Poverty as a structural failing

Rank, Yoon, and Herschl (2003) present a contrary argument to the idea that personal failings are the cause of poverty. The argument presented is that United States poverty is result of “failings at the structural level.” Key social and economic structural failings which contribute heavily to poverty within the U.S. are identified in the article. The first is a failure of the job market to provide a proper amount of jobs which pay enough to keep families out of poverty.


Even if unemployment is low, the labor market may be saturated with low paying, part-time work which lacks benefits (thus limiting the amount of full-time, good paying jobs). Rank, Yoon and Herschl examined the Survey of Income and Program Participation (SIPP), a longitudinal study on employment and income. Using the 1999 official poverty line of $17,029 for a family of four, it was found that 9.4% of persons working full time and 14.9% of persons working at least part time did not earn enough annually to keep them above the poverty line. Low minimum wage, combined with part-time jobs which offer no benefits have contributed to the labor market’s inability to produce enough jobs which can keep a family out of poverty this is an example of an economic structural failure.


Rank, Yoon and Herschl point to the minimal amount of social safety nets found with in the U.S. as a social structural failure and a major contributor to poverty in the U.S. Other industrialized nations devote more resources to assisting the poor than the U.S. As a result of this difference poverty is reduced in nations which devote more to poverty reduction measure and programs.


Rank et al use a table to drive this point home. The table shows that in 1994, the actual rate of poverty (what the rate would be without government interventions) in the U.S. was 29%. When compared to actual rates in Canada (29%), Finland(33%), France(39%), Germany(29%), the Netherlands(30%), Norway(27%), Sweden(36%) and the United Kingdom(38%), the United States rate is low. But when government measures and programs are included, the rate of reduction in poverty in the United States is low (38%). Canada and the United Kingdom had the lowest reduction rates outside of the U.S. at 66%, while Sweden, Finland and Norway had reduction rates greater than 80% .