ACT
Practice Test 42

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SOCIAL SCIENCE: Defining the Poverty Line: A Political Question

Poverty is an enduring problem that must be addressed by all modern societies. In fact, some ethicists say a civilization can be judged by how well it treats its least fortunate. By this measure, the United

Line 5 States has much to be proud of. On a national level, the United States has done remarkable work to decrease the suffering of the poor by subsidizing food, housing, and education, and even by giving money directly to those who need it the most. Still, even in the public sector,

10 projects have to be evaluated to see if they are effective. No one can measure the benefits of aid without defining what poverty is, and when someone has been lifted out of it. This leads to one very political question: How exactly should poverty be measured?

15 The question of poverty is extremely complex. Should it be considered absolute—as a simple matter of the availability of food and shelter—or should it be relative to the goods and services enjoyed by the society as a whole? In other words, if a person can

20 afford a DVD player but not to live in a safe neighborhood, is that person poor? Certainly something as fluid as the economy can affect any number of forces to cause financial suffering—sometimes quite suddenly. Still, according to our federal government, there is

25 a specific measure, the “poverty line,” that answers the question. Such a measure was devised in 1963 by government economist Mollie Orshansky, then working for the Social Security Administration under the jurisdiction of the Office of Management and Budget.

30 Orshansky’s statistical measurement was one small part of the federal government’s plan to attack the difficult national economic conditions that were hurting millions of Americans in the early 1960s. President Lyndon Johnson labeled the plan the government’s

35 “War on Poverty,” and it led to such national programs as Head Start, VISTA, and the Jobs Corps. Orshansky developed her poverty threshold from a Department of Agriculture study outlining the cost of nutritionally adequate meals.

40 From the Agriculture study, Orshansky took the most economic and healthy meal design she could find. She then estimated statistically that the average American family in the 1950s spent approximately onethird of its household income on food; from there, she

45 multiplied by three the cost of the most economically efficient, nutritional diet. This multiplier effect, in theory, produced the level of pre-tax household income at or below which a family should be considered poor. Orshansky’s calculation was distributed for use across

50 the government, and the measure came to be known as the poverty line. It has been scaled every year for inflation, and it is adjustable to household size. Given the decades-old origins of this measure and the limited data available to Orshansky at the time, it is

55 fair to wonder if her standard is still accurate. Studies show that it is not. While families today spend about 12 percent of their income on food—nowhere near the 33 percent assumed in the 1950s—the cost of important budget items, such as housing, transportation, and

60 health care, has increased dramatically. Orshansky’s poverty measure, which only takes into account the ability of a household to provide itself with food, is missing several essential components to be accurate in modern society. With over $60 billion in federal aid tied

65 each year to this guideline, not to mention an additional $260 billion in Medicaid spending, the fact is many Americans are still falling deeper into poverty and failing to receive the aid they so desperately need and deserve.

70 If reform of the measure of poverty used by society is an obvious need, it remains to be seen why such reform has not been forthcoming. The answer lies in the very politics that caused the measure to be created in the first place. Any change in the measured poverty

75 level of a society is an indicator of economic health within that society, and no president has been willing to increase the perceived amount of poverty for a statistical recalculation, no matter how justified. Indeed, some economists say that updating the poverty measure

80 would increase the number of those considered poor, and therefore eligible for government aid, by as much as 2 percentage points. That may not seem significant, but in real terms it means an additional several million people are living below the “poverty line”—whether

85 we count them or not.

In the context of lines 46–51, the statement “the measure came to be known as the poverty line” (line 51) is used to support the idea that:

  • Solution

    The best answer is A. According to the passage, there is a “specific measure, the ‘poverty line,”’ that can be used to determine poverty. Because the passage refers to this line as being a specific measure, answer choice A is best. The other answer choices are not supported by the passage.

