The Trump Administration is exploring changing the inflation measure used to update the poverty line each year, which could wipe millions of low-income people off the poverty rolls and eventually make fewer people eligible for benefits such as SNAP, Medicaid, and ACA subsidies, as well as programs like CSBG, Head Start, LIHEAP, Weatherization, and many others.
Until June 21, 2019, at 11:59 PM, OMB is accepting comments "on the differences among the various consumer price indexes produced by the Bureau of Labor Statistics (BLS) and the Bureau of Economic Analysis (BEA), and in particular how those differences might influence the estimation of the Official Poverty Measure (OPM) and other income measures produced by the Census Bureau".
Submit your comments at www.regulation.gov .
To better understand the issue in preparation of drafting your comments, the following background and links have been provided. You can also contact the National Community Action Foundation (NACF) with any questions (firstname.lastname@example.org or 202-842-2092).
BACKGROUND AND MAY 7 NOTICE:
In 1978, OMB directed that the poverty thresholds be adjusted for inflation each year using the Consumer Price Index (CPI). There are multiple versions of the CPI, and the CPI-All Urban Consumers (CPI-U) has traditionally been used to adjust the poverty thresholds. OMB now is reevaluating the CPI-U and considering use of a different inflation measure to make these annual adjustments.
OMB’s three-page May 7 Federal Register notice identifies and explains alternative versions of the CPI, including a newer version called the Chained CPI-U (or C-CPI-U). OMB also identifies a sixth inflation measure that relies on expenditure data, rather than income data. The May 7 notice requests comments on the strengths and weaknesses of these measures for updating the poverty thresholds; comments will go to an interagency technical workgroup for consideration.
See the May 7 Federal Register notice: https://www.govinfo.gov/content/pkg/FR-2019-05-07/pdf/2019-09106.pdf
Economists estimate the Chained CPI-U will yield a lower estimate of inflation than the traditional CPI-U, which means the poverty thresholds would rise at a slower rate and fewer people would be defined as poor than under current practice.
The following provide quick analyses of the Administration’s May 7 request for comments:
NEWS AND EDITORIALS ON MAY 7 NOTICE:
General Background on Poverty Measurement:
Congressional Research Service report on poverty measurement: https://crsreports.congress.gov/product/pdf/R/R44780
Congressional Research Service report on the Supplemental Poverty Measure: