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n1 [soylentnews.org] writes:

From Ryan McMaken at Mises.org [mises.org]:

Given the importance of the cost of living, it is very problematic that the official poverty rate totals for US states do not take costs into account.

When measuring poverty rates internationally, poverty is just defined as households that make 50 percent or 60 percent of the national median income. [...] It simply makes poverty a purely relative measure, so we end up with a situation where purchasing power for a median household in one country (say, Portugal) is actually lower than a poverty-level household in another country (say, the US).

The US official measure, on the other hand, attempts to get around this problem by defining the poverty rate as an actual dollar amount based on what a household can buy.

[...] The problem is this dollar amount is applied nationwide and then used to calculate poverty rates.

[...] Many have noticed certain regional trends here, and that has led to a myriad of articles claiming that so-called "red states" have higher poverty rates than the "blue states." In many cases, "red states" is really code for "low tax" or "free-market-ish" state. In other words, this map "proves" that low taxes and freer economies cause more poverty.

[...] If we adjust the states and poverty rates for the cost of living, however, the map looks a bit different [...]

In this case, the state with the highest poverty rate is California at 23 percent. Arizona and Florida are close behind with rates of 22 percent and 20 percent, respectively. New York has risen to sixth place with a poverty rate of 18 percent, while Mississippi has fallen to eighth place with a rate of 17 percent.

Here we see our bias-confirming assumptions no longer seem to apply since no correlation is apparent along the lines of the red-state/blue-state claims.

[...] Obviously, we have to look somewhere beyond our neat-and-nice ideas about red states and blue states to come up with an explanation.

Original Submission