the supplemental measure first published in 2011 is 12.4%.
  2. The Census Bureau reports those in poverty spend two dollars for every dollar of reported income.
  3. This is larger than the average home of middle income families in France, Germany and the UK.
  4. Taken from a study by the BLS, or the Bureau of Labor Statistics.
  5. Wall Street Journal op-ed by John Early, former Assistant Commissioner of the BLS and Phil Gramm, former Chairman of the Senate Banking Committee.

© 2024 George Noga
More Liberty – Less Government, Post Office Box 916381
Longwood, FL 32791-6381, Email: mllg@cfl.rr.com

MLLG State of the Union Address

George Noga

Biden’s SOTU address is this Tuesday. Following is MLLG’s SOTU speech.

MLLG State of the Union Address

By: George Noga – February 21, 2021

My fellow Americans:

I begin with first principles. Governments are instituted among men to protect their rights, which include life, liberty and pursuit of happiness. This is its only legitimate purpose. Experience shows legally sanctioned force, i.e. government is necessary to secure our rights and to protect us from foreign and domestic violence. Government is a dangerous, albeit necessary, force but is preferable to the alternative, i.e. anarchy.

All human history demonstrates that free people, free trade and free markets result in the greatest prosperity for everyone. Civil society and markets are 100% voluntary and non-coercive. No corporation, no matter how powerful, can compel you to buy its product. A consumer armed with a free choice is the most powerful force on earth.

In contrast, government is inherently coercive; it is not about reason, persuasion or logic. It is about brute force. If you run afoul of a government diktat, ultimately men with guns will come and take away your property, liberty or even your life. Because government is such a powerful and malevolent force, it must be limited, controlled, confined to its constitutional box and used only when absolutely necessary.

Ours is a government of laws and not men. Who holds executive, legislative, or judicial offices should be of little import to citizens, provided they remain inside the constitutional box. We must gradually shrink a severely bloated government back to its core responsibilities; this means we scale the government back to 15% of GDP, a level which empirically has been shown to maximize the well-being of all Americans.

The few legitimate functions of government should be vigorously carried out. Of these, none is more important than protection from foreign threats to our liberty; hence, we must make our military so strong no adversary would even contemplate challenging us. This means that we will spend whatever is required to defend our liberty.

We must begin to restore our constitutional republic back to first principles. Following are some of the other main goals and policies we will pursue in the time ahead.

– Free Trade: Prosperity is created by trade among people. The USA unilaterally will eliminate all tariffs and trade barriers – even if no other countries reciprocate.

– Sound Money: The Federal Reserve will have only one mission: sound money. It will be audited regularly and will take a hard look at returning to a gold standard.

– Taxation: As we scale government back to 15%, taxes can be reduced. All present taxes (income, payroll, etc.) will be repealed and replaced by a consumption tax.

– War on Drugs: The war is over; drugs won. Drugs will be legal, taxed, regulated and discouraged. Taxes from drugs will be spent on rehabilitation, not incarceration.

– Education: We will implement universal school choice and thereby solve the greatest civil rights issue of our time. Great God almighty – free at last!

– Regulation: All regulations automatically sunset after 10 years. Any regulations promulgated by bureaucrats and having an economic impact of more than $25 million must be approved by a vote of Congress before they become effective.

– Climate Change: Open scientific debate is encouraged. All climate spending will be subject to strict cost/benefit analysis. More funds will be allocated to mitigation.

– Entitlements: Social Security will be voluntarily privatized. All entitlements will be placed on the budget. Medicare will be converted to a premium support system.

– War on Poverty: This war also is over; this time we won. Americans living in poverty (by their own account) are down to 2-3% and consist nearly entirely of those with very low mental acuity, untreated mental illness and drug addiction. We will not abandon these people but will structure solutions better tailored to their problems.

There is more – much more. But the policy initiatives outlined above should provide a good idea of the direction we are leading America. Thank you very much. Good night and may God bless you, your family and these United States of America.

Next up on February 28th: Real doctors versus witch doctors.
More Liberty Less Government – mllg@cfl.rr.com – www.mllg.us

Victory in the War on Poverty!

