Measuring poverty in Canada


temperance
#1
How can we be sending money to other countries when we are not stable ourselves how and why do we do this ??



OTTAWA -- How do poor families spend so much more money than they earn? By one measure -- the National Council of Welfare -- the average poor Canadian family spends $4,855 a year more than the $14,366 it receives as income, a difference of 33 per cent. By another measure -- the Fraser Institute -- the average poor Canadian family spends $9,370 more than the $9,114 it receives as income, a difference of more than 100 per cent.

And this counterintuitive phenomenon is in no way a strictly Canadian statistical aberration. The U.S. Census's Consumer Expenditure Survey says spending by the poorest U.S. families typically exceeds income by 100 per cent a year, and has done so annually since 1984.
By this official measure, U.S. households earning between $5,000 (U.S.) to $10,000 a year spend an average of $14,500.

The solution to this mystery will help determine the number of poor households in Canada and in the United States. It will help determine whether this number is rising or falling, whether these countries are winning or losing the war on want. Could we not, simply put, eliminate as much as 50 per cent of the official poverty in North America merely by making family expenditures, rather than family income, the principal test of a family's ability to supply its basic needs?

Canada has no "official" poverty line. Statistics Canada calculates an average cost across the country for food, shelter and clothing and calls it low-income cut-off, or LICO, but insists that this number doesn't define poverty. (Oddly, in its reports on poverty, Statscan omits the people who live in the most wretched poverty -- Canada's natives.)
LICO is a relative measure that reflects spending trends, but makes no attempt to determine the dollar cost of the necessities of life.

The Ottawa-based National Council of Welfare is a conventional lobby organization that seeks to increase federal funding to fight poverty. It produces extensive, sophisticated reports based almost exclusively on the incomes of the poor. It rarely makes reference to the spending of the poor.
Using Statscan's LICO as its definition of poverty, it decides expansively who's poor and who isn't. For a family of four, for example, poverty is $33,251 (Canadian) a year or less. By this measure, 16.2 per cent of Canadians (five million people) lived in poverty in 2006 -- an improbable decline of a mere one percentage point in the past 25 years.

By the council's own calculations, though, the average poor household spends 33 per cent more money a year than it receives as income. Whatever the explanation, these "bonus bucks" lift poor families at the top end of "poverty" toward consumption of $38,000, or consumption that approaches the average, real spending of all the households in the entire country. (The average Canadian household earns $63,393 a year but, after all personal taxes, consumes $44,606 in goods and services.)
By these criteria, the average Canadian household lives only $6,606 a year from a poverty-line existence, while still paying, on average, $12,650 in personal taxes. The council itself says that the average "poverty household" pays $585 in personal taxes. The more affluent of the poor households, of course, pay more taxes than average poor households.

In his most recent look at these numbers, Nipissing University economist Chris Sarlo, author of the Fraser Institute's Measuring Poverty, asks whether it is credible to think that federal and provincial governments would burden poverty-stricken households with such onerous tax burdens. Of course, it is not. In any case, the "bonus bucks" provide enough statistical leverage to hoist hundreds of thousands of Canadians out of poverty.

The people most apt to lose poverty status would be the short-term poor. The council says that there are one million such Canadians. And people can, indeed, be short-term poor, though they won't all experience poverty. Using LICO as a definition of poverty, many young people, earning low salaries in their first career-track job, are impoverished. Authentic poverty, on the other hand, often traps people, and families, for entire lifetimes. The welfare council puts the percentage of households that have spent the past six years in poverty at a credible 5.9 per cent. Coincidentally, perhaps, Mr. Sarlo himself puts the percentage of "poverty households" at 6.6 per cent -- down from 40 per cent, he says, in the past 50 years. Use an objective definition of poverty and count consumption rather than income, he says, and the poverty rate falls to 4.2 per cent, or 1.3 million people.

How does Statscan determine the income of the poor? It asks them. How does it determine the spending of the poor? It asks them. What's the source of the "bonus bucks" that the poor spend? Perhaps, in one of its surveys, Statscan should ask them. We can, meantime, only speculate. Off-the-table earnings. Wanton use of credit cards. Gifts from more affluent family members. Academic scholarships. (Many postgraduate students are, by LICO logic, poverty-stricken.) But Canada's basic information on poverty remains dubious.

