The poverty rate has stagnated since it was devised back in 1965. It's lowest rate was in 1973, when it was 11.1%. Meanwhile, per capita real income has more than doubled since 1973, and so has welfare spending. What gives? Nicholas Eberstadt of the Hoover Institute has a neat paper where he argues it's primarily due to the transitory nature of poverty. He notes that real spending per capita for bottom quintile earners has risen by 63% since 1973, while their real income is the same. The poor have more housing space, more air conditioning, more health care, more cars, all have TVs, 75% have DVDs or VCRs, lower infant mortality ... and more obesity. If Adam Smith had the data on today's poor he would say they were rich.

But of course, they are poor. In what way? Mainly, in my opinion, their dependence on others, and their lack of hope, and most importantly their relatively harsh incidence of things like crime, poor education, broken families, and work participation.