The Luxurious Kitchens of America’s Poor

Moneybox
A blog about business and economics.
May 1 2014 5:58 PM

The Luxurious Kitchens of America’s Poor

A woman in Bridgeport, Connecticut (poverty rate 21.6 percent) shops at a discount food store.
A woman in Bridgeport, Connecticut (poverty rate 21.6 percent) shops at a discount food store.

Photo by Spencer Platt/Getty Images

Yes, the headline is sarcasm. Earlier today, I touched on some of the reasons poverty is still such a miserable and precarious experience, even though low-income families can now afford all sorts of great consumer goods like HD TVs and budget smartphones. The gist: Although manufactured goods are getting cheaper, and making everybody’s life a bit more pleasant, services that could actually lift households out of impoverishment, such as education and child care, are getting impossibly expensive. And so long as families are scraping bottom, they have to cope with the constant stress of financial instability.

I wanted to drill down on that point a little harder using, of course, some graphs. If you just look at basic conveniences, today’s poor don’t seem to be faring so terribly. As Fox News will eagerly tell you, almost all of them have refrigerators. Air conditioning isn’t much of a problem. TVs are ubiquitous. The most important and problematic instance where the poor trail other households is computer ownership. 

poor_basic_goods

Data: BLS

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So we have established that impoverished Americans generally have functioning kitchens and some 21st-century communications tools. Which is wonderful. But nobody is suggesting that the main problem the poor face today is a lack of stuff. It’s a lack of security, an inability to cover basic recurring expenses, like utilities and rent, as well as major unexpected costs like medical care. According to the Bureau of Labor Statistics, the bottom fifth of U.S. households devote a combined 78 percent of their spending, on average, to housing, food, utilities, transportation, and health care. In fact, they spend more on those basics than they make in total pre-tax income, which they can do thanks to government supports such as food stamps and the Earned Income Tax Credit.

what_the_poor_spend_on

Data: U.S. Census

These are only averages, but they give you a basic sense of where the poor are stretched. Meanwhile, because they spend more than they take in, these households are not especially prepared to deal with unexpected setbacks. If they lose a shift at work or suddenly get sick, that may well mean a missed electric bill or rent check. If their car breaks down, they may well not have enough money to fix it.

There are, of course, families that are so impoverished that they have trouble affording a TV, or a working fridge. Plenty don't have the budget for new clothes or school supplies for their kids. But if you're trying to broadly understand the troubles facing the poor, again, don't think so much about stuff. Think about security.

Jordan Weissmann is Slate's senior business and economics correspondent.

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