Chapter 10: Social Class and Inequality: What Poverty Looks Like

In a society, the poverty line, determined by the federal government, is an amount of annual income required for a family to “meet its basic needs” (Newman, 357). In 2012, “the official poverty line was an annual income of $23,021 for a family of four” (businessweek.com)

In order to bring the poverty line into perspective, I've created an imaginary family, who, for the purposes of this assignment shall be called the Socios. The Socios live in a Minnesota suburb, south of the Twin Cities, and represent a family of four: two parents who work, one seven-year-old child who attends elementary school, and one three-year-old who requires day care.

The Socios require a number of services and goods to function at a minimum subsistence level in society, i.e., the poverty line (Newman, 355). Of course, these elements do not come free of charge. In order to begin calculating the Socio family budget, I used the Economic Policy Institute's website (epi.org). Although their most recent data is from 2008, it allowed me to create a rough estimate of the expenses a family of four in rural Minnesota pays to get by:

$600 - Housing 
$500 - Food
$800 - Child Care
$400 - Transportation 
$550 - Health Care 
$200 - Other Necessities 
$3150 - Monthly Total

With a monthly total of $3,050, their annual expenses would amount to $36,600, a significant step up from the 2012 poverty line of $23,021(businessweek.com). So, what can we begin to cut out of the Socio's budget?

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The Socios could reduce spending in the “Other Necessities” category by around $50 if they began shopping at second hand stores such as Goodwill for clothing and some household goods. They could also get rid of their cell phone plan, costing on average about $50 per month (business.time.com)

In order to subsist, the Socios could decrease the frequency of their regular checkups at the doctor, and dentist, only going in in the case of an illness, saving them around $150 per month.

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The Socio's could reduce the cost of nutrition by cooking their own food, avoiding eating at restaurants and buying drinks at coffee shops, buying items on sale or using coupons at the local grocery store, and most importantly, buying nutritionally efficient foods –   peanut butter (calories consist of healthy fats and protein) instead of jam (less calories, and most come from sugar). The Socio's could also save by increasing their water intake and reducing intake of juices and sodas. This could amount to savings of up to $100 per month for a family of four.

In a rural suburb, it might be possible to find an in-home day care center with reduced costs, saving them up to $200. However, Minnesota is one of the most expenses states in the country for child care, ranking second in nationwide costs of center-based child care (startribune.com)

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Cutting down on shower times, only running the dishwasher when its full, keeping their home a few degrees warmer in the summer and a few degrees cooler in the winter, and only using lights when needed could save the Socios around $20 per month, barely making a dent in their budget cuts.

Finally, if the Socio's were able to sell one of their cars, or even use public transportation, they could cut their transportation budget in half.

Below is a revised budget plan, taking all of the above options into consideration:

$600  --->  $580 - Housing 
$500  --->  $400 - Food   
$800  --->  $600 - Child Care
$400  --->  $200 - Transportation
$550  --->  $400 - Health Care
$200  --->  $100 - Other Necessities
$3150 ---> $2280 - Monthly Total

With a monthly total reduced to $2,280, I have reduced the Socio's annual expenses to $27,360. But this still exceeds the poverty line of $23,021 by about $360 per month! In order to make ends meet, the Socios would be forced to reduce their caloric intake, or move out of their current home. If one of the Socios quit their job to reduce transportation and child care costs, they would lose half of their income, and would no longer be able to pay for other necessities. If either of their children became ill, they would be forced into a financial crisis.

This is what poverty looks like.

Their quality of life would obviously be incredibly poor. Living from paycheck to paycheck, and being forced to live without things that a majority of Americans take for granted daily.... as I sit here typing on my laptop in the warmth of my own apartment. See what I mean? This kind of lifestyle contributes to a great deal of anxiety, and could even lead to more serious conditions like depression. The sense of hopelessness created by never having quite enough, according to societal norms, can easily lead to modes of thinking that spiral viciously downward.

Affluent families can afford to take time off work and use saved money to travel, buy presents for their children on their birthdays, and give them the security of having funds saved for their eventual college education. Affluent families have the security that they will one day be able to retire, with enough money in the bank to provide them with a comfortable lifestyle for the rest of their years on earth.

Living in such an environment would have severe implications for children. The 3 year-old in child care lacks contact time with his/her parents. The separation from parents, and connection with adults at day care center could likely cause a sense of confusion for the 3-year-old, and a sense of insecurity which could materialize in various ways throughout the child's life. The 7-year-old would also lack the comfort of always having a parent at home, yet would develop a sense of independence early on, learning to take care of themselves and perhaps their younger sibling also. Having many responsibilities at a young age could translate into dealing well with large responsibilities later in life. Knowing how little the children would have in such a household, they would be taught to appreciate the little things in life, a precious quality, in my opinion.

Unfortunately, if the parent's financial situation persists, statistics show that the children won't fare as well in the educational system as their affluent counter parts. Newman notes that the educational deck is stacked against poor people, and that “even if they graduate from high school, most poor children can't afford to attend college” (Newman, 340). Even then, if they do make it to college, the odds of their success are still significantly less than students from affluent families. Class structure is clearly translated onto the field of the American education system.

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I cannot fathom how living at the poverty line, or even slightly above it, constitutes “subsistence.” In writing this post I have realized the endless hindrances in attempting to balance a poverty line budget, along with the various resulting hardships. It seems to me that even with a budget hovering above the poverty line, a family of four would be living in absolute poverty, unable to sustain a healthy existence.

Sources:
http://www.businessweek.com/ap/2012-09-12/us-poverty-rate-unchanged-record-numbers-persist
http://www.startribune.com/local/166351706.html?refer=y
http://www.epi.org/resources/budget/
http://www.jobsnowcoalition.org/reports/2010/cost-of-living2010.pdf
http://adage.com/article/special-report-american-consumer-project/necessities-consumers-live/230981/
http://www.cnpp.usda.gov/Publications/FoodPlans/2012/CostofFoodNov2012.pdf
http://business.time.com/2012/10/18/47-a-month-why-youre-probably-paying-double-the-average-cell-phone-bill/