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Poverty Inequality : Poverty And Income Inequality

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Poverty & Income Inequality
How do we balance the assistance we give the poor but do not discourage work? The labor markets which determine how much workers are paid do not take into consideration how much a family really requires to pay for all expenses like health care, clothes, food, housing, and transportation. The labor markets actually create inequalities of income and as a result create issues leading to poverty. Poverty is measured by the U.S. Census Bureau as a direct result of the Office of Management and Budget 's (OMB) Statistical Policy Directive 14. The Census Bureau uses thresholds that vary by size and composition of families to determine levels of poverty. To sum it up, if a families total income is less than the set …show more content…

There are some economists who advocate for a national poverty line and still other economists who think that the poverty line should be adjusted for the twenty-first century, due to the various government assistance programs whose value are not currently taken into consideration when determining the poverty line. In addition to the poverty line we must consider the implications that the safety net programs and the poverty trap set for those that fall below the poverty live.
Poverty Trap and Safety Net Programs
Another way to balance assistance and not discourage work is to consider the poverty trap and the governmental safety net programs available to assist those below the poverty line. The poverty trap is found when a group within a society are provided with the basic necessities of living such as food, housing, healthcare, and income to name a few. This assistance becomes problematic when the people have reduced incentive to work due to the benefits of the assistance programs. When a person can have more disposable income when they do not work because the amount of assistance is reduced equally by the amount of money gained by working. Some of the more common safety net programs, in the U.S., are TANF (Temporary Assistance for Needy Families), EITC (Earned Income Tax Credit), SNAP (Supplemental Nutrition Assistance Program), and Medicaid, all of which are designed to help bring people above

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