It can be reasonably inferred from the passage that:

  • Solution

    The best answer is H. As stated in the passage, “The question of poverty is extremely complex.” Therefore, one can infer that measuring poverty is a difficult task. The other answer choices are not supported by the passage.

It can reasonably be inferred from the passage that Orshansky estimated that, in the 1950s, the percentage of income that the average American family spent on non-food items was:

  • Solution

    The best answer is D. According to the passage, the average American family in the 1950s “spent approximately one-third of its household income on food.” When one subtracts 1/3 from the whole, 2/3 remains. Therefore, the average American family spent 2/3 of their income on non-food items in the 1950s.

Which of the following best expresses the paradox described in the fifth paragraph (lines 53–69)?

  • Solution

    The best answer is F. As stated in the passage, “While families today spend about 12 percent of their income on food—nowhere near the 33 percent assumed in the 1950s—the cost of important budget items, such as housing, transportation, and health care, has increased dramatically. Orshansky’s poverty measure, which only takes into account the ability of a household to provide itself with food, is missing several essential components to be accurate in modern society. With over $60 billion in federal aid tied each year to this guideline, not to mention an additional $260 billion in Medicaid spending, the fact is many Americans are falling deeper into poverty and failing to receive the aid they so desperately need and deserve.” This information suggests that Americans are much poorer than they were in the past, which best supports answer choice F.

According to the passage, the impact of Orshansky’s economic model on the distribution of federal aid to the poor is that:

  • Solution

    The best answer is C. The passage states that, “Orshansky’s poverty measure, which only takes into account the ability of a household to provide itself with food, is missing several essential components to be accurate in modern society. With over $60 billion in federal aid tied each year to this guideline, not to mention an additional $260 billion in Medicaid spending, the fact is many Americans are falling deeper into poverty and failing to receive the aid they so desperately need and deserve.” These statements best support answer choice C.

The author traces Orshansky’s economic model back to its origins in:

  • Solution

    The best answer is G. As indicated in the passage, “Orshansky’s statistical measurement was one small part of the federal government’s plan to attack the difficult national economic conditions that were hurting millions of Americans in the early 1960s. President Lyndon Johnson labeled the plan the government’s “War on Poverty,” and it led to such national programs as Head Start, VISTA, and the Jobs Corps.” These statements best support answer choice G.

The main point of the first paragraph is that:

  • Solution

    The best answer is B. The first paragraph of the passage states that, “Poverty is an enduring problem that must be addressed by all modern societies.” It also states that, “projects have to be evaluated to see if they are effective. No one can measure the benefits of aid without defining what poverty is, and when someone has been lifted out of it.” Based on this information, one can infer that the paragraph aims to detail the importance of measuring poverty in relation to aid disbursement.

According to the passage, which of the following statements is accurate regarding the percentage of income the average American family spends on food?

  • Solution

    The best answer is H. The passage states the following information: “While families today spend about 12 percent of their income on food— nowhere near the 33 percent assumed in the 1950s …” This statement best supports answer choice H.

The passage implies that no president has been willing to change the poverty measure for all of the following reasons EXCEPT:

  • Solution

    The best answer is D. According to the passage, “Any change in the measured poverty level of a society is an indicator of economic health within that society, and no president has been willing to increase the perceived amount of poverty for a statistical recalculation, no matter how justi- fied. Indeed, some economists say that updating the poverty measure would increase the number of those considered poor, and therefore eligible for government aid, by as much as 2 percentage points.” Based on this information, answer choices A, B, and C are all reasons why no president is willing to make a poverty level change.

According to the passage, Orshansky’s role in President Johnson’s “War on Poverty” was to:

  • Solution

    The best answer is F. As stated in the passage, “Orshansky’s statistical measurement was one small part of the federal government’s plan to attack the difficult national economic conditions that were hurting millions of Americans in the early 1960s.” Specifically, Orshansky worked to formulate a way to define poverty so that the government could help those who met this definition. This information best supports answer choice F.

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