Redefining Poverty Upwards — For Political Gain

In the battle over the expansion of the S-CHIP bill, which would greatly increase the number of children covered by government-subsidized health insurance, there were a lot of arguments going around. One I read — and quoted without checking — is that the planned increase would make some families simultaneously poor enough for government help, and rich enough to get nailed with the Alternative Minimum Tax.

I took that talking point, and repeated it. I shouldn’t have. It turns out that factoid (or, rather, “fictoid”) was based on an early draft, which would have set the limit at 4 times the poverty level. The bill Bush vetoed used a multiplier of 3. The Heritage Foundation’s piece on it is — to put it kindly — outdated.

I went over to and went digging. It turns out that the median family income in 2006 was $58,832 per year. The S-CHIP bill defines “poor children” who would qualify for this as those whose families make as much as $62,000 per year.

According to this article, the revised changes would increase the number of children covered by 50%, or 6.6 million to 10 million. And according to Wikipedia, this would cost $7 billion a year — or about $2,000 per child per year. That’s presuming, of course, that the government got the numbers right — and that’s never a safe bet. Government spending ALWAYS goes over projections.

I think that the S-CHIP program ought to be indexed, not fixed. And a multiplier of the poverty level seems fairly appropriate. But a factor of 3? To people making above the median income?

I don’t think I’d shoot my mother for THAT.

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