No one knows whether the poor, in their reports, minimize the money they either earn or otherwise get. It shouldn't be surprising if they do. Everyone else does it all the time

https://secure.globeadvisor.com/serv...05/RREYNOLDS05 (external - login to view)
 
temperance
#2
You know whats worse the people cant figure out how to define poverty and the reports and % 's differ between groups by about 3 times

One says 17% of Canadian children live in poverty then the other says only 6 %


www.canadiansocialresearch.net/poverty.htm (external - login to view)
 
Zzarchov
#3
Quote: Originally Posted by temperanceView Post

You know whats worse the people cant figure out how to define poverty and the reports and % 's differ between groups by about 3 times

One says 17% of Canadian children live in poverty then the other says only 6 %


www.canadiansocialresearch.net/poverty.htm (external - login to view)

I would say even lower. The problem with definitions of poverty is that they were either a.) long since exceeded (such as the original definition from Britain) because we are a wealthy nation or b.) useless because they are based on a percentage of average wealth. In a nation of billionaires a millionaire would be in poverty, even in the rest of the world was a third world hellhole.
 
Curiosity
#4
Governmental systems of measurement for anything of value such as health care, education, or poverty (in children and/or adults/elders), is always skewed to perform for the necessary readership or audience.

There is only one way to measure poverty..... on an individual basis. To see the pure truth, we in our western "democracies" would be alarmed at the third world standard (thank you Zzarchov) we actually expect or ignore in our own people... while proclaiming our charitable giving to others in far off nations.

I am not of a mind that all wealth should be redistributed, however for those who simply cannot earn enough to exist without assistance, there must be an individual plan geared to sustain and eventually raise them up from that level. Until all are able to care for themselves and/or support themselves.

The first charity should be for our neighbors on a local level. This is where the real measuring can take place. Not by government "agencies" to whom people are merely numbers reported by less caring government agencies.
 
marygaspe
#5
Quote: Originally Posted by temperanceView Post

How can we be sending money to other countries when we are not stable ourselves how and why do we do this ??

Not saying you're necessarily wrong, but just wondering why we cannot reach out to help all people regardless of their nationality? And despite our problems, the majority of us are quite well judging from the fact that over half the population is overweight. In short, we aren't starving here!
 
tamarin
#6
I'm more interested in poverty catalysts. Single parent households, high school dropout rates, teenage pregnancy and other key determinants. Poverty doesn't just happen. It's motivated.
 
#juan
#7
Quote:

OTTAWA -- How do poor families spend so much more money than they earn? By one measure -- the National Council of Welfare -- the average poor Canadian family spends $4,855 a year more than the $14,366 it receives as income, a difference of 33 per cent. By another measure -- the Fraser Institute -- the average poor Canadian family spends $9,370 more than the $9,114 it receives as income, a difference of more than 100 per cent.

That whole paragraph is ridiculous. No matter who you are, you can't spend more money than you have period.
Poverty depends on a person's circumstances and on their intelligence. For instance, if the house is paid off, the family of four might well be able to live comfortably on a net income of $17 thousand a year.
Quote:

Using Statscan's LICO as its definition of poverty, it decides expansively who's poor and who isn't. For a family of four, for example, poverty is $33,251 (Canadian) a year or less. By this measure, 16.2 per cent of Canadians (five million people) lived in poverty in 2006 -- an improbable decline of a mere one percentage point in the past 25 years.

Again it depends entirely on the circustances. If that family of four is buying a house in Vancouver, they might be living in something like poverty with a much higher income.

A better way to describe poverty might be to say that this family must have $500 per month for food, $300 per month for utilities, $450 per month for clothing and extras, $300 per month for health care and related expences, and enough for the rent or mortgage whatever it is. If a family doesn't have at least this much income, they could be said to be living in poverty.
 
Curiosity
#8
That is exactly what I was saying is wrong with the statistical measurements.... unless we give in a bit and think of "poverty" as a flexible descriptive.

StatsCan base everything on a family of four do they? Sounds like a lazy way to measure people - and yet governments do it all the time. Even in our own neighborhoods we know there are unique situations for almost every family on our street... their needs, their size, etc.

Does that mean an individual man or woman of elder years living along would be able to live on one-fourth of that amount? The utilies may be a bit lighter but not much as many are flat rate as a family of four and yet they are judged by what a family of four needs divided by four?

It is an individual situation - the ages, number of adults, number of children, residence in an apt., rental or owned dwelling, what part of the country they live in, if any of them have work, or another source of income.

It is an individual thing and should be measured on an individual basis....
 
whicker
#9
Quote: Originally Posted by #juanView Post

That whole paragraph is ridiculous. No matter who you are, you can't spend more money than you have period.
Poverty depends on a person's circumstances and on their intelligence. For instance, if the house is paid off, the family of four might well be able to live comfortably on a net income of $17 thousand a year.

Again it depends entirely on the circustances. If that family of four is buying a house in Vancouver, they might be living in something like poverty with a much higher income.

A better way to describe poverty might be to say that this family must have $500 per month for food, $300 per month for utilities, $450 per month for clothing and extras, $300 per month for health care and related expences, and enough for the rent or mortgage whatever it is. If a family doesn't have at least this much income, they could be said to be living in poverty.

Sorry, your first comment is not correct and I know for certain sure that you can spend more than you make and it is poverty creating because what you are doing is going into debt and more debt, even if only by little amounts each pay cheque.
If a house is paid the cost of keeping the house, not to mention food, gobbles up income regardless of how careful you are with spending -- especially with a family of four and if you have to travel any distance (not of choice) for employment that $17 thousand does not go far at all.
I like your amount description of poverty but how do you guage the amounts.
The problem to start with in Canada is that Canada does not have poverty -- according to stats Can and the idiot politicians. What there is is a low income cut off level. Sooo, if you don't admit there is poverty then it doesn't exist -- typical political thinking of our 'leaders'.
A very basic and not hurtful option for this greedy, self-serving govt (all levels) would be to eliminate tax on income under $20thousand a year for single income earners and $30K for double incomes. This puts more money into immediate use and would relieve those that use it wisely and needly right away. This business of taking with one hand and returning at tax time is stupid. There is enough money being abused, misused and wasted by gov'ts that this money shouldn't be missed. Requires intelligent thought tho and politicians can't think beyond their immediate self interest.
 
#juan
#10
On a similar topic a while back, I suggested that there was a difference between being poor and being broke. The definition was: "Being broke is a temporary shortage of cash, while being poor is a state of mind".

Spending more than you have is just stupidity.


When I finished university, we bought a house and we even borrowed the down payment. We lived on beans and simple fare for a few years but I never considered myself to be poor. My earnings went up as I progressed in my career and things became easier.
I stand by what I said. People's circumstances change. A couple years ago some woman wrote in the Vancouver Sun that anyone with an income of less than thirty eight thousand a year was living in poverty. That figure was very close to what my pension is and I don't think I live in poverty, or anywhere near it.
 
whicker
#11
I agree that being poor is state of mind and so is poverty. Not saying they are not existant situations but the state of the state you are in is in the mind and creates the grind that brings you down.
Spending more than you have IS stupidity - not always avoidable, but stupid none the less. However, this was not your statment that I was replying to, it was: ' no matter who you are, you can't spend more money than you have period.' That is what I was referring to and I will say again you can and it is being done every day. Sometimes by not very bright, smart people but mostly by those trying to get by.
We live on my husband's pension, part of which goes for alimony and we have a daughter living at home who needs occasional (and sometimes more than) support (and she is working). I have gone back to work to supplement the income, mostly the outgo. Could be that we don't spend wisely but we are constantly behind. We are not poor by any stretch but we are not flush either. What I find absolutely denigrating about not have spare cash is the gouging we have to take on living expenses so that ceos and our fine upstanding politicans can have their cake and eat it too.
The woman said 'anyone'? Don't know what she was smoking but $38k for a single person would be more than enough to live on and if they couldn't then they don't deserve much respect.
 

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