George Noga
The War on Poverty is over. America won – poverty, hunger and homelessness lost.
Victory in the War on Poverty!
By: George Noga – September 30, 2018

          We have written for years that poverty per se barely existed in America; now,  it’s time to declare victory in the War on Poverty! The White House Council of Economic Advisers recently issued a report which included the following: “Based on historical standards of material well-being . . . our War on Poverty is largely over and a success.” Predictably, progressives and poverty pimps won’t accept victory; they continue to rant that anti-poverty programs are insufficient and must be expanded.

          Please note we use the term “per se“. There are about 8 million Americans, or 2.5%, living in material poverty. The normal distribution of human IQ dictates 2.5% will have IQ below 70, which is de facto retardation. That means there are 8 million Americans in that category – the same number as in material poverty. It should be incandescently obvious that those two cohorts are one and the same; a Venn diagram would show the two circles nearly 100% overlapping. This is the basis of our statement that there is no poverty per se, because the real problem is retardation, not poverty.

          In addition to poverty, low cognitive ability accounts for hunger, homelessness and a host of other social pathologies. Venn diagrams for these also would mostly overlap with low IQ. As with poverty, hunger per se has been eliminated. Nearly 40% of Americans are obese and food insecurity has replaced hunger in the liberal lexicon. We have reversed the centuries old paradigm; today, the wealthy are thin and the poor fat. Homelessness also is extinct, apart from low IQ and untreated mental illness.

        By far, the biggest flaw with usual measures of poverty is that they are based entirely on reported income. When we look at spending instead of income, the picture changes dramatically. The poorest quintile of Americans spend $2 for each $1 of reported income. Official measures of income fail to take into account benefits such as SNAP, EITC, public housing, Medicaid and many others. They ignore the underground (cash) economy estimated at $3 trillion and concentrated among low income groups. They also fail to account for quality changes and shifts to uber low-cost stores.

       Today, the bottom quintile of Americans live as the middle class did a generation ago – as measured by size of homes, number of rooms per person, air conditioning and  other amenities. The top income quintile spend only about twice as much per person as the bottom quintile, showing low inequality. The poorest 10% of Americans live equal to or better than most Europeans. If Sweden, touted by many as a socialist paradigm, were a US state, its per capita GDP would be similar to Mississippi, our poorest state.

         No discussion of poverty is complete without noting relative poverty, defined as less than 50% of a nation’s median income. By this stilted metric, the US has more people in poverty than many third world countries. A country uniformly and utterly destitute has less relative poverty than America because in places where everyone is dirt poor (Haiti, Congo, Guinea), no one is relatively poor. When you see news stories asserting high poverty rates in America, they invariably are based on relative poverty.

         America has extinguished poverty, hunger and homelessness per se. Nonetheless, there are 8 million still living in material poverty – many of whom also are hungry and homeless. These people deserve our compassion and assistance. We do not help them by being politically correct and ignoring the true cause of their predicament. Instead, we need to tailor solutions to deal with low ability and untreated mental illness.

         We also should recognize our victory over poverty. This truly is a great American accomplishment and worthy of being honored and celebrated throughout the land.

Next: The definitive account of socialism in the Nordic countries.
MLLG

MLLG State of the Union Address

George Noga
By: George Noga – October 1, 2014
      My fellow Americans: I begin with first principles. Governments are instituted among men to protect their rights which include life, liberty, property and the pursuit of happiness. Indeed, this is the only legitimate purpose for government. Experience has shown that legally sanctioned force, i.e. government is necessary to secure our rights including defense against foreign threats, protection from domestic violence and enforcement of contracts. Government therefore is a necessary, albeit evil, force that must be tightly controlled and used only for the carefully circumscribed purposes noted supra and then only to the absolute minimum extent necessary.
      All of human experience demonstrates free people, free trade and free markets result in the greatest prosperity for all. Government is inherently coercive; it is not about logic, reason or persuasion; it is about brute force including the threat of force. In contrast, civil society is always voluntary and cooperative. No company, no matter how big or powerful, can compel you to buy its product or service. A consumer armed with a free choice is the most powerful force on earth.

     The principles identified supra lead to twelve major initiatives I now announce. There is much more to be done; however, this is where we must begin to restore our Constitutional Republic.

