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A Project of The Annenberg Public Policy Center

Romney’s Poverty Points

Mitt Romney said that under President Obama “there are more people in poverty in America than ever before.” That’s true, but the poverty rate — which accounts for population changes — was higher under several former presidents than it is currently.

Romney, who is considering a third presidential run, made the statement while discussing income inequality at an event sponsored by the Republican National Committee.

Romney, Jan. 16: Under Obama the rich have gotten richer, income inequality has gotten worse, and there are more people in poverty in America than ever before.

It’s true that “income inequality has gotten worse.” According to research by Emmanuel Saez, a professor of economics at the University of California, Berkeley, post-recession incomes of the top 1 percent of earners grew by 34.7 percent from 2009 to 2012, while incomes of the bottom 99 percent of earners grew by just 0.8 percent. The top 1 percent saw 91 percent of the income gains in the first three years of the economic recovery, according to Saez.

It’s also true, as Romney said, that the 45.3 million people living in poverty in 2013, according to the U.S. Census Bureau, is more than under any other president. However, the 2013 figure, the most recent available, was lower than the 46.5 million people living in poverty in 2012. The 2013 count is also the lowest since 2009, Obama’s first year in office.

Romney’s focus on the raw numbers also ignores the fact that the poverty rate declined in 2013. That year, the official rate was 14.5 percent, down from 15 percent in 2012, and the lowest rate since Obama’s first year as president.

More importantly, when comparing Obama to past presidents, a better measurement would be the poverty rate, since it takes population into account. And the most recent rate under Obama is not the highest that it has ever been. The rate was 15.1 percent in 1993 under President Clinton. It was 15.2 percent in 1983 under President Reagan. And it was between 17.3 percent and 22.4 percent in the seven years between 1959 and 1965 under Presidents Eisenhower, Kennedy and Lyndon Johnson.

Even using a different measure of poverty — the Census Bureau’s Supplemental Poverty Measure — the rate under Obama isn’t the highest on record.

The SPM was developed in 2011 to account for many of the government programs assisting low-income families and individuals that are not included in the current official poverty measure. It “creates a more complex statistical picture incorporating additional items, such as tax payments, work expenses and in-kind benefits in its family resource estimates.” It generally factors in the cost of food, clothing, shelter, and utilities used by families. It also takes into account such things as geographical differences in the cost of living.

In 2013, 15.5 percent of the population was living in poverty, based on the Supplemental Poverty Measure. That was down from 16 percent in 2012. Like the official poverty rate, the SPM, in 2013, was the lowest since 2009, the earliest year for comparable estimates.

However, in January 2014, prior to the release of the 2013 figure, the White House Council of Economic Advisers calculated an “anchored” version of the supplementary measure, which sets poverty thresholds based on expenditures for necessary items and then adjusts for inflation in each year. Using those assumptions, the White House found that “the percent of the population in poverty when measured to include tax credits and other benefits has declined from 25.8 percent in 1967 to 16.0 percent in 2012.”

— D’Angelo Gore