Seebohm Rowntree was the son of the wealthy Quaker businessman Joseph Rowntree, but acutely aware of the poverty that surrounded him in late-Victorian York. In 1899 he set himself the task of defining a “poverty line” by working out how much it would cost to supply basic food, housing and clothes. Anyone who couldn’t afford to buy those basics – including a helping of pease pudding with bacon on Sunday – was below the poverty line.
The idea of a poverty line has stayed with us, but the candidates have multiplied. The World Bank has two poverty lines: a dollar a day and two dollars a day (strictly, those are 1985 dollars adjusted for inflation). In the US, the poverty line is $29.58 a day for a single adult under the age of 65. All these are absolute income standards, just as Rowntree’s was.
Eurostat, the European Union’s statistics agency, takes a different approach: it defines the poverty line as 60 per cent of each nation’s median income. (The median income is the income of the person in the middle of the income distribution.)
This has an unfortunate consequence: poverty is permanent. If everyone in Europe woke up tomorrow to find themselves twice as rich, European poverty rates would not budge. That is indefensible. Such “poverty” lines measure inequality, not poverty, and they do so clumsily.
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