  1. The Constitutional Box: We are a government of laws and not men. The identity of those who hold executive, legislative or judicial offices should be of little consequence to citizens provided they act within the confines of the Constitution, i.e. stay inside the Constitutional box. This means shrinking government to its core responsibility of securing our rights and, to a very limited extent, providing infrastructure. Accordingly, we will scale the federal government back to 15% of GDP, a level which empirically is demonstrated to result in the maximum rate of economic growth and hence the maximum well-being for all our citizens.
  2. Free Trade: Wealth and prosperity are created by trade among peoples. Traders take substantial risks and can accrue riches; however, their wealth ultimately depends on improving the lives of their customers. If they fail to make you better off, they do not prosper. Free and unfettered trade is universally good – always and everywhere. For that reason I announce the United States unilaterally will eliminate all tariffs and trade barriers – even if other countries do not reciprocate. We will be better off for that action and those who do not follow will be worse off.
  3. Sound Money: The Federal Reserve will have one mission only: to maintain sound money. This means purchasing power will be maintained, inflation eliminated, and increases in the money supply subject to strict constraints. The Fed will be audited regularly and we will take a hard look at reestablishing a gold standard.
  4. Taxation: As we scale government back to 15% of GDP, taxes can be slashed. I am asking for repeal of the 16th amendment to eliminate the income tax. We also will eliminate the death tax and Social Security/Medicare payroll taxes. These will be replaced by  a consumption tax at the lowest rate possible – likely in a single digit. The 60% of Americans who currently pay no income tax (net of credits) will begin to enjoy the dignity that comes with being a taxpayer. Moreover, they will have a personal stake in controlling spending and holding taxes to the absolute minimum. The crisis of spending, debt and deficits will end instantaneously.
  5. Defense and Foreign Affairs: We will follow the admonition of President John Quincy Adams that “America is a friend of freedom everywhere, but a custodian only of our own.” Simultaneously, we will observe George Washington’s advice  that “The best way to keep the peace is to be prepared for war.” We will strengthen and then consistently maintain the military for the long term at such a high level as to deter any possibly adversary.
  6. War on Drugs: The war on drugs is over. As we learned with prohibition, the drug war is unwinnable and never should have been fought. Henceforth, all drugs will be legal but regulated, taxed and discouraged just as with tobacco. Drug taxes collected will go solely for rehabilitation of those who continue to abuse them. We immediately will realize benefits including: (a) releasing non-violent drug offenders; (b) ending drug related crime; (c) putting drug cartels out of business; (d) reducing police corruption; (e) refocusing our foreign policy; (f) ensuring safety of drugs; and (g) eliminating drug dealers as role models.
  7. Regulation: All regulations will automatically sunset ratably every 10 years. Congress must enact any that need to be replaced. Any regulations promulgated by bureaucrats that have an economic impact of over $25 million must be voted on and approved by Congress before taking effect.
  8. Role of Juries: Henceforth, defendants (and their attorneys) will have the right to explain to juries that juries are sovereign and, as intended by our nation’s founders, have the final say about the legality and enforcement of all laws. The grand jury system will be reformed to stop prosecutorial abuse and to allow citizen grand juries.
  9. War on Poverty: The war on poverty is finished. The percentage of Americans who, by their own reports, lack a healthy level of food, shelter, clothing or medical care is 2%-3%. This cohort is identical to the 2% to 3% of Americans with very low mental acuity, i.e. those who struggle to fill out a simple form. We will therefore refocus our attention and also our solutions to better deal with the real problem. Even though the percentage in poverty is low, it still equates to 7-8 million of our countrymen to whom we pledge a strong safety net.
  10. Entitlements: Obamacare is to be repealed and replaced with free market solutions. Entitlements  will be placed on budget. Social Security gradually and voluntarily will be privatized. In the interim, benefits will be maintained by changing indexing and lengthening eligibility ages. Medicare benefits will be maintained by gradually lengthening eligibility ages and changing to a premium support model; also, medical costs will moderate given real prices.  Medicaid will be block granted to the states to administer as they see fit without interference.
  11. Energy/Climate: The Keystone Pipeline will be built and natural gas exported. We will drill and frack in ANWR, offshore and on federal lands – all ASAP. Our national delusion about manmade global warming  is over. Warming is a solar phenomenon to which man’s contribution is minimal. We will continue to develop alternative fuels for the future while eliminating subsidies for wind, solar and biofuels. The EPA’s mission will be refocused.
  12. Education: School choice is the civil rights issue of our time. We will move with all deliberate speed to universal school vouchers. We will bring education into the 21st century with technology and by furthering alternatives such as online and home schooling and by creating entirely new paradigms.
          Thank you and may God bless the United States of America.